Document:

indenture.htm

Exhibit 4.1

 

 

 

FORM OF INDENTURE

 

 

 

 

between

 

 

HUNTINGTON AUTO TRUST 20[  ]-[ ],

as Issuing Entity

 

 

 

and

 

 

 

[               ],

as Indenture Trustee

 

 

 

 

Dated as of [               ]

 

Indenture

  

  

  

CROSS REFERENCE TABLE1

 

 

	
TIA

Section

 

	  	
Indenture

Section

	
310

	
(a) (1)                                                                                                

	
6.11

	  	
(a) (2)                                                                                                

	
6.11

	  	
(a) (3)                                                                                                

	
6.10; 6.11

	  	
(a) (4)                                                                                                

	
N.A.2

	  	
(a) (5)                                                                                                

	
6.11

	  	
(b)                                                                                                

	
6.08; 6.11

	
311

	
(a)                                                                                                

	
6.12

	  	
(b)                                                                                                

	
6.12

	
312

	
(a)                                                                                                

	
7.01

	  	
(b)                                                                                                

	
7.02

	  	
(c)                                                                                                

	
7.02

	
313

	
(a)                                                                                                

	
7.03

	  	
(b) (1)                                                                                                

	
7.03

	  	
(b) (2)                                                                                                

	
7.03

	  	
(c)                                                                                                

	
7.03

	  	
(d)                                                                                                

	
7.03

	
314

	
(a)                                                                                                

	
3.09

	  	
(b)                                                                                                

	
3.06[; 11.14]

	  	
(c) (1)                                                                                                

	
11.01

	  	
(c) (2)                                                                                                

	
11.01

	  	
(c) (3)                                                                                                

	
11.01

	  	
(d)                                                                                                

	
11.01

	  	
(e)                                                                                                

	
11.01

	  	
(f)                                                                                                

	
N.A.

	
315

	
(a)                                                                                                

	
6.01(a)

	  	
(b)                                                                                                

	
6.05

	  	
(c)                                                                                                

	
6.01

	  	
(d)                                                                                                

	
5.11; 6.01(b)

	  	
(e)                                                                                                

	
5.13

	
316

	
(a) (1) (A)                                                                                                

	
5.11

	  	
(a) (1) (B)                                                                                                

	
5.12

	  	
(a) (2)                                                                                                

	
N.A.

	  	
(b)                                                                                                

	
5.07

	  	
(c)                                                                                                

	
N.A.

	
317

	
(a) (1)                                                                                                

	
5.03(b)

	  	
(a) (2)                                                                                                

	
5.03(d)

	  	
(b)                                                                                                

	
3.03(i)-(ii)

	
318

	
(a), (c)                                                                                                

	
11.22

_____________________________

  

	
1

2

	
Note:  This Cross Reference Table shall not, for any purpose, be deemed to be part of this Indenture.

N.A. means Not Applicable.

           

	  	  	
2007-1 Indenture

  

  

  

Table of Contents

 

Page

 

	
ARTICLE I

DEFINITIONS AND INCORPORATION BY REFERENCE

 

	
Section 1.01

	
Definitions

	
  2

	
Section 1.02

	
Other Definitional Provisions

	
  7

	
 

ARTICLE II

THE NOTES

 

	
Section 2.01

	
Form; Denomination

	
  9

	
Section 2.02

	
Execution, Authentication and Delivery

	
  9

	
Section 2.03

	
Temporary Notes

	
10

	
Section 2.04

	
Registration of Transfer and Exchange

	
10

	
Section 2.05

	
Mutilated, Destroyed, Lost or Stolen Notes

	
12

	
Section 2.06

	
Persons Deemed Owners

	
13

	
Section 2.07

	
Payment of Principal and Interest

	
13

	
Section 2.08

	
Cancellation

	
14

	
Section 2.09

	
Tax Treatment; Withholding

	
14

	
Section 2.10

	
Intentionally Omitted

	
16

	
Section 2.11

	
Book-Entry Notes

	
16

	
Section 2.12

	
Notices to Depository

	
17

	
Section 2.13

	
Definitive Notes

	
17

	
Section 2.14

	
Depositor as Noteholder

	
17

	
Section 2.15

	
Transfer of Private Notes.

	
17

	
Section 2.16

	
ERISA

	
20

	
 

ARTICLE III

COVENANTS

 

	
Section 3.01

	
Payment of Principal and Interest

	
21

	
Section 3.02

	
Maintenance of Office or Agency

	
21

	
Section 3.03

	
Money for Payments to Be Held in Trust

	
21

	
Section 3.04

	
Existence

	
23

	
Section 3.05

	
Protection of Collateral; Manner of Perfection

	
23

	
Section 3.06

	
Opinions as to Collateral

	
24

	
Section 3.07

	
Performance of Obligations; Servicing of Loans

	
25

	
Section 3.08

	
Negative Covenants

	
26

	
Section 3.09

	
Annual Statement as to Compliance

	
27

	
Section 3.10

	
Issuing Entity May Not Merge or Consolidate

	
28

	
Section 3.11

	
No Other Business

	
28

	
Section 3.12

	
No Borrowing

	
28

	
Section 3.13

	
Servicer’s Obligations

	
28

	
Section 3.14

	
Guarantees, Loans, Advances and Other Liabilities

	
28

 

Indenture

  i

  

  

 

	
Section 3.15

	
Capital Expenditures

	
29

	
Section 3.16

	
Removal of Administrator

	
29

	
Section 3.17

	
Restricted Payments

	
29

	
Section 3.18

	
Notice of Events of Default

	
29

	
Section 3.19

	
Further Instruments and Acts

	
29

	
 

ARTICLE IV

SATISFACTION AND DISCHARGE

 

	
Section 4.01

	
Satisfaction and Discharge of Indenture

	
30

	
Section 4.02

	
Application of Trust Money

	
30

	
Section 4.03

	
Repayment of Moneys Held by Paying Agent

	
30

	
Section 4.04

	
Release of Collateral

	
30

	
 

ARTICLE V

REMEDIES

 

	
Section 5.01

	
Events of Default

	
31

	
Section 5.02

	
Acceleration of Maturity; Rescission and Annulment

	
31

	
Section 5.03

	
Collection of Indebtedness and Suits for Enforcement by Indenture Trustee; Authority of the Controlling Class

	
32

	
Section 5.04

	
Remedies; Priorities

	
35

	
Section 5.05

	
Optional Preservation of the Collateral

	
37

	
Section 5.06

	
Limitation of Suits

	
37

	
Section 5.07

	
Unconditional Rights of Noteholders to Receive Principal and Interest

	
38

	
Section 5.08

	
Restoration of Rights and Remedies

	
38

	
Section 5.09

	
Rights and Remedies Cumulative

	
39

	
Section 5.10

	
Delay or Omission Not a Waiver

	
39

	
Section 5.11

	
Control by Controlling Class

	
39

	
Section 5.12

	
Waiver of Past Defaults

	
39

	
Section 5.13

	
Undertaking for Costs

	
40

	
Section 5.14

	
Waiver of Stay or Extension Laws

	
40

	
Section 5.15

	
Action on Notes

	
40

	
Section 5.16

	
Performance and Enforcement of Certain Obligations

	
40

	
 

ARTICLE VI

THE INDENTURE TRUSTEE

 

	
Section 6.01

	
Duties of Indenture Trustee

	
42

	
Section 6.02

	
Rights of Indenture Trustee

	
43

	
Section 6.03

	
Individual Rights of Indenture Trustee

	
45

	
Section 6.04

	
Indenture Trustee’s Disclaimer

	
45

	
Section 6.05

	
Notice of Defaults

	
45

	
Section 6.06

	
Reports by Indenture Trustee to Holders

	
45

	
Section 6.07

	
Compensation and Indemnity

	
45

	
Section 6.08

	
Replacement of Indenture Trustee

	
46

	
Section 6.09

	
Successor Indenture Trustee by Merger

	
47

 

 

ii  

  

  

 

	
Section 6.10

	
Appointment of Co-Indenture Trustee or Separate Indenture Trustee

	
48

	
Section 6.11

	
Corporate Indenture Trustee Requirements; Eligibility

	
49

	
Section 6.12

	
Waiver of Setoffs

	
50

	
Section 6.13

	
Indenture Trustee as Securities Intermediary

	
50

	
Section 6.14

	
Representations and Warranties

	
50

	
Section 6.15

	
Exchange Act Rule 17g-5 Procedures

	
51

	
Section 6.16

	
Rule 15Ga-1 Compliance

	
51

	
 

ARTICLE VII

NOTEHOLDERS’ LISTS AND REPORTS

 

	
Section 7.01

	
Issuing Entity to Furnish Indenture Trustee Names and Addresses of Noteholders

	
53

	
Section 7.02

	
Preservation of Information; Communications to Noteholders

	
53

	
Section 7.03

	
Reports by the Indenture Trustee

	
53

	
Section 7.04

	
Noteholder Lists

	
54

	
Section 7.05

	
Access to Certain Documentation and Information

	
54

	
 

ARTICLE VIII

ACCOUNTS, DISBURSEMENTS AND RELEASES

 

	
Section 8.01

	
Collection of Money

	
55

	
Section 8.02

	
Trust Accounts; Payment of Principal and Interest

	
55

	
Section 8.03

	
General Provisions Regarding Accounts

	
56

	
Section 8.04

	
Release of Collateral

	
56

	
Section 8.05

	
Opinion of Counsel and Officer’s Certificate

	
56

	
 

ARTICLE IX

SUPPLEMENTAL INDENTURES

 

	
Section 9.01

	
Supplemental Indentures With Consent of the Noteholders

	
57

	
Section 9.02

	
Supplemental Indentures Without Consent of Noteholders

	
58

	
Section 9.03

	
Execution of Supplemental Indentures

	
61

	
Section 9.04

	
Effect of Supplemental Indentures

	
61

	
Section 9.05

	
Reference in Notes to Supplemental Indentures

	
61

	
 

ARTICLE X

REDEMPTION OF NOTES

 

	
Section 10.01

	
Redemption In Whole Pursuant to Option to Purchase

	
62

	
Section 10.02

	
Form of Redemption Notice

	
62

	
Section 10.03

	
Notes Payable on Redemption Date

	
63

	
 

ARTICLE XI

MISCELLANEOUS

 

	
Section 11.01

	
Compliance Certificates and Opinions, etc.

	
64

 

  

iii

  

 

	
Section 11.02

	
Form of Documents Delivered to Indenture Trustee

	
65

	
Section 11.03

	
Acts of Noteholders

	
66

	
Section 11.04

	
Notices, etc., to Indenture Trustee, Issuing Entity and Rating Agencies

	
67

	
Section 11.05

	
Notices to Noteholders; Waiver

	
67

	
Section 11.06

	
Alternate Payment and Notice Provisions

	
68

	
Section 11.07

	
Effect of Headings and Table of Contents

	
68

	
Section 11.08

	
Successors and Assigns

	
68

	
Section 11.09

	
Severability

	
68

	
Section 11.10

	
Benefits of Indenture

	
68

	
Section 11.11

	
Legal Holidays

	
68

	
Section 11.12

	
GOVERNING LAW

	
69

	
Section 11.13

	
Counterparts

	
69

	
Section 11.14

	
Recording of Indenture

	
69

	
Section 11.15

	
Trust Obligation

	
69

	
Section 11.16

	
No Petition

	

69

	
Section 11.17

	
Inspection

	
69

	
Section 11.18

	
Limitation of Liability

	
70

	
Section 11.19

	
Waiver of Jury Trial

	
70

	
Section 11.20

	
Force Majeure

	
70

	
Section 11.21

	
Patriot Act

	
71

	
Section 11.22

	
Conflict with Trust Indenture Act

	
71

	  	  	  
	  	  	  
	  	  	  
	  	  	  
	  	  	  
	  	  	  
	
EXHIBIT A-1

	
Form of Class A Note

	
EXHIBIT A-2

	
Form of Class B Note

	
EXHIBIT B

	
Form of Rule 15Ga-1 Information Report

iv

  

  

  

 

THIS INDENTURE, dated as of [               ], is between HUNTINGTON AUTO TRUST 20[  ]-[ ], a Delaware statutory trust (the “Issuing Entity”), and [               ], a [              ], as trustee and not in its individual capacity (the “Indenture Trustee”).

 

Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Issuing Entity’s Class A-1 Auto Loan Asset Backed Notes (the “Class A-1 Notes”), Class A-2-A Auto Loan Asset Backed Notes (the “Class A-2-A Notes”), Class A-2-B Auto Loan Asset Backed Notes (the “Class A-2-B Notes”), Class A-3-A Auto Loan Asset Backed Notes (the “Class A-3-A Notes”), Class A-3-B Auto Loan Asset Backed Notes (the “Class A-3-B Notes”), Class A-4 Auto Loan Asset Backed Notes (the “Class A-4 Notes”; the Class A-1 Notes, the Class A-2-A Notes, the Class A-2-B Notes, the Class A-3-A Notes, the Class A-3-B Notes, and the Class A-4 Notes, each a “Class A Note” and collectively, the “Class A Notes”)) and Class B Auto Loan Asset Backed Notes (the “[Class B Notes]”) (the Class A Notes and [Class B Notes] each a “Note” and collectively, the “Notes”):

 

GRANTING CLAUSE

 

The Issuing Entity hereby Grants to the Indenture Trustee on the Closing Date, as Indenture Trustee for the benefit of the Holders of the Notes, all (without duplication) of the Issuing Entity’s right, title and interest in and to all accounts, payment intangibles and other general intangibles, chattel paper, instruments, documents, money, deposit accounts, certificates of deposit, goods, letters of credit, advices of credit and Investment Property and all other tangible and intangible property (together with all related supporting obligations and proceeds), whether now owned or hereafter acquired and whether now existing or hereafter coming into existence, including: (a) each Loan sold or contributed by the Loan Seller to the Depositor and sold or assigned by the Depositor to the Issuing Entity, together with all principal, interest and other amounts due or to become due thereon after the Cutoff Date; (b) any Liquidation Proceeds relating to a Loan or a Financed Vehicle; (c) the security interest in each Financed Vehicle and any other tangible or intangible property securing a Loan that has been sold by the Loan Seller to the Depositor on the Closing Date and sold or assigned by the Depositor to the Issuing Entity on the Closing Date (including all moneys due or to become due with respect thereto) and any accessions thereto and any other interest of Huntington or the Depositor, in any such Financed Vehicle and any other tangible or intangible property; (d) all other money, instruments, goods, advices of credit and letters of credit relating to, consisting of or arising under any Loan; (e) all documents and other items contained in each Loan File, (f) all funds on deposit from time to time in the Trust Accounts, the Certificate Distribution Account (as defined in the Trust Agreement), the Principal Distribution Account and any other accounts established pursuant to this Indenture, the Trust Agreement, or the Sale and Servicing Agreement, and all cash, investment property and other property from time to time credited thereto and all proceeds thereof (including all Net Investment Earnings thereon); (g) all Securities Accounts and all Security Entitlements with respect to Financial Assets credited to any Securities Account; [(h) all rights under the Interest Rate Cap Agreement; ](i) all rights under the Asset Purchase Agreement (including an assignment of the rights of the Depositor under the Asset Purchase Agreement) and the Sale and Servicing Agreement; (j) all rights in respect of Huntington Debt Forgiveness Policies with respect to the Loans; (k) all rights of the Loan Seller under agreements with the Dealers relating to the Loans, (l) all enforcement and other rights under the UCC and other Applicable Law in respect of any or all of the foregoing; (m) all present and future claims,

 

Indenture

  

  

  

demands, causes of action and choses in action in respect of any or all of the foregoing; and (n) the proceeds of or with respect to any and all of the foregoing (collectively, the “Collateral”).  It is understood and agreed that the foregoing Grant is intended to cover property owned by the Issuing Entity at the Closing Date.

 

The Issuing Entity hereby authorizes the filing of UCC financing statements describing as the collateral covered thereby “all assets of the debtor, including all personal property of the debtor” or words to that effect, and any limitations on such collateral description, notwithstanding that such collateral description may be broader in scope than the Collateral described in this Indenture.

 

The foregoing Grant is made in trust to secure the payment of principal of and interest on, and any other amounts owing in respect of, the Notes, equally and ratably without prejudice, priority or distinction, to secure compliance with the provisions of this Indenture and the Sale and Servicing Agreement.

 

The Indenture Trustee, on behalf of the Holders of the Notes, acknowledges such Grant, accepts the trusts under this Indenture in accordance with the provisions of this Indenture and agrees to perform its duties required in this Indenture to the best of its ability to the end that the interests of the Holders of the Notes may be adequately and effectively protected.

 

This Indenture shall be deemed to be and hereby is a security agreement within the meaning of the UCC as in effect in the State of New York.

 

ARTICLE I

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01          Definitions.  Capitalized terms not defined in this Agreement have the meanings assigned thereto in the Sale and Servicing Agreement.  As used in this Agreement, the following terms shall, unless the context otherwise requires, have the following meanings.

 

“Act” has the meaning specified in Section 11.03(a).

 

“Administration Agreement” means the Owner Trust Administration Agreement, dated as of [               ] among the Administrator, the Owner Trustee, the Issuing Entity and the Indenture Trustee.

 

“Administrator” means [Huntington], or any successor Administrator under the Administration Agreement.

 

“Affiliate” means, 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 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.

 

 

Indenture

  

2

  

“Agency Office” means the office of the Issuing Entity maintained pursuant to Section 3.02.

 

“Applicable Procedures” has the meaning specified in Section 2.11(b).

 

“Authorized Officer” means, with respect to the Issuing Entity, any officer of the Owner Trustee who is authorized to act for the Owner Trustee in matters relating to the Issuing Entity 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, so long as the Administration Agreement is in effect, any Vice President or more senior officer of the Administrator (or any authorized signatory specifically authorized by the board of directors of the Administrator) who is authorized to act for the Administrator in matters relating to the Issuing Entity and to be acted upon by the Administrator pursuant to the Administration Agreement and who is identified on the list of Authorized Officers delivered by the Administrator to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter).

 

“Benefit Plan” means (a) an “employee benefit plan” as defined in Section 3(3) of ERISA, which is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the Code, which is subject to Section 4975 of the Code, (c) an entity deemed to hold “plan assets” of any of the foregoing by reason of investment by an employee benefit plan or plan in such entity or (d) a governmental, non-U.S. or church plan which is subject to any federal, state or local law that is similar to Section 406 of ERISA or Section 4975 of the Code.

 

“Benefit Plan Investor” means (a) an “employee benefit plan” as defined in Section 3(3) of ERISA, which is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the Code, which is subject to Section 4975 of the Code, or (c) an entity deemed to hold “plan assets” of any of the foregoing by reason of investment by an employee benefit plan or plan in such entity.

 

“Book-Entry Notes” means Notes in which ownership and transfers shall be made through book entries by a Depository as described in Section 2.11.

 

“Clearstream” shall mean Clearstream Bank, société anonyme.

 

“Closing Date” means [                 ].

 

“Code” means the U.S. Internal Revenue Code of 1986, as amended.

 

“Collateral” has the meaning specified in the Granting Clause of this Indenture.

 

“Corporate Trust Office” means the principal office of the Indenture Trustee at which at any particular time its corporate trust business is administered, which office at the date of execution of this Indenture is located at [               ], Attention: [          ] or at such other address as the Indenture Trustee may designate from time to time by notice to the Noteholders, the [Cap Counterparty] and the Issuing Entity, or the principal corporate trust office of any successor Indenture Trustee at the address designated by such successor Indenture Trustee by

 

 

Indenture

  

3

  

notice to the Noteholders, [the Cap Counterparty] and the Issuing Entity.  Definitive Notes should be delivered to 648 [                    ].

 

“Default” means any occurrence that is, or with notice or the lapse of time or both would become, an Event of Default.

 

“Definitive Notes” means 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 2.13.

 

“Depository” means 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(3) of the UCC.

 

“Depository Agreement” means, with respect to any Class of Notes, the agreement between the Issuing Entity and the initial Depository, dated as of [        ].

 

“Depository Participant” means a securities broker, dealer, bank, trust company, clearing corporation 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.

 

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

 

“Euroclear” means Euroclear Bank S.A./N.V., as operator of the Euroclear system, or any successor thereto in such capacity.

 

“Event of Default” has the meaning specified in Section 5.01.

 

“Financial Asset” means a “financial asset” as defined in Section 8-102(a)(9) of the UCC.

 

“Fiscal Year” means a calendar year.

 

“Grant” means mortgage, pledge, bargain, sell, warrant, alienate, remise, release, convey, assign, transfer, create, and grant a lien upon and a security interest in and a right of set-off against, deposit, set over and confirm pursuant to this Indenture.  A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and options (but none of the obligations) of the granting party thereunder, including the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of the Collateral and all other moneys payable thereunder, to give and receive notices and other communications, to make waivers or other agreements, to exercise all rights and options, to bring Proceedings in the name of the granting party or otherwise, and generally to do and receive anything that the granting party is or may be entitled to do or receive thereunder or with respect thereto.

 

 

Indenture

  

4

  

“Holder” or “Noteholder” means a Person in whose name a Note is registered on the Register.

 

“Huntington” means The Huntington National Bank, a national banking association.

 

“Indenture Trustee” has the meaning specified in the introductory paragraph of this Indenture.

 

“Independent” means, when used with respect to any specified Person, that such Person (a) is in fact independent of the Issuing Entity, any other obligor on the Notes, the Depositor 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 Issuing Entity, any such other obligor, the Depositor or any Affiliate of any of the foregoing Persons and (c) is not connected with the Issuing Entity, any such other obligor, the Depositor 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” means 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 11.01, made by an Independent appraiser or other expert appointed by an Issuing Entity 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” in this Indenture and that the signer is Independent within the meaning thereof.

 

“Investment Property” means “investment property” within the meaning of Section 9-102 of the UCC.

 

“Issuing Entity” has the meaning specified in the introductory paragraph of this Indenture.

 

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

 

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

 

“1933 Act”  means the Securities Act of 1933, as amended.

 

“Officer’s Certificate” means a certificate signed by any Authorized Officer of the Issuing Entity, under the circumstances described in, and otherwise complying with, the applicable requirements of Section 11.01, and delivered to the Indenture Trustee.  Unless otherwise specified, any reference in this Indenture to an Officer’s Certificate shall be to an Officer’s Certificate of any Authorized Officer of the Issuing Entity.

 

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

 

 

Indenture

  

5

  

“Owner Trustee” means [               ], not in its individual capacity but solely as Owner Trustee under the Trust Agreement, or any successor Owner Trustee under the Trust Agreement.

 

“Paying Agent” means the Indenture Trustee or any other Person that meets the eligibility standards for the Indenture Trustee specified in Section 6.11 and is authorized by the Issuing Entity to make payments to and distributions from the Collection Account, the Principal Distribution Account and the Reserve Account in accordance with the terms hereof and of the Sale and Servicing Agreement, including payments of principal of or interest on the Notes on behalf of the Issuing Entity.

 

“Predecessor Note” means, with respect to any particular Note, every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note; and, for the purpose of this definition, any Note authenticated and delivered under Section 2.05 in lieu of a mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same debt as the mutilated, lost, destroyed or stolen Note.

 

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

 

“Protected Purchaser” has the meaning set forth in Section 8-303 of the UCC.

 

“Record Date” means, with respect to a Payment Date or Redemption Date, the close of business on the day immediately preceding such Payment Date or Redemption Date.

 

“Register” has the meaning specified in Section 2.04(a).

 

“Registered Holder” means the Person in whose name a Note is registered on the Register on the applicable Record Date.

 

“Registrar” means the registrar at any time of the Register, appointed pursuant to Section 2.04(a).

 

“Responsible Officer” means, with respect to the Indenture Trustee or Owner Trustee, as applicable, any officer within the Corporate Trust Office of the Indenture Trustee or the Owner Trustee, including any Vice President, Assistant Vice President, Assistant Treasurer, Assistant Secretary or any other officer of the Indenture Trustee or the Owner 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, in each case having direct responsibility for the administration of the Basic Documents.

 

“Restricted Note Legend” has the meaning specified in Section 2.17.

 

“Restricted Notes” means the Notes bearing the Restricted Note Legend.

 

“Rule 15Ga-1 Information”:  As defined in Section 6.16 hereof.

 

 

Indenture

  

6

  

“Sale and Servicing Agreement” means the Sale and Servicing Agreement, dated as of [               ], among the Issuing Entity, the Depositor, Huntington, as Loan Seller, Servicer, Calculation Agent, Custodian and Administrator, and the Indenture Trustee.

 

“Similar Law” means any federal, state, local or non-U.S. law that is similar to Section 406 of ERISA or Section 4975 of the Code.

 

“State” means any one of the 50 states of the United States of America, or the District of Columbia.

 

“Successor Servicer” has the meaning specified in Section 3.07(e).

 

“Tax Opinion” means, with respect to any action, an Opinion of Counsel (which counsel shall not be an employee of the Issuing Entity or an Affiliate of the Issuing Entity) to the effect that, for federal and, unless waived by the applicable recipient in writing, state and local income, single business and franchise tax purposes, (a) such action will not adversely affect the tax characterization of any outstanding Notes that are characterized as debt, (b) such action will not cause the Issuing Entity to be deemed to be an association (or publicly-traded partnership) taxable as a corporation, and (c) such action will not cause or constitute an event in which gain or loss would be recognized by any Noteholder.

 

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

 

“UCC” means, unless the context otherwise requires, the Uniform Commercial Code as in effect in the relevant jurisdiction.

 

“Unregistered Note” has the meaning set forth in Section 2.15.

 

Section 1.02          Other Definitional Provisions.

 

(a)           All terms defined in this Agreement have the respective meanings ascribed thereto herein when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein.

 

(b)           Accounting terms used in this Agreement and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in this Agreement or in any such certificate or other document, and accounting terms partly defined in this Agreement or in any such certificate or other document to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles in the United States as in effect from time to time.  To the extent that the definitions of accounting terms in this Agreement or in any such certificate or other document are inconsistent with the meanings of such terms under generally accepted accounting principles in the United States as in effect from time to time, the definitions contained in this Agreement or in any such certificate or other document shall control.

 

 

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(c)           The words “hereof,” “herein,” “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement; Section and Exhibit references contained in this Agreement are references to Sections and Exhibits in or to this Agreement unless otherwise specified; “or” includes “and/or”; and the term “including” means “including without limitation.”

 

(d)           The definitions contained in this Agreement are applicable to the singular and plural forms of such terms and to the masculine, feminine and neuter genders of such terms.

 

(e)           Any agreement, instrument or statute defined or referred to herein or in any instrument or certificate delivered in connection herewith means such agreement, instrument or statute as from time to time amended, modified or supplemented and includes (in the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein; references to a Person are also to its permitted successors and assigns.

 

[End of Article I]

 

 

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ARTICLE II

THE NOTES

 

Section 2.01          Form; Denomination.  The Class A Notes and [the Class B Notes], in each case together with the Indenture Trustee’s certificate of authentication, shall be in substantially the form set forth in Exhibit A-1, Exhibit A-2, or Exhibit A-3, as applicable, with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may, consistently herewith, be determined by the officers executing the Notes, as evidenced by their execution of the Notes.  Any portion of the text of any Note may be set forth on the reverse thereof, with an appropriate reference thereto on the face of such Note.

 

Each Note shall be dated the date of its authentication.  The terms of the Notes set forth in Exhibit A-1, Exhibit A-2, or Exhibit A-3, are part of the terms of this Indenture.

 

The Notes shall be issuable as registered Notes in minimum denominations of $[100,000] and in integral multiples of $[1,000] in excess thereof (except for one Note of each Class of Notes which may be issued in a denomination other than an integral multiple of [1,000]).

 

Section 2.02          Execution, Authentication and Delivery.  The Notes shall be executed on behalf of the Issuing Entity by any of its Authorized Officers.  The signature of any such Authorized Officer on the Notes may be manual or facsimile.

 

Notes bearing the manual or facsimile signature of individuals who were at any time Authorized Officers of the Issuing Entity shall bind the Issuing Entity, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Notes or did not hold such offices at the date of such Notes.

 

The Indenture Trustee shall authenticate and deliver Notes for original issue in an aggregate principal amount of $[      ] with respect to the Class A-1 Notes, $[      ] in the aggregate with respect to the Class A-2-A Notes, $[      ] in the aggregate with respect to the Class A-2-B Notes, $[      ] in the aggregate with respect to the Class A-3-A Notes, $[      ] in the aggregate with respect to the Class A-3-B Notes, $[      ] in the aggregate with respect to the Class A-4 Notes and $[      ] with respect to the [Class B Note].  The aggregate principal amount of (i) Class A-1 Notes, Class A-4 Notes and [Class B Notes], , as the case may be, outstanding at any time may not exceed the respective amounts set forth above with respect to such Classes of Notes, (ii) the aggregate principal amount of the Class A-2-A Notes and the Class A-2-B Notes outstanding at any time may not exceed $[      ], and (iii) the aggregate principal amount of the Class A-3-A Notes and the Class A-3-B Notes outstanding at any time may not exceed $[      ].

 

No Note shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose, unless there appears on such Note a certificate of authentication executed by the Indenture Trustee by the manual signature of one of its authorized signatories,

 

 

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and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered hereunder.

 

Section 2.03          Temporary Notes.

 

(i)           Pending the preparation of Definitive Notes, the Issuing Entity may execute, and upon receipt of an Issuing Entity Order, the Indenture Trustee shall authenticate and deliver, such temporary Notes which are printed, lithographed, typewritten, mimeographed or otherwise produced, of the tenor of the Definitive Notes in lieu of which they are issued and with such variations as are consistent with the terms of this Indenture as the officers executing such Notes may determine, as evidenced by their execution of such Notes.

 

(ii)           If temporary Notes are issued, the Issuing Entity shall cause Definitive Notes to be prepared without unreasonable delay.  After the preparation of Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes upon surrender of the temporary Notes at the Agency Office of the Issuing Entity to be maintained as provided in Section 3.02, without charge to the Noteholder.  Upon surrender for cancellation of any one or more temporary Notes, the Issuing Entity shall execute and the Indenture Trustee shall authenticate and deliver in exchange therefor a like principal amount of Definitive Notes of authorized denominations.  Until so delivered in exchange, the temporary Notes shall in all respects be entitled to the same benefits under this Indenture as Definitive Notes.

 

Section 2.04          Registration of Transfer and Exchange.

 

(a)           The Issuing Entity shall cause to be kept the Register, comprising separate registers for each Class of Notes, in which, subject to such reasonable regulations as the Issuing Entity may prescribe, the Issuing Entity shall provide for the registration of the Notes and the registration of transfers and exchanges of the Notes (the “Register”). The Indenture Trustee shall initially be the Registrar for the purpose of registering the Notes and transfers of the Notes as herein provided. Upon any resignation of any Registrar, the Issuing Entity shall promptly appoint a successor Registrar or, if it elects not to make such an appointment, assume the duties of the Registrar. Notwithstanding anything to the contrary contained herein, the Registrar shall know only the Person in whose name a Note is registered in the Register, and the obligations of the Indenture Trustee (in its capacity as paying agent or otherwise) and the Registrar shall run only to such Persons.

 

(b)           If a Person other than the Indenture Trustee is appointed by the Issuing Entity as Registrar, the Issuing Entity shall give the Indenture Trustee prompt written notice of the appointment of such Registrar and of the location, and any change in the location, of the Register. The Indenture Trustee shall have the right to inspect the Register at all reasonable times and to obtain copies thereof. The Indenture Trustee shall have the right to rely upon a certificate executed on behalf of the Registrar by a Responsible Officer thereof as to the names and addresses of the Noteholders and the principal amounts and number of such Notes.

 

(c)           Upon surrender for registration of transfer of any Note at the Corporate Trust Office of the Indenture Trustee or the Agency Office of the Issuing Entity (and

 

 

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following the delivery, in the former case, of such Notes to the Issuing Entity by the Indenture Trustee), the Issuing Entity shall execute, the Indenture Trustee shall authenticate and the Noteholder shall obtain from the Indenture Trustee, in the name of the designated transferee or transferees, one or more new Notes of the same Class in any authorized denominations of a like aggregate principal amount.

 

(d)           At the option of the Noteholder, Notes may be exchanged for other Notes of the same Class in any authorized denominations, of a like aggregate principal amount and upon surrender of such Notes to be exchanged at the Corporate Trust Office of the Indenture Trustee or the Agency Office of the Issuing Entity (and following the delivery, in the former case, of Notes to the Issuing Entity by the Indenture Trustee), the Issuing Entity shall execute, and the Indenture Trustee shall authenticate and the Noteholder shall obtain from the Indenture Trustee, such Notes which the Noteholder making the exchange is entitled to receive.

 

(e)           All Notes issued upon any registration of transfer or exchange of other Notes shall be the valid obligations of the Issuing Entity, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Notes surrendered upon such registration of transfer or exchange.

 

(f)           Every Note presented or surrendered for registration of transfer or exchange shall be duly endorsed by, or be accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee and the Registrar, duly executed by the Holder thereof or such Holder’s attorney duly authorized in writing, with such signature guaranteed by a commercial bank or trust company.

 

(g)           No service charge shall be made to a Holder for any registration of transfer or exchange of Notes, but the Issuing Entity or Indenture Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Notes, other than exchanges pursuant to Sections 2.03(b) or 9.04 not involving any transfer.

 

(h)           The preceding provisions of this Section 2.04 notwithstanding, the Issuing Entity shall not be required to transfer or make exchanges, and the Registrar need not register transfers or exchanges, (i) of Notes that are due for repayment within 15 days of submission to the Corporate Trust Office or the Agency Office; or (ii) if Section 2.15 has not been complied with in connection with such transfer.

 

By acquiring a Class A Note, each purchaser and transferee shall be deemed to represent and warrant that either (a) it is not acquiring such Note with the plan assets of a Benefit Plan or (b) the acquisition, holding and disposition of such Note will not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or a nonexempt violation of any Similar Law.

 

No [Class B Note] may be acquired by or for the account of a Benefit Plan.  By acquiring a [Class B Note], each purchaser and transferee thereof shall be deemed to represent and warrant that (a) it is not a Benefit Plan and is not purchasing the [Class B Note] on behalf of a Benefit

 

 

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Plan and (b) that either (i) it is not acquiring the [Class B Note] with the assets of a governmental plan, non-U.S. plan, or church plan that is subject to any Similar Law or (ii) the acquisition, holding and disposition of the [Class B Note] will not give rise to a nonexempt violation of any Similar Law.

 

(i)           Neither the Indenture Trustee nor the Registrar shall have any responsibility to monitor or restrict the transfer of beneficial ownership in any Note an interest in which is transferable through the facilities of the Depository. In addition, neither the Indenture Trustee nor the Registrar shall have any obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

 

Section 2.05         Mutilated, Destroyed, Lost or Stolen Notes.  If (i) any mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee receives evidence to its satisfaction of the destruction, loss or wrongful taking of any Note, and (ii) there is delivered to the Indenture Trustee such security or indemnity as may be reasonably required by it to hold the Issuing Entity and the Indenture Trustee harmless, then, in the absence of notice to the Issuing Entity, the Registrar or the Indenture Trustee that such Note has been acquired by a Protected Purchaser, and provided that the requirements of Section 8-405 of the UCC are met, the Issuing Entity shall execute, and the Indenture Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or wrongfully taken Note, a replacement Note; provided, however, that if any such destroyed, lost or wrongfully taken Note, but not a mutilated Note, shall have become or within fifteen (15) days shall be due and payable, or shall have been called for redemption, instead of issuing a replacement Note, the Issuing Entity may pay such destroyed, lost or stolen Note when so due or payable or upon the Redemption Date without surrender thereof.  If, after the delivery of such replacement Note or payment of a destroyed, lost or wrongfully taken Note, a Protected Purchaser of the original Note in lieu of which such replacement Note was issued presents for payment such original Note, the Issuing Entity and the Indenture Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such replacement Note from such Person to whom such replacement Note was delivered or any assignee of such Person, except a Protected Purchaser, and shall be entitled to recover upon the security or indemnity provided therefore to the extent of any loss, damage, cost or expense incurred by the Issuing Entity or the Indenture Trustee in connection therewith.

 

Upon the issuance of any replacement Note under this Section 2.05, the Issuing Entity may require the payment by the Holder of such Note of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the fees and expenses of the Indenture Trustee) connected therewith.

 

Every replacement Note issued pursuant to this Section 2.05 in replacement of any mutilated, destroyed, lost or wrongfully taken Note shall constitute an original additional contractual obligation of the Issuing Entity, whether or not the mutilated, destroyed, lost or

 

 

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wrongfully taken Note shall be at any time enforceable by anyone, and shall be entitled to all of the benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder.

 

The provisions of this Section 2.05 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes.

 

Section 2.06          Persons Deemed Owners.  Prior to due presentment for registration of transfer of any Note, the Issuing Entity, the Indenture Trustee and any agent of the Issuing Entity or the Indenture Trustee may treat the Person in whose name any Note is registered (as of the day of determination) as the owner of such Note for the purpose of receiving payments of principal of and interest, if any, on such Note and for all other purposes whatsoever, whether or not such Note be overdue, and none of the Issuing Entity, the Indenture Trustee or any agent of the Issuing Entity or the Indenture Trustee shall be affected by notice to the contrary.

 

Section 2.07          Payment of Principal and Interest.  The Notes shall accrue interest during each Interest Period at the applicable Interest Rate, calculated in accordance with Section 5.05 of the Sale and Servicing Agreement and the Notes, and shall be payable from amounts deposited in the Collection Account in accordance with Section 5.06(a) of the Sale and Servicing Agreement.  Interest accrued on the Notes during an Interest Period shall be due and payable on the Payment Date immediately following the end of such Interest Period.

 

(a)           The principal of the Notes will be due and payable in accordance with Section 5.06(b) of the Sale and Servicing Agreement.  The principal of the Notes shall also be due and payable as follows: (i) on the Redemption Date, in an amount equal to the outstanding Note Balance, (ii) on the date of acceleration of the maturity of the Notes pursuant to Section 5.02 of this Indenture in the amount of the outstanding Note Balance and (iii) to the extent any Notes remain and have not been paid prior to such date, on the Final Scheduled Payment Date in an amount equal to the outstanding Note Balance.

 

(b)           Any installment of interest or principal payable with respect to a Note that is punctually paid or duly provided for by the Issuing Entity on the applicable Payment Date shall be paid to the Person in whose name such Note is registered on the Record Date, by wire transfer of immediately available funds to the account of any such Noteholder at a bank or other entity having appropriate facilities therefor, if such Noteholder shall have provided the Trustee with wiring instructions no less than two (2) Business Days prior to the related Record Date (which wiring instructions may be in the form of a standing order applicable to all subsequent Payment Dates), or otherwise by check mailed to the address of such Noteholder as it appears in the Register; provided, however, that, with respect to Book-Entry Notes registered on the applicable Record Date in the name of the nominee of the Depository (initially, such nominee to be Cede & Co.) for which Definitive Notes have not been issued pursuant to Section 2.13, payment shall be made by wire transfer in immediately available funds to Cede & Co., for further credit to the account designated by such Holder.  The final distribution on each Note will be made in like manner, but only upon presentation and surrender of such Note at the Corporate Trust Office or such other location specified in the notice to Noteholders of

 

 

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such final distribution.  With respect to Book-Entry Notes for which Definitive Notes have not been issued, such notice shall be sent on the Business Day prior to such Payment Date by facsimile, and with respect to Definitive Notes, such notice shall be sent not later than three Business Days after such Record Date in accordance with Section 11.05, and, in each case, shall specify that such final installment shall be payable only upon presentation and surrender of such Note and shall specify the place where such Note may be presented and surrendered for payment of such installment. The Indenture Trustee shall not be liable for any failure to provide notice to the Noteholders as required pursuant to this Section 2.07(b) to the extent it has not received notice of such expected final Payment Date from the Issuing Entity not later than two Business Days after the Record Date.  Notices in connection with redemptions of Notes shall be mailed to Noteholders as provided in Section 10.02. The funds represented by any such checks returned undelivered shall be held in accordance with Section 3.03.  The final interest payment on each Class of Notes is due on the earlier of (a) the Payment Date on which the Note Balance of that Class of Notes is reduced to zero (including any Redemption Date) and (b) the applicable Final Scheduled Payment Date.

 

Section 2.08          Cancellation.  All Notes surrendered for payment, registration of transfer, exchange or redemption shall, if surrendered to any Person other than the Indenture Trustee, be delivered to the Indenture Trustee and shall be promptly cancelled by the Indenture Trustee.  The Issuing Entity may at any time deliver to the Indenture Trustee for cancellation any Notes previously authenticated and delivered hereunder that the Issuing Entity may have acquired in any manner whatsoever, and all Notes so delivered shall be promptly cancelled by the Indenture Trustee.  No Notes shall be authenticated in lieu of or in exchange for any Notes cancelled as provided in this Section 2.08, except as expressly permitted by this Indenture.  All cancelled Notes may be held or disposed of by the Indenture Trustee in accordance with its standard retention or disposal policy as in effect at the time unless the Issuing Entity shall direct by an Issuing Entity Order that they be returned to it; provided, however, that such Issuing Entity Order is timely and the Notes have not been previously disposed of by the Indenture Trustee.

 

Section 2.09          Tax Treatment; Withholding.    

 

(a)           The Issuing Entity has entered into this Indenture, and the Notes will be issued, with the intention that, for federal, state and local income, single business and franchise tax purposes, the Notes will qualify as indebtedness secured by the Collateral, and, unless otherwise required by law, the Noteholders and the Owners agree that, by acquiring any Note or interest therein, that it will not take a position contrary to such treatment.  The Issuing Entity, by entering into this Indenture agree solely for U.S. federal, state and local income, single business and franchise tax purposes, (i) to treat the Notes as debt secured by the Collateral and (ii) not to treat the Issuing Entity as an association (or publicly-traded partnership) taxable as a corporation, in each case, unless such treatment has been determined to be contrary to applicable law by a decision, judgment, decree or other order by any court of competent jurisdiction, which decision, judgment, decree or other order is final and binding after all appeals allowably by law.

 

(b)           In the event that any withholding tax is imposed on payments to a Noteholder, such tax shall reduce the amount otherwise distributable to such Noteholder

 

 

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in accordance with this Section. The Indenture Trustee or Paying Agent is hereby authorized and directed to retain from amounts otherwise distributable to the Noteholders sufficient funds for the payment of any tax that is legally owed with respect to such payment (but such authorization shall not prevent the Indenture Trustee or the Paying Agent from contesting any such tax in appropriate proceedings and withholding payment of such tax, if permitted by law, pending the outcome of such proceedings; provided, however, the Indenture Trustee or the Paying Agent shall not be required to contest any tax). The amount of any withholding tax imposed with respect to a Noteholder shall be treated as cash distributed to such Noteholder at the time it is withheld by Indenture Trustee or Paying Agent and remitted to the appropriate taxing authority. If there is a possibility that withholding tax is payable with respect to a payment (such as a payment to a non-U.S. Noteholder), the Indenture Trustee or the Paying Agent may in its sole discretion withhold such amounts in accordance with this paragraph.

 

(c)           Prior to the receipt of any interest payment, any Noteholder or its transferee that is a United States person (as defined in Section 7701(a)(30) of the Code) shall (i) provide the Indenture Trustee and the Paying Agent with Internal Revenue Service Form W-9 (or successor form) or (ii) establish to the satisfaction of the Indenture Trustee and the Paying Agent that it is exempt from backup withholding.  Each Noteholder or its transferee agrees by acceptance of a Note that, upon request of the Issuing Entity, the Indenture Trustee or the Paying Agent, such Noteholder or its transferee will provide the Issuing Entity, the Indenture Trustee or the Paying Agent with a supplemental Internal Revenue Service Form W-9 (or successor form) to the extent legally able to do so and that each Noteholder or its transferee shall notify the Indenture Trustee or Paying Agent should subsequent circumstances render such forms or exemptions incorrect or invalid.  The Indenture Trustee and the Paying Agent shall be fully protected in relying upon, and each Noteholder or its transferee by its acceptance of a Note hereunder agrees to indemnify and hold the Indenture Trustee and the Paying Agent harmless against all claims or liability of any kind arising in connection with or related to the Indenture Trustee’s and the Paying Agent’s reliance upon, any documents, forms or information provided by any Noteholder or its transferee to the Issuing Entity, the Indenture Trustee or the Paying Agent pursuant to this Section 2.09.

 

(d)           Prior to the receipt of any interest payment, any Noteholder, and upon transfer, any transferee that is not a United States person (as defined in Section 7701(a)(30) of the Code) shall provide the Indenture Trustee and the Paying Agent with Internal Revenue Service Form W-8BEN, Form W-8ECI or other applicable Internal Revenue Service Form W-8 (or successor forms).  Each Noteholder or transferee agrees by acceptance of a Note that, upon request of the Issuing Entity, the Indenture Trustee or the Paying Agent, such Noteholder or transferee will provide the Issuing Entity, the Indenture Trustee or the Paying Agent with a supplemental Internal Revenue Service Form W-8BEN, W-8ECI or other applicable Internal Revenue Service Form W-8 (or successor forms) to the extent legally able to do so and that each Noteholder or its transferee shall notify the Indenture Trustee or Paying Agent should subsequent circumstances render such forms incorrect or invalid.  The Indenture Trustee and the Paying Agent shall be fully protected in relying upon, and each Noteholder or its transferee by its acceptance of a Note hereunder agrees to indemnify and hold the

 

 

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Indenture Trustee and the Paying Agent harmless against all claims or liability of any kind arising in connection with or related to the Indenture Trustee’s and the Paying Agent’s reliance upon, any documents, forms or information provided by any Noteholder or its transferee to the Issuing Entity, the Indenture Trustee or the Paying Agent pursuant to this Section 2.09.

 

Section 2.10          Intentionally Omitted

 

Section 2.11          Book-Entry Notes.

 

(a)           Generally.  Each Note, upon original issuance, shall be issued in the form of a typewritten Note or Notes representing the Book-Entry Notes, which shall be deposited on behalf of the purchasers of the Notes represented by such Book-Entry Note with the Depository or the Indenture Trustee, as custodian for the Depository, and registered on the Register in the name of the Depository or a nominee thereof (initially, such nominee to be Cede & Co.).  No Owner shall receive a Definitive Note representing such Owner’s interest in such Notes, except as provided in Section 2.13. Unless and until Definitive Notes with respect to such Notes have been issued to such Owners pursuant to Section 2.13, with respect to such Notes:

 

(i)           the provisions of this Section 2.11 shall be in full force and effect;

 

(ii)           the Registrar and the Indenture Trustee shall be entitled to deal with the Depository for all purposes of this Indenture (including the payment of principal of and interest on such Notes and the giving of instructions or directions hereunder) as the sole Holder of such Notes and shall have no obligation to such Owners;

 

(iii)           to the extent that the provisions of this Section 2.11 conflict with any other provisions of this Indenture, the provisions of this Section 2.11 shall control;

 

(iv)           the rights of the Owners shall be exercised only through the Depository and shall be limited to those established by law and agreements between such Owners and the Depository and/or the Depository Participants, and unless and until Definitive Notes are issued pursuant to Section 2.13, the initial Depository shall make book-entry transfers between the Depository Participants and receive and transmit payments of principal of and interest on such Notes to such Depository Participants, pursuant to the Depository Agreement; and

 

(v)           whenever this Indenture requires or permits actions to be taken based upon instructions or directions of Holders of Notes evidencing a specified percentage of the outstanding Note Balance, the Depository shall be deemed to represent such percentage only to the extent that it has (x) received written instructions to such effect from Owners and/or Depository Participants owning or representing, respectively, such required percentage of the beneficial interest in the Notes and (y) has delivered such instructions to the Indenture Trustee.

 

 

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Section 2.12          Notices to Depository.  With respect to any Notes issued as Book-Entry Notes, whenever a notice or other communication to the Noteholders is required under this Indenture, unless and until Definitive Notes representing such Notes shall have been issued to the related Owners pursuant to Section 2.13, the Indenture Trustee shall give all such notices and communications specified herein to be given to the related Noteholders to the Depository and shall have no obligation to such Owners.

 

Section 2.13          Definitive Notes.  Except as provided in Section 2.04, if for any Notes issued as Book-Entry Notes (a) the Administrator advises the Indenture Trustee in writing that the Depository is no longer willing or able to properly discharge its responsibilities with respect to such Notes and the Issuing Entity is unable to locate a qualified successor; or (b) after the occurrence of an Event of Default or a Servicer Replacement Event, Owners representing beneficial interests aggregating at least a majority of the outstanding Note Balance advise the Depository in writing that the continuation of a book-entry system through the Depository is no longer in the best interests of such Owners, then the Depository shall notify all Owners and the Indenture Trustee in writing of the occurrence of any such event and of the availability of Definitive Notes to such Owners requesting the same. Upon surrender to the Indenture Trustee of the typewritten Notes or Notes representing such Book-Entry Notes by the Depository, accompanied by registration instructions, the Issuing Entity shall execute and the Indenture Trustee shall authenticate the related Definitive Notes in accordance with the instructions of the Depository. None of the Issuing Entity, the Administrator, the Registrar or the Indenture Trustee shall be liable for any delay in delivery of such instructions and may conclusively rely on, and shall be fully protected in relying on, such instructions. Upon the issuance of such Definitive Notes, the Indenture Trustee shall recognize the Holders of such Definitive Notes as Noteholders. The Indenture Trustee shall not be liable if the Administrator or the Indenture Trustee is unable to locate a qualified successor Depository.

 

Section 2.14          Depositor as Noteholder.  The Depositor in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Issuing Entity or its affiliates with the same rights it would have if it were not the Depositor.

 

Section 2.15           Transfer of Private Notes.

 

(a)           Notwithstanding anything else herein to the contrary, the [Class B Notes] and the Trust Certificates together may at no time be held by more than [95] persons.  No transfer of the [Class B Notes] (or an economic interest therein) will be permitted or effective to the extent that (i) such transfer would cause the number of direct or indirect holders of an interest in the [Class B Notes] and the number of direct or indirect holders of an interest in the Trust Certificates to exceed, in the aggregate, a number equal to [95] holders and (ii) the Issuer has not consented, in writing, to such transfer.  The Indenture Trustee and the Note Registrar shall have no duty or obligation to ascertain the number of direct or indirect holders of an interest in the Class B Notes and the Trust Certificates.

 

(b)           Prior to any transfer of a Class B Note, the transferee shall represent and warrant in writing that the transfer is not being effected on or through (x) an “established securities market” within the meaning of Section 7704(b)(1) of the Code, including without limitation, an over-the-counter market or an interdealer quotation system that

 

 

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regularly disseminates firm buy or sell quotations or (y) a “secondary market” or “substantial equivalent thereof” within the meaning of Section 7704(b)(2) of the Code and any proposed, temporary or final Treasury Regulations thereunder;

 

(c)           Prior to any transfer of a Class B Note, the transferee shall represent and warrant in writing that it (i) it is acquiring the Class B Note for its own account and is the sole beneficial owner of such Class B Note and that it will not become, a partnership, Subchapter S corporation or grantor trust for U.S. federal income tax purposes, or (ii) is or will become a partnership, Subchapter S corporation or grantor trust for U.S. federal income tax purposes, and at all times the aggregate value of any Class B Notes and the Trust Certificate that it holds or beneficially owns represents, or will represent, less than 50% of the value of all of its assets and at no time will any Class B Notes and Trust Certificates that it holds or beneficially owns be disproportionately represented (in relation to  its other assets) in the value of any of its ownership interests.

 

(d)                      The provisions of this Section and of the Indenture generally are intended to prevent the Issuer from being characterized as a “publicly traded partnership” within the meaning of Section 7704 of the Code, in reliance on Treasury Regulations Sections 1.7704-1(e) and (h).

 

(e)                      Each Class B Noteholder shall be deemed to represent and warrant that (a) it is not a Benefit Plan and is not purchasing a Class B Note on behalf of a Benefit Plan and (b) that either (i) it is not acquiring a Class B Note with the assets of a governmental plan, non-U.S. plan, or church plan that is subject to any Similar Law or (ii) the acquisition and holding of a Class B Note will not give rise to a non-exempt violation of any Similar Law.

 

(f)                      Each Class B Note will bear a legend to the following effect:

 

“THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES OR BLUE SKY LAW.  THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (A) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (B) TO ANOTHER PERSON IN ACCORDANCE WITH AN EXEMPTION FROM THE

 

 

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REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. EACH PURCHASER WILL BE DEEMED TO HAVE MADE CERTAIN REPRESENTATIONS AND AGREEMENTS SET FORTH IN THE INDENTURE.  ANY TRANSFER IN VIOLATION OF THE FOREGOING WILL BE OF NO FORCE AND EFFECT, WILL BE VOID AB INITIO, AND WILL NOT OPERATE TO TRANSFER ANY RIGHTS TO THE TRANSFEREE.

 

NO TRANSFER OF THIS NOTE WILL BE PERMITTED IF SUCH TRANSFER WOULD CAUSE THE NUMBER OF DIRECT OR INDIRECT HOLDERS OF AN INTEREST IN THE CERTIFICATES ISSUED UNDER THE TRUST AGREEMENT (AS DEFINED IN THE INDENTURE) AND CLASS E NOTES TO EXCEED A NUMBER EQUAL TO [95] PERSONS.

 

EACH HOLDER, BY ITS ACQUISITION OF THIS NOTE (OR ANY INTEREST HEREIN), SHALL BE DEEMED TO REPRESENT AND WARRANT THAT (I) IT IS NOT AND IS NOT ACQUIRING THIS NOTE (OR ANY INTEREST HEREIN) ON BEHALF OF OR WITH THE ASSETS OF ANY (A) “EMPLOYEE BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), THAT IS SUBJECT TO TITLE I OF ERISA, (B) “PLAN” AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), OR (C) ENTITY DEEMED TO HOLD PLAN ASSETS OF ANY OF THE FOREGOING AND (II) EITHER (A) IT IS NOT ACQUIRING THIS NOTE WITH THE ASSETS OF A GOVERNMENTAL PLAN, NON-U.S. PLAN, OR CHURCH PLAN THAT IS SUBJECT TO ANY APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR SECTION 4975 OF THE CODE (“SIMILAR LAW”) OR (B) THE ACQUISITION AND HOLDING OF THIS NOTE WILL NOT GIVE RISE TO A NON-EXEMPT VIOLATION OF ANY SIMILAR LAW.

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE AS SET FORTH HEREIN.  ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

 

TRANSFERS OF THE NOTES MUST GENERALLY BE ACCOMPANIED BY APPROPRIATE TAX TRANSFER DOCUMENTATION AND ARE SUBJECT TO RESTRICTIONS AS PROVIDED IN THE INDENTURE.”

 

 

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(g)                      Each Class B Noteholder shall be deemed to represent and warrant that it is a person who is, for U.S. federal income tax purposes, (i) a citizen or resident of the United States, (ii) a corporation (or other entity treated as a corporation for United States federal income tax purposes) or partnership (or other entity treated as a partnership for United States federal income tax purposes) organized in or under the laws of the United States or any state (or the District of Columbia), (iii) an estate the income of which is subject to U.S. federal income tax, regardless of source or (iv) a trust if a court within the United States is able to exercise primary supervision over the administration of such trust and one or more persons described  in this paragraph have the authority to control all substantial decisions of such trust.  Each Class B Noteholder agrees to provide a certification of non-foreign status if requested by the Depositor, in such form as may be requested by the Depositor, signed under penalties of perjury (and such other certification, representations or opinion of counsel as may be requested by the Depositor).

 

(h)                      The Indenture Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Class B Note other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

 

Section 2.16          ERISA.  The Class A Notes and the [Class B Notes] may not be purchased by or transferred to a Benefit Plan Investor or any governmental, non-U.S. or church plan subject to any Similar Law unless the acquisition and holding of such Note will not give rise to a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or a non-exempt violation of any Similar Law.

 

[End of Article II]

 

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ARTICLE III

 

 COVENANTS

 

Section 3.01          Payment of Principal and Interest.  The Issuing Entity will duly and punctually pay the principal of and interest, if any, on the Notes, and all other amounts owing hereunder or in respect of the Notes, in accordance with the terms of the Notes, this Indenture and the Sale and Servicing Agreement.  Without limiting the foregoing, subject to Section 8.02(c), on each Payment Date the Issuing Entity shall cause all amounts deposited pursuant to the Sale and Servicing Agreement for the benefit of the Notes to be paid to the Noteholders.

 

Section 3.02          Maintenance of Office or Agency.  The Issuing Entity will maintain in the Borough of Manhattan, The City of New York, an office or agency where Notes may be surrendered for registration of transfer or exchange, and where notices and demands to or upon the Issuing Entity in respect of the Notes and this Indenture may be served.  Such office will initially be located at the Corporate Trust Office.  Definitive Notes may be surrendered for registration of transfer or exchange at the address set forth for such purposes in the definition of Corporate Trust Office herein.  The Issuing Entity will give prompt written notice to the Indenture Trustee of the location, and of any change in the location, of any such office or agency.  If at any time the Issuing Entity shall fail to maintain any such office or agency or shall fail to furnish the Indenture Trustee with the address thereof, such surrenders, notices and demands may be made or served at the Corporate Trust Office, and the Issuing Entity hereby appoints the Indenture Trustee as its agent to receive all such surrenders, notices and demands.

 

Section 3.03          Money for Payments to Be Held in Trust.  All payments of amounts due and payable with respect to any Notes that are to be made from amounts withdrawn from the Collection Account, the Principal Distribution Account and the Reserve Account shall be made on behalf of the Issuing Entity by the Indenture Trustee or by another Paying Agent, and no amounts so withdrawn from the Collection Account, the Principal Distribution Account or the Reserve Account for payments of Notes shall be paid over to the Issuing Entity except as provided in this Section 3.03.

 

On or before the Business Day preceding each Payment Date and the Redemption Date, the Issuing Entity shall deposit or cause to be deposited in the Collection Account and the Principal Distribution Account an aggregate sum sufficient to pay the amounts then becoming due under the Notes, such sum to be held in trust for the benefit of the Persons entitled thereto, and (unless the Paying Agent is the Indenture Trustee) shall promptly notify the Indenture Trustee, in writing, of its action or failure so to act.

 

The Issuing Entity will cause each Paying Agent other than the Indenture Trustee to execute and deliver to the Indenture Trustee an instrument in which such Paying Agent shall agree with the Indenture Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of this Section 3.03, that such Paying Agent will:

 

(i)           hold all sums held by it for the payment of amounts due with respect to the Notes in trust for the benefit of the Persons entitled thereto until

 

 

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such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay such sums to such Persons as herein provided;

 

(ii)           give the Indenture Trustee written notice of any default by the Issuing Entity (or any other obligor on the Notes) of which it has actual knowledge in the making of any payment required to be made with respect to the Notes;

 

(iii)           at any time during the continuance of any such default, upon the written request of the Indenture Trustee, forthwith pay to the Indenture Trustee all sums so held in trust by such Paying Agent;

 

(iv)           immediately resign as a Paying Agent and forthwith pay to the Indenture Trustee all sums held by it in trust for the payment of Notes if at any time it ceases to meet the standards required to be met by a Paying Agent at the time of its appointment; and

 

(v)           comply with all requirements of the Code with respect to the withholding from any payments made by it on any Notes of any applicable withholding taxes imposed thereon and with respect to any applicable reporting requirements in connection therewith.

 

The Issuing Entity may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, by Issuing Entity Order direct any Paying Agent to pay to the Indenture Trustee all sums held in trust by such Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts as those upon which the sums were held by such Paying Agent; and upon such payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall be released from all further liability with respect to such money.

 

Subject to applicable laws with respect to escheat of funds, any money held by the Indenture Trustee or any Paying Agent in trust for the payment of any amount due with respect to any Note and remaining unclaimed for two years after such amount has become due and payable shall be discharged from such trust and be paid upon Issuing Entity Request to the Issuing Entity; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Issuing Entity for payment thereof (but only to the extent of the amounts so paid to the Issuing Entity), and all liability of the Indenture Trustee or such Paying Agent with respect to such trust money shall thereupon cease; provided, however, that the Indenture Trustee or such Paying Agent, before being required to make any such repayment, shall at the expense and written direction of the Issuing Entity cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in The City of New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than thirty (30) days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Issuing Entity.  The Indenture Trustee shall also adopt and employ, at the expense and written direction of the Issuing Entity, any other reasonable means of notification of such repayment (including, but not limited to, mailing notice of such repayment to Holders whose Notes have been called but have not been

 

 

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surrendered for redemption or whose right to or interest in moneys due and payable but not claimed is determinable from the records of the Indenture Trustee or of any Paying Agent, at the last address of record for each such Holder).

 

Section 3.04          Existence.  The Issuing Entity will keep in full effect its existence, rights and franchises as a statutory trust under the laws of the State of Delaware and will obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Indenture, the Notes and the Collateral, and will not dissolve or liquidate in whole or in part.

 

Section 3.05          Protection of Collateral; Manner of Perfection.

 

(a)           The Issuing Entity will from time to time execute, deliver and file all such supplements and amendments hereto and (subject to clause (b) below) all such UCC financing statements, continuation statements, instruments of further assurance and other instruments, and will take such other action necessary or advisable to:

 

(i)           maintain or preserve the lien and security interest (and the first priority thereof) of this Indenture or carry out more effectively the purposes hereof;

 

(ii)           perfect, publish notice of or protect the validity of any Grant made or to be made by this Indenture;

 

(iii)           enforce the Indenture Trustee’s rights in any of the Collateral, including all rights under the Interest Rate Cap Agreement; or

 

(iv)           preserve and defend title to the Collateral and the rights of the Indenture Trustee and the Noteholders in such Collateral against the claims of all persons and parties.

 

(b)           The Issuing Entity hereby designates the Indenture Trustee, as its agent and attorney-in-fact, to execute any UCC financing statement, continuation statement or other instrument required to be executed pursuant to this Section 3.05; provided, however, that the Issuing Entity will have the primary responsibility for taking such actions.

 

(c)           The Issuing Entity hereby represents and warrants that, as to the Collateral pledged to the Indenture Trustee for the benefit of the Noteholders, on the Closing Date:

 

(i)           the Indenture creates a valid and continuing security interest (as defined in the applicable UCC) in the Collateral that is in existence in favor of the Indenture Trustee, which security interest is prior to all other liens, and is enforceable as such as against creditors of and purchasers from the Issuing Entity;

 

(ii)           the Loans constitute “tangible chattel paper” under the applicable UCC;

 

 

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(iii)           the Issuing Entity owns and has good and marketable title to such Collateral free and clear of any liens, claims or encumbrances of any Person, other than the interest Granted under this Indenture;

 

(iv)           the Issuing Entity has acquired its ownership in such Collateral in good faith without notice of any adverse claim;

 

(v)           the Trust Accounts are not in the name of any person other than the Indenture Trustee and the Issuing Entity has not consented to the bank maintaining the Trust Accounts to comply with the instructions of any person other than the Indenture Trustee;

 

(vi)           the Issuing Entity has not assigned, pledged, sold, granted a security interest in or otherwise conveyed any interest in such Collateral (or, if any such interest has been assigned, pledged or otherwise encumbered, it has been released) other than interests Granted pursuant to this Indenture;

 

(vii)           the Issuing Entity has caused or will have caused, within ten days after the Closing Date, the filing of all appropriate financing statements in the proper filing office in the appropriate jurisdiction under the applicable law in order to perfect the security interest Granted hereunder in the Loans;

 

(viii)           other than its Granting hereunder, the Issuing Entity has not Granted such Collateral, the Issuing Entity has not authorized the filing of and is not aware of any financing statements against the Issuing Entity that include a description of such Collateral other than the financing statement in favor of the Indenture Trustee, and the Issuing Entity is not aware of any judgment or tax lien filing against it; and

 

(ix)           the information relating to such Collateral set forth in the Schedule of Loans (attached as Schedule I to the Asset Purchase Agreement) is correct.

 

(d)           All financing statements filed or to be filed against the Issuing Entity in favor of the Indenture Trustee in connection with this Indenture describing the Collateral shall contain a statement to the following effect: “A purchase of, or a security interest in, any of the collateral covered by this financing statement will violate the rights of the secured party.”

 

Section 3.06          Opinions as to Collateral.

 

(a)           On the Closing Date, the Issuing Entity shall cause to be furnished to the Indenture Trustee an Opinion of Counsel either stating that, in the opinion of such counsel, such action has been taken with respect to the recording and filing of this Indenture, any indentures supplemental hereto, and any other requisite documents, and with respect to the execution and filing of any UCC financing statements and continuation statements, as are necessary to perfect and make effective the lien and security interest of this Indenture and reciting the details of such action, or stating that, in the opinion of such counsel, no such action is necessary to make such lien and security interest effective.

 

 

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(b)           On or before June 30th, in each calendar year, beginning in [     ], the Issuing Entity shall furnish to the Indenture Trustee and the Rating Agencies an Opinion of Counsel either stating that, in the opinion of such counsel, such action has been taken with respect to the recording, filing, re-recording and refiling of this Indenture, any indentures supplemental hereto and any other requisite documents and with respect to the execution and filing of any UCC financing statements and continuation statements as is necessary to maintain the lien and security interest created by this Indenture, the Sale and Servicing Agreement and the Asset Purchase Agreement and reciting the details of such action, or stating that in the opinion of such counsel no such action is necessary to maintain such lien and security interest.  Such Opinion of Counsel shall also describe the recording, filing, re-recording and refiling of this Indenture, any indentures supplemental hereto and any other requisite documents and the execution and filing of any UCC financing statements and continuation statements that will, in the opinion of such counsel, be required to maintain the lien and security interest of this Indenture, the Sale and Servicing Agreement and the Asset Purchase Agreement and the priority thereof until June 30th in the following calendar year.

 

Section 3.07          Performance of Obligations; Servicing of Loans.

 

(a)           The Issuing Entity will not take any action and will use its reasonable best efforts not to permit any action to be taken by others that would release any Person from any of such Person’s material covenants or obligations under any instrument or agreement included in the Collateral or that would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, any such instrument or agreement, except as expressly provided in this Indenture or the Sale and Servicing Agreement.

 

(b)           The Issuing Entity may contract with other Persons acceptable to the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class and with notification to the Rating Agencies to assist it in performing its duties under this Indenture, and any performance of such duties by a Person identified to the Indenture Trustee in an Officer’s Certificate of the Issuing Entity shall be deemed to be action taken by the Issuing Entity, provided that any delegation shall not release the Issuing Entity from its obligations hereunder and under the Notes.  Initially, the Issuing Entity has contracted with the Servicer and the Administrator to assist the Issuing Entity in performing its duties under this Indenture.

 

(c)           The Issuing Entity will punctually perform and observe all of its obligations and agreements contained in this Indenture, the Basic Documents, and in the instruments and agreements included in the Collateral, and shall enforce its rights thereunder and the obligations of the other Persons parties thereto, including, but not limited to, filing or causing to be filed all UCC financing statements and continuation statements required to be filed by the terms of this Indenture and the Sale and Servicing Agreement in accordance with and within the time periods provided for herein and therein.  The Issuing Entity and the Indenture Trustee shall not waive, amend, modify, supplement or terminate, or grant any consent with respect to any Basic Document or any provision thereof without the consent of the Noteholders representing a majority of the

 

 

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outstanding Note Balance of the Controlling Class.  If a Servicer Replacement Event shall arise from the failure of the Servicer to perform any of its duties or obligations under the Sale and Servicing Agreement with respect to the Loans, the Issuing Entity shall take all reasonable steps available to it to remedy such failure.

 

(d)           If the Issuing Entity shall have knowledge of the occurrence of a Servicer Replacement Event or of any other breach by a Person under any Basic Document, the Issuing Entity shall promptly notify the Indenture Trustee, the Noteholders and the Rating Agencies thereof, and shall specify in such notice the action, if any, that the Issuing Entity is taking with respect to such default.

 

(e)           Upon any termination of the Servicer’s rights and powers pursuant to the Sale and Servicing Agreement, the Issuing Entity shall promptly notify the Indenture Trustee thereof and the Noteholders.  As soon as a successor servicer (a “Successor Servicer”) is appointed, the Issuing Entity shall notify the Indenture Trustee and the Noteholders in writing of such appointment, specifying in such notice the name and address of such Successor Servicer.

 

(f)           Without limitation of the absolute nature of the assignment granted to the Indenture Trustee under this Indenture or the rights of the Indenture Trustee hereunder, the Issuing Entity hereby agrees (i) that it will not, without the prior written consent of the Indenture Trustee acting at the written direction of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class, amend, modify, waive, supplement, terminate or surrender, or agree to any amendment, modification, supplement, termination, waiver or surrender of, the terms of any Collateral or the Basic Documents, or waive timely performance or observance by the Servicer or the Depositor under the Sale and Servicing Agreement; and (ii) that any such amendment shall not (A) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections on payments on the Collateral or distributions that are required to be made for the benefit of the Noteholders or (B) reduce the aforesaid percentage of the Notes that is required to consent to any such amendment, without the consent of the Holders of all Notes.  If the Indenture Trustee acting at the written direction of such Holders agrees to any such amendment, modification, supplement or waiver, the Indenture Trustee agrees, promptly following a request by the Issuing Entity to do so, to execute and deliver, at the Issuing Entity’s own expense, such agreements, instruments, consents and other documents as the Issuing Entity may deem necessary or appropriate in the circumstances.

 

Section 3.08          Negative Covenants.  So long as any Notes are outstanding, the Issuing Entity shall not, in addition to the covenants set forth in Section 2.3 of the Trust Agreement:

 

(a)           except as expressly permitted by this Indenture, the Asset Purchase Agreement, the Trust Agreement, the Administration Agreement or the Sale and Servicing Agreement, sell, transfer, exchange or otherwise dispose of any of the properties or assets of the Issuing Entity, including those included in the Collateral;

 

 

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(b)           engage in any activities other than financing, acquiring, owning, pledging and managing the Loans and the other Collateral as contemplated by this Indenture and the other Basic Documents;

 

(c)           claim any credit on, or make any deduction from the principal or interest payable in respect of, the Notes (other than amounts properly withheld from such payments under the Code or applicable state law) or assert any claim against any present or former Noteholder by reason of the payment of the taxes levied or assessed upon any part of the Collateral;

 

(d)           (i) permit the validity or effectiveness of this Indenture to be impaired or permit any Person to be released from any covenants or obligations with respect to the Notes under this Indenture except as may be expressly permitted hereby, (ii) permit any lien, charge, excise, claim, security interest, mortgage or other encumbrance (other than the lien of this Indenture) to be created on or extend to or otherwise arise upon or burden the Collateral or any part thereof or any interest therein or the proceeds thereof (other than tax liens, mechanics’ liens and other liens that arise by operation of law, in each case on any of the Financed Vehicles and arising solely as a result of an action or omission of the related Loan Obligor), (iii) permit the lien of this Indenture not to constitute a valid first priority (other than with respect to any such tax, mechanics’ or other lien) security interest in the Collateral, (iv) dissolve or liquidate in whole or in part or (v) merge or consolidate with, or transfer substantially all of its assets to, any other Person; or

 

(e)           take any action that, for federal, state or local income, single business and franchise tax purposes, (i) would cause the Notes to fail to be treated as debt or (ii) would cause the Issuing Entity to be treated as an association (or publicly-traded partnership) taxable as a corporation.

 

Section 3.09          Annual Statement as to Compliance. (a) The Issuer shall deliver to the Indenture Trustee on or before [March 31st] of each calendar year beginning with [March 31st], [     ], an Officer’s Certificate stating, as to the Authorized Officer signing such Officer’s Certificate, that:

 

(i)           a review of the activities of the Issuer during such year (or since the Closing Date, in case of the first such Officer’s Certificate) and of its performance under this Indenture has been made under such Authorized Officer’s supervision; and

 

(ii)           to the best of such Authorized Officer’s knowledge, based on such review, the Issuer has complied with all conditions and covenants under this Indenture in all material respects throughout such year, or, if there has been a default in the compliance of any such condition or covenant, specifying each such default known to such Authorized Officer and the nature and status thereof.

 

(b)             The Issuer shall:

 

(i)           file with the Indenture Trustee, within 15 days after the Issuer is required (if at all) to file the same with the Commission, copies of the annual

 

 

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reports and such other information, documents and reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) as the Issuer may be required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act or such other reports required pursuant to TIA Section 314(a)(1);

 

(ii)           file with the Indenture Trustee and the Commission in accordance with rules and regulations prescribed from time to time by the Commission such other information, documents and reports with respect to compliance by the Issuer with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; and

 

(iii)           supply to the Indenture Trustee (and the Indenture Trustee shall transmit by mail to all Noteholders as required by TIA Section 313(c)) such summaries of any information, documents and reports required to be filed by the Issuer pursuant to clauses (i) and (ii) of this Section 3.9(b) as may be required pursuant to rules and regulations prescribed from time to time by the Commission.

 

(c)             Delivery of such reports, information and documents to the Indenture Trustee is for informational purposes only and the Indenture Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Issuer’s compliance with any of its covenants hereunder (as to which the Indenture Trustee is entitled to rely exclusively on Officer’s Certificates).

 

(d)             Unless the Issuer otherwise determines, the fiscal year of the Issuer shall be the same as the fiscal year of the Servicer.

 

Section 3.10          Issuing Entity May Not Merge or Consolidate.  The Issuing Entity shall not consolidate or merge with or into any other Person.  The Issuing Entity shall not convey or transfer any of its properties or assets, including the Collateral, to any person.

 

Section 3.11          No Other Business.  The Issuing Entity shall not engage in any business other than financing, purchasing, owning, selling and managing the Loans in the manner contemplated by this Indenture and the Basic Documents and engaging in any activities incidental thereto (including entering into any Interest Rate Cap Agreement).  The Issuing Entity shall not fund the purchase of any receivables other than the Loans.

 

Section 3.12          No Borrowing.  The Issuing Entity shall not issue, incur, assume, guarantee or otherwise become liable, directly or indirectly, for any indebtedness, or incur any other obligations or liabilities, except for the Notes.

 

Section 3.13           Servicer’s Obligations.  The Issuing Entity shall cause the Servicer to comply with its obligations under the Sale and Servicing Agreement.

 

Section 3.14           Guarantees, Loans, Advances and Other Liabilities.  Except as contemplated by the Trust Agreement, the Sale and Servicing Agreement or this Indenture, the

 

 

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Issuing Entity shall not make any loan or advance or credit to, or guarantee (directly or indirectly or by an instrument having the effect of assuring another’s payment or performance on any obligation or capability of so doing or otherwise), endorse or otherwise become contingently liable, directly or indirectly, in connection with the obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or agree contingently to do so) any stock, obligations, assets or securities of, or any other interest in, or make any capital contribution to, any Person.

 

Section 3.15          Capital Expenditures.  The Issuing Entity shall not make any expenditure (by long-term or operating lease or otherwise) for capital assets (whether consisting of realty or personalty).

 

Section 3.16          Removal of Administrator.  So long as any Notes are outstanding, the Issuing Entity shall not remove the Administrator unless the Rating Agency Condition shall have been satisfied in connection with such removal and the Indenture Trustee and the Noteholders shall have received written notice of the foregoing and shall have consented thereto.

 

Section 3.17          Restricted Payments.  The Issuing Entity shall not, directly or indirectly, (i) pay any dividend or make any distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, to the Owner Trustee or any owner of a beneficial interest in the Issuing Entity or otherwise with respect to any ownership or equity interest or security in or of the Issuing Entity or to the Servicer, (ii) redeem, purchase, retire or otherwise acquire for value any such ownership or equity interest or security or (iii) set aside or otherwise segregate any amount for any such purpose; provided, however, that the Issuing Entity may make, or cause to be made, distributions as contemplated by, and to the extent funds are available for such purpose under, the Sale and Servicing Agreement, this Indenture or the Trust Agreement.  The Issuing Entity will not, directly or indirectly, make payments to or distributions from the Trust Accounts except in accordance with this Indenture, the Sale and Servicing Agreement and the other Basic Documents.

 

Section 3.18          Notice of Events of Default.  The Issuing Entity shall give the Indenture Trustee and the Rating Agencies prompt written notice of each Event of Default hereunder and each “Event of Default” or “Termination Event” (as defined in the Interest Rate Cap Agreement) under the Interest Rate Cap Agreement.  In addition, on any Payment Date on which the Issuing Entity has not received from the Cap Counterparty any amount due from the Cap Counterparty on such Payment Date, the Issuing Entity shall give immediate notice thereof to the Cap Counterparty, the Indenture Trustee and each Rating Agency.

 

Section 3.19          Further Instruments and Acts.  Upon request of the Indenture Trustee, the Issuing Entity will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.

 

[End of Article III]

 

 

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ARTICLE IV

 

SATISFACTION AND DISCHARGE

 

Section 4.01          Satisfaction and Discharge of Indenture.  This Indenture shall cease to be of further effect with respect to the Notes except as to (i) rights of registration of transfer and exchange of outstanding Notes, (ii) substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments of principal thereof and interest thereon and all other amounts with respect thereto (iv) Section 3.03, 3.04, 3.05, 3.07, 3.08, 3.10, 3.11, 3.12, 3.13, 3.14, 3.15, 3.17 and 6.07, (v) the rights, obligations and immunities of the Indenture Trustee hereunder (including the rights of the Indenture Trustee under Section 6.07 and the obligations of the Indenture Trustee under Section 4.03) and (vi) the rights of Noteholders as beneficiaries hereof with respect to the property so deposited with the Indenture Trustee payable to all or any of them, and the Indenture Trustee, on demand of and at the expense of the Issuing Entity, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect to the Notes, when all Notes theretofore authenticated and delivered (other than Notes that have been destroyed, lost or stolen and that have been replaced or paid as provided in Section 2.05) have been discharged and Paid In Full.

 

Section 4.02          Application of Trust Money.  All moneys deposited with the Indenture Trustee pursuant to Section 4.01 shall be held in trust and applied by it, in accordance with the provisions of the Notes and this Indenture, to the payment, either directly or through any Paying Agent, as the Indenture Trustee may determine, to the Holders of the particular Notes for the payment or redemption of which such moneys have been deposited with the Indenture Trustee, of all sums due and to become due thereon for principal and interest; but such moneys need not be segregated from other funds except to the extent required herein or in the Sale and Servicing Agreement or required by law.

 

Section 4.03          Repayment of Moneys Held by Paying Agent.  In connection with the satisfaction and discharge of this Indenture with respect to the Notes, all moneys then held by any Paying Agent other than the Indenture Trustee under the provisions of this Indenture with respect to such Notes shall, upon written demand of the Issuing Entity or the Indenture Trustee, be paid to the Indenture Trustee to be held and applied according to Section 3.03; and thereupon, such Paying Agent shall be released from all further liability with respect to such moneys.

 

Section 4.04          Release of Collateral.  Subject to Section 11.01 and the terms of the Basic Documents, the Indenture Trustee shall release property from the lien of this Indenture only when the Notes shall have been Paid In Full.

 

[End of Article IV]

 

 

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ARTICLE V

REMEDIES

 

Section 5.01          Events of Default.  “Event of Default”, wherever used herein, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

 

(a)           default in the payment of any interest on any Note of the Controlling Class when the same becomes due and payable, and such default shall continue for a period of two (2) Business Days; provided, however, that if the Servicer has made a deposit of Interest Collections and Principal Collections to the Collection Account in accordance with Section 5.02 of the Sale and Servicing Agreement and such amounts are sufficient to pay the accrued and unpaid interest hereunder and has timely delivered instructions to the Indenture Trustee for the application of such funds as provided in Section 5.06(a) of the Sale and Servicing Agreement and such failure to pay interest is owing to circumstances caused by the Indenture Trustee, such payment default shall be an Event of Default if it continues for a period of five (5) days (in lieu of the two (2) Business Day period referred to above in this paragraph);

 

(b)           default in the payment of the principal of any Note when the same becomes due and payable at the related Final Scheduled Payment Date or the Redemption Date;

 

(c)           any failure by the Issuing Entity to duly observe or perform its covenants under Sections 3.04, 3.08(a), 3.08(d), 3.10, 3.11, 3.12, 3.13, 3.14, 3.15, 3.16, 3.17, and 3.18;

 

(d)           any failure by the Issuing Entity to duly observe or perform any of its other covenants or agreements or any of its representations and warranties in this Indenture (other than the ones specified above in clauses (a) through (c)), which failure continues unremedied a period of thirty (30) days; or

 

(e)           the occurrence of an Insolvency Event with respect to the Issuing Entity.

 

The Issuing Entity shall promptly (but in any event not later than five (5) Business Days) deliver to the Indenture Trustee written notice in the form of an Officer’s Certificate of any event that with the giving of notice and the lapse of time would become an Event of Default under clauses (c) and (d) above, its status and what action the Issuing Entity is taking or proposes to take with respect thereto.

 

Section 5.02          Acceleration of Maturity; Rescission and Annulment.

 

(a)           If an Event of Default under this Indenture shall have occurred and be continuing (other than an Event of Default specified in clause (e) of Section 5.01), the Indenture Trustee in its discretion may, or if so requested in writing by the Noteholders

 

 

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representing a majority of the outstanding Note Balance of the Controlling Class, shall, declare by written notice to the Issuing Entity all of the Notes to be immediately due and payable, and upon any such declaration (but subject to clause (b) below) the entire outstanding Note Balance, together with accrued interest thereon through the date of acceleration, shall become immediately due and payable as provided in the Notes.  If an Event of Default specified in clause (e) of Section 5.01 shall have occurred and be continuing, the Notes shall automatically become immediately due and payable without any further action on the part of any Person.

 

(b)           At any time after declaration of acceleration of maturity has been made pursuant to clause (a) above and before a judgment or decree for payment of the money due has been obtained by the Indenture Trustee as provided hereinafter in this Article V, the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class may, by written notice to the Issuing Entity and the Indenture Trustee, rescind such declaration and annul such consequences if:

 

(i)           the Issuing Entity has paid or deposited with the Indenture Trustee a sum sufficient to pay:

 

(A)           all payments of principal of and interest on all Notes and all other amounts that would then be due hereunder or upon such Notes if the Event of Default giving rise to such acceleration had not occurred; and

 

(B)           all sums paid by the Indenture Trustee hereunder and the reasonable compensation, expenses and disbursements of the Indenture Trustee and its agents and counsel and the reasonable compensation, expenses and disbursements of the Owner Trustee and its agents and counsel.

 

(ii)           all Events of Default, other than the nonpayment of the principal of the Notes that has become due solely by such acceleration, have been cured or waived as provided in Section 5.12.

 

No such rescission shall affect any subsequent default or impair any right consequent thereto.

 

Section 5.03          Collection of Indebtedness and Suits for Enforcement by Indenture Trustee; Authority of the Controlling Class.

 

(a)           The Issuing Entity covenants that if (i) a default is made in the payment of any interest on any Note when the same becomes due and payable, and such default continues for a period of five (5) days, or (ii) default is made in the payment of the principal of or any installment of the principal of any Note when the same becomes due and payable, the Issuing Entity will, upon demand of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class, pay to the Indenture Trustee, for the benefit of the Noteholders, the entire amount then due and payable on such Notes in respect of principal and interest, with interest on the overdue principal and, to the extent payment at such rate of interest shall be legally enforceable, on overdue

 

 

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installments of interest at the rate then applicable to the Notes and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses and disbursements of the Indenture Trustee and its agents and counsel.

 

(b)           In case the Issuing Entity shall fail forthwith to pay such amounts upon such demand or if any such amounts became due and payable automatically pursuant to the terms of Section 5.02(a), the Indenture Trustee, in its own name and as trustee of an express trust, may (and at the written direction of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class shall) institute a Proceeding for the collection of the sums so due and unpaid, and may prosecute such Proceeding to judgment or final decree, and may enforce the same against the Issuing Entity or other obligor on such Notes and collect in the manner provided by law out of the Collateral or the property of any other obligor on such Notes, wherever situated, the moneys adjudged or decreed to be payable.

 

(c)           If an Event of Default occurs, the Indenture Trustee may, as more particularly provided in Section 5.04, in its discretion, or shall, at the written direction of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class, proceed to protect and enforce its rights and the rights of the Noteholders, by such appropriate Proceedings as the Indenture Trustee or the Indenture Trustee at the written direction of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class shall reasonably deem most effective to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy or legal or equitable right vested in the Indenture Trustee by this Indenture or by law.

 

(d)           In case there shall be pending, relative to the Issuing Entity or any other obligor on the Notes or any Person having or claiming an ownership interest in the Collateral, Proceedings under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or other similar law, or in case a receiver, assignee or trustee in bankruptcy or reorganization, or liquidator, sequestrator or similar official shall have been appointed for or taken possession of the Issuing Entity or its property or Huntington or its property or such other obligor or Person, or in case of any other comparable Proceedings relative to the Issuing Entity or other obligor on the Notes or Huntington, or to the creditors or property of the Issuing Entity or such other obligor or Huntington, the Indenture Trustee, irrespective of whether the principal of any Notes shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Indenture Trustee shall have made any demand pursuant to the provisions of this Section 5.03, shall be entitled and empowered (and at the written direction of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class shall), by intervention in such Proceedings or otherwise:

 

(i)           to file and prove a claim or claims for the entire amount of principal and interest owing and unpaid in respect of the Notes and to file such other papers or documents as may be necessary or advisable in order to have the

 

 

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claims of the Indenture Trustee (including any claim for reasonable compensation to the Indenture Trustee and each predecessor Indenture Trustee, and their respective agents, attorneys and counsel, and for reimbursement of reasonable out-of-pocket expenses and liabilities incurred, by the Indenture Trustee and each predecessor Indenture Trustee, except as a result of negligence or bad faith) and of the Noteholders allowed in such Proceedings;

 

(ii)           unless prohibited by applicable law or regulation, to vote on behalf of the Noteholders in any election of a trustee, a standby trustee or a Person performing similar functions in any such Proceedings;

 

(iii)           to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute all amounts received with respect to the claims of the Noteholders and of the Indenture Trustee on their behalf; and

 

(iv)           to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee or the Noteholders allowed in any Proceedings relative to the Issuing Entity, its creditors or its property;

 

and any trustee, receiver, liquidator, custodian or other similar official in any such Proceeding is hereby authorized by each of such Noteholders to make payments to the  Indenture Trustee for application in accordance with Section 5.03 of the Sale and Servicing Agreement and, in the event that the Indenture Trustee shall consent to the making of payments directly to such Noteholders, to pay to the Indenture Trustee such amounts as shall be sufficient to cover reasonable compensation to the Indenture Trustee, each predecessor Indenture Trustee and their respective agents, attorneys and counsel, and all other expenses and liabilities incurred by the Indenture Trustee and each predecessor Indenture Trustee except as a result of negligence or bad faith.

 

(e)           Nothing herein contained shall be deemed to authorize the Indenture Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Noteholder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder or to authorize the Indenture Trustee to vote in respect of the claim of any Noteholder in any such proceeding except, as aforesaid, to vote for the election of a trustee in bankruptcy or similar Person.

 

(f)           All rights of action and of asserting claims under this Indenture, or under any of the Notes, may be enforced by the Indenture Trustee without the possession of any of the Notes or the production thereof in any Proceedings relative thereto, and any such Proceedings instituted by the Indenture Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment, subject to the payment of the expenses, disbursements and compensation of the Indenture Trustee, each predecessor Indenture Trustee and their respective agents and attorneys, shall be for the ratable benefit of the Holders of the Notes.

 

 

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(g)           In any Proceedings brought by the Indenture Trustee (and also any Proceedings involving the interpretation of any provision of this Indenture to which the Indenture Trustee shall be a party), the Indenture Trustee shall be held to represent all of the Holders of the Notes, and it shall not be necessary to make any Noteholder a party to any such Proceedings.

 

Section 5.04          Remedies; Priorities.

 

(a)           If an Event of Default shall have occurred and be continuing, the Indenture Trustee may, and at the written direction of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class shall, do one or more of the following (subject to Section 5.05):

 

(i)           institute Proceedings in its own name and as trustee of an express trust for the collection of all amounts then payable on the Notes or under this Indenture with respect thereto, whether by declaration or otherwise, enforce any judgment obtained and collect from the Issuing Entity and any other obligor on such Notes moneys adjudged due;

 

(ii)           institute Proceedings from time to time for the complete or partial foreclosure of this Indenture with respect to the Collateral;

 

(iii)           exercise any remedies of a secured party under the UCC and take any other appropriate action to protect and enforce the rights and remedies of the Indenture Trustee and the Holders of the Notes; and

 

(iv)           sell the Collateral or any portion thereof or rights or interest therein, at one or more public or private sales called and conducted in any manner permitted by law; provided, however, notwithstanding anything else herein to the contrary, that the Indenture Trustee may not sell or otherwise liquidate the Collateral following an Event of Default, other than an Event of Default described in Section 5.01(a) or (b), unless, (I) the Noteholders representing 100% of the outstanding Note Balance of the Notes voting as a single class consents thereto, or (II) the proceeds of such sale or liquidation distributable to the Noteholders are sufficient to discharge in full all amounts then due and unpaid on such Notes in respect of principal and interest, or (III) the default is a payment default and the Indenture Trustee determines that the Collateral will not continue to provide sufficient funds for the payment of principal of and interest on the Notes as they would have become due if the Notes had not been declared due and payable, and the Indenture Trustee obtains the consent of the Noteholders representing 66 2/3%of the outstanding Note Balance of the Notes voting as a single class; provided, further, that the Depositor or its Affiliates may not participate in such sales as long as any of them is a Noteholder.

 

In determining such sufficiency or insufficiency with respect to clause (II) and (III) above, the Indenture Trustee may, at the Issuing Entity’s expense and paid in the priority set forth in Sections 5.06(a) and (b) of the Sale and Servicing

 

 

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Agreement, but need not, obtain and conclusively rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the sufficiency of the Collateral for such purpose.

 

(b)           If the Indenture Trustee collects any money or property pursuant to this Article V and the Notes have been accelerated, it shall pay out such money or property (and other amounts, including all amounts held on deposit in the Reserve Account) held as Collateral for the benefit of the Noteholders (net of liquidation costs associated with the sale of the Collateral) in the following order of priority:

 

(i)           first, to the Indenture Trustee and the Owner Trustee, any accrued and unpaid fees, indemnity payments and reasonable expenses permitted under the Basic Documents (other than the Notes and the Assignment);

 

(ii)           second, to the Servicer, the Servicing Fee and all unpaid Servicing Fees with respect to prior Collection Periods;

 

(iii)           third, to the Holders of the Class A Notes, pro rata, the Accrued Class A Note Interest;

 

(iv)           fourth, if (x) the Loans have been sold after an Event of Default has occurred or (y) an Event of Default described in Section 5.01(a), (b) or (e) has occurred, in the following order of priority:

 

(A)           to the Holders of the Class A-1 Notes in respect of principal thereon until the Class A-1 Notes have been Paid in Full;

 

(B)           to the Holders of the Class A-2-A Notes, Class A-2-B Notes, Class A-3-A Notes, Class A-3-B Notes, Class A-4 Notes, in respect of principal thereon, on a pro rata basis, until all the Class A Notes have been Paid in Full;

 

(C)           to the Holders of the Class B Notes, the Accrued Class B Note Interest; and

 

(D)           to the Holders of the Class B Notes in respect of principal thereon until the Class B Notes have been Paid in Full.]

 

(v)           fifth, if an Event of Default other than that described in clause (iv) above has occurred and the Loans have not been sold after such Event of Default has occurred, in the following order of priority:

 

(A)           to the Holders of the Class B Notes, the Accrued Class B Note Interest;

 

(B)           to the Holders of the Class A-1 Notes in respect of principal thereon until the Class A-1 Notes have been Paid in Full;

 

 

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(C)           to the Holders of the Class A-2-A Notes, Class A-2-B Notes, Class A-3-A Notes, Class A-3-B Notes, Class A-4 Notes, in respect of principal thereon, on a pro rata basis, until all the Class A Notes have been Paid in Full;

 

(D)           [to the Holders of the Class B Notes in respect of principal thereon until the Class B Note have been Paid in Full; and]

 

(vi)           sixth, any remaining funds shall be distributed to the Certificateholder (as defined in the Trust Agreement).

 

(c)           The Indenture Trustee may fix a record date and payment date for any payment to Noteholders pursuant to this Section 5.04.  At least fifteen (15) days before such record date, the Issuing Entity shall mail to each Noteholder and the Indenture Trustee a notice that states the record date, the payment date and the amount to be paid.

 

Section 5.05          Optional Preservation of the Collateral.  If the Notes have been declared to be due and payable under Section 5.02 following an Event of Default, and such declaration and its consequences have not been rescinded and annulled, the Indenture Trustee may, and if instructed in writing by the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class shall, elect to maintain possession of the Collateral.  It is the desire of the parties hereto and the Noteholders that there be at all times sufficient funds for the payment of principal of and interest on the Notes, and the Indenture Trustee shall take such desire into account when determining whether or not to maintain possession of the Collateral.  In determining whether or not to maintain possession of the Collateral, the Indenture Trustee may, and if instructed in writing by the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class shall, obtain (and may conclusively rely upon) an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Collateral for such purpose.  Such opinion shall be at the expense of the Issuing Entity and paid in the priority set forth in Section 5.06(b)(i) of the Sale and Servicing Agreement.

 

Section 5.06           Limitation of Suits.

 

(a)           No Noteholder shall have any right to institute any Proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless:

 

(i)           such Holder has previously given written notice to the Indenture Trustee of a continuing Event of Default;

 

(ii)           the Holders of not less than 25% of the outstanding Note Balance of the Notes have made written request to the Indenture Trustee to institute such Proceeding in respect of such Event of Default in its own name as Indenture Trustee hereunder, provided that for purposes of computing the foregoing percentage, any Notes held by Huntington or any of its Affiliates shall be disregarded;

 

 

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(iii)           such Holder or Holders have offered to the Indenture Trustee reasonable indemnity satisfactory to it against the costs, expenses and liabilities that may be incurred in complying with such request;

 

(iv)           the Indenture Trustee for thirty (30) days after its receipt of such notice, request and offer of indemnity has failed to institute such Proceedings; and

 

(v)           no direction inconsistent with such written request has been given to the Indenture Trustee during such thirty (30) day period by Controlling Party.

 

(b)           It is understood and intended that no one or more Noteholders shall have any right in any manner whatsoever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Noteholders or to obtain or to seek to obtain priority or preference over any other Holders or to enforce any right under this Indenture, except as set forth herein.

 

(c)           In the event the Indenture Trustee shall receive conflicting or inconsistent requests and indemnity from two or more groups of Noteholders pursuant to this Section 5.06, each representing less than a majority of the outstanding Note Balance of the Notes, the Indenture Trustee shall only act at the written direction of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class.

 

Section 5.07           Unconditional Rights of Noteholders to Receive Principal and Interest.  Notwithstanding any other provisions in this Indenture, each Noteholder shall have the right, which is absolute and unconditional, to receive payment of the principal of and interest, if any, on such Note on or after the respective due dates thereof expressed in such Note or in this Indenture (or, in the case of redemption, on or after the Redemption Date) and to institute suit for the enforcement of any such payment, and such right shall not be impaired without the consent of such Holder.

 

Section 5.08            Restoration of Rights and Remedies.  If the Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any right or remedy under this Indenture and such Proceeding has been discontinued or abandoned for any reason or has been determined adversely to the Indenture Trustee or to such Noteholder, then and in every such case the Issuing Entity, the Indenture Trustee and the Noteholders shall, subject to any determination in such Proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all rights and remedies of the Indenture Trustee and the Noteholders shall continue as though no such Proceeding had been instituted.

 

 

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Section 5.09          Rights and Remedies Cumulative.  No right or remedy herein conferred upon or reserved to the Indenture Trustee or to the Noteholders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

Section 5.10          Delay or Omission Not a Waiver.  No delay or omission of the Indenture Trustee, or any Noteholder to exercise any right or remedy accruing upon any Default or Event of Default shall impair any such right or remedy or constitute a waiver of any such Default or Event of Default or an acquiescence therein.  Every right and remedy given by this Article V or by law to the Indenture Trustee or to the Noteholders may be exercised from time to time, and as often as may be deemed expedient, by the Indenture Trustee or the Noteholders, as the case may be.

 

Section 5.11          Control by Controlling Class.  The Holders of a majority of the outstanding Note Balance of the Controlling Class shall have the right to direct the time, method and place of conducting any Proceeding for any remedy available to the Indenture Trustee with respect to the Notes or this Agreement or exercising any trust or power conferred on the Indenture Trustee hereunder or under the Notes or any other Basic Document; provided, however, that (i) such direction shall not be in conflict with any rule of law or with this Indenture, and (ii) the Indenture Trustee may take any other action reasonably deemed proper by the Indenture Trustee that is not inconsistent with such direction.  Notwithstanding the rights of Noteholders set forth in this Section 5.11, subject to Section 6.01, the Indenture Trustee need not take any action that it reasonably determines might involve it in liability (unless it is offered a reasonable indemnity) or might materially adversely affect the rights of any Noteholders not consenting to such action.

 

Section 5.12          Waiver of Past Defaults.  Prior to the declaration of the acceleration of the maturity of the Notes as provided in Section 5.02, the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class may waive any past Default or Event of Default and its consequences except a Default (a) in payment of principal of or interest on any of the Notes, (b) in respect of a covenant or provision hereof that cannot be modified or amended without the consent of the Holder of each Note or (c) arising from an Insolvency Event with respect to the Issuing Entity.  In the case of any such waiver, the Issuing Entity, the Indenture Trustee and the Holders of the Notes shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereto.

 

Upon any such waiver, such Default shall cease to exist and be deemed to have been cured and not to have occurred, and any Event of Default arising therefrom shall be deemed to have been cured and not to have occurred, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereto.

 

 

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Section 5.13          Undertaking for Costs.  All parties to this Indenture agree, and each Noteholder by such Holder’s acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Indenture Trustee for any action taken, suffered or omitted by it as Indenture Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section 5.13 shall not apply to (a) any suit instituted by the Indenture Trustee, (b) any suit instituted by any Noteholder, or group of Noteholders, in each case holding in the aggregate more than 50% of the outstanding Note Balance, or (c) any suit instituted by any Noteholder for the enforcement of the payment of principal of or interest on any Note on or after the respective due dates expressed in such Note and in this Indenture (or, in the case of redemption, on or after the Redemption Date).

 

Section 5.14          Waiver of Stay or Extension Laws.  The Issuing Entity covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Issuing Entity (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Indenture Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

 

Section 5.15          Action on Notes.  The Indenture Trustee’s right to seek and recover judgment on the Notes or under this Indenture shall not be affected by the seeking, obtaining or application of any other relief under or with respect to this Indenture.  Neither the lien of this Indenture nor any rights or remedies of the Indenture Trustee or the Noteholders shall be impaired by the recovery of any judgment by the Indenture Trustee against the Issuing Entity or by the levy of any execution under such judgment upon any portion of the Collateral or upon any of the assets of the Issuing Entity.  Any money or property collected by the Indenture Trustee shall be applied in accordance with Section 5.04(b).

 

Section 5.16          Performance and Enforcement of Certain Obligations. Promptly following a request from the Indenture Trustee (which request the Indenture Trustee shall make if instructed in writing to do so by the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class) to do so and at the Administrator’s expense, the Issuing Entity shall take all such lawful action as the Indenture Trustee may request to compel or secure the performance and observance by Huntington and the Cap Counterparty, as applicable, of each of their obligations to the Issuing Entity under or in connection with the Basic Documents and to exercise any and all rights, remedies, powers and privileges lawfully available to the Issuing Entity under or in connection with the Basic Documents to the extent and in the manner directed by the Indenture Trustee, including the transmission of notices of default on the part of Huntington or the Cap Counterparty, as applicable, thereunder and the institution of legal or administrative actions or proceedings to compel or secure performance by Huntington or the Cap Counterparty, as applicable, of each of their obligations under the Basic Documents; provided, however, nothing herein shall in any way impose on the Indenture Trustee the duty to monitor

 

 

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the performance of Huntington or the Cap Counterparty, as applicable, of any of their liabilities, duties or obligations under any Basic Documents.

 

[End of Article V]

 

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ARTICLE VI

 

THE INDENTURE TRUSTEE

 

Section 6.01          Duties of Indenture Trustee.  If an Event of Default has occurred and is continuing of which a Responsible Officer of the Indenture Trustee has actual knowledge, the Indenture Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.

 

(a)           Except during the continuance of an Event of Default:

 

(i)           the Indenture Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Indenture Trustee; and

 

(ii)           in the absence of bad faith or negligence on its part, the Indenture Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon the face value of the certificates, reports, resolutions, documents, orders, opinions or other instruments furnished to the Indenture Trustee and conforming to the requirements of this Indenture; provided, however, that the Indenture Trustee shall not be responsible for the accuracy or content of any such resolution, certificate, statement, opinion, report, document, order or other instrument; however, the Indenture Trustee shall examine any officers’ certificate of opinion of counsel issued pursuant to the provisions of this Indenture to determine whether or not they conform to the requirements of this Indenture.  If any such instrument is found not to conform in any material respect to the requirements of this Agreement, the Indenture Trustee shall notify the Noteholders of such instrument in the event that the Indenture Trustee, after so requesting, does not receive a satisfactorily corrected instrument.

 

(b)           The Indenture Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act, its own bad faith or its own willful misconduct, except that:

 

(i)           this paragraph does not limit the effect of paragraph (a) of this Section 6.01;

 

(ii)           the Indenture Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer unless it is proved that the Indenture Trustee was negligent in ascertaining the pertinent facts; and

 

(iii)           the Indenture Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it in accordance with the terms of this Indenture or any other Basic Document.

 

(c)           The Indenture Trustee shall not be liable for indebtedness evidenced by or arising under any of the Basic Documents, including principal of or interest on the Notes,

 

 

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or interest on any money received by it except as the Indenture Trustee may agree in writing with the Issuing Entity.

 

(d)           Money held in trust by the Indenture Trustee need not be segregated from other funds except to the extent required by law or the terms of this Indenture or the Sale and Servicing Agreement.

 

(e)           No provision of this Indenture shall require the Indenture Trustee to advance, expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

 

(f)           Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Indenture Trustee shall be subject to the provisions of this Section 6.01.

 

(g)           Except as provided in Section 8.03 of the Sale and Servicing Agreement, the Indenture Trustee shall not be required to perform, or be responsible for the manner of performance of, any of the obligations of the Servicer or any other party under the Sale and Servicing Agreement.

 

(h)           The Indenture Trustee shall have no duty (A) to see to any recording, filing, or depositing of this Indenture or any agreement referred to herein or any UCC financing statement or continuation statement evidencing a security interest, or to see to the maintenance of any such recording or filing or depositing or to any rerecording, refiling or redepositing of any thereof, (B) to see to any insurance, or (C) to see to the payment or discharge of any tax, assessment, or other governmental charge or any lien or encumbrance of any kind owing with respect to, assessed or levied against, any part of the Trust Account Property.  The Indenture Trustee shall take all actions as directed in writing by the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class.

 

For purposes of this Section 6.01, the Indenture Trustee, or a Responsible Officer thereof, shall be charged with actual knowledge of any default or an Event of Default if a Responsible Officer actually knows of such default or Event of Default or the Indenture Trustee receives written notice of such default or Event of Default from the Issuing Entity, the Servicer or any Noteholder.  Subject to the foregoing, the Indenture Trustee shall not be required to take notice and in the absence of such actual notice and knowledge, the Indenture Trustee may conclusively assume that there is no such default or Event of Default.

 

Section 6.02          Rights of Indenture Trustee.   The Indenture Trustee may conclusively rely on the face value of any document reasonably believed by it to be genuine and to have been signed or presented by the proper person.  The Indenture Trustee need not investigate any fact or matter stated in the document.

 

(a)           Before the Indenture Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel from the appropriate party.  The Indenture

 

 

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Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on an Officer’s Certificate or Opinion of Counsel from the appropriate party.

 

(b)           The Indenture Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys or a custodian or nominee and the Indenture Trustee shall not be responsible for any willful misconduct or gross negligence on the part of any such agent, attorney or custodian reasonably selected  by the Indenture Trustee with due care provided that any such appointment shall not release the Trustee from its obligations and responsibilities hereunder.

 

(c)           The Indenture Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within its rights or powers; provided that the Indenture Trustee’s conduct does not constitute willful misconduct, negligence or bad faith.

 

(d)           The Indenture Trustee may consult with counsel reasonably selected by it at the Issuing Entity’s expense and paid in the priority set forth in Section 5.06(a) of the Sale and Servicing Agreement, and the advice or opinion of counsel with respect to legal matters relating to this Indenture and the Notes shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.

 

(e)           in no event shall the Indenture Trustee be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Indenture Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action;

 

In the event that the Indenture Trustee is also acting as Paying Agent, Registrar, Securities Intermediary or collateral agent, the rights, privileges, immunities, benefits and protections afforded to the Indenture Trustee, including, without limitation, its right to be indemnified pursuant to this Article VI shall be afforded to such Paying Agent, Registrar, Securities Intermediary, agent, collateral agent, custodian or other Person employed to act hereunder; provided, however, that:

 

(i)           the Indenture Trustee shall be under no obligation to institute, conduct or defend any litigation hereunder or in relation hereto at the request, order or direction of any of the Noteholders, pursuant to the provisions of this Indenture, unless such Noteholders shall have offered to the Indenture Trustee reasonable security or indemnity satisfactory to it in its reasonable discretion against the costs, expenses and liabilities which may be incurred therein or thereby;

 

(ii)           the right of the Indenture Trustee to perform any discretionary act enumerated in this Indenture shall not be construed as a duty, and the Indenture Trustee shall not be answerable for other than its negligence or willful misconduct in the performance of such act;

 

 

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(iii)           the Indenture Trustee shall not be required to give any bond or surety in respect of the powers granted hereunder; or

 

(iv)           the Indenture Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, instrument, opinion, report, notice, request, direction, consent, order, or other paper or document reasonably and in good faith believed by the Trustee to be accurate, but the Indenture Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Indenture Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books and records of the Issuing Entity, personally, or by agent or attorney at the sole cost of the Issuing Entity and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.

 

Section 6.03          Individual Rights of Indenture Trustee.  Subject to Section 310 of the TIA, its obligations hereunder and under any other Basic Document, the Indenture Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Issuing Entity or its Affiliates with the same rights it would have if it were not Indenture Trustee.  Subject to its obligations hereunder and under any other Basic Document, the Paying Agent, Registrar, co-registrar or co-paying agent may do the same with like rights.

 

Section 6.04          Indenture Trustee’s Disclaimer.  The Indenture Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture, the Collateral or the Notes, it shall not be accountable for the Issuing Entity’s use of the proceeds from the Notes, and it shall not be responsible for any statement of the Issuing Entity in the Indenture, any other Basic Document or in any document issued in connection with the sale of the Notes or in the Notes other than the Indenture Trustee’s certificate of authentication.

 

Section 6.05          Notice of Defaults.  If a Default occurs and is continuing and if it is actually known to a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall (i) fax to each Noteholder notice of the Default within five (5) Business Days after it occurs and (ii) promptly following such fax, deliver by courier or first class mail to each Noteholder a copy of such notice.

 

Section 6.06          Reports by Indenture Trustee to Holders.  The Indenture Trustee shall deliver to each Noteholder such information as may be required to enable such holder to prepare its federal and state income tax returns as and to the extent provided in Section 7.04(b) or such other information reasonably requested by any Noteholder.

 

Section 6.07          Compensation and Indemnity.

 

(a)           The Issuing Entity shall cause the Servicer to pay to the Indenture Trustee from time to time such compensation for its services as shall be agreed in writing.  The Indenture Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust.  The Issuing Entity shall cause the Servicer to reimburse the Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by it,

 

 

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including costs of collection, in addition to the compensation for its services.  Such expenses shall include the reasonable out-of-pocket compensation and expenses, disbursements and advances of the Indenture Trustee’s agents, counsel, accountants and experts.  The Issuing Entity shall cause the Servicer to indemnify the Indenture Trustee (including its officers, directors, employees and agents) against any and all loss, liability, damage, claim or expense (including any reasonable attorneys’ fees) incurred by it in connection with the administration of this trust and the performance of its duties as indenture trustee under the Basic Documents.  The Indenture Trustee shall notify the Issuing Entity and the Servicer promptly of any claim for which it may seek indemnity.  To the extent these fees and indemnification amounts are not paid by the Servicer, they will be paid out of Available Funds as described in the Sale and Servicing Agreement.  Failure by the Indenture Trustee to so notify the Issuing Entity and the Servicer shall not relieve the Issuing Entity or the Servicer of its obligations hereunder if no prejudice to the Issuing Entity or the Servicer shall have resulted from such failure.  The Issuing Entity shall, or shall cause the Servicer to, defend any such claim, and the Indenture Trustee may have separate counsel and the Issuing Entity shall, or shall cause the Servicer to, pay the fees and expenses of such counsel.  Neither the Issuing Entity nor the Servicer need reimburse any expense or indemnify against any loss, liability or expense incurred by the Indenture Trustee through or arising from (i) the Indenture Trustee’s own willful misconduct, negligence or bad faith (including such conduct of its officers, directors, employees or agents), (ii) the breach of any of the Indenture Trustee’s representations or warranties hereunder, (iii) the negligence or willful misconduct of the Indenture Trustee in connection with its performance of the duties of successor Servicer under the Sale and Servicing Agreement, or (iv) any taxes fees or other charges on, based on or measure by, any fees, commissions or compensation received by the Indenture Trustee.

 

(b)           When the Indenture Trustee incurs expenses after the occurrence of an Event of Default specified in Section 5.01(e) with respect to the Issuing Entity, such expenses are intended to constitute expenses of administration under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or similar law.

 

(c)           The provisions of this Section 6.07 shall survive the termination of this Indenture or the resignation or removal of the Indenture Trustee.

 

Section 6.08          Replacement of Indenture Trustee.

 

(a)           The Indenture Trustee may resign at any time by so notifying the Issuing Entity and each Rating Agency.  The Holders of a majority of the outstanding Note Balance may remove the Indenture Trustee without cause by so notifying the Indenture Trustee and may appoint a successor Indenture Trustee.  The Issuing Entity shall remove the Indenture Trustee if:

 

(i)           the Indenture Trustee fails to comply with Section 6.11;

 

(ii)           the Indenture Trustee is adjudged a bankrupt or insolvent;

 

 

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(iii)           a receiver or other public officer takes charge of the Indenture Trustee or its property;

 

(iv)           the Indenture Trustee otherwise becomes incapable of acting; or

 

(v)           the Indenture Trustee breaches any representation, warranty or covenant made by it under any Basic Document.

 

If the Indenture Trustee resigns or is removed or if a vacancy exists in the office of Indenture Trustee for any reason (the Indenture Trustee in such event being referred to herein as the retiring Indenture Trustee), the Issuing Entity shall promptly appoint a successor Indenture Trustee, subject to Section 6.11.  No resignation or removal of the Indenture Trustee and no appointment of a successor Indenture Trustee shall become effective until the acceptance of appointment by the successor Indenture Trustee pursuant to this Section 6.08.

 

(b)           A successor Indenture Trustee shall deliver a written acceptance of its appointment to the retiring Indenture Trustee and to the Issuing Entity.  Thereupon the resignation or removal of the retiring Indenture Trustee shall become effective, and the successor Indenture Trustee shall have all of the rights, powers and duties of the Indenture Trustee under this Indenture.  The retiring Indenture Trustee shall be paid all amounts owed to it upon its resignation or removal.  The successor Indenture Trustee shall mail a notice of its succession to Noteholders and the Cap Counterparty.  The retiring Indenture Trustee shall promptly transfer all property held by it as Indenture Trustee to the successor Indenture Trustee.  The retiring Indenture Trustee shall not be liable for the acts or omissions of any successor Indenture Trustee.

 

(c)           Subject to the last sentence of clause (a) of this Section 6.08, if a successor Indenture Trustee does not take office within thirty (30) days after the retiring Indenture Trustee resigns or is removed, the retiring Indenture Trustee, the Issuing Entity or the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class may petition any court of competent jurisdiction for the appointment of a successor Indenture Trustee.

 

(d)           If the Indenture Trustee fails to comply with Section 6.11, any Noteholder may petition any court of competent jurisdiction for the removal of the Indenture Trustee and the appointment of a successor Indenture Trustee.

 

(e)           Notwithstanding the replacement of the Indenture Trustee pursuant to this Section 6.08, the Issuing Entity’s and the Administrator’s obligations under Section 6.07 shall continue for the benefit of the retiring Indenture Trustee.

 

Section 6.09          Successor Indenture Trustee by Merger.  If the Indenture Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Indenture Trustee; provided that such corporation or banking association shall be qualified and eligible under Section 6.11.  The Indenture Trustee shall provide the Rating Agencies and the Noteholders notice of any such transaction.

 

 

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In case at the time such successor or successors by merger, conversion or consolidation to the Indenture Trustee shall succeed to the trusts created by this Indenture any of the Notes shall have been authenticated but not delivered, any such successor to the Indenture Trustee may adopt the certificate of authentication of any predecessor trustee and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to the Indenture Trustee shall authenticate such Notes in the name of the successor to the Indenture Trustee; and in all such cases such certificates shall have the full force that it is anywhere in the Notes or in this Indenture provided that the certificate of the Indenture Trustee shall have.

 

Section 6.10          Appointment of Co-Indenture Trustee or Separate Indenture Trustee.

 

(a)           Notwithstanding any other provisions of this Indenture, at any time, for the purpose of meeting any legal requirement of any jurisdiction in which any part of the Collateral may at the time be located, the Indenture Trustee shall have the power and may execute and deliver all instruments to appoint one or more Persons reasonably selected in good faith to act as a co-trustee or co-trustees, or separate trustee or separate trustees, of all or any part of the trust, and to vest in such Person or Persons, in such capacity and for the benefit of the Noteholders, such title to the Collateral, or any part thereof, and, subject to the other provisions of this Section 6.10, such powers, duties, obligations, rights and trusts as the Indenture Trustee may consider necessary or desirable provided that any such appointment shall not release the Trustee from its obligations and responsibilities hereunder.  Such co-trustee or separate trustee hereunder shall meet the terms of eligibility as a successor trustee under Section 6.11 and notice to Noteholders of the appointment of any co-trustee or separate trustee shall be required under Section 6.08 hereof.

 

(b)           Every separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions:

 

(i)           all rights, powers, duties and obligations conferred or imposed upon the Indenture Trustee shall be conferred or imposed upon and exercised or performed by the Indenture Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co-trustee is not authorized to act separately without the Indenture Trustee joining in such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed the Indenture Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding of title to the Collateral or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee, but solely at the direction of the Indenture Trustee;

 

(ii)           no trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder; and

 

 

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(iii)           the Indenture Trustee may at any time accept the resignation of or remove any separate trustee or co-trustee.

 

(c)           Any notice, request or other writing given to the Indenture Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them.  Every instrument appointing any separate trustee or co-trustee shall refer to this Indenture and the conditions of this Article VI.  Each separate trustee and co-trustee, upon its acceptance of the trusts conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Indenture Trustee or separately, as may be provided therein, subject to all of the provisions of this Indenture, specifically including every provision of this Indenture relating to the conduct of, affecting the liability of, or affording protection to, the Indenture Trustee.  Every such instrument shall be filed with the Indenture Trustee.

 

(d)           Any separate trustee or co-trustee may at any time constitute the Indenture Trustee, its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Agreement on its behalf and in its name.  If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Indenture Trustee, to the extent permitted by law, without the appointment of a new or successor trustee.

 

Section 6.11          Corporate Indenture Trustee Requirements; Eligibility.  The Indenture Trustee shall at all times satisfy the requirements of TIA Section 310(a).  The Issuing Entity agrees, for the benefit of the Noteholders, that there shall at all times be an indenture trustee hereunder which shall be a bank (within the meaning of Section 2(a)(5) of the 1940 Act) organized and doing business under the laws of the United States or any State thereof, authorized under such laws to exercise corporate trust powers, having aggregate capital, surplus and undivided profits of at least $250,000,000, and subject to supervision or examination by federal or State authority, the long term debt of which is rated not lower than “A” by each Rating Agency.  If such bank published reports of conditions at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section 6.11, the combined capital, surplus and undivided profits of such bank shall be deemed to be its combined capital, surplus and undivided profits as set forth in its most recent report of condition so published.  The Indenture Trustee shall in no event be an Affiliate of the Issuing Entity or the Servicer or an Affiliate of any Person involved in the organization or operation of the Issuing Entity or be directly or indirectly controlled by the Issuing Entity.  The Indenture Trustee shall also satisfy the requirements of TIA Section 310(b).  If at any time the Indenture Trustee shall cease to be eligible in accordance with the provisions of this Section 6.11, it shall resign immediately in the manner and with the effect specified in Section 6.08 of this Indenture.

 

In the case of the appointment hereunder of a successor Indenture Trustee with respect to the Notes pursuant to this Section 6.11, (y) the Issuing Entity, the retiring Indenture Trustee and the successor Indenture Trustee shall execute and deliver an indenture supplemental hereto wherein each successor Indenture Trustee shall accept such appointment and which (i) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, the successor Indenture Trustee all of the rights, powers, trusts and duties of the retiring

 

 

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Indenture Trustee with respect to which the appointment of such successor Indenture Trustee relates, (ii) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Indenture Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Indenture Trustees co-trustees of the same trust and that each such Indenture Trustee shall be a trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Indenture Trustee; and upon the removal of the retiring Indenture Trustee shall become effective to the extent provided herein, and (iii) shall provide that the successor Indenture Trustee agrees to enter into a new control agreement and such other agreements as are pertinent hereto and (z) the retiring Indenture Trustee shall assign the security interest in the Collateral to the successor Indenture Trustee and executes all instruments and makes all filings that are necessary in order for the successor Indenture Trustee to have a perfected security interest in the Collateral.

 

Section 6.12          Waiver of Setoffs.  The Indenture Trustee hereby expressly waives any and all rights of setoff that the Indenture Trustee may otherwise at any time have under applicable law with respect to any Trust Account and agrees that amounts in the Trust Accounts shall at all times be held and applied solely in accordance with the provisions hereof and of the other Basic Documents.

 

Section 6.13          Indenture Trustee as Securities Intermediary.    The Indenture Trustee represents that it is a Securities Intermediary and a “bank” within the meaning of Section 9-102(a)(8) of the UCC.

 

The Indenture Trustee, in its capacity as Securities Intermediary, shall:

 

(i)           treat all Collateral credited to the Accounts as “financial assets” within the meaning of Section 8-102(a)(9) of the UCC to the fullest extent permitted by the UCC;

 

(ii)           indicate by book entry that a financial asset has been credited to the relevant Account, and when receiving a financial asset from the Issuing Entity or acquiring a financial asset for the Issuing Entity, shall accept it for credit to the relevant Account; and

 

(iii)           comply with any “entitlement orders” (within the meaning of Section 8-102(a)(8) of the UCC) originated by the Indenture Trustee with respect to the Accounts without further consent by the Issuing Entity.

 

Section 6.14          Representations and Warranties.  The Indenture Trustee hereby represents that:

 

(a)           the Indenture Trustee is duly organized and validly existing as a banking corporation duly organized in good standing under the laws of the State of New York with power and authority to own its properties and to conduct its business as such properties are currently owned and such business is presently conducted;

 

 

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(b)           the Indenture Trustee has the power and authority to execute and deliver this Indenture and to carry out its terms; and the execution, delivery and performance of this Indenture have been duly authorized by the Indenture Trustee by all necessary corporate action;

 

(c)           the consummation of the transactions contemplated by this Indenture and the fulfillment of the terms hereof do not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time) a default under the articles of organization or bylaws of the Indenture Trustee or any agreement or other instrument to which the Indenture Trustee is a party or by which it is bound; and

 

(d)           there are no pending or, to the best of its knowledge, threatened actions or proceedings against the Indenture Trustee before any court, administrative agency or tribunal which, if determined adversely to it, would materially and adversely affect its ability, either in its individual capacity or as Indenture Trustee, as the case may be, to perform its obligations under this Indenture or the Basic Documents.

 

Section 6.15          Exchange Act Rule 17g-5 Procedures.

 

Prior to an Event of Default, the Indenture Trustee shall not communicate with (including verbal communication) or provide information to any Rating Agency regarding anything related to this Agreement without prior consultation with the Depositor to ensure compliance with Rule 17g-5 under the Securities Exchange Act of 1934 (“Rule 17g-5”). With respect to any document, notice or other information required pursuant to this Agreement to be sent by the Indenture Trustee to any Rating Agency, the Indenture Trustee agrees to provide any such document, notice or other information to the Depositor for posting on its Rule 17g-5 compliant website related to this transaction (the “Rule 17g-5 Website”). The Depositor shall promptly confirm to the Indenture Trustee any such document, notice or other information has been posted to the Rule 17g-5 Website as a condition to the Indenture Trustee providing such document, notice or other information to any Rating Agency or Holder. Notwithstanding anything to the contrary in this Agreement, the Indenture Trustee shall have no obligation to deliver such document, notice or other information to the Rating Agencies until the Indenture Trustee has received written confirmation from the Depositor of the posting of such document, notice or other information by the Depositor to the Rule 17g-5 Website, and the Indenture Trustee shall not be liable for any failure to deliver such document, notice or other information to the Rating Agencies prior to any applicable deadline in this Agreement where such failure is caused by any failure or inability of the Depositor timely to provide such written confirmation.

 

Section 6.16          Rule 15Ga-1 Compliance. 

 

(a)           To the extent a Responsible Officer of the Servicer or the Indenture Trustee receives a demand for the repurchase or substitution of a Loan based on a breach of a representation or warranty made by the Loan Seller regarding such Loan (each a “Demand”) or information that, in its reasonable determination, could indicate a breach of such a representation or warranty has occurred (“Rule 15Ga-1 Information”), the Servicer and the Indenture Trustee agree to submit such Demand or item of Rule 15Ga-1 Information in writing to the Issuing Entity, the Loan Seller and the Adminstrator as

 

 

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described in Section 6.16(c) hereof; provided, however, that the Servicer shall not be required to submit any Demand or item of Rule 15Ga-1 Information if such information was received from the Indenture Trustee, the Administrator or the Loan Seller, and the Indenture Trustee shall not be required to submit any Demand or item of Rule 15Ga-1 Information if such information was received from the Servicer, the Administrator or the Loan Seller.

 

(b)           In connection with the repurchase or substitution of a Loan pursuant to a Demand or based upon Rule 15Ga-1 Information, any dispute with respect to a Demand or Rule 15Ga-1 Information, or the withdrawal or final rejection of a Demand or Rule 15Ga-1 Information, the Servicer and the Indenture Trustee agree, to the extent a Responsible Officer of the Servicer or Indenture Trustee, as applicable, has actual knowledge thereof, to notify the Issuing Entity, the Loan Seller and the Administrator in writing, in accordance with Section 6.16(c) hereof; provided, however, that the Servicer shall not be required to submit such notice if such information was received from the, the Indenture Trustee, the Administrator or the Loan Seller, and the Indenture Trustee shall not be required to submit such notice if such information was received from the Servicer, the Administrator or the Loan Seller.

 

(c)           In order to enable the Loan Seller to meet its reporting obligations under Rule 15Ga-1 of the Exchange Act, the Servicer and the Indenture Trustee shall forward in writing a report substantially in the form of Exhibit B hereto, to the Issuing Entity, the Loan Seller and the Administrator, no later than the 15th day of each month, commencing in [         ], as to each Demand or item of Rule 15Ga-1 Information or information as described in Section 6.16(b) hereof received in the previous month.  For purposes of this Section 6.16, any information or report required to be delivered in writing may be delivered via email to the email addresses specified for each party hereto or, in respect of the Indenture Trustee, as specified in the definition of “Corporate Trust Office.” The Loan Seller shall be entitled conclusively to rely on the information provided to it by the Servicer or the Indenture Trustee in accordance with this Section 6.16 in connection with the compilation by the Loan Seller or the Administrator on behalf of the Loan Seller of the information required to be reported on Exchange Act Form ABS-15G.  For the avoidance of doubt, the Loan Seller shall have sole responsibility for compiling the information required to be reported on Exchange Act Form ABS-15G and filing Exchange Act Form ABS-15G as required under Exchange Act Rule 15Ga-1.

 

[End of Article VI]

 

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ARTICLE VII

 

NOTEHOLDERS’ LISTS AND REPORTS

 

Section 7.01          Issuing Entity to Furnish Indenture Trustee Names and Addresses of Noteholders.  The Issuing Entity will furnish or cause to be furnished to the Indenture Trustee (a) not more than three (3) days after the earlier of (i) each Record Date and (ii) three months after the last Record Date, a list, in such form as the Indenture Trustee may reasonably require, of the names and addresses of the Noteholders as of such Record Date, and (b) at such other times as the Indenture Trustee may request in writing, within thirty (30) days after receipt by the Issuing Entity of any such request, a list of similar form and content as of a date not more than ten (10) days prior to the time such list is furnished; provided, however, that so long as the Indenture Trustee is the Registrar or the Notes are issued as Book-Entry Notes, no such list shall be required to be furnished.

 

Section 7.02          Preservation of Information; Communications to Noteholders.

 

(a)           The Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of the Noteholders contained in the most recent list furnished to the Indenture Trustee as provided in Section 7.01 and the names and addresses of Noteholders received by the Indenture Trustee in its capacity as the Registrar; provided, however, that so long as the Indenture Trustee is the Registrar or the Notes are issued as Book-Entry Notes, no such list shall be required to be preserved or maintained.

 

(b)           The Noteholders may communicate pursuant to TIA Section 312(b) with other Noteholders with respect to their rights under this Indenture or under the Notes.  Upon receipt by the Indenture Trustee of any request by three or more Noteholders or by one or more Noteholders of Notes evidencing not less than 25% of the Outstanding Note Balance to receive a copy of the current list of Noteholders (whether or not made pursuant to TIA Section 312(b)), the Indenture Trustee shall promptly notify the Administrator thereof by providing to the Administrator a copy of such request and a copy of the list of Noteholders produced in response thereto. The Indenture Trustee may destroy any list furnished to it as provided in such Section 7.01 upon receipt of a new list so furnished.  The Indenture Trustee shall make such list available to the Owner Trustee on written request, and to any Noteholder upon written request of such Noteholder

 

(c)             The Issuer, the Indenture Trustee and Note Registrar shall have the protection of TIA Section 312(c).

 

Section 7.03          Reports by the Indenture Trustee.

 

If required by TIA Section 313(a), within 60 days after each March 31, beginning with March 31, 20[  ], the Indenture Trustee shall mail to each Noteholder as required by TIA Section 313(c), a brief report dated as of such date that complies with TIA Section 313(a). The Indenture Trustee also shall comply with TIA Section 313(b).  A copy of each report at the time of its mailing to Noteholders shall be filed by the Indenture Trustee with the Commission and

 

 

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each stock exchange, if any, on which the Notes are listed.  The Issuer shall notify the Indenture Trustee if and when the Notes are listed on any stock exchange.

 

Section 7.04          Noteholder Lists.  The Registrar shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Noteholders, which list, upon request, will be made available to the Indenture Trustee insofar as the Indenture Trustee is no longer the Registrar.  Upon written request of any Noteholder made for purposes of communicating with other Noteholders with respect to their rights under this Indenture, the Registrar shall promptly furnish such Noteholder with a list of the other Noteholders of record identified in the Registrar at the time of the request.  Every Noteholder, by receiving such access, agrees with the Registrar that the Registrar will not be held accountable in any way by reason of the disclosure of any information as to the names and addresses of any Noteholder regardless of the source from which such information was derived.

 

Section 7.05           Access to Certain Documentation and Information.

 

(a)           The Indenture Trustee shall provide the Noteholders access to the Basic Documents and servicer reports, such access being afforded without charge but only upon reasonable written request and during normal business hours at offices designated by the Indenture Trustee.

 

(b)           Within sixty (60) days after the end of the calendar year, the Indenture Trustee shall furnish to each Person who at any time during the calendar year was a Holder of a Note a statement containing information regarding payments of principal, interest and other amounts on such Person’s Notes, aggregated for such calendar year or the applicable portion thereof during which such person was a Noteholder.  Such obligation shall be deemed to have been satisfied to the extent that substantially comparable information is provided by the Issuing Entity or the Indenture Trustee pursuant to any requirements of the Code as are from time to time in force.

 

(c)           The Indenture Trustee shall deliver to each Noteholder a copy of each Servicer’s Certificate delivered pursuant to Section 4.09 of the Sale and Servicing Agreement, a copy of each annual compliance statement delivered pursuant to Section 4.10 of the Sale and Servicing Agreement, and a copy of each annual accountant’s report delivered pursuant to Section 4.11 of the Sale and Servicing Agreement.

 

 

 [End of Article VII]

 

 

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ARTICLE VIII

 

ACCOUNTS, DISBURSEMENTS AND RELEASES

 

Section 8.01          Collection of Money.  Except as otherwise expressly provided herein, the Indenture Trustee may demand payment or delivery of, and shall receive and collect, directly and without intervention or assistance of any fiscal agent or other intermediary, all money and other property payable to or receivable by the Indenture Trustee pursuant to this Indenture and the Sale and Servicing Agreement.  The Indenture Trustee shall apply all such money received by it as provided in this Indenture and the Sale and Servicing Agreement.  Except as otherwise expressly provided in this Indenture, if any default occurs in the making of any payment or performance under any agreement or instrument that is part of the Collateral, the Indenture Trustee may (and at the written direction of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class shall) take such action as may be appropriate to enforce such payment or performance, including the institution and prosecution of appropriate Proceedings.  Any such action shall be without prejudice to any right to claim a Default or Event of Default under this Indenture and any right to proceed thereafter as provided in Article V.

 

Section 8.02           Trust Accounts; Payment of Principal and Interest.

 

(a)           On or prior to the Closing Date, the Issuing Entity shall cause the Indenture Trustee to establish and maintain the Trust Accounts for the benefit of the Noteholders as provided in Section 5.01 of the Sale and Servicing Agreement.

 

(b)           On the day required by Section 5.02 of the Sale and Servicing Agreement, all Principal Collections and Interest Collections with respect to the preceding Collection Period will be deposited in the Collection Account as provided in Section 5.02 of the Sale and Servicing Agreement.  On each Payment Date, all amounts required to be distributed from the Collection Account and Principal Distribution Account pursuant to Section 5.06 of the Sale and Servicing Agreement will be transferred from such account and distributed in accordance with Section 5.06 of the Sale and Servicing Agreement.

 

(c)           Interest on and principal of each Note shall be payable in accordance with the instruction of the Servicer given to the Indenture Trustee from and to the extent of funds available in accordance with Section 5.06 of the Sale and Servicing Agreement.  The final payment of principal of and interest on each Note (or payment of the Redemption Price thereof in the case of a Note called for redemption pursuant to Article X hereof) shall be payable only upon presentation and surrender thereof at the Corporate Trust Office of the Indenture Trustee or at the office of any Paying Agent.

 

(d)           No interest will accrue with respect to any Note from and after the final Payment Date with respect thereto to the extent that all amounts owing with respect to such Notes were Paid In Full on such Payment Date.

 

(e)           So long as the Indenture Trustee shall be the Paying Agent, the Indenture Trustee shall make payments of principal on the Notes from amounts deposited into the

 

 

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Principal Distribution Account and shall make payment of interest on the Notes from amounts deposited into the Collection Account; provided, however, that if the Owner Trustee has removed the Indenture Trustee as the Paying Agent, the Indenture Trustee shall distribute such amounts to the Paying Agent as instructed by the Owner Trustee.  If an Event of Default has occurred and the Notes have been accelerated under Section 5.02, then amounts then held in the Collection Account shall be treated by the Indenture Trustee as money or property collected pursuant to Article V of this Indenture and shall be applied as provided in Section 5.04(b) of this Indenture.

 

Section 8.03          General Provisions Regarding Accounts.  The Indenture Trustee shall not in any way be held liable by reason of any insufficiency in any of the Trust Accounts resulting from any loss on any Eligible Investment included therein except for losses attributable to the Indenture Trustee’s failure to make payments on such Eligible Investments issued by the Indenture Trustee, in its commercial capacity as principal obligor and not as trustee, in accordance with their terms.

 

Section 8.04           Release of Collateral.

 

(a)           The Indenture Trustee shall, at such time as there are no Notes outstanding and all sums due the Indenture Trustee pursuant to Section 6.07 have been Paid In Full, release any remaining portion of the Collateral that secured the Notes from the lien of this Indenture and release to the Issuing Entity or any other Person entitled thereto any funds then on deposit in the Trust Accounts.  The Indenture Trustee shall release property from the lien of this Indenture pursuant to this Section 8.04(a) only upon receipt by it of an Issuing Entity Request accompanied by an Officer’s Certificate and an Opinion of Counsel.

 

(b)           The Issuing Entity agrees, upon request by the Servicer and representation by the Servicer that it has complied with the procedure in Section 9.01 of the Sale and Servicing Agreement, to render the Issuing Entity Request to the Indenture Trustee in accordance with Section 4.04 and 11.01, and take such other actions as are required in such Sections.

 

Section 8.05           Opinion of Counsel and Officer’s Certificate.  The Indenture Trustee shall receive at least seven (7) days prior written notice when requested by the Issuing Entity to take any action pursuant to Section 8.04(a), accompanied by copies of any instruments involved, and the Indenture Trustee shall also require, as a condition to such action, an Opinion of Counsel and Officer’s Certificate, stating the legal effect of any such action, outlining the steps required to complete the same, and concluding that all conditions precedent to the taking of such action have been complied with and such action will not adversely impair the security for the Notes or the rights of the Noteholders in contravention of the provisions of this Indenture; provided, however, that such Opinion of Counsel shall not be required to express an opinion as to the fair value of the Collateral.  Counsel rendering any such opinion may rely, without independent investigation, on the accuracy and validity of any certificate or other instrument delivered to the Indenture Trustee in connection with any such action.

 

[End of Article VIII]

 

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ARTICLE IX

 

SUPPLEMENTAL INDENTURES

 

Section 9.01          Supplemental Indentures With Consent of the Noteholders.

 

(a)           The Issuing Entity and the Indenture Trustee, when authorized by an Issuing Entity Order, may, with prior notice to the Rating Agencies and with the consent of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class, by Act of such Holders delivered to the Issuing Entity and the Indenture Trustee, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the Holders of the Notes under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Holder of each outstanding Note affected thereby:

 

(i)           change the date of payment of any installment of principal of or interest on any Note, or reduce the principal amount thereof, the Interest Rate thereon or the Redemption Price with respect thereto, change the provisions of this Indenture relating to the application of collections on, or the proceeds of the sale of, the Collateral to payment of principal of or interest on the Notes, or change any place of payment where, or the coin or currency in which, any Note or the interest thereon is payable, or impair the right to institute suit for the enforcement of the provisions of this Indenture requiring the application of funds available therefor, as provided in Article V, to the payment of any such amount due on the Notes on or after the respective due dates thereof (or, in the case of redemption, on or after the Redemption Date);

 

(ii)           change the definition of “Controlling Class” or any other provision hereof specifying the number or percentage of Holders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder;

 

(iii)           modify or alter the provisions of this Indenture regarding the voting of Notes held by the Issuing Entity, any other obligor on the Notes, the Depositor or any affiliate of any of them, or definition of “Notes”;

 

(iv)           reduce the percentage of the Notes required to be represented to direct the Indenture Trustee to direct the Issuing Entity to sell or liquidate the Collateral pursuant to Section 5.04;

 

(v)           modify any provision of this Section 9.01 except to increase any percentage specified herein or to provide that certain additional provisions of this Indenture or the Basic Documents cannot be modified or waived without the consent of the Holder of each Note affected thereby;

 

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(vi)           modify any of the provisions of this Indenture in such manner as to affect the calculation of the amount of any payment of interest or principal due on any Note on any Payment Date (including the calculation of any of the individual components of such calculation) or to affect the rights of the Noteholders to the benefit of any provisions for the mandatory redemption of the Notes contained herein; or

 

(vii)           permit the creation of any lien ranking prior to or on a parity with the lien of this Indenture with respect to any part of the Collateral or, except as otherwise permitted or contemplated herein, terminate the lien of this Indenture on any property at any time subject hereto or deprive the Noteholder of the security provided by the lien of this Indenture; and

 

provided further that the Issuing Entity shall have received a Tax Opinion (and shall have delivered copies thereof to the Indenture Trustee).

 

(b)           The Indenture Trustee may in its discretion or at the advice of counsel determine whether or not any Notes would be affected by any supplemental indenture and any such determination shall be conclusive upon the Holders of all Notes, whether theretofore or thereafter authenticated and delivered hereunder.  The Indenture Trustee shall not be liable for any such determination made in good faith.

 

(c)           Promptly after the execution by the Issuing Entity and the Indenture Trustee of any supplemental indenture pursuant to this Section 9.01, the Issuing Entity shall mail to the Holders of the Notes to which such amendment or supplemental indenture relates a notice setting forth in general terms the substance of such supplemental indenture.  Any failure of the Issuing Entity to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture.

 

(d)           It shall be a condition to the execution and delivery of any amendment to this Agreement that the Rating Agency Condition be satisfied with respect to such amendment.

 

(e)           Notwithstanding anything to the contrary to the foregoing, this Indenture may not be amended in any way that would: (i) materially and adversely affect the Owner Trustee’s or this Indenture Trustee’s, as applicable, own rights, privileges, indemnities, duties or obligations under the Indenture, without the prior written consent of such Person; or (ii) significantly change the permitted activities or powers of the Issuing Entity even if such amendment would not have a material effect on the holders of the Notes, without the consent of the Holders representing at least a majority of the outstanding Note Balance.

 

Section 9.02          Supplemental Indentures Without Consent of Noteholders.

 

(a)           Without the consent of the Noteholders or any other Person but with prior notice to each Rating Agency, the Issuing Entity and the Indenture Trustee, when authorized by an Issuing Entity Order, at any time and from time to time, may enter into 

 

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one or more indentures supplemental hereto (which shall conform to the provisions of the Trust Indenture Act as in force at the date of the execution thereof), in form satisfactory to the Indenture Trustee, for any of the following purposes:

 

(i)           to correct or amplify the description of any property at any time subject to the lien of this Indenture, or better to assure, convey and confirm unto the Indenture Trustee any property subject or required to be subjected to the lien of this Indenture, or to subject additional property to the lien of this Indenture;

 

(ii)           to evidence the succession, in compliance with the applicable provisions hereof, of another Person to the Issuing Entity, and the assumption by any such successor of the covenants of the Issuing Entity contained herein and in the Notes;

 

(iii)           to add to the covenants of the Issuing Entity, for the benefit of the Noteholders, or to surrender any right or power herein conferred upon the Issuing Entity;

 

(iv)           to convey, transfer, assign, mortgage or pledge any property to or with the Indenture Trustee;

 

(v)           to cure any ambiguity, to correct or to supplement any provision herein or in any supplemental indenture which may be inconsistent with any other provision herein or in any supplemental indenture or to make any other provisions with respect to matters or questions arising under this Indenture or in any supplemental indenture; provided, that such action shall not materially and adversely affect the interests of the Noteholders;

 

(vi)           to evidence and provide for the acceptance of the appointment hereunder by a successor trustee with respect to the Notes and to add to or change any of the provisions of this Indenture as shall be necessary to facilitate the administration of the trusts hereunder by more than one trustee, pursuant to the requirements of Article VI;

 

(vii)           to modify, eliminate or add to the provisions of this Indenture to such extent as shall be necessary to effect the qualification of this Indenture under the Trust Indenture Act or under any similar federal statute hereafter enacted and to add to this Indenture such other provisions as may be expressly required by the Trust Indenture Act; or

 

(viii)           to add, modify or eliminate such provisions as may be necessary or advisable in order to enable (a) the transfer to the Issuing Entity of all or any portion of the Loans to be derecognized under U.S. generally accepted accounting principles by the Loan Seller to the Issuing Entity, (b) the Issuing Entity to avoid becoming a member of the Loan Seller’s consolidated group under U.S. generally accepted accounting principles or (c) the Loan Seller or any of its Affiliates to otherwise comply with or obtain more favorable treatment under any law or regulation or any accounting rule or principle (whether now or in the future in

 

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effect); it being a condition to any such amendment that the Rating Agency Condition be satisfied.

The Indenture Trustee is hereby authorized to join in the execution of any such supplemental indenture and to make any further appropriate agreements and stipulations that may be therein contained.

 

(b)           Any term or provision of this Indenture may be amended by the Issuing Entity and the Indenture Trustee, when authorized by an Issuing Entity Order, without the consent of any Noteholder (other than the modifications set forth in Section 9.01, which require consent of each Noteholder affected thereby), the Owner Trustee, the Servicer, the Depositor or any other Person subject to Section 9.02(e) and satisfaction of the following conditions:

 

(i)           the Issuing Entity delivers an Officer’s Certificate of the Servicer, respectively, to the Indenture Trustee to the effect that such amendment will not materially and adversely affect the interests of the Noteholders;

 

(ii)           the Issuing Entity delivers to the Indenture Trustee written confirmation from each Rating Agency that such amendment will not cause it to downgrade, qualify or withdraw its rating assigned to any of the Notes; and

 

(iii)           that such action shall not, as evidenced by an Opinion of Counsel, (A) materially and adversely affect the interests of any Noteholder, (B) affect the treatment of the Notes as debt for federal income tax purposes, (C) cause the Issuing Entity to be deemed an association (or publicly-traded partnership) taxable as a corporation for federal income tax purposes or (D) be deemed to cause a taxable exchange of the Notes for federal income tax purposes.

 

(c)           Prior to the execution of any amendment to this Indenture, the Indenture Trustee, at the written direction of the Issuing Entity, shall provide written notification of the substance of such amendment prepared by the Issuing Entity to each Rating Agency; and promptly after the execution of any such amendment or consent, the Indenture Trustee shall furnish a copy of such amendment or consent to each Rating Agency.

 

(d)           Prior to the execution of any amendment to this Indenture, the Indenture Trustee shall be entitled to receive and conclusively rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement and that all conditions precedent to the execution and delivery of such amendment have been satisfied.  The Indenture Trustee may, but shall not be obligated to, enter into or execute on behalf of the Issuing Entity any such amendment which  materially and adversely affects the Indenture Trustee’s own rights, privileges, indemnities, duties or obligations under this Agreement, the Basic Documents or otherwise.

 

(e)           Notwithstanding anything to the contrary to the foregoing, this Indenture may not be amended in any way that would: (i) materially and adversely affect the Owner Trustee’s or this Indenture Trustee’s, as applicable, own rights, privileges, indemnities, 

 

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duties or obligations under the Indenture, without the prior written consent of such Person; or (ii) significantly change the permitted activities or powers of the Issuing Entity even if such amendment would not have an adverse effect on the holders of the Notes, without the consent of the Holders representing at least a majority of the outstanding Note Balance.

 

Section 9.03          Execution of Supplemental Indentures.  In executing, or permitting the additional trusts created by, any supplemental indenture permitted by this Article IX or the modification thereby of the trusts created by this Indenture, the Indenture Trustee shall be entitled to receive, and subject to Sections 6.01 and 6.02, shall be fully protected in relying upon, an Opinion of Counsel and Officer’s Certificate stating that the execution of such supplemental indenture is authorized or permitted by this Indenture.  The Indenture Trustee may, but shall not be obligated to, enter into any such supplemental indenture that affects the Indenture Trustee’s own rights, duties, liabilities or immunities under this Indenture or otherwise.  The Administrator shall provide a fully executed copy of any supplemental indentures to this Indenture to each Rating Agency.

 

Section 9.04          Effect of Supplemental Indentures.  Upon the execution of any supplemental indenture pursuant to the provisions hereof, this Indenture shall be and shall be deemed to be modified and amended in accordance therewith with respect to the Notes affected thereby, and the respective rights, limitations of rights, obligations, duties, liabilities and immunities under this Indenture of the Indenture Trustee, the Issuing Entity and the Noteholders shall of thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all of the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes.

 

Section 9.05          Reference in Notes to Supplemental Indentures. Notes authenticated and delivered after the execution of any supplemental indenture pursuant to this Article IX may, and if required by the Indenture Trustee shall, bear a notation in form approved by the Indenture Trustee as to any matter provided for in such supplemental indenture.  If the Issuing Entity or the Indenture Trustee shall so determine, new Notes so modified as to conform, in the opinion of the Indenture Trustee and the Issuing Entity, to any such supplemental indenture may be prepared and executed by the Issuing Entity and authenticated and delivered by the Indenture Trustee in exchange for the outstanding Notes.

 

[End of Article IX]

 

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ARTICLE X

 

REDEMPTION OF NOTES

 

Section 10.01          Redemption In Whole Pursuant to Option to Purchase.

 

(a)           The Notes are subject to redemption in whole, but not in part, at the direction of the Servicer pursuant to Section 9.01 of the Sale and Servicing Agreement, on any Payment Date on which the Servicer exercises its option to purchase the Collateral (other than the Reserve Account) pursuant to said Section 9.01, for a purchase price equal to the Redemption Price; provided that (i) as of the last day of the related Collection Period the then-outstanding Net Pool Balance as of the last day of the related Collection Period has declined to 10% or less of the Initial Net Pool Balance as of the Cutoff Date, and (ii) the sum of the Optional Purchase Price and the Available Funds as of such Payment Date would be sufficient to pay (x) the amounts set forth under Sections 5.06(a)(i) through 5.06(a)(ix) and Section 5.06(a)(xi) of the Sale and Servicing Agreement and (y) the aggregate outstanding Note Balance of the Notes (without giving effect to payments described in the preceding clause (x)).

 

(b)           Each of the Notes is subject to redemption in whole, but not in part, on any Payment Date on which the sum of the amounts in the Reserve Account and the remaining Available Funds after the payments under Sections 5.06(a)(i) through 5.06(a)(ix) and Section 5.06(a)(xi) would be sufficient to pay in full the aggregate unpaid Note Balance of all of the outstanding Notes as determined by the Servicer.  On such Payment Date, (i) the Indenture Trustee upon written direction from the Servicer shall transfer all amounts on deposit in the Reserve Account to the Collection Account and (ii) the outstanding Notes shall be redeemed in whole, but not in part.

 

(c)           The Servicer or the Issuing Entity shall furnish the Rating Agencies and the Indenture Trustee notice of such redemption.  If the Notes are to be redeemed pursuant to this Section 10.01, the Servicer shall furnish notice of such election to the Indenture Trustee not later than twenty (20) days prior to the Redemption Date and shall deposit on the Business Day prior to the Redemption Date with the Indenture Trustee in the Collection Account and the Principal Distribution Account, as applicable, the Redemption Price of the Notes to be redeemed, whereupon all such Notes shall be due and payable on the Redemption Date upon the furnishing of a notice complying with Section 10.02 to each Holder of the Notes.

 

Section 10.02          Form of Redemption Notice.

 

(a)           Notice of redemption under Section 10.01 shall be given by the Indenture Trustee at the written direction and at the expense of the Servicer by first-class mail, postage prepaid, or by facsimile mailed or transmitted not later than ten (10) days prior to the applicable Redemption Date to each registered Holder of Notes, as of the close of business on the Record Date preceding the applicable Redemption Date, at such Holder’s address or facsimile number appearing in the Register.  All notices of redemption shall identify the CUSIP number, if applicable, and shall state:

 

 

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 (i)           the Redemption Date;

 

(ii)           the Redemption Price;

 

(iii)          that the Record Date otherwise applicable to that Redemption Date is not applicable and that payments will be made only upon presentation and surrender of those Notes;

 

(iv)          the place where such Notes are to be surrendered for payment of the Redemption Price (which shall be the office or agency of the Issuing Entity to be maintained as provided in Section 3.02); and

 

(v)           that interest on the Notes shall cease to accrue on the Redemption Date.

 

(b)           Notice of redemption of the Notes shall be given by the Indenture Trustee in the name of the Issuing Entity and at the expense of the Servicer.  Failure to give notice of redemption, or any defect therein, to any Holder of any Note shall not impair or affect the validity of the redemption of any other Note.

 

Section 10.03          Notes Payable on Redemption Date.  The Notes shall, following notice of redemption pursuant to Section 10.01 as required by Section 10.02, on the Redemption Date become due and payable at the Redemption Price and (unless the Issuing Entity shall default in the payment of the Redemption Price) no interest shall accrue on the Redemption Price for any period after the date to which accrued interest is calculated for purposes of calculating the Redemption Price.

 

[End of Article X]

 

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ARTICLE XI

 

MISCELLANEOUS

 

Section 11.01          Compliance Certificates and Opinions, etc.

 

(a)  Upon any application or request by the Issuing Entity to the Indenture Trustee to take any action under any provision of this Indenture, the Issuing Entity shall furnish to the Indenture Trustee (x) an Officer’s Certificate stating that the Issuing Entity has complied with all conditions precedent, if any, provided for in this Indenture relating to the proposed action and the proposed action satisfies TIA Section 314(c)(1), (y) an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with that satisfies TIA Section 314(c)(2), and (z) if required by the TIA in the case of condition precedent compliance with which is subject to verification by accountants, a certificate or opinion of an accountant that satisfies TIA Section 314(c)(3), except that, in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture, no additional certificate or opinion need be furnished.

 

Every certificate or opinion in accordance with TIA Section 314(e) with respect to compliance with a condition or covenant provided for in this Indenture shall include:

 

(i)  a statement that each signatory of such certificate or opinion has read or has caused to be read such covenant or condition and the definitions herein relating thereto;

 

(ii)  a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

(iii)  a statement that, in the opinion of each such signatory, such signatory has made such examination or investigation as is necessary to enable such signatory to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(iv)  a statement as to whether, in the opinion of each such signatory such condition or covenant has been complied with.

 

(b)  Prior to the deposit of any Collateral or other property or securities with the Indenture Trustee that is to be made the basis for the release of any property or securities subject to the lien of this Indenture, the Issuing Entity shall, in addition to any obligation imposed in Section 11.01 or elsewhere in this Indenture, furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion of each Person signing such certificate as to the fair value in accordance with TIA Section 314(d) (as of a date no more than thirty (30) prior to such deposit) to the Issuing Entity of the Collateral or other property or securities to be so deposited.

 

(i)  Whenever the Issuing Entity is required to furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion of any signer thereof as to the matters described in clause (a) above, the Issuing Entity shall also deliver to the Indenture Trustee an Independent Certificate as to the same matters, if the fair value in accordance

 

 

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with TIA Section 314(d) to the Issuing Entity of the property or securities to be so deposited and of all other such securities made the basis of any such withdrawal or release since the commencement of the then-current fiscal year of the Issuing Entity, is 10% or more of the Outstanding Note Balance, but such a certificate need not be furnished with respect to any securities so deposited, if the fair value thereof to the Issuing Entity as set forth in the related Officer’s Certificate is less than $25,000.

 

(ii)  Whenever any property or securities are to be released from the lien of this Indenture, the Issuing Entity shall also furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion of each Person signing such certificate as to the fair value (as of a date no more than thirty (30) days prior to such release) of the property or securities proposed to be released and stating that in the opinion of such Person the proposed release will not impair the security under this Indenture in contravention of the provisions hereof.

 

(iii)  Other than with respect to the release of the lien of this Indenture on any Collateral with respect to which payment of the Repurchase Price has been made to the Issuing Entity, the Issuing Entity is required to furnish to the Indenture Trustee an Officer’s Certificate certifying or stating the opinion of any signer thereof as to the matters described in clause (ii) above, the Issuing Entity shall also furnish to the Indenture Trustee an Independent Certificate as to the same matters if the fair value of the property or securities and of all other property other than property as contemplated by clause (iv) below, or securities released from the lien of this Indenture since the commencement of the then current calendar year, as set forth in the certificates required by clause (ii) above and this clause (iii), equals 1% or more of the Outstanding Note Balance, but such certificate need not be furnished in the case of any release of property or securities if the fair value thereof as set forth in the related Officer’s Certificate is less than $25,000.

 

(iv)  Notwithstanding Section 4.04 or any other provision of this Section 11.01, the Issuing Entity may, without compliance with the requirements of the other provisions of this Section 11.01 (A) collect, liquidate, sell or otherwise dispose of Loans and Financed Vehicles as and to the extent permitted or required by the Basic Documents and (B) make cash payments out of the Trust Accounts as and to the extent permitted or required by the Basic Documents.

 

Section 11.02          Form of Documents Delivered to Indenture Trustee.  In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.

 

Any certificate or opinion of an Authorized Officer of the Issuing Entity may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the

 

 

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certificate or opinion or representations with respect to the matters upon which such officer’s certificate or opinion is based are erroneous.  Any such certificate of an Authorized Officer or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Servicer, the Depositor, the Issuing Entity or the Administrator, stating that the information with respect to such factual matters is in the possession of the Servicer, the Depositor, the Issuing Entity or the Administrator, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.

 

Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.

 

Whenever in this Indenture, in connection with any application or certificate or report to the Indenture Trustee, it is provided that the Issuing Entity shall deliver any document as a condition of the granting of such application, or as evidence of the Issuing Entity’s compliance with any term hereof, it is intended that the truth and accuracy, at the time of the granting of such application or at the effective date of such certificate or report (as the case may be), of the facts and opinions stated in such document shall in such case be conditions precedent to the right of the Issuing Entity to have such application granted or to the sufficiency of such certificate or report.  The foregoing shall not, however, be construed to affect the Indenture Trustee’s right to rely upon the truth and accuracy of any statement or opinion contained in any such document as provided in Article VI.

 

Section 11.03          Acts of Noteholders.

 

(a)           Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Noteholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Noteholders in person or by agents duly appointed in writing; and except as herein otherwise expressly provided such action shall become effective when such instrument or instruments are delivered to the Indenture Trustee and, where it is hereby expressly required, to the Issuing Entity.  Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the Noteholders signing such instrument or instruments.  Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.01) conclusive in favor of the Indenture Trustee and the Issuing Entity, if made in the manner provided in this Section 11.03.

 

(b)           The fact and date of the execution by any person of any such instrument or writing may be proved in any manner that the Indenture Trustee deems sufficient.

 

(c)           The ownership of Notes shall be proved by the Register.

 

(d)           Any request, demand, authorization, direction, notice, consent, waiver or other action by the Holder of any Notes shall bind the Holder of every Note issued upon the registration thereof or in exchange therefor or in lieu thereof, in respect of anything

 

 

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done, omitted or suffered to be done by the Indenture Trustee or the Issuing Entity in reliance thereon, whether or not notation of such action is made upon such Note.

 

Section 11.04          Notices, etc., to Indenture Trustee, Issuing Entity and Rating Agencies.

 

(a)           Any request, demand, authorization, direction, notice, consent, waiver or Act of Noteholders or other documents provided or permitted by this Indenture shall be in writing and, if such request, demand, authorization, direction, notice, consent, waiver or act of Noteholders is to be made upon, given or furnished to or filed with:

 

(i)           the Indenture Trustee by any Noteholder or by the Issuing Entity, shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Indenture Trustee at its Corporate Trust Office; or

 

(ii)           the Issuing Entity by the Indenture Trustee or by any Noteholder, shall be sufficient for every purpose hereunder if in writing and mailed first-class, postage prepaid to the Issuing Entity addressed to:  Huntington Auto Trust 20[  ]-[ ], in care of [      ], as Owner Trustee, [            ], or at any other address previously furnished in writing to the Indenture Trustee by the Issuing Entity or the Administrator.  The Issuing Entity shall promptly transmit any notice received by it from the Noteholders to the Indenture Trustee.

 

(b)           Notices required to be given to the Rating Agencies by the Issuing Entity, the Indenture Trustee or the Owner Trustee shall be in writing and, upon notice that it has been posted to the Depositor’s Rule 17g-5 website, personally delivered or mailed by certified mail, return receipt requested, to (x) in the case of [      ], at the following address:  [                         ] and (y) in the case of [           ], at the following address:  [            ]; or as to each of the foregoing, at such other address as shall be designated by written notice to the other parties.

 

Section 11.05          Notices to Noteholders; Waiver.  Where this Indenture provides for any notice, report or other communication to any Noteholders, such notice, report or other communication shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class, postage prepaid to each Noteholder affected by such event, at such Holder’s address as it appears on the Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice, report or other communication and shall be deemed given only upon receipt.

 

Where this Indenture provides for notice in any manner, such notice may be waived in writing by any Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice.  Waivers of notice by Noteholders shall be filed with the Indenture Trustee but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such a waiver.

 

In case, by reason of the suspension of regular mail service as a result of a strike, work stoppage or similar activity, it shall be impractical to mail notice of any event to Noteholders when such notice is required to be given pursuant to any provision of this Indenture,

 

 

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then any manner of giving such notice as shall be reasonably satisfactory to the Indenture Trustee and actually received by such recipient shall be deemed to be a sufficient giving of such notice.

 

Where this Indenture provides for notice to the Rating Agencies, failure to give such notice shall not affect any other rights or obligations created hereunder, and shall not under any circumstance constitute a Default or Event of Default; except where such failure to give notice results in a downgrade to the Notes.

 

Upon notice from the Issuing Entity that they have been posted on the Depositor’s 17g-5 Website, the Noteholders shall be provided with copies of all notices, reports or other communication required to be made upon, given, furnished to or filed with the Indenture Trustee or the Issuing Entity, which copies shall be provided to the Noteholders by the initial recipient thereof.

 

Section 11.06          Alternate Payment and Notice Provisions.  Notwithstanding any provision of this Indenture or any of the Notes to the contrary, the Issuing Entity may enter into any agreement with any Holder of a Note providing for a method of payment, or notice by the Indenture Trustee or any Paying Agent to such Holder, that is different from the methods provided for in this Indenture for such payments or notices.  The Issuing Entity will furnish to the Indenture Trustee a copy of each such agreement and the Indenture Trustee will cause payments to be made and notices to be given in accordance with such agreements.  The Indenture Trustee shall provide a copy of any request made pursuant to this Section 11.06 to the Owner Trustee.

 

Section 11.07          Effect of Headings and Table of Contents.  The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.

 

Section 11.08          Successors and Assigns.  All covenants and agreements in this Indenture and the Notes by the Issuing Entity shall bind its successors and assigns, whether so expressed or not.  All agreements of the Indenture Trustee in this Indenture shall bind its successors, co-trustees and agents.

 

Section 11.09          Severability.  In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

Section 11.10          Benefits of Indenture.  Nothing in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto and their permitted successors hereunder, and the Noteholders and Owners and their respective successors and assigns, and any other party secured hereunder, and any other Person with an ownership interest in any part of the Collateral, any benefit or any legal or equitable right, remedy or claim under this Indenture.

 

Section 11.11          Legal Holidays.  In any case where the date on which any payment is due shall not be a Business Day, then (notwithstanding any other provision of the Notes or this Indenture) payment need not be made on such date, but may be made on the next succeeding

 

 

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68

  

Business Day with the same force and effect as if made on the date on which nominally due, and no interest shall accrue for the period from and after any such nominal date.

 

Section 11.12          GOVERNING LAW.  THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (EXCEPT FOR SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

Section 11.13          Counterparts.  This Indenture may be executed in any number of counterparts (including by facsimile or other electronic transmission), each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

 

Section 11.14          Recording of Indenture.  If this Indenture is subject to recording in any appropriate public recording offices, such recording is to be effected by the Issuing Entity and at the expense of the Servicer accompanied by an Opinion of Counsel to the effect that such recording is necessary either for the protection of the Noteholders or any other Person secured hereunder or for the enforcement of any right or remedy granted to the Indenture Trustee under this Indenture.

 

Section 11.15          Trust Obligation.  No recourse may be taken, directly or indirectly, with respect to the obligations of the Issuing Entity, the Owner Trustee or the Indenture Trustee on the Notes or under this Indenture or any certificate delivered in connection herewith or therewith, against (i) the Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuing Entity, solely in such capacity, including the Depositor, or (iii) any partner, owner, beneficiary, agent, officer, director, employee or agent of the Indenture Trustee or the Owner Trustee in its individual capacity, any holder of a beneficial interest in the Issuing Entity, solely in such capacity, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed (it being understood that the Indenture Trustee and the Owner Trustee have no such obligations in their individual capacity).  For all purposes of this Indenture, in the performance of any duties or obligations of the Issuing Entity hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Article VI, VII and VIII of the Trust Agreement.

 

Section 11.16          No Petition.  The Indenture Trustee, by entering into this Indenture, and each Noteholder and Owner, by accepting a Note or an interest therein,  hereby covenant and agree that they will not at any time institute against the Issuing Entity or the Depositor, or join in any institution against the Issuing Entity or the Depositor, of any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, this Indenture or any of the Basic Documents.

 

Section 11.17          Inspection.  The Issuing Entity agrees that, on reasonable prior notice, it will permit any representative of the Indenture Trustee, during the Issuing Entity’s

 

 

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69

  

normal business hours, to examine all of the books of account, records, reports and other papers of the Issuing Entity, to make copies and extracts therefrom, to cause such books to be audited by Independent certified public accountants, and to discuss the Issuing Entity’s affairs, finances and accounts with the Issuing Entity’s officers, employees and Independent certified public accountants, all at such reasonable times and as often as may be reasonably requested; provided, however, that the Indenture Trustee may only cause the books of the Issuing Entity to be audited on an annual basis, unless there occurs an Event of Default hereunder.  The Indenture Trustee shall, and shall cause its representatives to, hold in confidence all such information except to the extent such information is publicly available or such disclosure may be required by law (and all reasonable applications for confidential treatment are unavailing) and except to the extent that the Indenture Trustee may reasonably determine with the advice of counsel and after consultation with the Issuing Entity that such disclosure is consistent with its obligations hereunder.

 

Section 11.18          Limitation of Liability.  (a) It is expressly understood and agreed by the parties hereto that (i) this Indenture is executed and delivered by [                         ], not individually or personally but solely as Owner Trustee of Huntington Auto Trust 20[  ]-[ ], in the exercise of the powers and authority conferred and vested in it, (ii) each of the representations, undertakings and agreements herein made on the part of the Issuing Entity is made and intended not as personal representations, undertakings and agreements by [                         ] but is made and intended for the purpose for binding only the Issuing Entity, (iii) nothing herein contained shall be construed as creating any liability on [                         ], 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 and by any Person claiming by, through or under the parties hereto and (iv) under no circumstances shall [                         ] be personally liable for the payment of any indebtedness or expenses of the Issuing Entity or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Issuing Entity under this Indenture or any other related documents.

 

(b)           Notwithstanding anything contained herein to the contrary, this Agreement has been accepted by [               ], not in its individual capacity but solely as Indenture Trustee, and in no event shall [               ] have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuing Entity hereunder or in any of the certificates, notices or agreements delivered pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuing Entity in accordance with the priorities set forth herein.

 

Section 11.19          Waiver of Jury Trial.

 

EACH OF THE ISSUING ENTITY AND THE INDENTURE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.

 

Section 11.20          Force Majeure.

 

 

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70

  

In no event shall the Indenture Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Indenture Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

 

Section 11.21          Patriot Act.

 

The parties hereto acknowledge that, in accordance with Section 326 of the USA Patriot Act, [               ], like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account.  The parties to this Agreement agree that they will provide the [               ] with such information as it may request in order for the [               ] to satisfy the requirements of the USA Patriot Act.

 

Section 11.22          Conflict with Trust Indenture Act.                                                                           

 

If any provision hereof limits, qualifies or conflicts with another provision hereof that is required to be included in this Indenture by any of the provisions of the Trust Indenture Act, such required provision shall control.

 

The provisions of TIA Sections 310 through 317 that impose duties on any Person (including the provisions automatically deemed included herein unless expressly excluded by this Indenture) are a part of and govern this Indenture, whether or not physically contained herein.

 

 

[End of Article XI]

 

Indenture

  71

  

  

IN WITNESS WHEREOF, the Issuing Entity and the Indenture Trustee have caused this Indenture to be duly executed by their respective officers, thereunto duly authorized and duly attested, all as of the day and year first above written.

 

 

 

	 	  

HUNTINGTON AUTO TRUST 20[  ]-[ ]

 

	 

 

	 	  

By:

	  

[                         ], not in its individual 

capacity but solely as Owner Trustee

	 	
 

 

By:

	
 

 

__________________________

         Name:

         Title:

 

 

 

 

 

Indenture

  

  

  

 

	 	 	  

[                         ], not in its individual capacity but solely 

as Indenture Trustee

	 	  

By:

	  

__________________________

         Name:

         Title:

	 	
 

 

By:

	
 

 

__________________________

         Name:

         Title:

 

 

 

Indenture

  

  

  

EXHIBIT A-1

 

FORM OF [CLASS A-1] [CLASS A-2-A] [CLASS A-2-B] [CLASS A-3-A] [CLASS A-3-B] [CLASS A-4] NOTE

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

 

BY ACQUIRING THIS NOTE, EACH PURCHASER OR TRANSFEREE WILL BE DEEMED TO REPRESENT AND WARRANT THAT EITHER (I) IT IS NOT ACQUIRING AND WILL NOT HOLD THE NOTES WITH THE ASSETS OF AN “EMPLOYEE BENEFIT PLAN” AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), A “PLAN” AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), AN ENTITY DEEMED TO HOLD THE PLAN ASSETS OF ANY OF THE FOREGOING OR ANY OTHER EMPLOYEE BENEFIT PLAN OR RETIREMENT ARRANGEMENT THAT IS SUBJECT TO A LAW THAT IS SIMILAR TO SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR (II) THE ACQUISITION, HOLDING AND DISPOSITION OF THIS NOTE WILL NOT GIVE RISE TO A NONEXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR A NONEXEMPT VIOLATION OF ANY SIMILAR APPLICABLE LAW.

 

Indenture (Exhibit A-1)

  

  

  

HUNTINGTON AUTO TRUST 20[  ]-[ ]

 

[CLASS A-1][CLASS A-2-A][CLASS A-2-B][CLASS A-3-A][CLASS A-3-B][CLASS A-4] AUTO LOAN ASSET BACKED NOTE

 

$_________________3

 

NOTE No. ____

 

[CUSIP NO. [_________]

 

[ISIN NO. [__________]

 

 

HUNTINGTON AUTO TRUST 20[  ]-[ ], a Delaware statutory trust (herein referred to as the “Issuing Entity”), for value received, hereby promises to pay to Cede & Co., or registered assigns, the principal sum of _________ MILLION DOLLARS ($________), on the earlier of the Payment Date occurring in [______] (the “Final Scheduled Payment Date”) and the Redemption Date, if any, pursuant to Section 10.01 of the Indenture (referred to on the reverse side hereof) except as provided below or in the Indenture (referred to on the reverse side hereof); provided, however, that the principal sum of this [Class A-1][Class A-2-A][Class A-2-B][Class A-3-A][Class A-3-B][Class A-4] Note and each other Note of the same Class shall not collectively exceed the principal amount of $[________].  The Issuing Entity will pay interest on this Note at the [Class A-1][Class A-2-A][Class A-2-B][Class A-3-A][Class A-3-B][Class A-4] Interest Rate, on each Payment Date until the principal of this Note is paid or made available for payment, on the principal amount of this Note outstanding on the close of business on the preceding Payment Date, subject to certain limitations contained in Article V of the Sale and Servicing Agreement (referred to on the reverse side hereof).  [Interest on this Note will accrue for each Payment Date from the most recent Payment Date on which interest has been paid to but excluding the then current Payment Date or, if no interest has yet been paid, from the Closing Date. Interest will be computed on the basis of the actual number of days in each Interest Period divided by 360.]4 [Interest on this Note will accrue for each Payment Date from the and including the 15th day of each calendar month preceding the Payment Date (or from and including the Closing Date in the case of the first Payment Date) to but excluding the 15th day of the following month.  Interest will be computed on the basis of a 360-day year consisting of twelve 30-day months.]5 Such principal of and interest on this Note shall be paid in the manner specified in the Indenture and the Sale and Servicing Agreement.

 

Capitalized terms used but not defined herein are defined in Indenture or the Sale and Servicing Agreement.

 

The Notes are secured by certain assets of the Issuing Entity consisting primarily of a portfolio of motor vehicle installment sale contracts and loans. This note (the “Note”) does

 

_______________________

  

3 Denominations of $100,000 and integral multiples of $1,000 in excess thereof. 

4 For the Class A-1 Notes and the Floating Rate Notes. 

5 For Fixed Rate Notes other than the Class A-1 Notes.

 

 

Indenture (Exhibit A-1)

  

  

  

not represent an interest in, or obligation of, Huntington Funding, LLC (the “Depositor”), The Huntington National Bank, or any affiliate thereof.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture, or the Sale and Servicing Agreement or be valid for any purpose.

 

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREOF (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

 

Indenture (Exhibit A-1)

  

  

  

IN WITNESS WHEREOF, the Issuing Entity has caused this instrument to be signed, manually or in facsimile, by its Authorized Officer.

 

 

 

 

	 	  

HUNTINGTON AUTO TRUST 20[  ]-[ ]

	 

 

 

	 	 By:	
[                         ], not in its individual 

capacity but solely as Owner Trustee under 

the Trust Agreement

	 	
 

 

 

 

 

 

	  

By: _________________________________

                  Authorized Signatory

 

 

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Notes designated above and referred to in the within-mentioned Indenture.

 

	
Date:

	
[               ], not in its individual capacity but solely 

as Indenture Trustee

 

 

 

 

	
  

	
By: _________________________________

               Authorized Signatory

 

 

 

 

 

 

Indenture (Exhibit A-1)

  

  

  

REVERSE OF NOTE

 

This certifies that Cede & Co. (the “Noteholder”), is the registered owner of the Note which is secured by certain assets of the HUNTINGTON AUTO TRUST 20[  ]-[ ] (the “Issuing Entity”) created by the Amended and Restated Trust Agreement, dated as of June 11, 2008, between Depositor and [                         ], as Owner Trustee (the “Owner Trustee”). The Notes are issued pursuant to an Indenture, dated as of [               ] (as amended, the “Indenture”), between the Issuing Entity and [               ], as Indenture Trustee (the “Indenture Trustee”) and are subject to the terms of the Indenture, the Sale and Servicing Agreement, dated as of [               ] (as amended, the “Sale and Servicing Agreement”), among The Huntington National Bank, Depositor, the Indenture Trustee and the Issuing Entity.

 

The property of the Issuing Entity will include the Issuing Entity’s right, title and interest in, to and under the Collateral (as defined in the Indenture).

 

This Note is issued under and is subject to the terms, provisions and conditions of the Sale and Servicing Agreement, and the Indenture, as each may be amended and supplemented from time to time, the Noteholder by virtue of the acceptance hereof assents and is bound. Although a summary of certain provisions of the Sale and Servicing Agreement and the Indenture are set forth below, this Note does not purport to summarize the Sale and Servicing Agreement or the Indenture and reference is made to the Sale and Servicing Agreement and the Indenture for information with respect to the interests, rights, benefits, obligations, proceeds and duties evidenced hereby and the rights, duties and obligations of the Indenture Trustee.  A copy of the Sale and Servicing Agreement and the Indenture (without schedules and exhibits) may be requested from the Indenture Trustee by writing to the Indenture Trustee at [               ], 60 Wall Street, 26th Floor, New York, NY 10005 (facsimile (212) 553-2459); Attention: SFS-TSS. In the event of any conflict between this Note, on the one hand, and the Indenture or the Sale and Servicing Agreement on the other hand, the Indenture or the Sale and Servicing Agreement shall control.

 

The Issuing Entity has entered into the Sale and Servicing Agreement and the Notes have been (or will be) issued with the intention that the Notes will qualify under applicable law as indebtedness of the Issuing Entity secured by the Collateral. The Issuing Entity, each Beneficiary and each Noteholder and Owner by the acceptance of its Note or Book-Entry Note, as applicable, agrees to treat the Notes as indebtedness secured by the Collateral for Federal income, state and local income, and franchise taxes and any other taxes imposed on or measured by income.

 

On each Payment Date, the Indenture Trustee shall distribute to each Noteholder at the close of business on the last day of the prior Collection Period (each a “Record Date”) such Noteholder’s share of such amounts on deposit in the Collection Account as are payable in respect of Notes pursuant to the Sale and Servicing Agreement.  Distributions with respect to this Note will be made by the Indenture Trustee by check mailed to the address of the Noteholder of record appearing on the Register without the presentation or surrender of this Note or the making of any notation thereon (except for the final distribution in respect of this Note) except that with respect to Notes registered in the name of a Depository, including Cede & Co., the nominee for DTC, distributions will be made to the Depository in immediately available funds. Final payment

 

Indenture (Exhibit A-1)

  

  

  

of this Note will be made only upon presentation and surrender of this Note at the office or agency specified in the notice of final distribution delivered by the Indenture Trustee to the Noteholder in accordance with the Indenture.

 

On the Payment Date occurring after the date on which the aggregate outstanding principal balance of the Notes is reduced to an amount equal to or less than 10% of the initial Net Pool Balance as of the Cut-off Date, the Servicer shall have the option to redeem the Notes in whole, but not in part, at a purchase price equal to the Redemption Price for such Payment Date.  Each of the Notes is also subject to redemption in whole, but not in part, on any Payment Date on which the sum of the amounts in the Reserve Account and the remaining Available Funds after the payments under Sections 5.06(a)(i) through 5.06(a)(ix) and Section 5.06(a)(xi) would be sufficient to pay in full the aggregate unpaid Note Balance of all of the outstanding Notes as determined by the Servicer.

 

This Note does not represent an obligation of, or an interest in Depositor, The Huntington National Bank, or any affiliate of any of them and is not insured or guaranteed by any governmental agency or instrumentality. This Note is limited in right of payment to certain Collections with respect to the Collateral, all as more specifically set forth herein and in the Sale and Servicing Agreement and the Indenture.

 

Upon the satisfaction of the Rating Agency Condition, the Sale and Servicing Agreement may be amended from time to time by the Depositor, the Loan Seller, the Servicer, the Indenture Trustee, the Issuing Entity and the Noteholders holding a majority of the Note Balance of the Controlling Class for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Sale and Servicing Agreement or of modifying in any manner the rights of the Noteholders.

 

The Issuing Entity and the Indenture Trustee, when authorized by an Issuing Entity Order, may, with prior notice to the Rating Agencies and with the consent of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class, by Act of such Holders delivered to the Issuing Entity and the Indenture Trustee, enter into supplemental indentures for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, the Indenture or of modifying in any manner the rights of the Holders of the Notes under the Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Holder of each Note affected thereby: (i) change the date of payment of any installment of principal of or interest on any Note, or reduce the principal amount thereof, the Interest Rate or the Redemption Price with respect thereto, change the provisions of the Indenture relating to the application of collections on, or the proceeds of the sale of, the Collateral to payment of principal of or interest on the Notes, or change any place of payment where, or the coin or currency in which, any Note or the interest thereon is payable, or impair the right to institute suit for the enforcement of the provisions of the Indenture requiring the application of funds available therefor, as provided in Article V thereof, to the payment of any such amount due on the Notes on or after the respective due dates thereof (or, in the case of redemption, on or after the Redemption Date); (ii) change the definition of “Controlling Class” or any other provision hereof specifying the number or percentage of Holders required to waive, amend or modify any rights under the Indenture or make any determination or grant any consent hereunder; (iii) modify or alter the definition of “Notes”; (iv) reduce the percentage of the Notes

 

Indenture (Exhibit A-1)

  

  

  

required to be represented to direct the Indenture Trustee to direct the Issuing Entity to sell or liquidate the Collateral pursuant to Section 5.04 of the Indenture; (v) modify any provision of Section 9.01 of the Indenture except to increase any percentage specified therein or to provide that certain additional provisions of the Indenture or the Basic Documents cannot be modified or waived without the consent of the Holder of each Note affected thereby; (vi) modify any of the provisions of the Indenture in such manner as to affect the calculation of the amount of any payment of interest or principal due on any Note on any Payment Date (including the calculation of any of the individual components of such calculation) or to affect the rights of the Noteholders to the benefit of any provisions for the mandatory redemption of the Notes contained therein;  (vii) permit the creation of any lien ranking prior to or on a parity with the lien of the Indenture with respect to any part of the Collateral or, except as otherwise permitted or contemplated therein, terminate the lien of the Indenture on any property at any time subject hereto or deprive the Noteholder of the security provided by the lien of the Indenture.

 

Without the consent of the Noteholders or any other Person but with prior notice to each Rating Agency, the Issuing Entity and the Indenture Trustee, when authorized by an Issuing Entity Order, at any time and from time to time, may enter into one or more supplemental indentures, (i) to correct or amplify the description of any property at any time subject to the lien of the Indenture, or better to assure, convey and confirm unto the Indenture Trustee any property subject or required to be subjected to the lien of the Indenture, or to subject additional property to the lien of the Indenture; (ii) to evidence the succession, in compliance with the applicable provisions hereof, of another Person to the Issuing Entity, and the assumption by any such successor of the covenants of the Issuing Entity contained herein and in the Notes; (iii) to add to the covenants of the Issuing Entity, for the benefit of the Noteholders, or to surrender any right or power herein conferred upon the Issuing Entity; (iv) to convey, transfer, assign, mortgage or pledge any property to or with the Indenture Trustee; (v) to cure any ambiguity, to correct or to supplement any provision herein or in any supplemental indenture which may be inconsistent with any other provision of the Indenture or in any supplemental indenture or to make any other provisions with respect to matters or questions arising under the Indenture or in any supplemental indenture; provided, that such action shall not materially and adversely affect the interests of the Noteholders; (vi) to evidence and provide for the acceptance of the appointment hereunder by a successor trustee with respect to the Notes and to add to or change any of the provisions of the Indenture as shall be necessary to facilitate the administration of the trusts by more than one trustee, pursuant to the requirements of Article VI of the Indenture; (vii) to modify, eliminate or add to the provisions of the Indenture to such extent as shall be necessary to effect the qualification of the Indenture under the Trust Indenture Act or under any similar federal statute hereafter enacted and to add to the Indenture such other provisions as may be expressly required by the Trust Indenture Act; or (viii) to add, modify or eliminate such provisions as may be necessary or advisable in order to enable (a) the transfer to the Issuing Entity of all or any portion of the Loans to be derecognized under U.S. generally accepted accounting principles by the Loan Seller to the Issuing Entity, (b) the Issuing Entity to avoid becoming a member of the Loan Seller’s consolidated group under U.S. generally accepted accounting principles or (c) the Loan Seller or any of its Affiliates to otherwise comply with or obtain more favorable treatment under 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 be satisfied.

 

Indenture (Exhibit A-1)

  

  

  

The Indenture Trustee is hereby authorized to join in the execution of any such supplemental indenture and to make any further appropriate agreements and stipulations that may be therein contained.

 

Notwithstanding anything to the contrary in the foregoing, none of the Basic Documents may be amended in any way that would: (i) materially and adversely affect the Owner Trustee’s or the Indenture Trustee’s, as applicable, own rights, privileges, indemnities, duties or obligations under the Basic Documents or otherwise without the prior written consent of such Person; or (ii) significantly change the permitted activities or powers of the Issuing Entity even if such amendment would not have an adverse effect on the Holders of the Notes without the consent of the Holders representing a majority of the outstanding Note Balance.

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Note is registrable in the Register of the Registrar upon surrender of this Note for registration of transfer at the office or agency maintained by the Registrar in the Borough of Manhattan, The City of New York, accompanied by a written instrument of transfer in form satisfactory to the Registrar duly executed by the Holder hereof or such Holder’s attorney duly authorized, and thereupon one or more new Notes of authorized denominations evidencing the same aggregate fractional undivided interest will be issued to the designated transferee or transferees.

 

The Notes are issuable only as registered Notes without coupons in denominations specified in the Indenture.

 

As provided in the Indenture and subject to certain limitations therein set forth, Notes are exchangeable for new Notes of a like Class and aggregate principal amount as requested by the Noteholder surrendering such Notes. No service charge may be imposed for any such exchange, but the Indenture Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith.

 

The Servicer, the Indenture Trustee, the Issuing Entity and the Registrar and any agent of any of them, may treat the person in whose name this Note is registered as the owner hereof for all purposes, and neither the Servicer nor the Indenture Trustee, the Issuing Entity and Registrar, nor any agent any of them, shall be affected by notice to the contrary except in certain circumstances described in the Indenture.

 

The Indenture Trustee is not responsible for and makes no representation as to the validity or adequacy of the Indenture or this Note, is not accountable for the Issuing Entity’s use of proceeds of the Notes and is not responsible for any statement in this Note other than the Indenture Trustee’s certificate of authentication.

 

Indenture (Exhibit A-1)

  

  

  

ASSIGNMENT

 

Social Security or taxpayer I.D. or other identifying number of assignee:

 

 

__________________________________________________

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:

 

 

 

____________________________________________________________________________________________________________

(name and address of assignee)

 

the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints 

 

____________________________________________, attorney, to transfer said Note on the books kept for registration thereof, with full 

 

power of substitution in the premises.

 

Dated: _____________________                                                                ______________________________

Signature Guaranteed:

 

                              _______________________________

	
  */

	
NOTICE:  The signature to this assignment must correspond with the name of the registered owner as it appears on the reverse of the within Note in every particular, without alteration, enlargement or any change whatsoever.

Indenture (Exhibit A-1)

  

  

  

EXHIBIT A-2

 

FORM OF CLASS B NOTE

 

[NTD:  TO BE IDENTICAL TO EXHIBIT A-1, MUTATIS MUTANDIS]

 

Indenture (Exhibit A-2)

  

  

  

EXHIBIT B

 

Form of Rule 15Ga-1 Information Report

 

 

 

 

 

 

 

 

 

1

 

Exhibit B-2-H Transferee Certificate for Permitted Transfereessale-srvcagmt.htm

Exhibit 4.2

 

FORM OF SALE AND SERVICING AGREEMENT

 

 

among

 

 

HUNTINGTON AUTO TRUST 20[  ]-[ ],

Issuing Entity,

 

 

HUNTINGTON FUNDING, LLC,

Depositor,

 

 

THE HUNTINGTON NATIONAL BANK,

Loan Seller, Servicer, Administrator, Calculation Agent and Custodian,

 

 

and

 

 

[                         ],

Indenture Trustee

 

 

Dated as of [                     ]

 

 

 

	Sale and Servicing Agreement 	 	 

  

  

  

Table of Contents

Page

	
ARTICLE I. DEFINITIONS

	
2

	  	  
	
Section 1.01.

	
Definitions

	
2

	
Section 1.02.

	
Other Definitional Provisions

	
24

 

	ARTICLE II. 	
CONVEYANCE OF LOANS; BOOKS AND RECORDS; PROVISIONS

	
26

	 	
FOR CLOSING

	 

 

	
Section 2.01.

	
Conveyance of the Loans

	
26

	
Section 2.02.

	
Ownership and Possession of Loan Files

	
26

	
Section 2.03.

	
Books and Records; Intention of the Parties

	
26

	  	  	  
	
ARTICLE III. THE CONVEYED ASSETS

	
28

	  	  
	
Section 3.01.

	
Representations and Warranties of the Loan Seller; Assignment of Representations and Warranties by the Depositor

	
28

	
Section 3.02.

	
Representations and Warranties of the Depositor

	
28

	
Section 3.03.

	
Repurchase upon Breach of Representation: Treatment of Repurchase Price

	
29

	
Section 3.04.

	
Appointment of Custodian; Custody and Delivery of Loan Files

	
30

	
Section 3.05.

	
Duties of Servicer as Custodian

	
30

	
Section 3.06.

	
Instructions; Authority to Act

	
30

	
Section 3.07.

	
Custodian’s Indemnification

	
31

	
Section 3.08.

	
Effective Period and Termination

	
31

	
Section 3.09.

	Risk Retention 	 32
	  	  	  
	
ARTICLE IV. ADMINISTRATION AND SERVICING OF CONVEYED ASSETS

	
33

	  	  
	
Section 4.01.

	
Duties of Servicer

	
33

	
Section 4.02.

	
Collection of Payments on Loans; Extensions

	
34

	
Section 4.03.

	
Realization upon Loans

	
35

	
Section 4.04.

	
Physical Damage Insurance

	
35

	
Section 4.05.

	
Maintenance of Security Interests in Financed Vehicles; Other Amounts

	
36

	
Section 4.06.

	
Covenants of Servicer

	
36

	
Section 4.07.

	
Purchase of Loans by Servicer upon Breach of Covenant

	
37

	
Section 4.08.

	
Servicing Fee

	
38

	
Section 4.09.

	
Servicer’s Monthly Certificate

	
38

	
Section 4.10.

	
Annual Officer's Certificate; Notice of Servicer Replacement Event

	
38

	
Section 4.11.

	
Annual Registered Public Accounting Firm Attestation Report

	
39

	
Section 4.12.

	
Access to Certain Documentation and Information Regarding Loans

	
39

	
Section 4.13.

	
Term of Servicer

	
39

	
Section 4.14.

	
Access to Information Regarding Trust and Basic Documents

	
39

	
Section 4.15.

	
Agreement on Compliance

	
39

	
Section 4.16.

	1934 Act Filings 	 39

 

	Sale and Servicing Agreement 	i	 

  

  

  

Table of Contents

(continued)

Page

	
ARTICLE V. DISTRIBUTIONS; STATEMENTS TO SECURITYHOLDERS

	
41

	  	  
	
Section 5.01.

	
Establishment of Accounts

	
41

	
Section 5.02.

	
Collections

	
43

	
Section 5.03.

	
Application of Collections

	
43

	
Section 5.04.

	
Reserved

	
43

	
Section 5.05.

	
LIBOR Calculation

	
43

	
Section 5.06.

	
Distributions; Payment Notification

	
45

	
Section 5.07.

	
Additional Deposits and Payments.

	
46

	
Section 5.08.

	
Statements to Noteholders and the Owner Trustee

	
47

	
Section 5.09.

	
Advances by the Servicer

	
49

	
Section 5.10.

	
[Interest Rate Cap Agreement.]

	
49

	  	  	  
	
ARTICLE VI. THE DEPOSITOR

	
53

	  	  
	
Section 6.01.

	
Representations of the Depositor

	
53

	
Section 6.02.

	
Entities’ Existence

	
54

	
Section 6.03.

	
Limitation on Liability of Depositor and Others

	
54

	
Section 6.04.

	
Depositor May Own Notes

	
54

	  	  	  
	
ARTICLE VII. THE SERVICER

	
56

	  	  
	
Section 7.01.

	
Representations of Servicer

	
56

	
Section 7.02.

	
Indemnities of Servicer

	
57

	
Section 7.03.

	
Merger or Consolidation of, or Assumption of the Obligations of, Servicer

	
59

	
Section 7.04.

	
Limitation on Liability of Servicer and Others

	
59

	
Section 7.05.

	
Appointment of Subservicer

	
60

	
Section 7.06.

	
Servicer Not to Resign

	
60

	
Section 7.07.

	
Huntington May Own Notes

	
61

	  	  	  
	
ARTICLE VIII. DEFAULT

	
62

	  	  
	
Section 8.01.

	
Servicer Replacement Events

	
62

	
Section 8.02.

	
Consequences of a Servicer Replacement Event

	
63

	
Section 8.03.

	
Appointment of Successor Servicer

	
63

	
Section 8.04.

	
Notification to Noteholders

	
64

	
Section 8.05.

	
Waiver of Past Defaults

	
64

	  	  	  
	
ARTICLE IX. TERMINATION

	
65

	  	  
	
Section 9.01.

	
Optional Purchase of All Conveyed Assets

	
65

	  	  	  
	
ARTICLE X. MISCELLANEOUS

	
66

	  	  
	
Section 10.01.

	
Amendment

	
66

 

	Sale and Servicing Agreement 	ii	 

  

  

  

Table of Contents

(continued)

Page

	
Section 10.02.

	
Protection of Title to Trust

	
66

	
Section 10.03.

	
Notices

	
68

	
Section 10.04.

	
Assignment by the Depositor or the Servicer

	
69

	
Section 10.05.

	
Limitations on Rights of Others

	
69

	
Section 10.06.

	
Severability

	
69

	
Section 10.07.

	
Counterparts

	
70

	
Section 10.08.

	
Headings and Cross-References

	
70

	
Section 10.09.

	
Governing Law

	
70

	
Section 10.10.

	
Confidential Information

	
70

	
Section 10.11.

	
Assignment by the Issuing Entity

	
70

	
Section 10.12.

	
Nonpetition Covenants

	
70

	
Section 10.13.

	
Limitation of Liability of Owner Trustee and Indenture Trustee

	
70

	
Section 10.14.

	Regulation AB 	 71
	
Section 10.15.

	Information to Be Provided by the Indenture Trustee 	 71
	
Section 10.16.

	Form 8-K Filings 	 72
	
Section 10.17.

	Cooperation 	 73

	
Exhibit A

	
Form of Closing Date Assignment

	
Exhibit B-1

	
Form of Servicer’s Monthly Certificate

	
Exhibit B-2

	
Form of Servicer’s Annual Certificate

	
Exhibit C

	
Servicing Standard

	
Exhibit D

	
Underwriting Policy

	
Schedule A

	
Loans Conveyed on the Closing Date

	
Schedule B

	
Location of Custodial Files

 

 

	Sale and Servicing Agreement 	iii	 

  

  

  

This SALE AND SERVICING AGREEMENT, dated as of [                     ], among HUNTINGTON AUTO TRUST 20[  ]-[ ], a Delaware statutory trust (the “Issuing Entity”), HUNTINGTON FUNDING, LLC, a Delaware limited liability company (the “Depositor”), THE HUNTINGTON NATIONAL BANK, a national banking association (“Huntington”), as servicer (in such capacity, the “Servicer”), as seller of motor vehicle installment sale contracts and loans to the Depositor (in such capacity, the “Loan Seller”), as administrator (in such capacity, the “Administrator”) and as custodian and securities intermediary (in such capacity, the “Custodian”) and [                         ], a [                              ], as indenture trustee (the “Indenture Trustee”).

 

WHEREAS, the Issuing Entity desires to purchase from the Depositor a portfolio of motor vehicle installment sale contracts and loans;

 

WHEREAS, the Depositor desires to sell and assign to the Issuing Entity the assets described in the preceding paragraph on the Closing Date (as defined herein); and

 

WHEREAS, Huntington, as Servicer, is willing on behalf of the Issuing Entity to service such loans and motor vehicle sale contracts and the special unit of beneficial interest on behalf of the Issuing Entity.

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto agree as follows:

 

 

[End of Recitals]

 

 

 

	Sale and Servicing Agreement 	 	 

  

  

  

ARTICLE I.

 

DEFINITIONS

 

Section 1.01.     Definitions.  Capitalized terms not defined in this Agreement have the meanings assigned thereto in the Indenture.   Whenever used in this Agreement, the following words and phrases have the following meanings, unless the context otherwise requires:

 

“Accrued Class A Note Interest” means, with respect to any Payment Date, the sum of the Class A Noteholders’ Monthly Accrued Interest for such Payment Date and the Class A Noteholders’ Interest Carryover Shortfall for such Payment Date.

 

[“Accrued Class B Note Interest” means, with respect to any Payment Date, the sum of the Class B Noteholders’ Monthly Accrued Interest for such Payment Date and the Class B Noteholders’ Interest Carryover Shortfall for such Payment Date.]

 

“Administration Agreement” means the Administration Agreement, dated as of [                     ], among the Issuing Entity, Huntington as Administrator, the Owner Trustee and the Indenture Trustee.

 

“Advance” means any advance that the Servicer is required to make pursuant to Section 5.09.

 

“Advance Reimbursement Amount” means any amount received or deemed to be received by the Servicer pursuant to Section 4.03 in reimbursement of an Advance made out of its own funds.

 

“Agreement” means this Sale and Servicing Agreement.

 

“Amount Financed” means, with respect to a Loan, the original principal amount that the Loan Obligor is required to pay under the related Contract, including repayment of amounts advanced toward the purchase price of the Financed Vehicle and any related costs and other amounts financed under the related Contract, exclusive of any amount advanced during the term of the Contract for the premiums for force-placed physical damage insurance covering the Financed Vehicle, it being understood that the Amount Financed includes amounts allocable to prepaid finance charges due under the related Contract.

 

“Annual Percentage Rate” or “APR” means, with respect to a Loan, the annual contractual rate of interest stated in the related Contract as being payable by the Loan Obligor, it being understood that this is not necessarily the “annual percentage rate” as disclosed in the Contract for such Loan pursuant to the federal Truth in Lending Act.

 

“Applicable Law” means all provisions of statutes, rules and regulations, interpretations and orders of any Governmental Authority applicable to a Person, and all orders and decrees of all courts and arbitrators in proceedings or actions in which the Person in question is a party including applicable federal, state and local laws and regulations thereunder.

 

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	Sale and Servicing Agreement 	 	 

  

  

  

“Asset Purchase Agreement” means the Asset Purchase Agreement, dated as of [                     ], between the Loan Seller and the Depositor, pursuant to which the Loan Seller has agreed to sell or assign (as applicable) the Conveyed Assets to the Depositor on the Closing Date.

 

“Assignment” means an assignment agreement supplemental to this Agreement and the Asset Purchase Agreement, in the form of Exhibit A hereto evidencing (i) the transfer or assignment (as applicable) of the Conveyed Assets from the Loan Seller to the Depositor, (ii) the transfer of Conveyed Assets from the Depositor to the Issuing Entity and (iii) the pledge of such Conveyed Assets by the Issuing Entity to the Indenture Trustee.

 

“Available Funds” means, for any Payment Date and the related Collection Period, an amount equal to the sum of the following amounts: (i) all Collections received by the Servicer during such Collection Period (less any amounts withdrawn from the Collection Account by the Servicer in order to reimburse itself for Nonrecoverable Advances in accordance with Section 5.09), (ii) the sum of the Repurchase Prices deposited into the Collection Account with respect to each Loan that is to become a repurchased Loan on such Payment Date, (iii) [the Reserve Account Excess Amount] for such Payment Date, (iv) [the Cap Payments, if any, received from the Cap Counterparty for such Payment Date and Cap Termination Payments made by the Cap Counterparty (less Cap Replacement Proceeds used to enter into a Replacement Interest Rate Cap Agreement), (v) amounts transferred from the Cap Termination Payment Account to the extent such amounts are required to be included in Available Funds pursuant to Section 5.10(d) of this Agreement and (vi) Cap Replacement Proceeds, to the extent required to be included in Available Funds pursuant to Section 5.10(f) of this Agreement.]

 

“Available Funds Shortfall Amount” means, as of any Payment Date, the amount by which the amounts required to be paid pursuant to clauses [first] through [fifth] of Section 5.06(a) of this Agreement exceeds the sum of Available Funds for such Payment Date.

 

“Basic Documents” means this Agreement, the Trust Agreement, the Indenture, the Notes, the Note Purchase Agreement, the Asset Purchase Agreement, the Assignment, the Administration Agreement, [the Interest Rate Cap Agreement] and all of the other documents and certificates delivered in connection with each such document.

 

“Business Day” means any day other than a Saturday, a Sunday or any other day on which national banking institutions or commercial banking institutions in the State of New York, the State of Ohio [or the principal place of business of the Cap Counterparty] are authorized or required by law, executive order or governmental decree to be closed or any day on which the Federal Reserve Bank of Cleveland is closed.

 

“Calculation Agent” means Huntington, in its capacity as Calculation Agent hereunder, or such other Person that shall have accepted appointment as Calculation Agent hereunder.

 

[“Cap Collateral Account” means a single, segregated trust account in the name of the Indenture Trustee, which shall be designated as the “Cap Collateral Account” which shall be held in trust for the benefit of the Noteholders established pursuant to Section 5.10(e) of this Agreement.]

 

	 	3 	 
	Sale and Servicing Agreement 	 	 

  

  

  

[“Cap Collateral Payment” means collateral payments made under Section 5.10.]

 

[“Cap Counterparty” means the Initial Cap Counterparty and any Replacement Cap Counterparty.]

 

[“Cap Payment Date” means the date on which Cap Payments, as applicable, are made pursuant to the Interest Rate Cap Agreement.]

 

[“Cap Payments” means, for the Interest Rate Cap Agreement, the amount, if any, owed by the Cap Counterparty to the Issuing Entity on any Payment Date (excluding any Cap Termination Payments) which shall be deposited in the Collection Account.]

 

[“Cap Replacement Proceeds” means any amounts received from a Replacement Cap Counterparty in consideration for entering into a Replacement Interest Rate Cap Agreement for a terminated Interest Rate Cap Agreement.]

 

[“Cap Termination Payment” means any payment due to the Issuing Entity by the Cap Counterparty, including interest that may accrue thereon, under the Interest Rate Cap Agreement due to a termination of the Interest Rate Cap Agreement due to an “event of default” or “termination event” under the Interest Rate Cap Agreement.]

 

[“Cap Termination Payment Account” means an Eligible Account held in the United States in the name of the Indenture Trustee which shall be held in trust for the benefit of the Noteholders pursuant to Section 5.10(b) of this Agreement.  ]

 

“Class” means a group of Notes whose form is identical except for variation in denomination, principal amount or owner, and references to “each Class” thus mean each of the Class A-1 Notes, the Class A-2-A Notes, the Class A-2-B Notes, the Class A-3-A Notes, the Class A-3-B Notes, the Class A-4 Notes and [the Class B Notes].

 

“Class A Noteholders” means, collectively, the Class A-1 Noteholders, the Class A-2-A Noteholders, the Class A-2-B Noteholders, the Class A-3-A Noteholders, the Class A-3-B Noteholders and the Class A-4 Noteholders.

 

“Class A Noteholders’ Interest Carryover Shortfall” means, with respect to any Payment Date, the excess of the Class A Noteholders’ Monthly Accrued Interest for the preceding Payment Date and any outstanding Class A Noteholders’ Interest Carryover Shortfall on such preceding Payment Date, over the amount in respect of interest that is actually paid to Noteholders of Class A Notes on such preceding Payment Date, plus interest on the amount of interest due but not paid to Noteholders of Class A Notes on the preceding Payment Date, to the extent permitted by law, at the respective Interest Rates borne by such Class A Notes for the related Interest Period.

 

“Class A Noteholders’ Monthly Accrued Interest” means, with respect to any Payment Date, the aggregate interest accrued for the related Interest Period on the Class A-1 Notes, the Class A-2-A Notes, the Class A-2-B Notes, the Class A-3-A Notes, the Class A-3-B Notes and the Class A-4 Notes at the respective Interest Rate for such Class on the Note Balance of the Notes of each such Class on the immediately preceding Payment Date or the Closing Date, as the

 

	 	4 	 
	Sale and Servicing Agreement 	 	 

  

  

  

case may be, after giving effect to all payments of principal to the Noteholders of the Notes of such Class on or prior to such preceding Payment Date.

 

“Class A Notes” means, collectively, the Class A-1 Notes, the Class A-2-A Notes, the Class A-2-B Notes, the Class A-3-A Notes, the Class A-3-B Notes and the Class A-4 Notes.

 

“Class A-1 Final Scheduled Payment Date” means the Payment Date occurring on [      ].

 

“Class A-1 Interest Rate” means [      ]% per annum (computed on the basis of the actual number of days elapsed during the applicable Interest Period, but assuming a 360-day year).

 

“Class A-1 Note Balance” means, at any time, the Initial Class A-1 Note Balance reduced by all payments of principal made prior to such time on the Class A-1 Notes.

 

“Class A-1 Noteholder” means the Person in whose name a Class A-1 Note is registered on the Register.

 

“Class A-1 Notes” means the Class of auto loan asset backed notes designated as Class A-1 Notes, issued in accordance with the Indenture.

 

“Class A-2 Final Scheduled Payment Date” means the Payment Date occurring on [      ].

 

“Class A-2 Notes” means the Class A-2-A Notes and the Class A-2-B Notes.

 

“Class A-2-A Interest Rate” means [      ]% per annum (computed on the basis of a 360-day year of twelve 30-day months).

 

“Class A-2-A Note Balance” means, at any time, the Initial Class A-2-A Note Balance reduced by all payments of principal made prior to such time on the Class A-2-A Notes.

 

“Class A-2-A Noteholder” means the Person in whose name a Class A-2-A Note is registered on the Register.

 

“Class A-2-A Notes” means the Class of auto loan asset backed notes designated as Class A-2-A Notes, issued in accordance with the Indenture.

 

“Class A-2-B Interest Rate” means the sum of LIBOR + [      ]% per annum (computed on the basis of the actual number of days elapsed during the applicable Interest Period, but assuming a 360-day year).

 

“Class A-2-B Note Balance” means, at any time, the Initial Class A-2-B Note Balance reduced by all payments of principal made prior to such time on the Class A-2-B Notes.

 

“Class A-2-B Noteholder” means the Person in whose name a Class A-2-B Note is registered on the Register.

 

“Class A-2-B Notes” means the Class of auto loan asset backed notes designated as Class A-2-B Notes, issued in accordance with the Indenture.

 

	 	5 	 
	Sale and Servicing Agreement 	 	 

  

  

  

“Class A-3 Final Scheduled Payment Date” means the Payment Date occurring on [      ].

 

“Class A-3 Notes” means the Class A-3-A Notes and the Class A-3-B Notes.

 

“Class A-3-A Interest Rate” means [      ]% per annum (computed on the basis of a 360-day year of twelve 30-day months).

 

“Class A-3-A Note Balance” means, at any time, the Initial Class A-3-A Note Balance reduced by all payments of principal made prior to such time on the Class A-3-A Notes.

 

“Class A-3-A Noteholder” means the Person in whose name a Class A-3-A Note is registered on the Register.

 

“Class A-3-A Notes” means the Class of auto loan asset backed notes designated as Class A-3-A Notes, issued in accordance with the Indenture.

 

“Class A-3-B Interest Rate” means the sum of LIBOR + [      ]% per annum (computed on the basis of the actual number of days elapsed during the applicable Interest Period, but assuming a 360-day year).

 

“Class A-3-B Note Balance” means, at any time, the Initial Class A-3-B Note Balance reduced by all payments of principal made prior to such time on the Class A-3-B Notes.

 

“Class A-3-B Noteholder” means the Person in whose name a Class A-3-B Note is registered on the Register.

 

“Class A-3-B Notes” means the Class of auto loan asset backed notes designated as Class A-3-B Notes, issued in accordance with the Indenture.

 

“Class A-4 Final Scheduled Payment Date” means the Payment Date occurring on [      ].

 

“Class A-4 Interest Rate” means [      ]% per annum (computed on the basis of a 360-day year of twelve 30-day months).

 

“Class A-4 Note Balance” means, at any time, the Initial Class A-4 Note Balance reduced by all payments of principal made prior to such time on the Class A-4 Notes.

 

“Class A-4 Noteholder” means the Person in whose name a Class A-4 Note is registered on the Register.

 

“Class A-4 Notes” means the Class of auto loan asset backed notes designated as Class A-4 Notes, issued in accordance with the Indenture.

 

“Class B Final Scheduled Payment Date” means the Payment Date occurring on [      ].

 

“Class B Interest Rate” means [      ]% per annum (computed on the basis of a 360-day year of twelve 30-day months).

 

	 	6 	 
	Sale and Servicing Agreement 	 	 

  

  

  

“Class B Note Balance” means, at any time, the Initial Class B Note Balance reduced by all payments of principal made prior to such time on the Class B Notes.

 

“Class B Noteholder” means the Person in whose name a Class B Note is registered on the Register.

 

“Class B Noteholders’ Interest Carryover Shortfall” means, with respect to any Payment Date, the excess of the Class B Noteholders’ Monthly Accrued Interest for the preceding Payment Date and any outstanding Class B Noteholders’ Interest Carryover Shortfall on such preceding Payment Date, over the amount in respect of interest that is actually paid to Noteholders of Class B Notes on such preceding Payment Date, plus interest on the amount of interest due but not paid to Noteholders of Class B Notes on the preceding Payment Date, to the extent permitted by law, at the Class B Interest Rate for the related Interest Period.

 

“Class B Noteholders’ Monthly Accrued Interest” means, with respect to any Payment Date, the aggregate interest accrued for the related Interest Period on the Class B Notes at the Class B Interest Rate on the Class B Note Balance on the immediately preceding Payment Date or the Closing Date, as the case may be, after giving effect to all payments of principal to the Class B Noteholders on or prior to such preceding Payment Date.

 

“Class B Notes” means the Class of auto loan asset backed notes designated as Class B Notes, issued in accordance with the Indenture.

 

“Closing Date” means [      ].

 

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

 

“Collections” means, with respect to any receivable and to the extent received by the servicer after the cut-off date, all Principal Collections and all Interest Collections, but excluding all Supplemental Servicing Fees.

 

“Collection Account” means the account designated as such pursuant to Section 5.01(a), which has been established by the Indenture Trustee and is to be maintained by the Indenture Trustee as an Eligible Account.

 

“Collection Period” means, with respect to any Payment Date, the calendar month immediately preceding the month in which such Payment Date occurs; provided, however, that the first Collection Period shall commence on the day immediately following the Cutoff Date and end on and include the last day of the calendar month immediately preceding the first Payment Date.

 

“Contract” means, with respect to Loan, a retail motor vehicle installment sale contract or a motor vehicle installment loan note originated, purchased or otherwise acquired by the Loan Seller and made part of the Conveyed Assets.

 

“Controlling Class” shall mean, with respect to any Notes Outstanding, the Class A Notes (voting together as a single Class) as long as any Class A Notes are Outstanding, and thereafter [the Class B Notes] as long as any [Class B Notes] are Outstanding (excluding, in each case,

 

	 	7 	 
	Sale and Servicing Agreement 	 	 

  

  

  

Notes held by the Servicer, Huntington or any of their respective Affiliates unless all of the Notes then Outstanding are held by the Servicer, Huntington and/or their respective Affiliates).

 

“Conveyed Assets” means (without duplication) all right, title and interest in and to all accounts, payment intangibles and other general intangibles, chattel paper, instruments, documents, money, deposit accounts, certificates of deposit, goods, letters of credit, advices of credit and Investment Property and all other tangible and intangible property (together with all related supporting obligations and proceeds), whether consisting of, arising from or relating to and including:

 

(i)           each Loan sold or contributed by the Loan Seller to the Depositor on the Closing Date, together with all principal, interest and other amounts due or to become due thereon after the Cutoff Date;

 

(ii)          the security interest in each Financed Vehicle and any other tangible or intangible property securing a Loan that has been sold by the Loan Seller to the Depositor on the Closing Date (including all moneys due or to become due with respect thereto) and any accessions thereto and any other interest of the Loan Seller or the Depositor, in any such Financed Vehicle and any other tangible or intangible property;

 

(iii)         any Liquidation Proceeds relating to a Loan or a Financed Vehicle;

 

(iv)         all other money, instruments, goods, advices of credit and letters of credit relating to, consisting of or arising under any Loan;

 

(v)          all documents and other items contained in each Loan File;

 

(vi)         all rights of the Depositor under the Asset Purchase Agreement;

 

(vii)        all funds on deposit from time to time in the Trust Accounts, the Certificate Distribution Account (as defined in the Trust Agreement), the Principal Distribution Account and any other accounts established pursuant to the Indenture, the Trust Agreement, or this Agreement, and all cash, investment property and other property from time to time credited thereto and all proceeds thereof (including all Net Investment Earnings thereon);

 

(viii)       all Securities Accounts and all Security Entitlements with respect to Financial Assets credited to any Securities Account;

 

(ix)          all rights in respect of Huntington Debt Forgiveness Policies with respect to the Loans;

 

(x)           all rights of the Loan Seller under agreements with Dealers relating to the Loans;

 

(xi)          all enforcement and other rights under the UCC and other Applicable Law in respect of any or all of the foregoing;

 

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(xii)           all present and future claims, demands, causes of action and choses in action in respect of any or all of the foregoing; and

 

(xiii)          the proceeds of or with respect to any and all of the foregoing.

 

“Cram Down Loss” means any loss on a Loan resulting from an order issued by a court of appropriate jurisdiction in an insolvency proceeding that reduces the amount owed on the Loan or otherwise modifies or restructures the scheduled payments to be made thereon.  The amount of any such Cram Down Loss with respect to a Loan will equal the excess of (x) the Principal Balance of the Loan immediately prior to such order over (y) the Principal Balance of such Loan as so reduced, modified or restructured.  A Cram Down Loss on a Loan will be deemed to have occurred on the date on which the Servicer receives notice of such order.

 

“Custodian” means any custodian appointed pursuant to Section 3.04 or Section 3.08, and shall initially be Huntington, in its capacity as custodian of the Loans.

 

“Cutoff Date” means [                     ].

 

“Dealer” means with respect to any Loan, the motor vehicle dealer that sold a Financed Vehicle and through which Huntington originated the related Loan or that originated the related Loan and assigned it to Huntington pursuant to a Dealer Agreement or form of assignment, as applicable.

 

“Dealer Agreement” means with respect to Loans, the agreement between a Dealer and the Loan Seller relating to the origination of, or assignment to the Loan Seller of, the related Loans.

 

“Delivery”, when used with respect to Trust Account Property, means:

 

(a)           with respect to bankers’ acceptances, commercial paper, negotiable certificates of deposit and other obligations that constitute “instruments” within the meaning of Section 9-102(a)(47)(i) of the UCC and are susceptible of physical delivery, transfer thereof to the Indenture Trustee by physical delivery to the Indenture Trustee endorsed to, or registered in the name of, the Indenture Trustee or endorsed in blank, and, with respect to a certificated security (as defined in Section 8-102 of the UCC) transfer thereof (i) by delivery of such certificated security endorsed to, or registered in the name of, the Indenture Trustee or (ii) by delivery thereof to a “clearing corporation” (as defined in Section 8-102 of the UCC) and the making by such clearing corporation of appropriate entries on its books reducing the appropriate Securities Account of the transferor and increasing the appropriate Securities Account of the Indenture Trustee by the amount of such certificated security and the identification by the clearing corporation of the certificated securities for the sole and exclusive account of the Indenture Trustee (all of the foregoing, “Physical Property”), and, in any event, any such Physical Property in registered form shall be in the name of the Indenture Trustee or its nominee; and such additional or alternative procedures as may hereafter become appropriate (in the sole discretion of the Indenture Trustee) to effect the complete transfer of ownership of any

 

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such Trust Account Property to the Indenture Trustee or its nominee or custodian, consistent with changes in Applicable Law or regulations or the interpretation thereof;

 

(b)           with respect to any security issued by the U.S. Treasury, the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association or the Government National Mortgage Association that is a book-entry security held through the Federal Reserve System pursuant to federal book-entry regulations, the following procedures, all in accordance with Applicable Law, including applicable federal regulations and Articles 8 and 9 of the UCC: book-entry registration of such Trust Account Property to an appropriate book-entry account maintained with a Federal Reserve Bank by a Securities Intermediary that is also a “depository” pursuant to applicable federal regulations; the making by such Securities Intermediary of entries in its books and records crediting such Trust Account Property to the Indenture Trustee’s Securities Account at the Securities Intermediary and identifying such book-entry security held through the Federal Reserve System pursuant to federal book-entry regulations as belonging to the Indenture Trustee; and such additional or alternative procedures as may hereafter become appropriate (in the sole discretion of the Indenture Trustee) to effect complete transfer of ownership of any such Trust Account Property to the Indenture Trustee, consistent with changes in Applicable Law or regulations or the interpretation thereof;

 

(c)           with respect to any item of Trust Account Property that is an uncertificated security under Article 8 of the UCC and that is not governed by clause (b) above, registration on the books and records of the issuer thereof in the name of the Indenture Trustee or its nominee or custodian who either (i) becomes the registered owner on behalf of the Indenture Trustee or (ii) having previously become the registered owner, acknowledges that it holds for the Indenture Trustee; and

 

(d)           with respect to any item of Trust Account Property that is a Security Entitlement, causing the Securities Intermediary to indicate on its books and records that such Security Entitlement has been credited to a Securities Account of the Indenture Trustee.

 

“Depositor” means Huntington Funding, LLC, a Delaware limited liability company, together with its successors.

 

“Depositor Operating Agreement” means the Amended and Restated Limited Liability Company Agreement of the Depositor dated as of [      ].

 

“Determination Date” means, with respect to each Payment Date, the third (3rd) Business Day immediately preceding such Payment Date.

 

“Eligible Account” means either (a) a segregated trust 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 State thereof, having corporate trust powers and acting as trustee for funds deposited in such account, so long as any of the

 

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securities of such depository institution shall have a short-term unsecured debt rating not less than “A-1+” by Standard & Poor’s and “P-1” by Moody’s.

 

“Eligible Institution” means (a) the corporate trust department of the Indenture Trustee or Owner Trustee or (b) a depository institution organized under the laws of the United States of America or any State thereof, that (i) has either (A) a long-term unsecured debt rating of at least “AA-“ by Standard & Poor’s and “A2” by Moody’s or (B) a short-term unsecured debt rating or certificate of deposit rating of at least “A-1+” by Standard & Poor’s and “P-1” by Moody’s and (ii) the deposits of which are insured by the FDIC.

 

“Eligible Servicer” means, on the Closing Date, Huntington, and thereafter any Person that at the time of its appointment as Servicer is legally qualified and has the capacity to service the Conveyed Assets.

 

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

 

“FDIC” means the Federal Deposit Insurance Corporation, and its successors.

 

“Federal Reserve Agreements” means the Agreements of Huntington with the Federal Reserve Bank of Cleveland, dated as of August 10, 1998 and August 24, 1998, to the provisions of Operating Circulate No. 10 referenced therein, and the related Borrower-in-Custody Application to Pledge Collateral for Advances and Discounts, as modified by the Release of Security Interest dated as of June 6, 2006 between Huntington and the Federal Reserve Bank of Cleveland.

 

“Final Scheduled Payment Date” means, with respect to (i) the Class A-1 Notes, the Class A-1 Final Scheduled Payment Date, (ii) the Class A-2 Notes, the Class A-2 Final Scheduled Payment Date, (iii) the Class A-3 Notes, the Class A-3 Final Scheduled Payment Date,  (iv) the Class A-4 Notes, the Class A-4 Final Scheduled Payment Date, and (v) [the Class B Notes, the Class B Final Scheduled Payment Date].

 

“Financed Vehicle” means a new or used automobile, light-duty truck, minivan or sport utility vehicle, together with all accessions thereto, securing a Loan Obligor’s indebtedness under the related Contract for a Loan.

 

“First Allocation of Principal” means, for any Payment Date, an amount not less than zero equal to the excess, if any, of (a) the aggregate Class A Note Balance as of the preceding Payment Date (after giving effect to all principal payments made on that preceding Payment Date and with respect to the first Payment Date, as of the Closing Date) over (b) the Net Pool Balance as of the last day of the related Collection Period; provided, that the First Allocation of Principal on and after the Final Scheduled Payment Date for any Class of Class A Notes will not be less than the amount that is necessary to reduce the principal amount of each such Class, as applicable, to zero.

 

“Fixed Rate Notes” means the Notes other than the Floating Rate Notes.

 

“Floating Rate Notes” means the Class A-2-B and Class A-3-B Notes.

 

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“Governmental Authority” means the government of the United States of America or any political subdivision thereof, whether state, federal or local, and any agency, authority, instrumentality, regulatory body, court, administrative court or judge, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

 

“Huntington” means The Huntington National Bank, a national banking association.

 

“Huntington Credit Guard” means a bargained-for contract entered into by some obligors pursuant to which specified obligations of the obligor of a receivable to pay unpaid amounts on the receivable are cancelled during a period of unemployment of the obligor or following the death of the obligor.  Under those contracts, Huntington agrees to pay such cancelled amounts as and to the same extent as if it were a third party providing such protection, with the issuing entity or the indenture trustee named as loss payee.

 

“Huntington Debt Forgiveness Policies” means Huntington Credit Guard and Huntington GAP.

 

“Huntington GAP” means a bargained-for contractual provision contained in some Contracts pursuant to which the Loan Obligor is absolved of specified obligations to pay unpaid amounts remaining on the Loan after theft or destruction of the related Financed Vehicle.  Under those contracts, Huntington agrees to pay such cancelled amounts as and to the same extent as if it were a third party providing such protection, with the issuing entity or the indenture trustee named as loss payee.

 

“Indenture” means the Indenture, dated as of [                     ], between the Issuing Entity and the Indenture Trustee.

 

“Indenture Trustee” means each Person acting as Indenture Trustee under the Indenture, initially [                         ].

 

[“Initial Cap Counterparty” means [      ], as Party A under the Initial Interest Rate Cap Agreement.]

 

“Initial Class A-1 Note Balance” means $[      ].

 

“Initial Class A-2-A Note Balance” means $[      ].

 

“Initial Class A-2-B Note Balance” means $[      ].

 

“Initial Class A-3-A Note Balance” means $[      ].

 

“Initial Class A-3-B Note Balance” means $[      ].

 

“Initial Class A-4 Note Balance” means $[      ].

 

[“Initial Class B Note Balance” means $[      ].]

 

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[“Initial Interest Rate Cap Agreement” means the long-form confirmation (which deems the existence of a 1992 ISDA Master Agreement between the Issuing Entity and the Cap Counterparty and includes a schedule and a 1994 Credit Support Annex to such deemed ISDA Master Agreement) dated as of the Closing Date between the Initial Cap Counterparty and the Issuing Entity, as the same may be amended or supplemented from time to time in accordance with the terms thereof.]

 

“Initial Note Balance” means, for any Class, the Initial Class A-1 Note Balance, the Initial Class A-2-A Note Balance, the Initial Class A-2-B Note Balance, the Initial Class A-3-A Note Balance, the Initial Class A-3-B Note Balance, the Initial Class A-4 Note Balance or [the Initial Class B Note Balance], as applicable, or with respect to the Notes generally, the sum of the foregoing.

 

“Initial Purchasers” means the initial purchasers of the Notes set forth in Schedule I to the Note Purchase Agreement.

 

[“Initial Reserve Account Deposit Amount” means an amount equal to $[      ].]

 

“Insolvency Event” means, with respect to a specified Person, (a) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of such Person or all or any part of its property in an involuntary case under any applicable federal or state bankruptcy, insolvency, receivership or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for all or any part of its property, or ordering the winding-up or liquidation of such Person’s affairs, and, if involuntary, such decree or order shall remain unstayed and in effect for a period of sixty (60) consecutive days or an order or decree approving or ordering any of the foregoing shall be ordered; or (b) the commencement by such Person of a voluntary case under any applicable federal or state bankruptcy, insolvency, receivership or other similar law now or hereafter in effect, or the application or consent by such Person to the entry of or failure to contest in a timely and appropriate manner an order for relief in an involuntary case under any such law, or the consent by such Person to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for all or any part of its property, or the making by such Person of any general assignment for the benefit of creditors, or the failure by such Person generally, or the admission in writing its inability, to pay its debts as such debts become due, or the taking of action by such Person in furtherance of any of the foregoing.

 

“Interest Collections” means, with respect to any Payment Date, the sum of the following amounts, without duplication:  (a) Loan Interest Collections; (b) all Net Investment Earnings designated as Interest Collections for such Payment Date pursuant to Section 5.01(e)(ii) and Section 5.01(e)(iii); (c) amounts required to be deposited by the Servicer in the Collection Account pursuant to Section 5.01(f) in reimbursement of Net Investment Losses and (d) [the Reserve Account Draw Amount.]

 

“Interest Period” means, with respect to each Payment Date, (a) for the [Class A-1 Notes] and the Floating Rate Notes the period from and including the prior Payment Date (or from and including the Closing Date in the case of the first Payment Date) to but excluding the following

 

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Payment Date or (b) for the Fixed Rate Notes, other than the [Class A-1 Notes], from and including the 15th day of each calendar month preceding each Payment Date (or from and including the Closing Date in the case of the first Payment Date) to but excluding the 15th day of the following month.

 

“Interest Rate” means (a) with respect to the Class A-1 Notes, the Class A-1 Interest Rate, (b) with respect to the Class A-2-A Notes, the Class A-2-A Interest Rate, (c) with respect to the Class A-2-B Notes, the Class A-2-B Interest Rate, (d) with respect to the Class A-3-A Notes, the Class A-3-A Interest Rate, (e) with respect to the Class A-3-B Notes, the Class A-3-B Interest Rate, (f) with respect to the Class A-4 Notes, the Class A-4 Interest Rate, or (g) [with respect to the Class B Notes, the Class B Interest Rate].

 

[“Interest Rate Cap Agreement” means the Initial Interest Rate Cap Agreement and any Replacement Interest Rate Cap Agreement.]

 

“ISDA Definitions” means the 2006 ISDA Definitions.

 

“Issuing Entity” means Huntington Auto Trust 20[  ]-[ ], a Delaware statutory trust.

 

“LIBOR” means, with respect to any Interest Period, the London interbank offered rate for deposits in U.S. dollars having a maturity of one month commencing on the related LIBOR Determination Date which appears on Reuters Telerate Service Page 3750 as of 11:00 a.m., London time, on such LIBOR Determination Date; provided, however, that for the first Interest Period, LIBOR shall mean an interpolated rate for deposits based on London interbank offered rates for deposits in U.S. Dollars for a period that corresponds to the actual number of days in the first Interest Period.  If the rates used to determine LIBOR do not appear on the Reuters Telerate Service Page 3750, the rates for that day will be determined on the basis of the rates at which deposits in U.S. dollars, having a maturity of one month and in a principal amount of not less than U.S. $1,000,000 are offered at approximately 11:00 a.m. London time, on such LIBOR Determination Date to prime banks in the London interbank market by the reference banks.  The Calculation Agent will request the principal London office of each of such reference banks to provide a quotation of its rate.  If at least two such quotations are provided, the rate for that day will be the arithmetic mean to the nearest 1/100,000 of 1.00% (0.0000001), with five one-millionths of a percentage point rounded upward, of all such quotations.  If fewer than two such quotations are provided, the rate for that day will be the arithmetic mean to the nearest 1/100,000 of 1.00% (0.0000001), with five one-millionths of a percentage point rounded upward, of the offered per annum rates that one or more leading banks in New York City, selected by the Calculation Agent (after consulting with the Depositor), are quoting as of approximately 11:00 a.m., New York City time, on such LIBOR Determination Date to leading European banks for United States dollar deposits for that maturity; provided, that if the banks selected as aforesaid are not quoting as mentioned in this sentence, LIBOR in effect for the applicable Interest Period will be LIBOR in effect for the previous Interest Period.  The reference banks are the four major banks in the London interbank market selected by the Calculation Agent (after consultation with the Seller).

 

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“LIBOR Determination Date” means the second London Business Day prior to the Closing Date with respect to the first Payment Date and, as to each subsequent Payment Date, the second London Business Day prior to the immediately preceding Payment Date.

 

“Lien” means a security interest, lien, charge, pledge or encumbrance of any kind.

 

“Liquidation Proceeds” means with respect to any Loan that becomes a Net Loss Asset, the moneys collected in respect thereof, from whatever source, during or after the Collection Period in which such Loan became a Net Loss Asset, including liquidation of the related Financed Vehicle, insurance proceeds, any recourse under a dealer agreement or extended service agreement, indemnity payments made with respect to a Loan under Huntington Debt Forgiveness Policies and indemnities by the related Loan Obligors, net of the sum of any out-of-pocket expenses of the Servicer reasonably allocated to such liquidation and any amounts required by law to be remitted to the related Loan Obligor on such Net Loss Asset; provided, however, that the Repurchase Price for any Loan purchased by the Loan Seller, the Depositor or the Servicer will not constitute Liquidation Proceeds.

 

“Loan” means any motor vehicle loan, retail motor vehicle installment sales contract or other form of financing arrangement and all right, title and interest related thereto and the security therefor, evidenced by a Contract listed on Schedule A to this Agreement, and any motor vehicle loan, retail motor vehicle installment sales agreement or other form of financing arrangement and all right, title and interest related thereto and the security therefor, evidenced by a Contract listed on a schedule attached to the Assignment.

 

“Loan Files” means the following documents with respect to each Financed Vehicle:

 

(i)           the original Contract or, where the original cannot be located, a copy of the original Contract or the fully executed original, electronically authenticated original or “authoritative copy” (within the meaning of Section 9-105 of the UCC) of the Contract, including any written amendments or extensions thereto;

 

(ii)           the original credit application, whether in paper or electronic form, or any copy, duplicate or electronic record thereof;

 

(iii)           the original or replacement certificate of title as issued in paper or electronic form by the appropriate governmental agency in the State in which the Financed Vehicle is titled, or if the original certificate of title is required to be held by the agency, department or office that issued such original certificate of title, a receipt thereof (which for Michigan and Arizona shall be in the form of RD-108 and for Kentucky shall be in the form of a “Lien Statement”), and such other documents that the Servicer shall keep on file, in accordance with its customary standards, policies and procedures, evidencing the security interest of the Loan Seller in the related Financed Vehicle;

 

(iv)           if the odometer reading of the Financed Vehicle at the time of sale to the Obligor is not listed on the certificate of title or the original credit application, the odometer statement; and

 

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(v)           any and all other documents that the Servicer shall have kept on file in accordance with its customary procedures relating to a Contract for a Loan.

 

“Loan Interest Collections” means, with respect to any Payment Date, the sum of the following amounts, without duplication: (a) that portion of all collections received on Loans during or with respect to the related Collection Period and allocable to interest in respect of Loans; (b) Advances made in respect of Loans allocable to interest for that Collection Period (but excluding any Advance Reimbursement Amounts in respect of such Loans); and (c) all Liquidation Proceeds for such Collection Period to the extent allocable to interest in respect of Loans.

 

“Loan Obligor” means, with respect to a Loan, the Person obligated on the Contract for the Loan, and any other Person obligated to make payments under the Loan including any Person that executes a guarantee on behalf of such Loan Obligator.

 

“Loan Seller” means Huntington, as the seller of Loans to the Depositor pursuant to the Asset Purchase Agreement.

 

“London Business Day” means any day other than a Saturday, Sunday or day on which banking institutions in London, England and New York are authorized or obligated by law or government decree to be closed.

 

“Material Adverse Effect” shall mean a material adverse effect on the ability of a Person to perform its obligations or enforce its rights under this Agreement or any other Basic Document.

 

“Moody’s” means Moody’s Investors Service, Inc. and its successors.

 

“Net Investment Earnings” means, with respect to a Trust Account and any Collection Period, the amount, if any, by which the aggregate of all interest and other income realized during such Collection Period in connection with the investment of funds in Permitted Investments in accordance with Section 5.01(e) exceeds the aggregate of all losses and expenses incurred during such period with respect to such funds.

 

“Net Investment Losses” means, with respect to a Trust Account and any Collection Period, the amount, if any, by which the aggregate of all losses and expenses incurred during such period in connection with the investment of funds in Permitted Investments in accordance with Section 5.01(e) exceeds the aggregate of all interest and other income realized during such period with respect to such funds.

 

“Net Loss Asset” means, with respect to any Collection Period, a Loan (a) which, at the end of such Collection Period, is deemed uncollectible by the Servicer in accordance with the Servicing Standard, (b) in respect of which the Servicer has repossessed the related Financed Vehicle and such Financed Vehicle has been liquidated during such Collection Period, (c) in respect of which the Servicer has repossessed the related Financed Vehicle and has held such Financed Vehicle in its or its agent’s repossession inventory for 60 days or more as of the last day of such Collection Period, (d) which becomes one hundred twenty (120) days past due

 

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during such Collection Period and in respect of which the related Financed Vehicle is not in repossession inventory or (e) which becomes 180 days past due during such Collection Period.

 

“Net Pool Balance” means, as of any date, the aggregate Outstanding Principal Balance of all Loans (other than Net Loss Assets) on such date.

 

“Nonrecoverable Advance” means any Advance made or proposed to be made pursuant to Section 5.09 which the Servicer in good faith believes is not, or if made would not be, ultimately recoverable from Liquidation Proceeds or otherwise.  In determining whether an Advance is or will be nonrecoverable, the Servicer need not take into account that it might receive any amounts by deficiency judgment or otherwise.

 

“Note” means a Class A-1 Note, Class A-2-A Note, Class A-2-B Note, Class A-3-A Note, Class A-3-B Note, Class A-4 Note or [Class B Note], in each case substantially in the forms of Exhibit A to the Indenture.

 

“Note Balance” means, with respect to any date of determination, for any Class, the Class A-1 Note Balance, the Class A-2-A Note Balance, the Class A-2-B Note Balance, the Class A-3-A Note Balance, the Class A-3-B Note Balance, the Class A-4 Note Balance or [the Class B Note Balance], as applicable, or with respect to the Notes generally, the sum of all of the foregoing.

 

“Note Factor” means, with respect to the Notes or any Class of Notes on any Payment Date, a six-digit decimal figure equal to the Note Balance of the Notes or such Class of Notes, as applicable, as of the end of the preceding Collection Period divided by the Note Balance of the Notes or such Class of Notes, as applicable, as of the Closing Date.  The decimal figure referred to in the immediately preceding sentence will be 1.000000 as of the Closing Date; thereafter, it will decline to reflect reductions in the Note Balance of the Notes or such Class of Notes, as applicable.

 

“Note Purchase Agreement” means the Note Purchase Agreement, dated as of [      ], among [      ], [      ], and [      ], Huntington, and the Depositor.

 

“Note Owner” means, with respect to a Book-Entry Note, the Person who is the beneficial owner of such Book-Entry Note, as reflected on the books of the Depository or a Person maintaining an account with such Depository (directly as a Depository Participant or as an indirect participant, in each case in accordance with the rules of such Depository).

 

“Noteholder” means each Person in whose name a Note is registered in the Register.

 

“Opinion of Counsel” means one or more written opinions of counsel, who may be an employee of counsel to the Loan Seller, the Depositor, the Servicer or the Issuing Entity, which counsel shall be acceptable to the applicable recipient and which shall be addressed to the Owner Trustee and the Indenture Trustee and which shall be at the expense of the Person required to provide such an Opinion of Counsel.

 

“Outstanding Amount Advanced” means, with respect to any Payment Date, the aggregate of all Advances remitted by the Servicer pursuant to Section 5.09 or expenses paid

 

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pursuant to Section 4.05, less the aggregate of all related Advance Reimbursement Amounts actually received by the Servicer prior to such Payment Date.

 

“Outstanding Principal Balance” means, with respect to any Loan as of any date, the outstanding principal balance of such Loan calculated in accordance with the Servicing Standard; provided, however, that the Outstanding Principal Balance of any Loan that became a Net Loss Asset will be deemed to be zero as of the date it becomes a Net Loss Asset.

 

“Owner Trustee” means [           ], a national banking association acting not in its individual capacity but solely as owner trustee under the Trust Agreement.

 

“Paid In Full” means, with respect to the Notes, that all principal, interest and other amounts in respect thereof have been indefeasibly paid in full in cash and the requirements of the Indenture and this Agreement with respect to the Notes shall have been satisfied.

 

“Payment Date” means the [15]th day of each calendar month beginning [      ]; provided, however, that whenever a Payment Date would otherwise be a day that is not a Business Day, the Payment Date shall be the next Business Day. As used herein, the “related” Payment Date with respect to a Collection Period shall be deemed to be the Payment Date which immediately follows such Collection Period.

 

“Permitted Investments” means any one or more of the following types of investments:

 

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

 

(b)           demand deposits, money market deposit accounts, time deposits or certificates of deposit of any depository institution (including the servicer, the indenture trustee or the owner trustee or any of their respective affiliates) 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 (including depository receipts issued by any such institution or trust company as custodian with respect to any obligation referred to in clause (a) above or a portion of such obligation for the benefit of the holders of such depository receipts); provided that at the time of the investment or contractual commitment to invest therein (which shall be deemed to be made again each time funds are reinvested following each payment date), the commercial paper or other short-term senior unsecured debt obligations (other than such obligations the rating of which is based on the credit of a person other than such depository institution or trust company) of such depository institution or trust company shall have a credit rating from Standard & Poor’s of at least “A-1+” and from Moody’s of “Prime-1”;

 

(c)           commercial paper (including commercial paper of the servicer, the indenture trustee or the owner trustee or any of their respective affiliates) having, at the time of the investment or contractual commitment to invest therein, a rating from Standard & Poor’s of “A-1”+ and from Moody’s of “Prime-1”;

 

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(d)           investments in money market funds (including funds for which the servicer, the indenture trustee or the owner trustee or any of their respective affiliates is investment manager or advisor) having a rating from Standard & Poor’s of “AAAm” or “AAAm-G” and from Moody’s of “Aaa-mf” and which fully qualify for the exemption from withholding tax on dividends under Section 871(k) or 881(e) of the Code (not taking into account any of the exceptions contained in Section 871(k) and 881(e) that are based on the identity of the applicable holder);

 

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

 

(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 principal) referred to in clause (b) above.

 

“Person” means any natural or juridical person, including any individual, corporation, partnership, joint venture, association, limited liability company, joint stock company, trust, business trust, bank, trust company, estate (including any beneficiaries thereof), unincorporated organization or government or any agency or political subdivision thereof.

 

“Physical Property” has the meaning assigned to such term in the definition of “Delivery” above.

 

“Principal Balance” means with respect to any Loan and any date of determination, the Amount Financed minus an amount equal to the sum, as of the close of business on the last day of the related Collection Period, of that portion of all amounts received on or prior to such day with respect to such Loan and allocable to principal.

 

“Principal Collections” means, with respect to any Payment Date, the sum of the following amounts, without duplication: (a) that portion of all collections received on the Loans during or with respect to the related Collection Period that is allocable to principal in accordance with the related Contract, whether in the form of prepayments or scheduled return of principal, and (b) Liquidation Proceeds for the related Collection Period to the extent allocable to Principal Balance.

 

“Privately Placed Notes” means, collectively, [the Class B Notes].

 

“Publicly Offered Notes” means the [Class A Notes].

 

“Purchased Asset” means a Loan purchased as of the close of business on the last day of a Collection Period by or on behalf of the Servicer pursuant to Section 4.07 or by or on behalf of the Loan Seller pursuant to Section 3.03 hereof.

 

“Rating Agency” means either or each of [Moody’s], or [Standard & Poor’s], as indicated by the context.

 

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“Rating Agency Condition” means, with respect to any action, that each Rating Agency shall have been given the ten (10) days’ (or such shorter period as shall be acceptable to each Rating Agency) prior notice thereof and (a) with respect to Standard & Poor’s, that Standard & Poor’s shall have notified the Issuing Entity or the Indenture Trustee in writing that such action will not result in a reduction, withdrawal or downgrade of the then-current rating of the Notes and (b) with respect to Moody’s, that Moody’s shall have notified the Issuing Entity or the Indenture Trustee in writing that such action will not result in a reduction, withdrawal or downgrade of the then-current rating of the Notes.

 

“Record Date” means, unless otherwise specified in any Transaction Document, with respect to any Payment Date or Redemption Date, (i) for any Definitive Notes and for the Certificates, the close of business on the last Business Day of the calendar month immediately preceding the calendar month in which such Payment Date or Redemption Date occurs and (ii) for any Book-Entry Notes, the close of business on the Business Day immediately preceding such Payment Date or Redemption Date.

 

“Redemption Date” means, in the case of a redemption of the Notes pursuant to Section 10.01 of the Indenture, the Payment Date specified by the Administrator or the Issuing Entity pursuant to Section 10.01 of the Indenture.

 

“Redemption Price” means an amount equal to the sum of (a) unpaid principal amount of the Notes redeemed plus (b) accrued and unpaid interest thereon at the applicable Interest Rate for the Notes being so redeemed, up to but excluding the Redemption Date.

 

“Registered Holder” means the Person in whose name a Note is registered on the Register on the related Record Date.

 

“Regular Principal Distribution Amount” means, for any Payment Date, an amount not less than zero equal to the excess of (a) the aggregate Note Balance of the Notes as of the preceding Payment Date (after giving effect to all principal payments made on that preceding Payment Date and with respect to the first Payment Date, as of the Closing Date) minus the sum of the First Allocation of Principal and [the Second Allocation of Principal] for the current Payment Date over (b) the Net Pool Balance as of the end of the related Collection Period minus the Target Credit Enhancement Overcollateralization Amount; provided, however, that the Regular Principal Distribution Amount on and after the Final Scheduled Payment Date for any Class of Notes will not be less than the amount that is necessary to reduce the Note Balance of each such Class, as applicable, to zero (after the application of the First Allocation of Principal and [the Second Allocation of Principal]).

 

[“Replacement Interest Rate Cap Agreement” means any long-form confirmation (which deems the existence of a 1992 ISDA Master Agreement between the Issuing Entity and the Cap Counterparty and includes a schedule and a 1994 Credit Support Annex to such deemed ISDA Master Agreement), each dated after the Closing Date, and pursuant to the conditions set forth in the Initial Interest Rate Cap Agreement, as the same may be amended or supplemented from time to time in accordance with the terms thereof. ]

 

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“[Replacement Cap Counterparty” means, with respect to any Cap Counterparty, any replacement Cap Counterparty under a Replacement Interest Rate Cap Agreement that satisfies the conditions set forth in the Interest Rate Cap Agreement. ]

 

“Repurchase Price” means, for each Loan, a price equal to (a) the remaining Principal Balance of such Loan as of the last day of the Collection Period related to the Payment Date on which the purchase or repurchase occurs, plus (b) accrued and unpaid interest on such Loan as of the last date of the related Collection Period, together with all unpaid amounts in respect of such Loan, less (c) Advances in respect of such Loan which have not been reimbursed in accordance with this Agreement.

 

]“Reserve Account” means the account designated as such, established and maintained pursuant to Section 5.01 of this Agreement.\

 

]“Reserve Account Draw Amount” means, for any Payment Date, the amount withdrawn from the Reserve Account, equal to the lesser of (a) the Available Funds Shortfall Amount, if any, or (b) the amount on deposit in the Reserve Account on such Payment Date.  In addition, if the sum of the amounts in the Reserve Account and the remaining Available Funds after the payments under clauses [first] through [fifth] of Section 5.06(a) this Sale and Servicing Agreement would be sufficient to pay in full the aggregate unpaid Note Balance of all of the outstanding Classes of Notes, then the Reserve Account Draw Amount will, if so specified by the Servicer in the Servicer’s Certificate, include such additional amount as may be necessary to pay all Outstanding Notes in full. \

 

[“Reserve Account Excess Amount” means, with respect to any Payment Date, an amount equal to the excess, if any, of (a) the amount of cash or other immediately available funds in the Reserve Account on that Payment Date, after giving effect to all deposits to and withdrawals from the Reserve Account relating to that Payment Date, over (b) the Specified Reserve Account Balance with respect to that Payment Date. ]

 

“Responsible Officer” means, (i) with respect to Huntington, the Servicer, or the Depositor, the chairman of the board, the president, any executive vice president, any vice president, the treasurer, any assistant treasurer, the secretary or any assistant secretary thereof or any officer identified to the Indenture Trustee by Huntington, the Servicer, or the Depositor as having day-to-day responsibilities for the performance of Huntington’s, the Servicer’s, or the Depositor’s, as the case may be, duties hereunder and (ii) with respect to the Owner Trustee, has the meaning set forth in the Indenture.

 

“Reuters Telerate Page 3750” means the page formerly known as page 3750 on the Reuters Telerate News Service, which page has been replaced by Reuters Screen LIBOR01 on the Reuters Telerate News Service, or such other page as may replace such page on that service for display of the information previously displayed on page 3750 or such other page as displays such information on an equivalent service if such page ceases to display the information.

 

[“Second Allocation of Principal” means, for any Payment Date an amount not less than zero equal to the excess, if any, of (a) the aggregate Note Balance of the Class A Notes and the Class B Notes as of the preceding Payment Date (after giving effect to all principal payments

 

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made on that preceding Payment Date and with respect to the first Payment Date, as of the Closing Date) minus the First Allocation of Principal for the current payment date over (b) the Net Pool Balance as of the last day of the related Collection Period; provided, however, that the Second Allocation of Principal on and after the Final Scheduled Payment Date for any Class of Class A Notes or the Class B Notes will not be less than the amount that is necessary to reduce the Note Balance of each such Class, as applicable, to zero (after the application of the First Allocation of Principal). ]

 

“Securities Account” means a “securities account” as that term is defined in Section 8-501(a) of the New York UCC.

 

“Securities Intermediary” means a “securities intermediary” as that term is defined in Section 8-102 of the New York UCC.

 

“Security Entitlement” means a “security entitlement” as that term is defined in Section 8-102 of the New York UCC.

 

“Servicer” means Huntington, as the servicer of the Loans and each successor to Huntington (in the same capacity) pursuant to Section 7.03 or Section 8.03.

 

“Servicer’s Annual Certification” has the meaning specified in Section 4.10.

 

“Servicer Remittance Date” means, with respect to any Payment Date, the date on which the Servicer is required to remit Principal Collections and Interest Collections to the Collection Account pursuant to Section 5.02.

 

“Servicer’s Monthly Certificate” means a certificate of the Servicer delivered pursuant to Section 4.09, substantially in the form of Exhibit B-1.

 

“Servicer Replacement Event” has the meaning set forth in Section 8.01.

 

“Servicing Fee” with respect to the servicing of the Loans means, with respect to each Payment Date, the sum of (a) an amount equal to the  the product of one twelfth (1/12) of the Servicing Fee Rate and the Net Pool Balance as of the first day of the related Collection Period and (b) any Supplemental Servicing Fees.

 

“Servicing Fee Rate” means [      ]% per annum.

 

“Servicing Standard” has the meaning set forth in Section 4.01(a).

 

“Simple Interest Method” means, with respect to a Loan, the method of allocating a fixed level payment between principal and interest, pursuant to which the portion of such payment that is allocated to interest is equal to the product of the applicable interest rate multiplied by the unpaid Principal Balance of such Loan multiplied by the period of time (expressed as a fraction of a year, based on the actual number of days in the month and a 365-day year or, in the event of a leap year, a 366-day year) elapsed since the preceding payment was received by the Servicer.  The remainder of such payment is allocable to fees and charges, if any, and to principal in the manner determined at the discretion of the Servicer; provided, however, that the Servicer applies

 

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Liquidation Proceeds, insurance proceeds and amounts in respect of deficiency balances first to unpaid principal, second to interest, third to unpaid late fees, and fourth to any receivable relating to the premium paid on any force-placed insurance policy.

 

“Small Balance Waiver” means a waiver of any unpaid amounts not to exceed $25 owed with respect to a Loan in connection with its final payout, which is granted by the Servicer in accordance with the Servicing Standard.

 

[“Specified Reserve Account Balance” means approximately $[    ] (which is approximately [ ]% of the initial net pool balance).. ]

 

“Standard & Poor’s” means Standard & Poor’s Financial Services LLC, and its successors.

 

“Starting Pool Balance” means an amount equal to the aggregate Principal Balance, as of the Cutoff Date, of the Loans listed on Schedule A hereto that are being conveyed on the Closing Date.

 

“State” means any state or territory of the United States of America, including the District of Columbia.

 

“Supplemental Servicing Fees” means any and all (i) late fees, (ii) extension fees, (iii) non-sufficient funds charges and (iv) any and all other administrative fees or similar charges allowed by applicable law with respect to any receivable.

 

“Target Credit Enhancement Overcollateralization Amount” means, with respect to any payment date, the excess, if any, of: (1) approximately $[      ] (which is [      ]% of the initial Net Pool Balance) over (2) [      ]% of the initial Net Pool Balance (which is the Specified Reserve Account Balance).

 

“Trust Account Property” means the Trust Accounts, all amounts and investments held from time to time in any Trust Account (whether in the form of deposit accounts, Physical Property, book-entry securities, uncertificated securities or otherwise) and all proceeds of the foregoing.

 

“Trust Accounts” means the Collection Account, the Principal Distribution Account, the Reserve Account and the Cap Termination Payment Account (to the extent established in accordance with Section 5.10(b)).

 

“Trust Agreement” means the Amended and Restated Trust Agreement, dated as of [      ], among Depositor as grantor and beneficiary, and the Owner Trustee as trustee.

 

“Trust Certificate” has the meaning set forth in the Trust Agreement.

 

“Trustee Fees” means the fees payable by the Issuing Entity to the Indenture Trustee and the Owner Trustee, which fees shall not exceed an aggregate amount per annum equal to $[      ].

 

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“Trust Officer” means, in the case of the Indenture Trustee, any officer within the Corporate Trust Office of the Indenture Trustee, including any Managing Director, Director, Vice President, Assistant Vice President, Assistant Treasurer, Assistant Secretary 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, in each case having direct responsibility for the administration of the Basic Documents and, with respect to the Owner Trustee, any officer in the Corporate Trust Administration Department of the Owner Trustee with direct responsibility for the administration of the Trust Agreement and the other Basic Documents on behalf of the Owner Trustee.

 

“UCC” means the Uniform Commercial Code, as in effect in the relevant jurisdiction.

 

“Underwriting Policy” means the underwriting and documentation policies and procedures of the Servicer in connection with the origination of Loans as set forth in Exhibit D hereto, provided that, for purposes of the representations and warranties set forth in Sections 3.02(b) of the Asset Purchase Agreement made in connection with the origination of Loans prior to the Closing Date, the definition of “Underwriting Policy” as used therein shall be deemed to mean the underwriting and documentation policies and procedures of the Servicer in connection with the origination of Loans in effect at the time of such origination so long as, to the extent that there are any changes in such underwriting and documentation policies and procedures from those set forth in Exhibit E hereto, such changes are not materially adverse to the Noteholders.

 

Section 1.02.     Other Definitional Provisions.

 

As used in this Agreement, the following terms shall, unless the context otherwise requires, have the following meanings:

 

(a)           All terms defined in this Agreement have the respective meanings ascribed thereto herein when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein.

 

(b)           As used in this Agreement and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in this Agreement or in any such certificate or other document, and accounting terms partly defined in this Agreement or in any such certificate or other document to the extent not defined, have the respective meanings given to them under generally accepted accounting principles in the United States.  To the extent that the definitions of accounting terms in this Agreement or in any such certificate or other document are inconsistent with the meanings of such terms under generally accepted accounting principles in the United States, the definitions contained in this Agreement or in any such certificate or other document shall control.

 

(c)           The words “hereof,” “herein,” “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement; Article, Section, Schedule and Exhibit references contained in this Agreement are references to Articles, Sections, Schedules and Exhibits in or to this Agreement unless otherwise specified; “or” shall include “and/or”; and the term “including” means “including without limitation.”

 

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(d)           The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such terms.

 

(e)           For purposes of Article V, references to payments by or on behalf of Loan Obligors or similar phrases shall include payments received with respect to the Loans from Persons other than the Servicer, the Loan Seller, or the Depositor.

 

(f)           Any agreement, instrument or statute defined or referred to herein or in any instrument or certificate delivered in connection herewith means such agreement, instrument or statute as from time to time amended, modified or supplemented (in case of agreements or instruments, to the extent permitted hereunder) and includes (in the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein; references to a Person are also to its permitted successors and assigns.

 

[End of Article I]

 

 

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ARTICLE II.

CONVEYANCE OF LOANS; BOOKS AND RECORDS; PROVISIONS FOR CLOSING

 

Section 2.01.     Conveyance of the Loans.   (a)   In consideration for (1) the Issuing Entity’s delivery to or upon the order of the Depositor of the Notes, and (2) an increase in the residual value of the equity interest in the Issuing Entity owned by the Depositor, the Depositor does hereby sell, transfer, assign, set over and otherwise convey to the Issuing Entity, without recourse, but subject to the other terms and conditions of this Agreement, (i) all right, title and interest of the Depositor in and to the Loans described in Schedule A to this Agreement, which are the Loans being conveyed by it on the Closing Date as part of the Starting Pool Balance, and (ii) all of the Depositor’s rights against the Loan Seller under the Asset Purchase Agreement, including the representations of the Loan Seller made therein and the Depositor’s right to enforce a breach of any such representation made with respect to any Conveyed Assets, and (iii) all of the Depositor’s right, title and interest in and to all of the Conveyed Assets whether or not described in the preceding clauses (i) through (ii) above.

 

(b)           [Intentionally Omitted].

 

(c)           As of the Closing Date, the Issuing Entity acknowledges (or will acknowledge pursuant to the Assignment) the conveyance to it of the Conveyed Assets transferred on such date, including all right and interest of the Depositor in and to the Conveyed Assets, receipt of which is hereby acknowledged by the Issuing Entity (or will be acknowledged pursuant to the Assignment).  Concurrent with such delivery, as of the Closing Date and pursuant to the Indenture the Issuing Entity pledges and/or assigns (or will pledge and/or assign pursuant to the Assignment) the Conveyed Assets and the other Collateral to the Indenture Trustee as security for the Notes.

 

Section 2.02.     Ownership and Possession of Loan Files.   The ownership of the contents of the Loan Files with respect to each Conveyed Asset shall be vested in the Issuing Entity and pledged to the Indenture Trustee for the benefit of the Noteholders, as of the Closing Date, although possession of the Loan Files on behalf of and for the benefit of the Noteholders shall remain with the Custodian.

 

Section 2.03.     Books and Records; Intention of the Parties.

 

(a)           Books and records for each Conveyed Asset have been clearly marked to reflect the ownership of each Conveyed Asset, as of the Closing Date, by the Issuing Entity, pledged, as of the Closing Date, to the Indenture Trustee for the benefit of the Noteholders.

 

(b)           It is the intention of the parties hereto that, other than for federal, state and local income, single business or franchise tax purposes, the transfer and assignment of the Conveyed Assets and the other Collateral on the Closing Date constitutes an absolute sale (and not a pledge to secure debt or other obligations of the Depositor) of the Conveyed Assets such that (i) the Conveyed Assets and [the Issuing Entity’s right, title and interest in and to the Interest Rate Cap Agreement] shall not be included in the bankruptcy estate of the Depositor pursuant to 11 U.S.C. 

 

 

 

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§ 541, (ii) the FDIC shall not, by exercise of its authority to disaffirm or repudiate contracts under Section 13(e) of the Federal Deposit Insurance Act, reclaim, recover or recharacterize as property of the Loan Seller any Conveyed Assets transferred by the Loan Seller to the Depositor or disregard the separateness of the Purchaser or the Issuing Entity from the Loan Seller., and (iii) the transfer of Conveyed Assets pursuant to this Agreement shall comply with the requirements of 12 C.F.R. Section 360.6.

 

(c)           If any of the assignments and transfers of the Conveyed Assets to the Issuing Entity and the Depositor pursuant to the Asset Purchase Agreement and this Agreement, other than for federal, state and local income, single business or franchise tax purposes, is held or deemed not to be a sale or is held or deemed to be a pledge of security for a loan, the parties hereto intend that the rights and obligations of the parties shall be established pursuant to the terms of this Agreement and the Asset Purchase Agreement, and that, in such event, with respect to such property and proceeds thereof (including all Loans and related property), the Loan Seller, and the Depositor shall be deemed to have granted to the Issuing Entity as of the Closing Date, a first priority security interest in the entire right, title and interest of such Person in and to such property and the proceeds thereof.  In such event, with respect to such property, this Agreement and the Asset Purchase Agreement, shall constitute, and hereby is deemed by the parties to be, a security agreement under the New York UCC.

 

(d)           The parties hereto intend to treat the Notes as indebtedness secured by the Collateral for federal, state and local income, single business and franchise tax purposes as provided for in Section 2.09(a) of the Indenture.

 

[End of Article II]

 

 

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ARTICLE III.

THE CONVEYED ASSETS

 

Section 3.01.     Representations and Warranties of the Loan Seller; Assignment of Representations and Warranties by the Depositor.

 

(a)           The Loan Seller hereby makes to the Issuing Entity each of the representations and warranties set forth in Section 3.02(b) of the Asset Purchase Agreement as of the date specified therein and consents to the assignment by the Depositor to the Issuing Entity of such representations and warranties and of the Depositor’s rights with respect to any breach thereof, including the right to require the Loan Seller to repurchase Conveyed Assets in accordance with the Asset Purchase Agreement.  Such representations and warranties speak as of the execution and delivery of this Agreement or as of such other date specified therein and shall survive the sale, transfer and assignment of the Conveyed Assets to the Issuing Entity and the pledge and/or assignment, as the case may be, of such Conveyed Assets to the Indenture Trustee.

 

(b)           Pursuant to Section 2.01 of this Agreement, the Depositor has sold, assigned, transferred and conveyed to the Issuing Entity all of its rights under the Asset Purchase Agreement, including the representations, warranties and covenants of the Loan Seller.  Each of the Depositor and the Loan Seller acknowledges that the Issuing Entity is relying on such representations and warranties in accepting the Conveyed Assets, together with all rights of the Depositor with respect to any breach thereof, including the right to require the Loan Seller to repurchase or reallocate, as the case may be, Conveyed Assets in accordance with the Asset Purchase Agreement.  It is understood and agreed that the representations and warranties referred to in this Section 3.01 shall survive the sale of the Conveyed Assets to the Issuing Entity and the delivery thereof to the Custodian.

 

(c)           The Loan Seller acknowledges the assignment of the Conveyed Assets from the Depositor to the Issuing Entity and Indenture Trustee and hereby agrees that the Issuing Entity and Indenture Trustee shall have the right to enforce any and all rights under the Asset Purchase Agreement assigned to the Issuing Entity herein, including (i) the right to cause the Loan Seller to repurchase any Loan with respect to which it is in breach of any of its representations and warranties set forth in Section 3.01(a) of this Agreement.  Such right may be enforced by the Issuing Entity directly against each of the Loan Seller as though the Issuing Entity and the Indenture Trustee were a party to the Asset Purchase Agreement, and the Issuing Entity shall not be obligated to exercise any such rights indirectly through the Depositor.

 

Section 3.02.     Representations and Warranties of the Depositor.  The Depositor makes the following representations and warranties with respect to the Conveyed Assets being conveyed by it to the Issuing Entity, on which the Issuing Entity relies in accepting such Conveyed Assets.  Such representations and warranties speak as of the execution and delivery of this Agreement and as of the Closing Date and shall survive the sale, transfer and assignment of the Conveyed Assets by the Depositor to the Issuing Entity and the pledge and/or assignment, as the case may be, thereof to the Indenture Trustee in accordance with the terms of the Indenture:

 

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(i)            Title.  The Depositor is conveying all of its right, title and interest in such Conveyed Assets to the Issuing Entity.

 

(ii)           All Filings Made.  The Depositor has caused all required filings (including UCC filings) to be made with respect to the transfer to the Issuing Entity of the Conveyed Assets being transferred by it and the pledge and/or assignment, as the case may be, thereof to the Indenture Trustee pursuant to the Indenture, to perfect the Issuing Entity’s and the Indenture Trustee’s interest in the Conveyed Assets.

 

(iii)           Liens.  The Depositor has not taken any actions to create, incur or suffer to exist any Lien on or restriction on transferability of any Conveyed Asset except for the Lien of the Indenture and the restrictions on transferability imposed by this Agreement.

 

Section 3.03.     Repurchase upon Breach of Representation: Treatment of Repurchase Price.

 

(a)           Each of the Depositor, the Issuing Entity, the Loan Seller, and the Servicer shall inform the other parties to this Agreement promptly and in writing upon the discovery by it of (i) any breach of the Loan Seller’s representations and warranties deemed to be made pursuant to Section 3.01(a), in each case without regard to any limitation set forth in such representation or warranty concerning the knowledge of any Person as to the facts stated therein or (ii) any breach of the Depositor’s representations and warranties under Section 3.02 of this Agreement.

 

(b)           Within thirty (30) days of the earlier of either discovery by, or notice to, the Loan Seller of any breach referred to in Section 3.03(a)(i) above (i) the Loan Seller shall use its best efforts to promptly cure such breach and (ii) if such breach is not cured, the Loan Seller shall repurchase such Loan which is the subject of such breach.  Any repurchase of a Loan pursuant to the foregoing provisions of this Section 3.03, shall be accomplished by payment to the Issuing Entity or its successors and assigns of the Repurchase Price on the Payment Date of the month immediately following the end of the Collection Period in which the thirty (30) day cure period referred to above has ended.

 

(c)           The sole remedy of the Issuing Entity, the Indenture Trustee or the Noteholders with respect to a breach of a representation or warranty referred to in Section 3.01(a) of this Agreement or with respect to a breach of a representation or warranty contained in Section 3.02(b) of the Asset Purchase Agreement, provided neither such breach has been cured pursuant to Section 3.03(b) of this Agreement, shall be to require the Loan Seller to purchase such Loan pursuant to subsection (b) of this Section 3.03 (it being understood that the indemnification covenants of the Loan Seller hereunder and under the other Basic Documents shall still apply notwithstanding this clause (c)).

 

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Section 3.04.     Appointment of Custodian; Custody and Delivery of Loan Files.   To assure uniform quality in servicing the Loans and to reduce administrative costs, the Issuing Entity hereby appoints the Servicer, and the Servicer hereby accepts such appointment, to act for the benefit of the Issuing Entity and the Indenture Trustee as Custodian of the Loan Files which are constructively delivered by the Issuing Entity to the Indenture Trustee on the Closing Date.

 

Section 3.05.     Duties of Servicer as Custodian.

 

(a)           The Servicer shall hold each Loan File as Custodian for the benefit of and as bailee of the Issuing Entity and the Indenture Trustee, and shall maintain such accurate and complete accounts, records and computer systems pertaining to each Loan File as shall enable the Issuing Entity to comply with this Agreement.  In performing its duties as Custodian, the Servicer shall act with reasonable care, and in accordance with the Servicing Standard.  The Servicer shall conduct, or cause to be conducted, periodic audits of the Loan Files held by it as Custodian under this Agreement and of the related accounts, records and computer systems, in such a manner as shall enable the Issuing Entity or the Indenture Trustee to verify the accuracy of the Servicer’s record keeping.  The Servicer shall promptly report to the Issuing Entity and the Indenture Trustee any failure on its part to hold the Loan Files and maintain its accounts, records and computer systems as herein provided and shall promptly take appropriate action to remedy any such failure.  Nothing herein shall be deemed to require an initial review or any periodic review by the Issuing Entity or the Indenture Trustee of the Loan Files.

 

(b)           The Servicer shall maintain each Loan File at one of its offices specified in Schedule B to this Agreement or at such other office as shall be specified to the Issuing Entity and the Indenture Trustee by written notice not later than thirty (30) days after any change in location.  Upon reasonable notice by the Issuing Entity or the Indenture Trustee, the Servicer shall make available to the Issuing Entity and the Indenture Trustee or their duly authorized representatives, attorneys or auditors a list of locations of the Loan Files and the related accounts, records and computer systems maintained by the Servicer during normal business hours and such review shall be conducted in a reasonable manner.

 

(c)           Upon reasonable request from the Indenture Trustee or, if the Notes have been Paid In Full, from the Owner Trustee, the Servicer shall release any Loan File to the Indenture Trustee or the Owner Trustee, as the case may be, or to the agent or designee of the Indenture Trustee or the Owner Trustee, as the case may be, at such place or places as the Indenture Trustee or the Owner Trustee, as applicable, may reasonably designate as soon as practicable.  Upon the release and delivery of any such document in accordance with the instructions of the Indenture Trustee or the Owner Trustee, as the case may be, the Servicer shall be released from any further liability and responsibility under this Section 3.05 with respect to such documents and any other provision of this Agreement or any of the other Basic Documents if the fulfillment of the Servicer’s responsibilities is dependent upon possession of such documents, unless and until such time as such documents shall be returned to the Servicer.  In no event shall the Servicer be responsible for any loss occasioned by the Indenture Trustee’s or the Owner Trustee’s failure to return any Loan File or any portion thereof in a timely manner.

 

Section 3.06.     Instructions; Authority to Act.   The Servicer shall be deemed to have received proper instructions with respect to the Loan Files upon its receipt of written instructions signed by a Trust Officer of the Indenture Trustee or by the Noteholders representing a majority 

 

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of the outstanding Note Balance of the Controlling Class or, if the Notes have been Paid In Full, of the Owner Trustee.

 

Section 3.07.     Custodian’s Indemnification.

 

(a)           The Custodian shall indemnify the Issuing Entity, the Owner Trustee and the Indenture Trustee and each of their officers, directors, employees and agents for any and all liabilities, obligations, losses, compensatory damages, payments, costs or expenses of any kind whatsoever that may be imposed on, incurred by or asserted against the Issuing Entity, the Owner Trustee or the Indenture Trustee or any of their officers, directors, employees or agents as the result of any improper act or omission in any way relating to the maintenance and custody by Custodian of the Loan Files; provided, however, that the Custodian shall not be liable to the Issuing Entity, the Owner Trustee, the Indenture Trustee or any such officer, director, employee or agent of the Issuing Entity, the Owner Trustee or the Indenture Trustee for any portion of any such amount resulting from (i) actions taken by the Custodian pursuant to instructions as provided in Section 3.06, or (ii) release and delivery of documents by the Custodian as provided in Section 3.05(c) or (iii) the willful misfeasance, bad faith or gross negligence of such Person, or any such officer, director, employee or agent of such Person.

 

(b)           Indemnification under this Section 3.07 shall survive the resignation or removal of the Custodian or the termination of this Agreement with respect to acts or omissions of the Custodian preceding such resignation or removal or termination and shall include reasonable fees and expenses of counsel and expenses of litigation.  If the Custodian shall have made any indemnity payments pursuant to this Section 3.07 and the Person to or on behalf of whom such payments are made thereafter collects any of such amounts from others, such Person shall promptly repay such amounts to the Custodian.

 

Section 3.08.     Effective Period and Termination.  The Servicer’s appointment as Custodian shall become effective as of the Closing Date and shall continue in full force and effect unless and until terminated pursuant to this Section 3.08.  If the Servicer or any successor Servicer shall resign as Servicer in accordance with the provisions of this Agreement or if all of the rights and obligations of the Servicer or any successor Servicer are terminated under Section 8.01(a) by the Issuing Entity or by the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class in the same manner as the Indenture Trustee or such Noteholders may terminate the rights and obligations of the Servicer under Section 8.01(a).  The Indenture Trustee or, with the consent of the Indenture Trustee, the Owner Trustee may terminate the Servicer’s appointment as Custodian, with cause, at any time upon written notification to the Servicer.  As soon as practicable after any termination of such appointment (but in no event more than five (5) Business Days after any such termination of appointment), the Servicer shall deliver the Loan Files to the Indenture Trustee or the Indenture Trustee’s agent at such place or places as the Indenture Trustee may reasonably designate.  Notwithstanding the termination of Huntington as Custodian, the Indenture Trustee and the Issuing Entity agree that, upon any such termination and for so long as Huntington remains the Servicer hereunder, the Indenture Trustee or the Issuing Entity, as the case may be, shall provide, or cause its agent to provide, access to the Loan Files to Huntington as the Servicer for the purpose of enabling Huntington as the Servicer to perform its obligations under this Agreement with respect to the servicing of the Loans and that Huntington shall be reimbursed for its reasonable costs and expenses incurred in connection with such access.

 

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Section 3.09.     Risk Retention.

 

The Loan Seller, as sponsor, shall retain an economic interest in a material portion of the credit risk of the Loans, which interest may be satisfied by retaining a representative sample of loans equal to not less than 5% of the initial Principal Balance of the Loans.  This retained interest may not be sold, pledged or hedged, except for the hedging of interest rate or currency risk, during the term of the transactions contemplated hereby.

 

[End of Article III]

 

 

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ARTICLE IV.

 

ADMINISTRATION AND SERVICING OF CONVEYED ASSETS

 

Section 4.01.     Duties of Servicer.

 

(a)           The Servicer, for the benefit of the Noteholders, shall manage, service, administer and make collections on the Conveyed Assets and perform the other actions required by the Servicer under this Agreement.  The Servicer shall be required to service the Loans in accordance with (i) its customary procedures for servicing automobile loans for which it is the owner or the appointed servicer from time to time which such procedures on the Closing Date are as set forth in Exhibit C hereto or (ii) in the event that Exhibit C does not specify a standard with respect to a particular servicing function, in accordance with its usual and customary procedures consistent with the procedures employed by institutions that service motor vehicle installment contracts or motor vehicle installment loan notes for their own account or for the account of third parties (the “Servicing Standard”).  Huntington agrees that for so long as Huntington is the Servicer, the Servicing Standard shall be consistent in all material respects with the servicing standards with respect to dealer-originated motor vehicle loans, for which Huntington or any of its affiliates is the owner or the appointed servicer from time to time.

 

(b)           The Servicer’s duties shall include the collection and posting of all payments on the Conveyed Assets, responding to inquiries of Loan Obligors, investigating delinquencies, sending payment coupons to Loan Obligors, reporting any required tax information to Loan Obligors, accounting for collections, furnishing monthly and annual statements to the Owner Trustee and the Indenture Trustee with respect to distributions and performing the other duties specified herein.  The Servicer also shall administer and enforce all rights of the Issuing Entity as holder of the Conveyed Assets and the Indenture Trustee as pledgee of the Conveyed Assets and shall enforce the provisions of the applicable Dealer Agreements and assignment forms.  To the extent consistent with the Servicing Standard, the Servicer shall follow its customary standards, policies and procedures and shall have full power and authority, acting alone, to do any and all things in connection with the managing, servicing, administration and collection of the Conveyed Assets that it may reasonably in good faith in accordance with the Servicing Standard deem necessary or desirable.

 

(c)           Without limiting the generality of the foregoing, the Servicer is hereby authorized and empowered to execute and deliver, on behalf of itself and any one or more of the Issuing Entity, the Owner Trustee or the Indenture Trustee 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 Conveyed Assets and with respect to the Financed Vehicles; provided, however, that, notwithstanding the foregoing, the Servicer shall not, except (x) pursuant to an order from a court of competent jurisdiction or a directive from an arbitrator in an arbitration proceeding or (y) in settlement of a legal proceeding in court or in arbitration in a manner consistent with the applicable Servicing Standard or (z) otherwise in accordance with the Servicing Standard, execute documents that would release a Loan Obligor from payment of any unpaid amount due under any Loan reduce the related APR on a Loan, waive the right to collect the unpaid balance of any Loan from the related Obligor, release any Loan Obligor from its obligations with respect

 

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to a Loan, extend the final payment date under any Loan beyond the Final Scheduled Payment Date.  Notwithstanding the foregoing, the Servicer may grant a Small Balance Waiver with respect to any Loan.

 

(d)           The Servicer is hereby authorized to commence, in its own name or in the name of the Issuing Entity, the Indenture Trustee or the Owner Trustee, a legal proceeding to enforce the rights of the Issuing Entity under any Contract pursuant to Section 4.03 or to commence or participate in any other legal proceeding (including a bankruptcy proceeding) relating to or involving a Loan, a Loan Obligor or a Financed Vehicle.  If the Servicer commences or participates in any such legal proceeding in its own name, the Indenture Trustee or the Issuing Entity shall thereupon be deemed to have automatically assigned the applicable Conveyed Asset to the Servicer, solely for purposes of commencing or participating in such proceeding as a party or claimant, and the Servicer is authorized and empowered by the Indenture Trustee or the Issuing Entity to execute and deliver in the Indenture Trustee’s or the Issuing Entity’s name any notices, demands, claims, complaints, responses, affidavits or other documents or instruments in connection with any such proceeding.  If in any enforcement suit or legal proceeding it shall be held that the Servicer may not enforce the rights of the Issuing Entity under the contract on the ground that it shall not be a real party in interest or a holder entitled to enforce such rights, the Owner Trustee shall, subject to the terms of the Trust Agreement, at the Servicer’s expense and direction, take steps to enforce such rights, including bringing suit in its name or the name of the Issuing Entity, the Indenture Trustee or the Noteholders.  The Owner Trustee and the Indenture Trustee shall upon the written request of the Servicer 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.

 

(e)           For all purposes of this Agreement, the Servicer shall be an independent contractor and shall not be subject to the supervision of the Issuing Entity, the Owner Trustee or the Indenture Trustee with respect to the manner in which it accomplishes the performance of its obligations hereunder.  Unless expressly set forth herein or otherwise authorized by the Issuing Entity, the Servicer shall have no authority to act for or represent the Issuing Entity, the Owner Trustee, the Indenture Trustee or any Noteholder in any way and shall not otherwise be deemed an agent of the Issuing Entity, the Owner Trustee, the Indenture Trustee or any Noteholder.

 

Section 4.02.     Collection of Payments on Loans; Extensions.

 

(a)           The Servicer shall make reasonable efforts to collect all payments called for under the terms and provisions of the Contracts as and when the same shall become due, in accordance with the Servicing Standard.  Notwithstanding the foregoing, the Servicer is authorized in its discretion to grant a Small Balance Waiver with respect to any Loan, and to waive any prepayment charge, late payment charge or any other similar fees that may be collected in the ordinary course of servicing any Conveyed Asset.

 

(b)           (i) The Servicer may grant payment extensions and holidays on the Loans in accordance with the Servicing Standard and as required by law; provided, however, that no such extension shall extend the final payment date on any Loan beyond the last day of the Collection Period ending six months prior to the Payment Date occurring in the Final Scheduled Payment Date of the Notes, and (ii) upon any extension of a Loan not in accordance with Section

 

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4.02(b)(i) or upon the reduction of the contract rate or outstanding principal balance of any Loan other than as required by applicable law (including, without limitation, by the Servicemembers Civil Relief Act), the Servicer shall be required to purchase the related Loan in accordance with Section 4.07.  Notwithstanding the foregoing, the Servicer, in accordance with the Servicing Standard, may waive any unpaid amounts not to exceed $25 owed with respect to a receivable in connection with its final payout.

 

Section 4.03.     Realization upon Loans.

 

(a)           Consistent with the Servicing Standard (and subject to clause (b) below), the Servicer shall use commercially reasonable efforts to repossess or otherwise convert the ownership of and liquidate any Financed Vehicle securing a Loan with respect to which the Servicer shall have determined that eventual payment in full is unlikely.  The Servicer shall begin such repossession and conversion procedures as soon as practicable after default on such Loan in accordance with its customary procedures in accordance with the Servicing Standard; provided, however, that the Servicer will not repossess a Financed Vehicle within such time period if it calculates that the proceeds ultimately recoverable with respect to such Loan would be increased by forbearance.  In repossessing or otherwise converting the ownership of a Financed Vehicle and liquidating a Loan, the Servicer is authorized to follow such customary practices and procedures as it shall reasonably deem necessary or advisable, consistent with the Servicing Standard, which practices and procedures may include the sale of the related Financed Vehicle at public or private sale, the submission of claims under an insurance policy and other actions by the Servicer in order to realize upon a Loan; provided, however, that if the Servicer is unable to liquidate a Loan within sixty (60) days of repossessing or otherwise converting the ownership of a Financed Vehicle, the Servicer shall purchase from the Issuing Entity the Financed Vehicle in the manner set forth in Section 4.07, provided, further, that in any case in which the Financed Vehicle shall have suffered damage, the Servicer shall not expend funds in connection with any repair or towards the repossession of such Financed Vehicle unless it shall determine in its reasonable judgment that such repair or repossession shall increase the related Liquidation Proceeds by an amount materially greater than the expense for such repair or repossession.  The Servicer shall be entitled to recover all expenses incurred by it that are reasonably allocated to repossessing and liquidating a Financed Vehicle into cash proceeds, but only out of the cash proceeds of the sale of such Financed Vehicle or any deficiency obtained from the related Loan Obligor.

 

(b)            [Intentionally Omitted].

 

(c)           [Intentionally Omitted].

 

(d)           Huntington agrees to pay all amounts due in respect of Huntington Debt Forgiveness Policies as and to the same extent as if it were a third party providing such protection with the Issuing Entity or the Indenture Trustee named as loss payee.

 

Section 4.04.     Physical Damage Insurance.   The Servicer shall, in accordance with the Servicing Standard, require that each Loan Obligor shall have obtained physical loss damage insurance covering the related Financed Vehicle as of the execution of the related Contract.

 

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Section 4.05.     Maintenance of Security Interests in Financed Vehicles; Other Amounts.

 

(a)           The Servicer shall, in accordance with the Servicing Standard, take such steps as are necessary to maintain the perfection of the security interest created by each Loan in the related Financed Vehicle.  The Servicer is hereby authorized to take such steps as are necessary to re-perfect such security interest on behalf of the Issuing Entity and the Indenture Trustee in the event of the relocation of a Financed Vehicle or for any other reason.  In the event that the assignment of a Loan to the Issuing Entity is insufficient, without a notation on the related Financed Vehicle’s certificate of title or without fulfilling any additional administrative requirements under the laws of the State in which such Financed Vehicle is located, to perfect a security interest in the related Financed Vehicle in favor of the Issuing Entity and the Indenture Trustee, each of the Servicer and Huntington hereby agree that the designation of Huntington as the secured party on such certificate of title shall only be in its capacity as agent of the Issuing Entity and the Indenture Trustee.

 

(b)           [Intentionally Omitted].

 

(c)          The Loan Seller, the Depositor, the Issuing Entity, the Indenture Trustee and the Servicer hereby agree that, upon the occurrence of a Servicer Replacement Event, the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class may take or cause to be taken such actions as may, in the opinion of counsel to such Noteholders, be necessary to perfect or re-perfect the security interests in the Financed Vehicles in the name of the Issuing Entity, including by amending the title documents of the Financed Vehicles.  The Servicer hereby agrees to pay all expenses related to such perfection or re-perfection and to take all action necessary therefor.  If such expenses are not paid within fifteen (15) days after delivery of any invoice therefor, such expenses shall be paid pursuant to Section 5.06(b)(i).

 

(d)           [Intentionally Omitted].

 

Section 4.06.     Covenants of Servicer.   By its execution and delivery of this Agreement, the Servicer hereby covenants as follows (upon which covenants the Issuing Entity, the Indenture Trustee and the Owner Trustee rely in accepting the Conveyed Assets and delivering the applicable Notes):

 

(a)           Liens in Force.  No Financed Vehicle securing a Loan shall be released in whole or in part from the security interest granted by the Loan Obligor, except upon payment in full of such Loan (subject to any Small Balance Waiver) or as otherwise contemplated herein or in accordance with the Servicing Standard.

 

(b)           [Intentionally Omitted].

 

(c)           No Impairment.  The Servicer shall do nothing to impair the rights of the Issuing Entity or the Indenture Trustee in the property of the Issuing Entity.

(d)           No Amendments.  The Servicer shall not extend or otherwise amend the terms of any Conveyed Asset, except in accordance with the Servicing Standard and Section 4.02(b).

 

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(e)           Notice of Material Litigation. The Servicer shall provide notice of material litigation, actions or judgments involving any Huntington Entity to the Issuing Entity and the Indenture Trustee; provided that, except with respect to any such material litigation, actions or judgments involving the Issuing Entity or the Depositor, the Servicer shall be deemed to have complied with the foregoing covenant with respect to any material litigation or judgments relating to the Servicer, to the extent that it or its parent company (Huntington Bancshares Incorporated) properly complied with its disclosure obligations under the Securities Exchange Act of 1934.

 

(f)           Compliance with Agreement, Basic Documents and Applicable Law.  The Servicer shall comply with its obligations under this Agreement and the Basic Documents to which it is a party.  The Servicer shall comply with all Applicable Law where the failure to do so could reasonably be expected to have a Material Adverse Effect.

 

(g)           Arm’s Length.  With respect to its obligations in connection with the Conveyed Assets, the Servicer shall transact and deal with its Affiliates on an arm’s length basis.

 

(h)           Licenses and Approvals.  The Servicer shall ensure that it has and maintains all licenses and approvals necessary for the conduct of its business in the jurisdictions where the failure to do so could reasonably be expected to have a Material Adverse Effect.

 

(i)           Restrictions on Liens.  The Servicer shall not (A) create, incur or suffer to exist, or agree to create, incur or suffer to exist, or consent to or permit in the future (upon the occurrence of a contingency or otherwise) the creation, incurrence or existence of any Lien (other than suffering to exist any tax liens, mechanics’ liens and any other liens that attach to property by operation of law (including without limitation statutory purchase liens) to the extent the applicable obligations are not past due) on or restriction on transferability of any Conveyed Asset except for the Lien of the Indenture and the restrictions on transferability imposed by this Agreement or (B) other than as contemplated herein, file or authorize the filing in any jurisdiction of any UCC financing statement that names Huntington, Depositor or any other Person as a debtor, and any Person other than the Depositor, the Indenture Trustee or the Issuing Entity as a secured party, or sign any security agreement authorizing any secured party thereunder to file any such financing statement, in each case with respect to the Conveyed Assets or the related property.

 

Section 4.07.     Purchase of Loans by Servicer upon Breach of Covenant.  Upon discovery by any of the Servicer, the Loan Seller, the Depositor, the Issuing Entity or the Indenture Trustee of a breach of any of the covenants set forth in Section 4.02(b)(i) or in Section 4.04, Section 4.05(a) or Section 4.06(a), (c), (d), (g) or (h), the party discovering such breach shall give prompt written notice to the other parties hereto; provided, however, that the failure to give any such notice shall not affect any obligation of the Servicer under this Section 4.07.  On or before the last day of the first Collection Period commencing after its discovery or receipt of notice of the breach of any covenant set forth in Section 4.02(b)(i), Section 4.04, Section 4.05(a) or Section 4.06(a), (c), (d), (g) or (h), the Servicer shall, unless such breach shall have been cured by such date, purchase from the Issuing Entity the Conveyed Asset affected by such breach.  In consideration of the purchase or reallocation of such Conveyed Asset, the Servicer shall remit the related Repurchase Price into the Collection Account, with written notice to the Indenture

 

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Trustee of such deposit, in the manner specified in Section 5.02.  Subject to Section 7.02, it is understood and agreed that the obligation of the Servicer to purchase any Conveyed Asset with respect to which such a breach has occurred and is continuing shall, if such obligation is fulfilled, constitute the sole remedy against the Servicer for such breach available to the Issuing Entity, the Owner Trustee, the Indenture Trustee or the Noteholders.

 

Section 4.08.     Servicing Fee.  The Servicing Fee shall be payable to the Servicer on each Payment Date.  The part of the Servicing Fee that is based on the Servicing Fee Rate shall be calculated on the basis of a 360-day year comprised of twelve 30-day months.  The Servicer shall be required to pay all expenses (apart from certain expenses incurred in connection with liquidating a financed vehicle related to a receivable, such as auction, painting, repair or refurbishment in respect of that financed vehicle) incurred by it in connection with its activities under this Agreement (including taxes imposed on the Servicer, expenses incurred in connection with distributions and reports made by the Servicer to the Owner Trustee and the Indenture Trustee and any fees and expenses of sub-servicers to whom it has delegated servicing responsibilities).

 

Section 4.09.     Servicer’s Monthly Certificate.  Not later than 10:00 a.m. (New York City time) on each Determination Date, the Servicer shall deliver to the Owner Trustee, the Indenture Trustee, [and the Cap Counterparty], with a copy to each Rating Agency, a Servicer’s Monthly Certificate containing all information necessary to make the payments to be made on the related Payment Date pursuant to Section 5.06 for the related Collection Period and any other information the Indenture Trustee may reasonably request, which certificate shall attach a copy of each schedule of collateral delivered by Huntington to the Federal Reserve Bank of Cleveland pursuant to the Federal Reserve Agreements in the previous Collection Period.  Such Servicer’s Monthly Certificate shall be certified by a Responsible Officer of the Servicer that the information provided is complete, accurate and no event has occurred that, with notice or passage of time, would be an Event of Default or a Servicer Replacement Event.

 

Section 4.10.     Annual Officer’s Certificate; Notice of Servicer Replacement Event.

 

(a)           The Servicer shall deliver to the Owner Trustee, the Depositor, the Indenture Trustee, and each Rating Agency, prior to March 30 of each calendar year, beginning with March 30, 2012, an officer’s certificate signed by a Responsible Officer of the Servicer (the “Servicer’s Annual Certification”) in substantially the form of Exhibit B-2 providing such information as is required under Item 1123 of Regulation AB.

 

(b)           The Servicer shall deliver to the Owner Trustee, the Indenture Trustee, each Rating Agency and the Depositor, promptly after having obtained knowledge thereof, but in no event later than two Business Days thereafter, written notice in an officer’s certificate from a Responsible Officer thereof of any event that is, or with the giving of notice or lapse of time or both would become, a Servicer Replacement Event.

 

(c)           The Servicer will deliver to the Issuer on or before March 30 of each year, beginning on March 30, [    ], a report regarding the Servicer’s assessment of compliance with the Servicing Criteria during the immediately preceding calendar year, including disclosure of any material instance of non-compliance identified by the Servicer, as required under paragraph (b) of Rule 13a-18 and Rule 15d-18 of the Exchange Act and Item 1122 of Regulation AB.

 

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Section 4.11.     Annual Registered Public Accounting Firm Attestation Report.

 

(a)           On or before the 90th day following the end of each fiscal year, beginning with the fiscal year ending December 31, [    ], the Servicer shall cause a firm of independent registered public accountants (who may also render other services to the Servicer, the Seller or their respective Affiliates) to furnish to the Indenture Trustee, the Servicer, the Seller and each Rating Agency each attestation report on assessments of compliance with the Servicing Criteria with respect to the Servicer or any Affiliate thereof during the related fiscal year delivered by such accountants pursuant to paragraph (c) of Rule 13a-18 or Rule 15d-18 of the Exchange Act and Item 1122 of Regulation AB.  The certification required by this paragraph may be replaced by any similar certification using other procedures or attestation standards 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 Commission.

 

Section 4.12.     Access to Certain Documentation and Information Regarding LoansThe Servicer shall provide to representatives of the Owner Trustee, the Indenture Trustee, [the Cap Counterparty] and the Noteholders reasonable access to the documentation regarding the Conveyed Assets.  Access shall be afforded without charge, but only upon reasonable request and conducted in a reasonable manner, during the normal business hours at the offices of the Servicer.  Nothing in this Section shall affect the obligation of the Servicer to observe any Applicable Law prohibiting disclosure of information regarding the Loan Obligors and the failure of the Servicer to provide access to information as a result of such obligation shall not constitute a breach of this Section 4.12.

 

Section 4.13.     Term of Servicer.  The Servicer hereby covenants and agrees to act as Servicer under, and for the term of, this Agreement.

 

Section 4.14.     Access to Information Regarding Trust and Basic Documents.  The Servicer shall furnish to the Owner Trustee and the Indenture Trustee from time to time such information regarding the Issuing Entity, or the Basic Documents as the Owner Trustee and Indenture Trustee (i) shall reasonably request prior to an Event of Default or (ii) shall request after an Event of Default.  Upon request, the Indenture Trustee shall furnish to the Owner Trustee annually a copy of the Register; provided, however, the Indenture Trustee shall not be obligated to furnish a copy of the Register more than once each calendar year.  The Servicer shall furnish to the Owner Trustee copies of all documents and reports required to be provided by the Servicer pursuant to this Article IV.

 

Section 4.15.     Agreement on Compliance.  The Servicer agrees that, should any governmental authority with bank regulatory powers find that the terms of this Agreement, or any agreement relating to the servicing of the Conveyed Assets constitute an unsafe and unsound condition with respect to the Servicer and such governmental authority notifies the Servicer of such finding, then the Servicer shall negotiate in good faith with the Issuing Entity to correct any such deficiencies and to bring this Agreement into compliance with Applicable Law.

 

Section 4.16.     1934 Act Filings.

 

The Issuer hereby authorizes the Servicer and the Seller, or either of them, to prepare, sign, certify and file any and all reports, statements and information respecting the

 

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Issuer and/or the Notes required to be filed pursuant to the Exchange Act, and the rules thereunder.

 

[End of Article IV]

 

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ARTICLE V.

 

DISTRIBUTIONS; STATEMENTS TO SECURITYHOLDERS

 

Section 5.01.     Establishment of Accounts.

 

(a)           The Issuing Entity, for the benefit of the Noteholders, shall cause the Indenture Trustee to establish and maintain in the name of the Indenture Trustee an Eligible Account (the “Collection Account”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Noteholders.

 

(b)           The Issuing Entity, for the benefit of the Noteholders, shall cause the Indenture Trustee to establish and maintain in the name of the Indenture Trustee an Eligible Account (the “Principal Distribution Account”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Noteholders.

 

(c)           [The Issuing Entity, for the benefit of the Noteholders, shall cause the Indenture Trustee to establish and maintain in the name of the Indenture Trustee an Eligible Account (the “Reserve Account”) bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Noteholders.]

 

(d)           [If required pursuant to Section 5.10(e), the Issuing Entity, for the benefit of the Noteholders, shall cause the Indenture Trustee to establish and maintain in the name of the Indenture Trustee an Eligible Account (the “Cap Collateral Account”) bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Noteholders.]

 

(e)           (i)           Funds on deposit in any Trust Account shall be invested by the Indenture Trustee in Permitted Investments selected by the Servicer and notified in writing to the Indenture Trustee; provided, however, that if the Servicer fails to select any Permitted Investment and notify the Indenture Trustee of such selection, the Indenture Trustee shall invest funds on deposit in any Trust Account, as the case may be, in an Permitted Investment described in clause (d) of the definition of “Permitted Investment” herein.  Permitted Investments are limited to obligations or securities that mature on or before the next Payment Date. All such Permitted Investments shall be held by the Indenture Trustee for the benefit of the Noteholders.  Amounts invested in Permitted Investments may not be converted into cash, sold or otherwise disposed of other than (i) upon maturity of the related investment, (ii) upon the date the related investment no longer meets the investment criteria of a Permitted Investment, or (iii) on any Payment Date, in order to allow the amount invested to be distributed to the Noteholders or Certificateholders in accordance with Section 5.06 herein.

 

(ii)           On each Payment Date, Net Investment Earnings on the amounts in the Collection Account shall be distributed by the Indenture Trustee to the Noteholders and Certificateholders in accordance with Section 5.06 herein, prior to distributions made from Available Funds..

(iii)           [On each Payment Date, if the amount in the Reserve Account, not including any investment earnings, is less than the Specified Reserve Account Balance,

 

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Net Investment Earnings on amounts on deposit in the Reserve Account shall be retained in the Reserve Account to the extent required to increase the amount in the Reserve Account to the Specified Reserve Account Balance and any excess shall be deposited into the Collection Account and included in and distributed as Interest Collections for that Payment Date.  On each Payment Date, if the amount in the Reserve Account, not including any investment earnings, is equal to or greater than the Specified Reserve Account Balance, Net Investment Earnings shall be distributed by the Indenture Trustee to the Noteholders and Certificateholders in accordance with Section 5.06 herein (prior to distributions made from Net Investment Earnings on the Collection Account and Available Funds).]

 

(f)           In the event that there are Net Investment Losses in Permitted Investments chosen by the Servicer, the Servicer shall deposit the amount of such Net Investment Losses into the Collection Account no later than one (1) Business Day prior to the Payment Date.  The Indenture Trustee shall not be held liable in any way for any Net Investment Losses, except for losses attributable to the Indenture Trustee’s failure to make payments on such Permitted Investments issued by the Indenture Trustee, in its commercial capacity as principal obligor and not as Indenture Trustee, in accordance with their terms.

 

(g)           (ii)           The Indenture Trustee shall possess all right, title and interest in all funds and investment property on deposit from time to time in or credited to the Trust Accounts and in all proceeds thereof (including all income thereon) and all such funds, investment property, proceeds and income shall be part of the assets of the Issuing Entity, except as otherwise set forth herein.  The Trust Accounts shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Noteholders.  If, at any time, any Trust Account ceases to be an Eligible Account, the Indenture Trustee (or the Servicer on its behalf) shall within 10 Business Days (or such longer period, not to exceed 30 calendar days, as to which each Rating Agency may consent) establish a new Trust Account as an Eligible Account and shall transfer any cash and/or any investments from the account that is no longer an Eligible Account to the new Trust Account.

 

(ii)           With respect to the Trust Account Property, the Indenture Trustee agrees, by its acceptance hereof, that:

 

(A)           any Trust Account Property that is held in deposit accounts shall be held solely in the Eligible Accounts, subject to the last sentence of Section 5.01(g)(i); and each such Eligible Account shall be subject to the exclusive custody and control of the Indenture Trustee, and the Indenture Trustee shall have sole signature authority with respect thereto;

 

(B)           any Trust Account Property that constitutes Physical Property shall be delivered to the Indenture Trustee in accordance with paragraph (a) of the definition of “Delivery” and shall be held, pending maturity or disposition, solely by the Indenture Trustee or a Securities Intermediary acting solely for the Indenture Trustee;

 

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(C)           any Trust Account Property that is a book-entry security held through the Federal Reserve System pursuant to federal book-entry regulations shall be delivered in accordance with paragraph (b) of the definition of “Delivery” and shall be maintained by the Indenture Trustee, pending maturity or disposition, through continued book-entry registration of such Trust Account Property as described in such paragraph;

 

(D)           any Trust Account Property that is an “uncertificated security” under Article 8 of the UCC and that is not governed by clause (C) above shall be delivered to the Indenture Trustee in accordance with paragraph (c) of the definition of “Delivery” and shall be maintained by the Indenture Trustee, pending maturity or disposition, through continued registration of the Indenture Trustee’s (or its nominee’s) ownership of such security; and

 

(E)           any Trust Account Property that is a Security Entitlement shall be delivered in accordance with paragraph (d) of the definition of “Delivery” herein and shall be held pending maturity or disposition by the Indenture Trustee or a securities intermediary acting solely for the Indenture Trustee.

 

(iii)           The Servicer shall have the power, (which power shall be revocable by the Indenture Trustee, or by the Owner Trustee with the consent of the Indenture Trustee, following a Servicer Replacement Event) to instruct the Indenture Trustee to make withdrawals and payments from the Trust Accounts [and the Cap Collateral Account] held by the Indenture Trustee for the purpose of withdrawing any amounts deposited in error into such accounts and withdrawing therefrom amounts that the Servicer is authorized to withdraw in accordance with Section 5.06(a).

 

Section 5.02.     Collections.

 

The the Servicer shall remit to the Collection Account all Principal Collections and Interest Collections within two (2) Business Days of receipt thereof irrespective of the Collection Period for which such Principal Collections and Interest Collections are applicable.

 

Section 5.03.     Application of Collections.  All payments by or on behalf of a Loan Obligor during each Collection Period with respect to each Loan shall be allocated to interest, fees, principal and other amounts in accordance with the Simple Interest Method and the Servicer’s customary procedures.

 

Section 5.04.     Reserved.

 

Section 5.05.     LIBOR Calculation.  

 

(a)           For so long as the Floating Rate Notes remain outstanding, LIBOR with respect to each Interest Period other than the first Interest Period will be determined by the Calculation Agent on each LIBOR Determination Date and reported to the Issuing Entity and the Indenture Trustee on each LIBOR Determination Date as soon as practicable after 11:00 a.m. (London time) on the following basis:

 

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(i)           On each LIBOR Determination Date LIBOR will be the offered quotation to leading banks for one-month U.S. dollar deposits in the London interbank market which appears on Reuters Telerate Page 3750 at approximately 11:00 a.m. (London time) on the LIBOR Determination Date in question

 

(ii)           If on any LIBOR Determination Date the rate for one-month deposits in U.S. dollars does not appear on Reuters Telerate Page 3750, LIBOR shall be determined on the basis of the rates at which one-month deposits in U.S. dollars are offered by four prime banks in the London interbank market (which may include the Calculation Agent) reasonably selected by the Calculation Agent (the “Reference Banks”), at approximately 11:00 a.m. (London time) on such Determination Date, to prime banks in the London interbank market in an amount determined by the Calculation Agent.  If at least two such quotations are provided, LIBOR will be the arithmetic mean of the quotations rounded to four decimal places.  If fewer than two quotations are provided, LIBOR will be the arithmetic mean of rates quoted by at least two major banks in New York City (which may include the New York City offices of the Calculation Agent), reasonably selected by the Calculation Agent, at approximately 11:00 a.m., New York City time, on such LIBOR Determination Date for one month loans in U.S. dollars to leading European banks in a principal amount equal to not less than U.S. $1,000,000; provided, however, that if fewer than two Reference Banks selected as aforesaid by the Calculation Agent are quoting rates as mentioned above, LIBOR shall be the rate in effect for the previous Interest Period.

 

For the sake of clarity it is understood and agreed that the mechanism for determining LIBOR described in clause (i) above is intended to conform to the definition of “USD-LIBOR-BBA” contained in the ISDA Definitions and the mechanism for determining an alternate floating rate as the LIBOR as described in clause (ii) above is intended to conform to the definition of “USD-LIBOR-Reference Banks” contained in the ISDA Definitions with a “designated maturity” of one month.

 

(b)           The Calculation Agent shall, on each LIBOR Determination Date, determine the  Interest Rate and the amount of interest accrued on the Class A Noteholders’ Interest Carryover Shortfall for such LIBOR Determination Date with respect to the Floating Rate Notes and round the resultant figure to the nearest U.S. $0.01 (U.S. $0.005 being rounded upwards) to arrive at the related Class A Noteholders’ Monthly Accrued Interest for such Payment Date.  In the event that the Calculation Agent shall fail to calculate the LIBOR, the Indenture Trustee shall calculate the LIBOR and related Class A Noteholders’ Monthly Accrued Interest in accordance with the provision above.

 

(c)           The Calculation Agent shall cause the related Class A Noteholders’ Monthly Accrued Interest to be made known to each of the Issuing Entity, the Servicer, [the Cap Counterparty], the Indenture Trustee and the Registrar no later than the Business Day prior to each Payment Date or as otherwise required by the Indenture Trustee.

 

(d)           All certificates, communications, opinions, determinations, calculations, quotations and decisions given, expressed, made or obtained for the purposes of the provisions of this Section 5.05 by the Calculation Agent shall (in the absence of willful misconduct, bad faith

 

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or manifest error) be binding on the Issuing Entity and all of the Noteholders and no liability shall attach to the Calculation Agent (or the Indenture Trustee, in the event that the Calculation Agent fails to calculate any Interest Rate) in connection with the exercise or non-exercise by it of its powers, duties and discretion.

 

Section 5.06.     Distributions; Payment Notification.  (a)           Prior  to any acceleration of the Notes pursuant to Section 5.02 of the Indenture, on each Payment Date, the Indenture Trustee (based on information contained in, and as directed by, the Servicer’s Monthly Certificate delivered on or before the related Determination Date pursuant to Section 4.09) shall make the following deposits and distributions, to the extent of Net Investment Earnings on the Reserve Account, Net Investment Earnings on the Collection Account, Available Funds [and the Reserve Account Draw Amount] on deposit in the Collection Account for such Payment Date (in that order), in the following order of priority:

 

(i)           first, to the Servicer, the Servicing Fee for the related Collection Period and all accrued and unpaid Servicing Fees with respect to prior Collection Periods;

 

(ii)          second, to the Class A Noteholders, the Accrued Class A Note Interest for the related Interest Period, pro rata based on their respective interest entitlements;

 

(iii)         third, to the Principal Distribution Account for distribution to the Noteholders pursuant to Section 5.06(b) of this Agreement, the First Allocation of Principal, if any;

 

(iv)         [fourth, to the Class B Noteholders, the Accrued Class B Note Interest for the related Interest Period;]

 

(v)          [fifth, to the Principal Distribution Account for distribution to the Noteholders pursuant to Section 5.06(b) of this Agreement, the Second Allocation of Principal, if any;]

 

(vi)         [sixth, to the Reserve Account, any additional amounts required to increase the amount in the Reserve Account up to the Specified Reserve Account Balance;]

 

(vii)        seventh, to the Principal Distribution Account for distribution to the Noteholders in accordance with Section 5.06(b) of this Agreement, the Regular Principal Distribution Amount, if any;

 

(viii)       eight, to the Owner Trustee and the Indenture Trustee, accrued and unpaid fees, reasonable expenses and indemnification amounts due and owing under this Agreement, the Trust Agreement, the Administration Agreement and the Indenture, as applicable, which have not been previously paid; and

 

(ix)          ninth, to the Certificate Distribution Account, any funds remaining for distribution to the Certificateholder.

 

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Notwithstanding any other provision of this Section 5.06, following the occurrence and during the continuation of an Event of Default which has resulted in an acceleration of the Notes, the Indenture Trustee shall apply all amounts on deposit in the Collection Account pursuant to Section 5.04(b) of the Indenture.

 

After the payment in full of the Notes, [all amounts payable to the Cap Counterparty] and all other amounts payable under Section 5.06(a), all Collections shall be paid to or in accordance with the instructions provided from time to time by the Certificateholder.

 

(b)           Prior to the acceleration of the Notes pursuant to Section 5.02 of the Indenture, on each Payment Date and the Redemption Date, the Indenture Trustee shall distribute all amounts on deposit in the Principal Distribution Account to Noteholders in respect of principal of the Notes to the extent of the funds therein in the following order of priority:

 

(i)           first, to the Holders of the Class A-1 Notes, until the Class A-1 Notes are paid in full;

 

(ii)          second, to the Holders of the Class A-2-A Notes and the Class A-2-B Notes, ratably based on their respective Note Balance, until the Class A-2-A Notes and the Class A-2-B Notes are paid in full;

 

(iii)         third, to the Holders of the Class A-3-A Notes and the Class A-3-B Notes, ratably based on their respective Note Balance, until the Class A-3-A Notes and the Class A-3-B Notes are paid in full;

 

(iv)         fourth, to the Holders of the Class A-4 Notes, until the Class A-4 Notes are paid in full; and

 

(v)          [fifth, to the Holders of the Class B Notes, until the Class B Notes are paid in full.]

 

Section 5.07.     Additional Deposits and Payments.

 

(a)           On each Payment Date, the Servicer and the Seller will deposit into the Collection Account the aggregate Repurchase Price with respect to Loans purchased by the Servicer pursuant to Section 4.07 or the Seller pursuant to Section 3.03, respectively, on such Payment Date and the Servicer will deposit into the Collection Account all amounts, if any, to be paid under Section 9.01 in connection with the optional purchase.  All such deposits with respect to a Payment Date will be made, in immediately available funds by 11:00 a.m., New York City time, on such Payment Date related to such Collection Period.

 

[(b)           The Indenture Trustee will, on each Payment Date, withdraw from the Reserve Account the Reserve Account Excess Amount, if any, for such Payment Date and deposit such amount in the Collection Account.]

 

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[(c)          The Indenture Trustee will, on the Payment Date relating to each Collection Period, withdraw from the Reserve Account the Reserve Account Draw Amount and deposit such amount in the Collection Account.]

 

[(d)          On the Closing Date the Seller will deposit (or cause to be deposited) into the Reserve Account an amount equal to the Initial Reserve Account Deposit Amount.]

 

(e)           [The Indenture Trustee will promptly, on the day of receipt, deposit into the Collection Account all Cap Payments received by it under the Interest Rate Cap Agreement in immediately available funds.]

 

(f)           The Indenture Trustee shall receive written instructions from the Servicer (which may be in the form of a written order or request of the Servicer signed by an Authorized Officer of the Servicer) directing the Indenture Trustee to make the foregoing deposits and payments.

 

Section 5.08.     Statements to Noteholders and the Owner Trustee.  On or before each Determination Date, the Servicer shall deliver to the Indenture Trustee and each Paying Agent, with a copy to each Rating Agency and the Indenture Trustee (upon receiving notice from the Issuing Entity that the statement has been posted on the Rule 17g-5 Website, shall make available on its website, as described below) such copy to [the Cap Counterparty], the Issuing Entity and to each Noteholder of record as of the most recent Record Date, a statement setting forth for the Collection Period and Payment Date relating to such Determination Date the following information (to the extent applicable):

 

(a)           the aggregate amount being paid on such Payment Date in respect of interest on and principal of each Class of Notes;

 

(b)           the Class A-1 Note Balance, the Class A-2-A Note Balance, the Class A-2-B Note Balance, the Class A-3-A Note Balance, the Class A-3-B Note Balance, the Class A-4 Note Balance and [the Class B Note Balance], in each case after giving effect to payments on such Payment Date;

 

(c)           [(i) the amount on deposit in the Reserve Account and the Specified Reserve Account Balance, each as of the beginning and end of the related Collection Period, (ii) the amount deposited in the Reserve Account in respect of such Payment Date, if any, (iii) the Reserve Account Draw Amount and the Reserve Account Excess Amount, if any, to be withdrawn from the Reserve Account on such Payment Date, (iv) the balance on deposit in the Reserve Account on such Payment Date after giving effect to withdrawals therefrom and deposits thereto in respect of such Payment Date and (v) the change in such balance from the immediately preceding Payment Date;]

 

(d)           the First Allocation of Principal, [the Second Allocation of Principal], and the Regular Principal Distribution Amount for such Payment Date;

 

(e)           the Net Pool Balance and the Note Factor as of the close of business on the last day of the preceding Collection Period;

 

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(f)           the amount of the Servicing Fee to be paid to the Servicer with respect to the related Collection Period and the amount of any unpaid Servicing Fees;

 

(g)           the amount of the Class A Noteholders’ Interest Carryover Shortfall and [the Class B Noteholders’ Interest Carryover Shortfall], if any, on such Payment Date and the change in such amounts from the preceding Payment Date;

 

(h)           the aggregate Repurchase Price with respect to repurchased Loans paid by (i) the Servicer and (ii) the Seller with respect to the related Collection Period;

 

(i)           the amount of Collections for the related Collection Period;

 

[(j)          amount of Cap Payments, if any;]

 

[(k)         the amount of any Cap Termination Payments or Cap Collateral Payments, if any, to be included in the Available Funds on the related Payment Date; ]

 

[(l)           the Cap Replacement Proceeds, if any; ]

 

(m)          the number of, and aggregate amount of payments due on, the related Loans which are delinquent as of the end of the related Collection Period;

 

(n)           the aggregate amount of proceeds received by the Servicer, net of reimbursable out-of-pocket expenses, in respect of a Loan which is a Net Loss Asset;

 

(o)           the amount remaining of any overcollateralization;

 

(p)           the number and Outstanding Principal Balance of Loans for which the related Financed Vehicle has been repossessed;

 

[(q)          the balance of the Cap Termination Payment Account;]

 

[(r)           the balance of the Cap Collateral Account; and

 

(s)           any change in the fees payable hereunder or pursuant to the Indenture or the Trust Agreement.]

 

Each amount set forth pursuant to paragraph (a) or (g) above relating to the Notes shall be expressed as a dollar amount per $1,000 of the Initial Note Balance of the Notes (or Class thereof).

 

The Indenture Trustee will make available via the Indenture Trustee’s internet website all reports or notices required to be provided by the Indenture Trustee under this Section 5.08 and Section 7.04(c) of the Indenture.  Any information that is disseminated in accordance with the provisions of this Section 5.08 shall not be required to be disseminated in any other form or manner.  The Indenture Trustee will make no representations or warranties as to the accuracy or completeness of such documents and will assume no responsibility therefor.

 

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The Indenture Trustee’s internet website shall be initially located at “[        ]” or at such other address as shall be specified by the Indenture Trustee from time to time in writing to the Noteholders, the Servicer, the Issuing Entity or any Paying Agent.  In connection with providing access to the Indenture Trustee’s internet website, the Indenture Trustee may require registration and the acceptance of a disclaimer.  The Indenture Trustee shall not be liable for the dissemination of information in accordance with this Agreement.

 

The Indenture Trustee shall have no duty or obligation to verify or confirm the accuracy of any of the information or numbers set forth in the Servicer’s Certificate delivered by the Servicer to the Indenture Trustee, and the Indenture Trustee shall be fully protected in relying upon such Servicer’s Certificate.

 

Section 5.09.     Advances by the Servicer.

 

(a)           Subject to the Servicer determination that an Advance would not represent a Nonrecoverable Advance by the close of business on the Servicer Remittance Date, the Servicer shall make an Advance, out of its own funds or from amounts held for future distributions, by deposit into the Collection Account, equal to the aggregate of all scheduled payments of interest on the Loans which were due during the immediately preceding Collection Period that remained unpaid at the end of such Collection Period or were not otherwise due during such Collection Period because the payment was deferred by the Servicer.

 

(b)           On each Payment Date, the Servicer shall reimburse itself from amounts received in respect of late scheduled payments of interest for the Outstanding Amount Advanced to the extent of actual collections of late scheduled payments of interest under Loan Contracts.

 

(c)           If the Servicer determines that any Advance made pursuant to this Section 5.09 has become a Nonrecoverable Advance and at the time of such determination there exists an Outstanding Amount Advanced with respect to each Advance, then the Servicer shall reimburse itself out of funds in the Collection Account for the amount of such Nonrecoverable Advance together with interest thereon, but only to the extent of such Outstanding Amount Advanced.

 

Section 5.10.     [Interest Rate Cap Agreement.

 

(a)           The Issuing Entity shall enter into the Initial Interest Rate Cap Agreement with the Initial Cap Counterparty.  Subject to the requirements of this Section 5.10, the Issuing Entity may from time to time enter into one or more Replacement Interest Rate Cap Agreements in the event that the Initial Interest Rate Cap Agreement is terminated due to any “Termination Event” or “Event of Default” (each as defined in the Initial Interest Rate Cap Agreement) prior to its scheduled expiration and in accordance with the terms of such Interest Rate Cap Agreement.  Other than any Replacement Interest Rate Cap Agreement entered into pursuant to this Section 5.10(a), the Issuing Entity may not enter into any additional interest rate cap agreements.

 

(b)           In the event of any early termination of any Interest Rate Cap Agreement, (i) upon written direction from the Servicer or the Issuing Entity and notification of such early termination, the Indenture Trustee shall establish the Cap Termination Payment Account, and (ii) any Cap Termination Payments received from the Cap Counterparty will be remitted to the Cap Termination Payment Account.

 

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(c)           The Issuing Entity shall promptly, following the early termination of any Initial Interest Rate Cap Agreement due to an “Event of Default” or “Termination Event” (each as defined in the Initial Interest Rate Cap Agreement) and in accordance with the terms of such Interest Rate Cap Agreement, enter into a Replacement Interest Rate Cap Agreement to the extent possible and practicable through application of funds available in the Cap Termination Payment Account unless entering into such Replacement Interest Rate Cap Agreement will cause the Rating Agency Condition not to be satisfied.

 

(d)           To the extent that (i) the funds available in the Cap Termination Payment Account exceed the costs of entering into a Replacement Interest Rate Cap Agreement or (ii) the Issuing Entity determines not to replace the Initial Interest Rate Cap Agreement and the Rating Agency Condition is met with respect to such determination, the amounts in the Cap Termination Payment Account (other than funds used to pay the costs of entering into a Replacement Interest Rate Cap Agreement, if applicable) shall be included in Available Funds and allocated in accordance with the order of priority specified in Section 5.06(a) on the following Payment Date.  In any other situation, amounts on deposit in the Cap Termination Payment Account at any time shall be invested pursuant to Section 5.01(d) and on each Payment Date after the creation of a Cap Termination Payment Account, the funds therein shall be used to cover any shortfalls in the amounts payable under clauses [first] through [fifth] and [seventh] under Section 5.06(a), provided, that in no event will the amount withdrawn from the Cap Termination Payment Account on such Payment Date exceed the amount of Cap Payments that would have been required to be paid on such Payment Date under the terminated Interest Rate Cap Transaction had there been no termination of such transaction.  Any amounts remaining in the Cap Termination Payment Account after payment in full of the Class A-3-B Notes shall be included in Available Funds and allocated in accordance with the order of priority specified in Section 5.06(a) on the following Payment Date.

 

(e)           If the Cap Counterparty is required to post collateral under the terms of the Interest Rate Cap Agreement, upon written direction and notification of such requirement from the Issuing Entity, the Indenture Trustee shall establish the Cap Collateral Account (the “Cap Collateral Account”) over which the Indenture Trustee shall have exclusive control and the sole right of withdrawal.  The Indenture Trustee shall deposit all collateral received from the Cap Counterparty under the Interest Rate Cap Agreement into the Cap Collateral Account.  Any and all funds at any time on deposit in, or otherwise to the credit of, the Cap Collateral Account shall be held in trust by the Indenture Trustee for the benefit of the Cap Counterparty, the Noteholders and the Certificateholder.  The only permitted withdrawal from or application of funds on deposit in, or otherwise to the credit of, the Cap Collateral Account shall be (i) for application to obligations of the Cap Counterparty to the Issuing Entity under the Interest Rate Cap Agreement in accordance with the terms of the Interest Rate Cap Agreement or (ii) to return collateral to the Cap Counterparty when and as required by the Interest Rate Cap Agreement.  On each Payment Date, if necessary to cover the obligations of the Cap Counterparty to the Issuing Entity under the Interest Rate Cap Agreement, the Indenture Trustee will transfer from available amounts either (x) the Cap Payment for the related Payment Date to the Collection Account or (y) the Cap Termination Payment to the Cap Termination Payment Account, as applicable.  Funds on deposit in the Cap Collateral Account shall be invested by the Indenture Trustee pursuant to the Interest Rate Cap Agreement, however, it is understood and agreed that the Indenture Trustee shall not be liable for any loss arising from such investment.

 

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(f)           If at any time the Interest Rate Cap Agreement becomes subject to early termination due to the occurrence of an “Event of Default” or “Termination Event” (as defined in the Interest Rate Cap Agreement), the Issuing Entity and the Indenture Trustee (upon receipt of notice and direction by the Servicer) shall use reasonable efforts (following the expiration of any applicable grace period) to enforce the rights of the Issuing Entity thereunder as may be permitted by the terms of the Interest Rate Cap Agreement and consistent with the terms hereof.  To the extent that the Cap Replacement Proceeds exceed any such Cap Termination Payments, the Cap Replacement Proceeds in excess of such Cap Termination Payments, if any, shall be included in Available Funds and allocated and applied in accordance with the order of priority specified in Section 5.06(a) on the following Payment Date.

 

(g)           Subject to the rights of the Cap Counterparty with respect to the Cap Collateral Account, the Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Cap Collateral Account and in all proceeds thereof (including all income thereon) and all such funds, investments, proceeds and income shall be part of the trust estate to the extent released to the Issuing Entity pursuant to the Interest Rate Cap Agreement.  The Cap Collateral Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Cap Counterparty, the Noteholders and the Certificateholder, as the case may be.  If, at any time the Cap Collateral Account ceases to be an Eligible Account, the Indenture Trustee (or the Servicer on its behalf) shall within 10 Business Days (or such longer period, not to exceed 30 calendar days, as to which each Rating Agency may consent) establish a new account as an Eligible Account and shall transfer any cash and/or any investments to such new account.  So long as [                         ] is an Eligible Institution, the Cap Collateral Account shall be maintained with it in an Eligible Account.

 

(h)           The Issuing Entity hereby grants to the Indenture Trustee for the benefit of the Noteholders a security interest in the Cap Collateral Account and all funds in the Cap Collateral Account (to the extent such amounts are property of the Issuing Entity) and the proceeds thereof to secure the payment of interest on and principal of the Notes, and the Indenture Trustee shall have all of the rights of a secured party under the UCC with respect thereto.  Any deposits or withdrawals from the Cap Collateral Account will be made in accordance with the Basic Documents.

 

(i)           Upon the occurrence of (i) any “Event of Default” (as defined in the Interest Rate Cap Agreement) with the Cap Counterparty as “Defaulting Party” (as defined in the Interest Rate Cap Agreement) (except as described in the following sentence), or (ii) any “Termination Event” (as defined in the Interest Rate Cap Agreement) with respect to which the Cap Counterparty is an “Affected Party” (as defined in the Interest Rate Cap Agreement), the Indenture Trustee may and will, at the written direction of the Administrator, by notice to the Cap Counterparty, designate an “Early Termination Date” (as defined in the Interest Rate Cap Agreement) with respect to the Interest Rate Cap Agreement.  If an “Event of Default” (as defined in the Interest Rate Cap Agreement) occurs as a result of the insolvency or bankruptcy of the Cap Counterparty, which event has not been otherwise cured under the terms of the Interest Rate Cap Agreement, the Issuing Entity will terminate the Interest Rate Cap Agreement and the Issuing Entity shall promptly, in accordance with the terms of the Interest Rate Cap Agreement, enter into a Replacement Interest Rate Cap Agreement to the extent possible and practicable through application of funds available in the Cap Termination Payment Account.]

 

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[End of Article V]

 

 

 

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ARTICLE VI.

THE DEPOSITOR

 

Section 6.01.     Representations of the Depositor.  The Depositor makes the following representations to the Issuing Entity, the Servicer, the Indenture Trustee, the Loan Seller, as of the execution and delivery of this Agreement and as of the Closing Date.  The Issuing Entity relies on such representations of the Depositor in accepting the Conveyed Assets.  Such representations shall survive the sale, transfer and assignment of the Conveyed Assets being sold by the Depositor to the Issuing Entity and the pledge thereof to the Indenture Trustee in accordance with the terms of the Indenture.

 

(a)           Organization and Good Standing.  The Depositor is duly formed and validly existing as a limited liability company in good standing under the laws of the State of Delaware, with the power and authority under its amended and restated limited liability company agreement and under the Delaware Limited Liability Company Act to own its properties and to conduct its business as such properties are currently owned and such business is presently conducted.

 

(b)           Due Qualification.  The Depositor is duly qualified to do business as a foreign limited liability company in good standing, and has obtained all necessary licenses and approvals in all jurisdictions where the failure to do so would adversely affect the Depositor’s ability to transfer the Conveyed Assets being conveyed by it to the Trust pursuant to this Agreement or the validity or enforceability of the Loans.

 

(c)           Power and Authority.  The Depositor has the power and authority under its amended and restated limited liability company agreement and under the Delaware Limited Liability Company Act to execute and deliver this Agreement and the other Basic Documents to which it is a party and to carry out their respective terms; the Depositor has full power and authority to sell and assign the property to be sold and assigned to and deposited with the Issuing Entity, and the Depositor shall have duly authorized such sale and assignment to the Issuing Entity by all necessary limited liability company action; and the execution, delivery and performance of this Agreement and the other Basic Documents to which the Depositor is a party have been duly authorized by the Depositor by all necessary limited liability company action.

 

(d)           Binding Obligation.  This Agreement and the other Basic Documents to which the Depositor is a party, when duly executed and delivered by the other parties hereto and thereto, shall constitute legal, valid and binding obligations of the Depositor, enforceable against the Depositor in accordance with their respective terms, except as the enforceability thereof may be limited by bankruptcy, insolvency, reorganization or similar laws now or hereafter in effect relating to or affecting creditors’ rights generally and relating to general principles of equity (whether applied in a proceeding at law or in equity).

 

(e)           No Violation.  The consummation of the transactions contemplated by this Agreement and the other Basic Documents and the fulfillment of the terms of this Agreement and the other Basic Documents shall not conflict with, result in any breach of any of the terms or provisions of or constitute (with or without notice or lapse of time or both) a default under, the amended and restated limited liability company agreement of the Depositor or any indenture, agreement, mortgage, deed of trust or other instrument or agreement to which the Depositor is a

 

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party or by which it is bound; or result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture, agreement, mortgage, deed of trust or other instrument or agreement other than this Agreement and the other Basic Documents; or violate any law, order, rule or regulation applicable to the Depositor of any court, federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Depositor.

 

(f)           No Proceedings.  There are no proceedings or investigations pending or, to the Depositor’s knowledge, threatened, against the Depositor before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality having jurisdiction over the Depositor or its properties:  (i) asserting the invalidity of this Agreement or any other Basic Document; (ii) seeking to prevent the issuance of the Notes or the consummation of any of the transactions contemplated by this Agreement or any other Basic Document; (iii) that could adversely affect the performance by the Depositor of its obligations under, or the validity or enforceability of, this Agreement or any other Basic Document; or (iv) seeking to adversely affect the federal income tax attributes of the Trust or the Notes.

 

(g)           No Consents.  The Depositor is not required to obtain the consent of any other party or any consent, license, approval, registration, authorization or declaration of or with any governmental authority, bureau or agency in connection with the execution, delivery, performance, validity or enforceability of this Agreement or any other Basic Document to which it is a party that has not already been obtained.

 

Section 6.02.     Entities’ Existence.   During the term of this Agreement, the Depositor will keep in full force and effect its existence, rights and franchises as a limited liability company under the laws of the jurisdiction of its formation and will obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Agreement, the Basic Documents and each other instrument or agreement necessary or appropriate to the proper administration of this Agreement and the transactions contemplated hereby.  In addition, all transactions and dealings between the Depositor and its Affiliates will be conducted on an arm’s-length basis.  The Depositor shall not merge or consolidate with any other entity or otherwise amend its organizational documents except in accordance with the provisions of its organizational documents.

 

Section 6.03.     Limitation on Liability of Depositor and Others.   The Depositor and any director, officer, employee or agent thereof may reasonably rely in good faith on the advice of counsel or on any document of any kind, prima facie properly executed and submitted by any Person respecting any matters arising hereunder.  The Depositor shall not be under any obligation to appear in, prosecute or defend any legal action that shall not be incidental to its obligations under this Agreement and that in its opinion may involve it in any expense or liability.

 

Section 6.04.     Depositor May Own Notes.   The Depositor and any Affiliate thereof may in its individual or any other capacity become the owner or pledgee of Notes with the same rights as it would have if it were not the Loan Seller, the Depositor or an Affiliate thereof, except as expressly provided herein or in any Basic Document.

 

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[End of Article VI]

 

 

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ARTICLE VII.

 

THE SERVICER

 

Section 7.01.     Representations of Servicer.   The Servicer makes the following representations upon which the Issuing Entity is deemed to have relied in acquiring the Conveyed Assets.  Such representations are made as of the date of the execution and delivery of this Agreement and as of the Closing Date, and shall survive the transfer of the Conveyed Assets to the Issuing Entity and the pledge and/or assignment, as the case may be, thereof to the Indenture Trustee in accordance with the terms of the Indenture.

 

(a)           Organization and Good Standing.  It is a national banking association duly organized and validly existing as a banking institution under the laws of the United States and continues to hold a valid certificate to do business as such.  It is duly authorized to own its properties and transact its business and is in good standing in each jurisdiction in which the character of the business transacted by it or any properties owned or leased by it requires such authorization and in which the failure to be so authorized could reasonably be expected to have a Material Adverse Effect.  It has, and at all relevant times had, the power, authority and legal right to acquire, own, and service the Conveyed Assets.

 

(b)           Securitization Structure.  It is the holder of 100% of the equity and voting interest in the Depositor.

 

(c)           Licenses and Approvals.  It has obtained all necessary licenses and approvals, in all jurisdictions where the failure to do so could reasonably be expected to materially and adversely affect its ability to acquire, own and service the Conveyed Assets.

 

(d)           Power and Authority.  It has the power and authority to execute and deliver this Agreement and the other Basic Documents to which it is a party and to carry out their respective terms; and the execution, delivery and performance of this Agreement and the other Basic Documents to which it is a party have been duly authorized by it by all necessary action.

 

(e)           Binding Obligation.  This Agreement and the other Basic Documents to which it is a party constitute its legal, valid and binding obligations, enforceable against it in accordance with their respective terms, except as the enforceability thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights generally and to general principles of equity, whether applied in a proceeding in equity or at law.

 

(f)           No Violation.  It is not in default under any indenture, mortgage, deed of trust, loan agreement, guarantee, lease financing agreement, or similar agreement or instrument to which it is a party except where such default could not reasonably be expected to have a material adverse effect on the Noteholders.  The consummation of the transactions contemplated by this Agreement and the other Basic Documents to which it is a party and the fulfillment of their respective terms shall not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time or both) a default under, its articles of association or bylaws or any indenture, agreement, mortgage, deed of trust or other instrument or agreement to which it is a party or by which it is bound; or result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture, agreement,

 

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mortgage, deed of trust or other instrument or agreement, other than this Agreement and the other Basic Documents, or violate any law, order, rule or regulation applicable to it of any court or federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over it or any of its properties.

 

(g)           No Proceedings.  There are no proceedings or investigations pending, or to its knowledge threatened, against it before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality having jurisdiction over it or its properties:  (i) asserting the invalidity of this Agreement or any of the other Basic Documents; (ii) seeking to prevent the issuance of the Notes or the consummation of any of the transactions contemplated by this Agreement or any of the other Basic Documents; (iii) that could materially and adversely affect the performance by it of its obligations under, or the validity or enforceability of, this Agreement or any of the other Basic Documents; or (iv) seeking to adversely affect the federal income tax or other federal, state or local tax attributes of the Notes.

 

(h)           No Consents.  The Servicer is not required to obtain the consent of any other party or any consent, license, approval, registration, authorization or declaration of or with any governmental authority, bureau or agency in connection with the execution, delivery, performance, validity or enforceability of this Agreement or any other Basic Document to which it is a party that has not already been obtained.

 

Section 7.02.     Indemnities of Servicer.

 

(a)           The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer and the representations made by the Servicer under this Agreement and the other Basic Documents.

 

(b)           The Servicer shall indemnify the Issuing Entity, the Owner Trustee and the Indenture Trustee and any of the officers, directors, employees and agents of each such Person from and against any and all costs (including reasonable legal fees and expenses), expenses, losses, damages, claims and liabilities (including servicing, underwriting or realization issues (including with respect to violations of consumer protection laws)) arising out of or resulting from the use, ownership or operation by the Servicer or any Affiliate thereof of a Financed Vehicle, excluding any losses incurred solely in connection with the sale of any repossessed Financed Vehicles in a commercially reasonable manner and in compliance with the terms of this Agreement.

 

(c)           The Servicer shall indemnify the Issuing Entity, the Owner Trustee, the Indenture Trustee, and any of the officers, directors, employees and agents of each such Person, from and against any taxes that may at any time be asserted against any of such parties with respect to the transactions contemplated in this Agreement, including any sales, gross receipts, tangible or intangible personal property, privilege or license taxes (but not including (i) any federal, state or other income taxes, (ii) any general corporation or franchise taxes, or (iii) any taxes asserted with respect to the transfer of the Conveyed Assets to the Issuing Entity or the issuance and original sale of the Notes), and any costs and expenses in defending against the same (including reasonable legal fees and expenses).  For the avoidance of doubt, the Servicer will not indemnify any Person for any costs, expenses, losses, claims, damages or liabilities due to the credit risk of

 

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any Loan Obligor and for which reimbursement would constitute recourse for uncollectible Loans.

 

(d)           The Servicer shall indemnify 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 (including reasonable legal fees and expenses) 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 loss, liability, expense, damage or injury suffered: (A) is due to the willful misconduct, bad faith or negligence 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 under the 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 under the Trust Agreement; or (D) shall arise out of or be incurred as a result of the negligence or willful misconduct of the Indenture Trustee in connection with its performance of the duties of successor Servicer hereunder should the Indenture Trustee accept such duties.

 

(e)           The Servicer shall indemnify, defend and hold harmless the Issuing Entity, the Owner Trustee, the Indenture Trustee, and any of the officers, directors, employees and agents of the Issuing Entity, the Owner Trustee and the Indenture Trustee from and against any and all costs, expenses, losses, claims, damages and liabilities (including reasonable legal fees and expenses) to the extent that such cost, expense, loss, claim, damage or liability arose out of, or was imposed upon any such Person through any breach of the Servicer’s obligations hereunder and under the other Basic Documents, and the negligence, willful misfeasance or bad faith of the Servicer (except errors in judgment) in the performance of its duties under this Agreement, by reason of breach of its representations, warranties, obligations or duties under this Agreement, or for any violation of law by the Servicer.

 

(f)           Indemnification under this Section 7.02 shall survive the resignation or removal of the Servicer or the termination of this Agreement with respect to acts of the Servicer prior thereto, and shall include reasonable fees and expenses of counsel and reasonable expenses of litigation.  For purposes of this Section 7.02, in the event of the termination of the rights and obligations of Huntington (or any successor thereto pursuant to Section 7.03) as Servicer pursuant to Section 8.01(a), or the resignation by such Servicer pursuant to Section 7.06, such Servicer shall be deemed to be the Servicer pending appointment of a successor Servicer (other than the Indenture Trustee) pursuant to Section 8.03.  If the Servicer shall have made any indemnity payments pursuant to this Section 7.02 and the Person to or on behalf of whom such payments are made thereafter collects any of such amounts from others, such Person shall promptly repay such amounts to the Servicer, without interest.

 

(g)           Indemnification under this Section 7.02 shall survive the resignation or removal of the Owner Trustee or the Indenture Trustee or the termination of this Agreement.

 

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Section 7.03.     Merger or Consolidation of, or Assumption of the Obligations of, Servicer.   Any Person (i) into which the Servicer may be merged or consolidated, (ii) resulting from any merger or consolidation to which the Servicer shall be a party, (iii) that acquires by conveyance, transfer or lease substantially all of the assets of the Servicer or (iv) succeeding to the business of the Servicer, which Person shall execute an agreement of assumption to perform every obligation of the Servicer under this Agreement or any other Basic Document, shall be the successor to the Servicer under this Agreement or any such Basic Document without the execution or filing of any paper or any further act on the part of any of the parties to this Agreement.  The Servicer shall provide notice of any merger, consolidation or succession pursuant to this Section 7.03 to the Owner Trustee, the Indenture Trustee and each Rating Agency.  Notwithstanding the foregoing, the Servicer shall not merge or consolidate with any other Person where it shall not be the survivor thereof or permit any other Person to become a successor to its automobile finance or leasing business unless (i) immediately after giving effect to such transaction, no representation or warranty made pursuant to Section 7.01 shall have been breached (for purposes hereof, such representations and warranties shall speak as of the date of the consummation of such transaction) and no event that, after notice or lapse of time or both, would become a Servicer Replacement Event shall have occurred, (ii) the Servicer shall have delivered to the Owner Trustee and the Indenture Trustee an officer’s certificate from a Responsible Officer thereof and an Opinion of Counsel each stating that such consolidation, merger or succession and such agreement of assumption comply with this Section 7.03 and that all conditions precedent provided for in this Agreement relating to such transaction have been complied with, (iii) the Servicer shall have delivered to the Owner Trustee and the Indenture Trustee an Opinion of Counsel stating that either (A) all financing statements and continuation statements and amendments thereto have been executed and filed that are necessary to preserve and protect the interest of the Issuing Entity and the Indenture Trustee, respectively, in the assets of the Issuing Entity and reciting the details of such filings or (B) no such action shall be necessary to preserve and protect such interest, (iv) such other Person is an Eligible Servicer and (v) such other Person shall have validly assumed the obligations of the Servicer under the Basic Documents.

 

Section 7.04.     Limitation on Liability of Servicer and Others.

 

(a)           Neither the Servicer nor any of its respective directors, officers, employees or agents shall be under any liability to the Issuing Entity, the Depositor, the Indenture Trustee, the Owner Trustee, or the Noteholders, for any action taken or for refraining from the taking of any action pursuant to this Agreement; provided, however, that this provision shall not protect the Servicer against any liability by reason of willful misfeasance, bad faith or negligence in the performance of its duties.  The Servicer, and any director, officer, employee or agent of the Servicer may conclusively rely in good faith on the written advice of counsel or on any document of any kind prima facie properly executed and submitted by any Person respecting any matters arising under this Agreement or any other Basic Document.

 

(b)           The parties expressly acknowledge and consent to the Indenture Trustee’s simultaneously acting in the capacity of successor Servicer and Indenture Trustee.  The Indenture Trustee may, in such capacities, discharge its separate functions fully, without hindrance or regard to conflict of interest principles, duty of loyalty principles or other breach of fiduciary

 

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duties to the extent that any such conflict or breach arises from the performance by the Indenture Trustee of express duties set forth in this Agreement in any of such capacities.

 

Section 7.05.     Appointment of Subservicer.

 

(a)           Subject to clause (c) below, the Servicer may at any time reasonably appoint a subservicer in good faith to perform all or any portion of its obligations as Servicer hereunder.

 

(b)           [Intentionally Omitted].

 

(c)           The appointment of a subservicer pursuant to clause (a) above is subject to the condition that (i) ten days’ prior notice of such appointment shall have been given to the Controlling Class, the Indenture Trustee and to each Rating Agency and each Rating Agency shall have notified the Servicer, the Owner Trustee and the Indenture Trustee in writing that such appointment satisfies the Rating Agency Condition; (ii) that the Servicer has received the written consent of the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class to such appointment; and (iii) that the Servicer remains obligated and liable to the Owner Trustee, the Indenture Trustee and the Noteholders for the servicing and administering of the Loans in accordance with the provisions hereof without diminution of such obligation and liability by virtue of the appointment of such subservicer and to the same extent and under the same terms and conditions as if the Servicer alone were servicing and administering the Conveyed Assets.

 

(d)           The fees and expenses of any subservicer shall be as agreed between the Servicer and such subservicer from time to time, and none of the Owner Trustee, the Indenture Trustee, the Issuing Entity or the Noteholders shall have any responsibility therefor.

 

Section 7.06.     Servicer Not to Resign.

 

(a)           Subject to the provisions of Section 7.03, the Servicer shall not resign from the obligations and duties imposed on it by this Agreement, except upon a determination that the performance of its duties under this Agreement shall no longer be permissible under Applicable Law.

 

(b)           Notice of any determination that the performance by the Servicer of its duties contemplated hereunder is no longer permitted under Applicable Law shall be communicated to the Owner Trustee and the Indenture Trustee at the earliest practicable time (and, if such communication is not in writing, shall be confirmed in writing at the earliest practicable time) and any such determination shall be evidenced by an Opinion of Counsel to such effect delivered by the Servicer to the Owner Trustee and the Indenture Trustee concurrently with or promptly after such notice.  Except as may otherwise be required by Applicable Law, no resignation of the Servicer shall become effective until a successor acceptable to the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class shall have assumed the responsibilities and obligations of such Person in accordance with Section 8.03.  If no successor has been appointed within 30 days of resignation or removal, the Noteholders representing a majority of the outstanding Note Balance of the Controlling Class may petition any court of competent jurisdiction for such appointment.

 

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Section 7.07.     Huntington May Own Notes.   Huntington and any Affiliate thereof may in its individual or any other capacity become the owner or pledgee of Notes with the same rights as it would have if it were not the Servicer, except as expressly provided herein or in any Basic Document.

 

[End of Article VII]

 

 

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ARTICLE VIII.

 

DEFAULT

 

Section 8.01.     Servicer Replacement Events.

 

(a)           For purposes of this Agreement, the occurrence and continuance of any of the following shall constitute a “Servicer Replacement Event”:

 

(i)           failure by the Servicer to deposit into the Collection Account any proceeds or any payment required to be so delivered under the terms of this Agreement that continues unremedied for a period of two (2) Business Days;

 

(ii)          any representation or warranty made or deemed made by or on behalf of the Servicer in or in connection with this Agreement, the other Basic Documents (other than the Notes and the Assignment) or any amendment or modification hereof or thereof, or in any report, certificate, financial statement or other document furnished pursuant to or in connection herewith or therewith or any amendment or modification hereof or thereof, shall prove to have been incorrect when made or deemed made and the circumstance or condition in respect of which such misrepresentation or warranty was incorrect shall not have been eliminated or otherwise cured for a period of thirty (30) days;

 

(iii)         failure by the Servicer to deliver to the Owner Trustee, the Indenture Trustee, and the Loan Seller the Servicer’s Monthly Certificate by the applicable Determination Date, which failure continues unremedied for a period of five (5) Business Days;

 

(iv)         failure on the part of the Servicer duly to observe or perform any other covenants or agreements of the Servicer set forth in this Agreement, which failure (i) could materially and adversely affect the rights of the Noteholders and (ii) continues unremedied for a period of thirty (30) days after: (A) the date of discovery of such failure by a Responsible Officer of the Servicer; (B) the date on which the Servicer should reasonably have been aware of such failure; or (C) written notice of such failure requiring the same to be remedied shall have been given to the Servicer by any of the Owner Trustee, the Indenture Trustee or the Noteholders holding at least 25% of the Note Balance of the Controlling Class;

 

(v)          the Servicer shall cease to be an Eligible Servicer;

 

(vi)         an Insolvency Event with respect to the Servicer;

 

(vii)        the Servicer has assigned or delegated any of its obligations under this Agreement or any Basic Document (other than the Notes and the Assignment) other than in accordance with the terms herein and/or therein, as applicable, or pursuant to the written consent of Noteholders holding at least a majority of the Note Balance of the Controlling Class; or

 

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(viii)           the Servicer has failed to obtain or maintain all licenses and approvals necessary for the conduct of its business in the jurisdictions where the failure to do so could reasonably be expected to have a material adverse effect on the Issuing Entity or the Noteholders.

 

Section 8.02.     Consequences of a Servicer Replacement Event.

 

(a)           Following a Servicer Replacement Event the Indenture Trustee may, or, at the written direction of Noteholders holding a majority of the Note Balance of the Controlling Class, shall, terminate all of the rights and obligations of the Servicer under this Agreement by notice in writing to the Servicer, each Rating Agency and the Noteholders.  On or after the receipt by the Servicer of such written notice, all authority, power, obligations and responsibilities of the Servicer under this Agreement automatically shall pass to, be vested in and become obligations and responsibilities of, either the Indenture Trustee (if the Indenture Trustee becomes the successor Servicer pursuant to Section 8.03) or the successor Servicer appointed pursuant to Section 8.03; provided, however, that such successor Servicer shall have no liability with respect to any obligation that was required to be performed by the terminated Servicer prior to the date that such successor Servicer becomes the Servicer or any claim of a third party based on any alleged action or inaction of the terminated Servicer.

 

(b)           [Intentionally Omitted].

 

(c)          The successor Servicer is authorized and empowered by this Agreement to execute and deliver, on behalf of the terminated Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of the Loans, and related documents to show the Indenture Trustee (or the Issuing Entity if the Notes have been Paid In Full) as lienholder or secured party on the related certificates of title of the Financed Vehicles or otherwise.  The terminated Servicer agrees to cooperate with the successor Servicer and with the Indenture Trustee in effecting the termination of the responsibilities and rights of the terminated Servicer under this Agreement, including (i) the transfer to the successor Servicer for administration by it of all money and property held by the terminated Servicer with respect to the Conveyed Assets and other records relating to the Conveyed Assets, including any portion of any Loan File, held by the terminated Servicer and a reasonably current computer tape in readable form containing all information necessary to enable the successor Servicer to service the Conveyed Assets, (ii) the prompt transfer of any remaining amounts relating to Conveyed Assets in the possession of the Servicer to the Indenture Trustee, (iii) the notification of existing Loan Obligors of the new address for payment, and (iv) the prompt remittance of any future amounts received by the Servicer with respect to Conveyed Assets to the successor.  The terminated Servicer shall also provide the successor Servicer access to personnel and computer records of such terminated Person in order to facilitate the orderly and efficient transfer of servicing duties.

 

Section 8.03.     Appointment of Successor Servicer.

 

(a)           On and after the time the Servicer receives a notice of termination pursuant to Section 8.02 or upon the resignation of the Servicer pursuant to Section 7.06, the Indenture

 

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Trustee shall be the successor in all respects to the Servicer in its capacity as Servicer under this Agreement and shall be subject to all the rights, responsibilities, restrictions, duties, liabilities and termination provisions relating to the Servicer except as otherwise stated herein.  Each party hereto shall take such action, consistent with this Agreement, as shall be necessary to effectuate any such succession.  If such a successor is acting as Servicer, it shall be subject to termination under Section 8.01(a) upon the occurrence of any Servicer Replacement Event after its appointment as successor Servicer.

 

(b)           If (i) the Controlling Class does not desire that the Indenture Trustee act as Servicer or (ii) the Indenture Trustee is legally unable to act, or shall choose not to act as Servicer, Noteholders holding a majority of the Note Balance of the Controlling Class may exercise at any time the right to direct the appointment of any Eligible Servicer as the successor to the Servicer, and shall have no liability to the Owner Trustee, the Indenture Trustee, the Servicer, the Depositor, any Noteholders or any other Person if it does so.  Notwithstanding the above, if the Controlling Class does not act, the Servicer, the Indenture Trustee, the Owner Trustee or Noteholders evidencing at least 25% of the Note Balance may petition a court of competent jurisdiction to appoint any Eligible Servicer as the successor to the Servicer, provided that for purposes of computing the foregoing percentage, any Notes held by Huntington or any of its Affiliates shall be disregarded.  Pending appointment pursuant to the preceding sentence, the outgoing Servicer shall continue to act as Servicer until a successor has been appointed and accepted such appointment.  The Indenture Trustee shall be entitled to withdraw from the Collection Account and remit to the successor Servicer or such other party entitled thereto all reasonably incurred Servicer transition costs.

 

(c)           Upon appointment, the successor Servicer shall be the successor in all respects to its predecessor and shall be subject to all the responsibilities, duties and liabilities arising thereafter relating thereto placed on its predecessor, and shall be entitled to the Servicing Fee as and to the extent provided for in this Agreement and all the rights granted to the predecessor in such capacity by the terms and provisions of this Agreement and any other applicable Basic Document.

 

Section 8.04.     Notification to Noteholders.   Upon any termination of, or appointment of a successor to, the Servicer pursuant to this Article VIII, the Indenture Trustee shall give prompt written notice thereof to the Noteholders and each Rating Agency.

 

Section 8.05.     Waiver of Past Defaults.   The Noteholders holding a majority of the Note Balance of the Controlling Class may, on behalf of all Noteholders, waive in writing any default by the Servicer.  Upon any such waiver of a past default, such default shall cease to exist, and any Servicer Replacement Event arising therefrom shall be deemed to have been remedied for every purpose of this Agreement.  No such waiver shall extend to any subsequent or other default or impair any right consequent thereto.

 

[End of Article VIII]

 

 

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ARTICLE IX.

TERMINATION

 

Section 9.01.     Optional Purchase of All Conveyed Assets.

 

(a)            The Servicer shall have the right at its option (the “Optional Purchase”) to purchase the trust estate [(other than the Reserve Account)] from the Issuing Entity on any Payment Date if both of the following conditions are satisfied: (a) as of the last day of the related Collection Period, the Net Pool Balance has declined to 10% or less of the Net Pool Balance as of the Cutoff Date and (b) the sum of the Optional Purchase Price and Available Funds for such Payment Date would be sufficient to pay (x) the amounts required to be paid under clauses [first] through [fifth] and [seventh] of Section 5.06(a) (assuming that such Payment Date is not a Redemption Date) and (y) the Outstanding Note Balance (after giving effect to the payments described in the preceding clause (x)).  The purchase price for the trust estate [(other than the Reserve Account)] (the “Optional Purchase Price”) shall equal the Net Pool Balance as of the related Payment Date plus interest accrued but unpaid through the last day of the related Collection Period, which amount shall be deposited by the Servicer into the Collection Account on the Redemption Date.  If the Servicer exercises the Optional Purchase, the Notes shall be redeemed and in each case in whole but not in part on the related Payment Date for the Redemption Price.

 

(b)           Following the satisfaction and discharge of the Indenture and where principal of and interest on the Notes have been Paid In Full, the Owner Trustee will succeed to the rights of the Indenture Trustee pursuant to this Agreement.

 

[End of Article IX]

 

 

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ARTICLE X.

 

MISCELLANEOUS

 

Section 10.01.     Amendment.

 

(a)           It shall be a condition to the execution and delivery of any amendment to be entered into under this Section 10.01 (including any amendment of any material provision of this Agreement) that (i) the Rating Agency Condition be satisfied with respect to such amendment and (ii) the Indenture Trustee and the Noteholders holding a majority of the Note Balance of the Controlling Class shall have consented to such amendment.

 

(b)           This Agreement may be amended from time to time by the Depositor, the Loan Seller, the Servicer, the Indenture Trustee, the Issuing Entity and the Noteholders holding a majority of the Note Balance of the Controlling Class for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders; provided, however, that this Agreement (i) may not be amended in any way that would materially and adversely affect the Owner Trustee’s or the Indenture Trustee’s, as applicable, own rights, privileges, indemnities, duties or obligations under this Agreement, the other Basic Documents or otherwise without the prior written consent of such Person; or (ii) significantly change the permitted activities or powers of the Issuing Entity even if such amendment would not have an adverse effect on the Holders of the Notes, without the consent of the Holders of at least a majority of the Note Balance.

 

(c)           Promptly after the execution of any amendment or consent, the Administrator shall furnish written notification of the substance of such amendment or consent to each Noteholder, the Indenture Trustee and each Rating Agency.

 

(d)           Prior to the execution of any amendment to this Agreement, the Owner Trustee, on behalf of the Issuing Entity, and the Indenture Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement.  The Owner Trustee, on behalf of the Issuing Entity, and the Indenture Trustee may, but shall not be obligated to, enter into any such amendment that affects the Owner Trustee’s or the Indenture Trustee’s, as applicable, own rights, duties or immunities under this Agreement or otherwise.

 

(e)           No amendment may increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections on payments on the Loans or payments that are required to be made for the benefit of the Noteholders without the consent of each Noteholder.

 

Section 10.02.     Protection of Title to Trust.

 

(a)           The Servicer shall execute and file such financing statements and cause to be executed and filed such continuation statements, or take such other actions all in such a manner and in such places as may be required by law or as shall be necessary to fully preserve, maintain and protect the interest of the Issuing Entity and the Indenture Trustee in the Conveyed Assets, [the Interest Rate Cap Agreement] and the proceeds thereof.  The Issuing Entity hereby authorizes the filing of financing statements describing as the collateral covered thereby “all 

 

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assets of the debtor, including all personal property of the debtor” or words to that effect, and any limitations on such collateral description, notwithstanding that such collateral description may be broader in scope than the Conveyed Assets described in this Sale and Servicing Agreement.  All financing statements filed or to be filed against in connection with this Sale and Servicing Agreement describing the Conveyed Assets shall contain a statement to the following effect: “A purchase of, or a security interest in, any of the collateral covered by this financing statement will violate the rights of the secured party.” The Servicer shall deliver or cause to be delivered to the Owner Trustee and the Indenture Trustee file-stamped copies of, or filing receipts for, any document filed as provided above as soon as available following such filing.

 

(b)           Neither the Depositor, Loan Seller, nor the Servicer shall change its name, identity or limited liability company or corporate structure, as applicable, in any manner that would, could or might make any financing statement or continuation statement filed in accordance with paragraph (a) above seriously misleading under Section 9-506 or 9-507 of the UCC, unless it shall have given the Owner Trustee and the Indenture Trustee at least forty-five (45) days’ prior written notice thereof and shall have promptly filed appropriate amendments to all previously filed financing statements or continuation statements.

 

(c)           Each of the Depositor, the Issuing Entity and Huntington shall have an obligation to give the Owner Trustee and the Indenture Trustee at least five (5) Business Days’ prior written notice of any relocation of its principal executive office if, as a result of such relocation, the applicable provisions of the UCC would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement, and shall promptly file any such amendment or new financing statement.  The Servicer shall at all times maintain each office from which it shall service Loans, and its principal executive office, within the United States of America.

 

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

 

(e)           The Servicer shall maintain its computer systems so that, from and after the time of sale of the Conveyed Assets under this Agreement, the Servicer’s master computer records (including any backup archives) that refer to a Conveyed Asset shall be coded to reflect that such Conveyed Asset is part of the portfolio of Loans that is the subject of this Agreement and is held by the Indenture Trustee for Huntington Auto Trust 20[  ]-[ ].  Indication of such inclusion of a Conveyed Asset in the portfolio shall be deleted from or modified on the Servicer’s computer systems when, and only when, the related Conveyed Asset shall have been Paid In Full or repurchased or reallocated, as the case may be.

 

(f)           If at any time the Depositor or Huntington shall propose to sell, grant a security interest in or otherwise transfer any interest in motor vehicle receivables to any prospective purchaser, lender or other transferee, such prospective purchaser, if any, provides that any computer tapes, records or printouts (including any restored from backup archives) that refer in 

 

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any manner whatsoever to any Conveyed Asset, shall indicate clearly that such Conveyed Asset has been sold and is owned by the Issuing Entity and has been pledged to the Indenture Trustee.

 

(g)           The Servicer shall permit the Indenture Trustee, the Owner Trustee and their agents and accountants upon reasonable notice and in a reasonable manner at any time during normal business hours, to inspect, audit and make copies of and abstracts from the Servicer’s records regarding any Conveyed Asset.

 

(h)           Upon request, the Servicer shall furnish to the Owner Trustee or the Indenture Trustee, within five (5) Business Days, a list of all Conveyed Assets (by Contract number and name of Loan Obligor) then held as part of the Trust, together with a reconciliation of such list to the Schedule of Conveyed Assets furnished prior to such request indicating removal of Conveyed Assets from the Trust.

 

Section 10.03.     Notices.   All demands, notices, communications and instructions upon or to the Depositor, the Servicer, the Issuing Entity, the Owner Trustee, the Indenture Trustee or any Rating Agency under this Agreement shall be in writing, personally delivered, faxed and followed by first class 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 Depositor, to:

 

Huntington Funding, LLC

41 South High Street

Columbus, Ohio 43287

Attention:  General Counsel

Facsimile No. (614) 480-5404

 

with a copy to

 

The Huntington National Bank

Huntington Center

41 South High Street

Columbus, Ohio 43287

Attention: General Counsel

Facsimile No. (614) 480-5404;

 

(b)           in the case of the Servicer, the Administrator and Custodian, to:

 

The Huntington National Bank

Huntington Center

41 South High Street

Columbus, Ohio 43287

Attention: General Counsel

Facsimile No. (614) 480-5404;

 

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(c)           in the case of Indenture Trustee, to:

 

[                         ]

 

(d)           in the case of the Issuing Entity or the Owner Trustee, to:

 

[                         ]

 

(e)           in the case of Moody’s, to:

 

Moody’s Investors Service, Inc.

ABS/RMBS Monitoring Department

25th Floor

7 World Trade Center

250 Greenwich Street

New York, NY 10007

Fax number: 212.298.7139

ServicerReports@moodys.com; and

 

(f)           in the case of Standard & Poor’s, to

 

Standard & Poor’s

55 Water Street, 40th Floor

New York, New York, 10041

Attention:  Asset Backed Surveillance Department

Facsimile No. (212) 438-2664;

 

or, as to each of the foregoing, at such other address as shall be designated by written notice to the other parties.  [Notices to the Cap Counterparty shall be sent to it at the notice address specified in the Interest Rate Cap Agreement].

 

Section 10.04.     Assignment by the Depositor or the Servicer.  Notwithstanding anything to the contrary contained herein, except as provided in Section 7.03 herein and as provided in the provisions of this Agreement concerning the resignation of the Servicer, this Agreement may not be assigned by the Depositor or the Servicer.

 

Section 10.05.     Limitations on Rights of Others.  The provisions of this Agreement are solely for the benefit of the Loan Seller, the Servicer, the Depositor, the Issuing Entity, the Owner Trustee, the Indenture Trustee and the Noteholders and their successor and assigns, and nothing in this Agreement, whether express or implied, shall be construed to give to any other Person any legal or equitable right, remedy or claim in the Conveyed Assets or under or in respect of this Agreement or any covenants, conditions or provisions contained herein.

 

Section 10.06.     Severability.  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

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Section 10.07.     Counterparts.  This Agreement may be executed by the parties hereto in any number of counterparts including by facsimile or other electronic transmission each of which when so executed and delivered shall be an original, but all of which shall together constitute but one and the same instrument.

 

Section 10.08.     Headings and Cross-References.  The various headings in this Agreement are included for convenience only and shall not affect the meaning or interpretation of any provision of this Agreement.  References in this Agreement to section names or numbers are to such Sections of this Agreement unless stated otherwise.

 

Section 10.09.     Governing Law.  THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CHOICE OF LAW PRINCIPLES THEREOF (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

Section 10.10.     Confidential Information.  The Issuing Entity agrees that it will neither use nor disclose to any Person names and addresses of the Loan Obligors or any other personally identifiable information of a Loan Obligor, except in connection with the enforcement of the Issuing Entity’s rights hereunder, under the Loans, under the Asset Purchase Agreement, or any other Basic Document, or as required by any of the foregoing or by law.

 

Section 10.11.     Assignment by the Issuing Entity.  The Loan Seller and the Depositor each hereby acknowledges, agrees and consents to any transfer (including any assignment, mortgage, pledge and grant of a security interest by the Issuing Entity) to the Indenture Trustee and the Noteholders in accordance with the terms of the Indenture for the benefit of the Noteholders of all right, title and interest of the Issuing Entity in, to and under the Conveyed Assets or the assignment of any or all of the Issuing Entity’s rights and obligations hereunder and the other Basic Documents to the Indenture Trustee and hereby agree that the Indenture Trustee may enforce the rights of the Issuing Entity as if it were a party hereto.

 

Section 10.12.     Nonpetition Covenants.  Notwithstanding any prior termination of this Agreement, the parties hereto shall not, prior to the date that is one year and one day after the Notes have been Paid In Full, acquiesce, petition or otherwise invoke or cause the Issuing Entity, the Loan Seller, or the Depositor to invoke the process of any court or government authority for the purpose of commencing or sustaining an involuntary case against the Issuing Entity, the Loan Seller, or the Depositor under any federal or state bankruptcy, insolvency or similar law, or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Issuing Entity, the Loan Seller, or the Depositor or any substantial part of its property or ordering the winding up or liquidation of the affairs of the Issuing Entity, or the Loan Seller, or the Depositor.

 

Section 10.13.     Limitation of Liability of Owner Trustee and Indenture Trustee.

 

(a)           Notwithstanding anything contained herein to the contrary, this Agreement has been countersigned by [       ] not in its individual capacity but solely in its capacity as Owner Trustee of the Issuing Entity and in no event shall [            ] in its individual capacity or, except as expressly provided in the Trust Agreement, as Owner Trustee of the Issuing Entity, have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuing Entity hereunder or in any of the certificates, notices or agreements delivered pursuant

 

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	Sale and Servicing Agreement 	 	 

  

  

  

hereto, as to all of which recourse shall be had solely to the assets of the Issuing Entity in accordance with the priorities set forth herein.  For all purposes of this Agreement, in the performance of its duties or obligations hereunder or in the performance of any duties or obligations of the Issuing Entity hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles VI, VII and VIII of the Trust Agreement.

 

(b)           Notwithstanding anything contained herein to the contrary, this Agreement has been accepted by [                         ], not in its individual capacity but solely as Indenture Trustee, and in no event shall [                         ] have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuing Entity hereunder or in any of the certificates, notices or agreements delivered pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuing Entity in accordance with the priorities set forth herein.

 

(c)            The parties hereto acknowledge that in accordance with Section 326 of the USA Patriot Act [                         ], like all financial institutions and in order to help fight the funding of terrorism and money laundering, are required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account.  The parties to this Agreement agree that they will provide the [                         ] with such information as it may request in order for the [                         ] to satisfy the requirements of the USA Patriot Act.

 

Section 10.14.     Regulation AB.

 

The Servicer shall cooperate fully with the Depositor and the Issuer to deliver to the Depositor and the Issuer (including any of its assignees or designees) any and all statements, reports, certifications, records and any other information necessary in the good faith determination of the Depositor or the Issuer to permit the Depositor to comply with the provisions of Regulation AB, together with such disclosures relating to the Servicer and the Receivables, or the servicing of the Receivables, reasonably believed by the Depositor to be necessary in order to effect such compliance.

 

Section 10.15.     Information to Be Provided by the Indenture Trustee.

 

(a)  For so long as the Depositor is filing reports under the Exchange Act with respect to the Issuer, the Indenture Trustee shall (i) on or before the fifth Business Day of each month, notify the Depositor, in writing, of any Form 10-D Disclosure Item with respect to the Indenture Trustee, together with a description of any such Form 10-D Disclosure Item in form and substance reasonably satisfactory to the Depositor; provided, however, that, subject to clauses (b)(iv) and (b)(v) of this Section 9.21, the Indenture Trustee shall not be required to provide such information in the event that there has been no change to the information previously provided by the Indenture Trustee to Depositor, and (ii) as promptly as practicable following notice to or discovery by a Responsible Officer of the Indenture Trustee of any changes to such information, provide to the Depositor, in writing, such updated information.

 

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(b)  As soon as available but no later than March 15 of each calendar year for so long as the Depositor is filing reports under the Exchange Act with respect to the Issuer, commencing on March 15, [    ], the Indenture Trustee shall:

 

	
  

	
(i)

	
deliver to the Depositor a report regarding the Indenture Trustee’s assessment of compliance with the Servicing Criteria during the immediately preceding calendar year, as required under paragraph (b) of Rule 13a-18, Rule 15d-18 of the Exchange Act and Item 1122 of Regulation AB.  Such report shall be signed by an authorized officer of the Indenture Trustee, and shall address each of the Servicing Criteria specified in Exhibit C or such other criteria as mutually agreed upon by the Depositor and the Indenture Trustee;

 

	
  

	
(ii)

	
cause a firm of registered public accountants that is qualified and independent within the meaning of Rule 2-01 of Regulation S-X under the Securities Act to deliver to the Depositor a report for inclusion in the Depositor’s filing of Exchange Act Form 10-K with respect to the Issuer that attests to, and reports on, the assessment of compliance made by the Indenture Trustee and delivered to the Depositor pursuant to the preceding paragraph.  Such attestation shall be in accordance with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act and the Exchange Act;

 

	
  

	
(iii)

	
deliver to the Depositor and any other Person that will be responsible for signing the certification (a “Sarbanes Certification”) required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act (pursuant to Section 302 of the Sarbanes-Oxley Act) on behalf of the Issuer or the Depositor, a back-up certification substantially in the form attached hereto as Exhibit D or such form as mutually agreed upon by the Depositor and the Indenture Trustee; and

 

	
  

	
(iv)

	
deliver to the Depositor the certification substantially in the form attached hereto as Exhibit E or such other form as is mutually agreed upon by the Depositor and the Indenture Trustee regarding any affiliations or relationships (as described in Item 1119 of Regulation AB) between the Indenture Trustee and any Item 1119 Party and any Form 10-D Disclosure Item.

 

The Indenture Trustee acknowledges that the parties identified in clause (iv) above may rely on the certification provided by the Indenture Trustee pursuant to such clause in signing a Sarbanes Certification and filing such with the Commission.

 

Section 10.16.     Form 8-K Filings.

 

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So long as the Depositor is filing Exchange Act Reports with respect to the Issuer, the Indenture Trustee shall promptly notify the Depositor, but in no event later than one (1) Business Day after its occurrence, of any Reportable Event of which a Responsible Officer of the Indenture Trustee has actual knowledge (other than a Reportable Event described in clause (a) or (b) of the definition thereof as to which the Depositor or the Servicer has actual knowledge). The Indenture Trustee shall be deemed to have actual knowledge of any such event to the extent that it relates to the Indenture Trustee or any action or failure to act by the Indenture Trustee.

 

Section 10.17.     Cooperation.

 

The parties hereto acknowledge and agree that the purpose of Sections 10.15 and 10.16 is to facilitate compliance by the Depositor and Servicer with the provisions of Regulation AB and related rules and regulations of the Commission.  Neither the Depositor nor the Servicer shall exercise its right to request delivery of information or other performance under these provisions other than in good faith in order to comply with the Securities Act, the Exchange Act, the rules and regulations of the Commission under the Securities Act and the Exchange Act and any comments or requests of the Commission. The Indenture Trustee acknowledges that interpretations of the requirements of Regulation AB may change over time, whether due to interpretive guidance provided by the Commission or its staff, consensus among participants in the asset-backed securities markets, advice of counsel, or otherwise, and agrees to cooperate with the Depositor to deliver to the Depositor and Servicer such information necessary in the good faith determination of the Depositor and Servicer to permit the Depositor or such Servicer to comply with the provisions of Regulation AB.

 

 

[End of Article X]

 

 

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	Sale and Servicing Agreement 	 	 

  

  

  

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

 

 

	 	HUNTINGTON FUNDING, LLC
	 	 
	 	 
	 	
By: ______________________________

	 	 	
Name:

	 	 	
Title:

	 	 	 
	 	 	 
	 	 	 

	 	THE HUNTINGTON NATIONAL BANK
	 	 
	 	 
	 	
By: ______________________________

	 	 	
Name:

	 	 	
Title:

 

 

 

	Sale and Servicing Agreement 	 	 

  

  

  

 

	 	[                         ],
	 	not in its individual capacity, 
	 	but solely as Indenture Trustee 
	 	 
	 	 
	 	
By: ______________________________

	 	 	
Name:

	 	 	
Title:

	 	 
	 	 
	 	 
	 	
By: ______________________________

	 	 	
Name:

	 	 	
Title:

 

 

 

	Sale and Servicing Agreement 	 	 

  

  

  

 

	 	HUNTINGTON AUTO TRUST 20[  ]-[ ]
	 	 
	 	
By: [                               ],

	 	 	
not in its individual capacity,

	 	 	
but solely as Owner Trustee

	 	 
	 	 
	 	
By: ______________________________

	 	 	
Name:

	 	 	
Title:

 

 

 

	Sale and Servicing Agreement 	 	 

  

  

  

EXHIBIT A

 

[FORM OF CLOSING DATE ASSIGNMENT]

 

ASSIGNMENT

 

ASSIGNMENT (“Assignment”), dated as of [                     ] (the “Closing Date”) from (i) THE HUNTINGTON NATIONAL BANK (the “Loan Seller”) to HUNTINGTON FUNDING, LLC (the “Depositor”), (ii) from the Depositor to the HUNTINGTON AUTO TRUST 20[  ]-[ ] (the “Issuing Entity”) and (iii) from the Issuing Entity to [                         ] (the “Indenture Trustee”) as pledgee.

 

W I T N E S S E T H:

 

WHEREAS, the Loan Seller, and the Depositor are parties to an asset purchase agreement dated as of [                     ] (as amended, supplemented or modified from time to time, the “Asset Purchase Agreement”) pursuant to which the Loan Seller has agreed to convey to the Depositor, on the Closing Date, motor vehicle retail installment sale contracts and motor vehicle loan contracts originated or purchased by it (together with all Conveyed Assets (as defined in the Asset Purchase Agreement) related thereto, the “Loans”);

 

WHEREAS, the Loan Seller, the Depositor, the Issuing Entity and the Indenture Trustee are parties to a sale and servicing agreement dated as of [                     ] (as amended, supplemented or modified from time to time, the “Sale and Servicing Agreement”) pursuant to which (i) the parties have agreed to terms and conditions on which the Issuing Entity will purchase certain Conveyed Assets from the Depositor and pledge them to the Indenture Trustee and (ii) the Loan Seller will service all Conveyed Assets;

 

WHEREAS, the Issuing Entity and the Indenture Trustee are parties to an indenture dated as of [                     ] (as amended, supplemented or otherwise modified from time to time, the “Indenture”), pursuant to which the Issuing Entity has issued $[    ] of Class A-1 Notes, $[    ] of Class A-2-A Notes, $[    ] of Class A-2-B Notes, $[    ] of Class A-3-A Notes, $[    ] of Class A-3-B Notes, and $[    ] of Class A-4 Notes (collectively, the “Notes”) each of which Notes so issued is ratably secured by the Conveyed Assets and all other property of the Issuing Entity;

 

WHEREAS, the Loan Seller desires to sell the Loans identified on Schedule A to the Sale and Servicing Agreement (together with all Conveyed Assets (as defined in the Asset Purchase Agreement) related thereto, the “Transferred Loans”) (collectively, the “Closing Date Sold Assets”) to the Depositor, and the Depositor desires to purchase such the Closing Date Sold Assets in exchange for consideration consisting of the purchase price of the Closing Date Sold Assets and the Loan Seller’s increase (if any) in the value of the equity interest in the Depositor owned by the Loan Seller and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged;

Sale and Servicing Agreement (Exhibit A)

  

  

WHEREAS, the Issuing Entity is willing to acquire the Closing Date Sold Assets from the Depositor subject to the terms and conditions hereof and desires to pledge the Closing Date Sold Assets to the Indenture Trustee as security for the payment of the Notes and for its obligations under the Indenture;

 

WHEREAS, the Board of Directors of the Loan Seller has approved the transactions contemplated in the Sale and Servicing Agreement, the Asset Purchase Agreement and the other Basic Documents and it is intended that this Assignment constitute the basis of a claim against the Federal Deposit Insurance Corporation as receiver of the Loan Seller under the Federal Deposit Insurance Act; and

 

WHEREAS, the Closing Date Sold Assets being sold by the Loan Seller to the Depositor and by the Depositor to the Issuing Entity shall be identified and segregated for the benefit of the Issuing Entity from and after the date first above written and shall be transferred and sold on the Closing Date under the terms of the Asset Purchase Agreement and the Sale and Servicing Agreement.

 

NOW THEREFORE, the Loan Seller, the Depositor, the Issuing Entity and the Indenture Trustee hereby agree as follows:

 

1.           Defined Terms.  All capitalized terms defined in the Sale and Servicing Agreement and used herein shall have such defined meanings when used herein, unless otherwise defined herein.  In this Assignment, its recitals, exhibits and schedules save where otherwise expressly provided or unless the context provides otherwise:

 

(i)           words importing one gender shall be treated as importing any gender, words importing individuals shall be treated as importing bodies corporate, corporations, unincorporated associations and partnerships and vice versa, words importing the singular shall be treated as importing the plural and vice versa, and words importing the whole shall be treated as including a reference to any part;

 

(ii)           section and paragraph headings are inserted for ease of reference only and shall not affect construction;

 

(iii)           references to recitals, sections, paragraphs and schedules are to the recitals, sections, paragraphs, and the schedules to this Assignment;

 

(iv)           any reference herein to any Person shall be construed to include such Person’s successors and permitted assigns;

 

(v)           the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”;

 

(vi)           references to any agreement or other document shall be deemed to be a reference to such agreement or other document as the same may be amended, restated or

Sale and Servicing Agreement (Exhibit A)

  

  

otherwise modified from time to time in accordance with its terms and the terms hereof; and

 

(vii)           references to any law, constitution, statute, treaty, regulation, rule or ordinance, including any section or other part thereof (each for purposes of this clause (vii), a “law”), shall refer to that law as amended from time to time and shall include any successor law.

 

2.           Closing.  The transfer of the Closing Date Sold Assets pursuant to this Assignment shall take place on the Closing Date.

 

3.           Designation of Closing Date Sold Assets.  The Loan Seller and the Depositor do hereby deliver herewith a true and complete list of the Transferred Loans to be conveyed on the Closing Date.  Such lists are marked as Schedule A to the Sale and Servicing Agreement and are hereby incorporated into and made a part of this Assignment.

 

4.           Conveyance of Closing Date Sold Assets.

 

(i)           The Loan Seller hereby sells, transfers, assigns, sets over and otherwise conveys to the Depositor, without recourse (subject to the obligations of such Seller set forth in the Asset Purchase Agreement) all right, title and interest of the Loan Seller in and to the Closing Date Sold Assets from and after the Cutoff Date.

 

(ii)           The Depositor hereby sells, transfers, assigns, sets over and otherwise conveys to the Issuing Entity, without recourse, but subject to the terms and conditions of the Sale and Servicing Agreement, all right, title and interest of the Depositor in and to the Closing Date Sold Assets from and after the Cutoff Date.

 

(iii)           The Issuing Entity hereby Grants (as such term is defined in the Indenture) to the Indenture Trustee on the Closing Date, for the benefit of the Holders of the Notes, all of the Issuing Entity’s right, title and interest in and to the Closing Date Sold Assets and acknowledges and reaffirms the Grant contained in the Granting Clause of the Indenture of all Collateral, including the Closing Date Sold Assets, to secure the payment of principal of and interest on, and other amounts owing in respect of, the Notes, equally and ratably without prejudice, priority or distinction and to secure compliance with the provisions of the Indenture, all as provided in the Indenture.

 

(iv)           The Loan Seller agrees to deliver the related Loan Files to the Custodian subject to Section 3.02(b)(xxii) of the Asset Purchase Agreement, where applicable.

 

5.           Acknowledgment of Assignment.  As of the Closing Date, pursuant to this Assignment, the Depositor acknowledges its receipt of the Transferred Loans from the Loan Seller, the Issuing Entity acknowledges its receipt of the Closing Date Sold Assets from the Depositor, and the Indenture Trustee acknowledges the grant of a security interest in the Closing Date Sold Assets to it pursuant to the Indenture.

 

6.           Acceptance of Rights But Not Obligations.  The foregoing sale, transfer, assignment and conveyance does not, and is not intended to, result in a creation of an obligation

Sale and Servicing Agreement (Exhibit A)

  

  

under this Assignment or under any agreement or instrument relating hereto except as specifically set forth herein and in the Basic Documents.

 

7.           Consideration.  The consideration for the Closing Date Sold Assets shall be given by the Depositor as required by Section 2.01 of the Asset Purchase Agreement on the Closing Date (in immediately available funds, with respect to cash consideration) to the Loan Seller.  The consideration for the Closing Date Sold Assets set forth in Section 2.01(a)(i) of the Sale and Servicing Agreement shall be delivered by the Issuing Entity to the Depositor (or to the Depositor’s order).

 

8.           Counterparts.  This Assignment may be executed by the parties hereto in any number of counterparts including by facsimile or other electronic transmission each of which when so executed and delivered shall be an original, but all of which shall together constitute but one and the same instrument.

 

9.           Limitation of Liability.  It is expressly understood and agreed by the parties hereto that (a) this Assignment is executed and delivered by [         ], not individually or personally but solely as Owner Trustee (in such capacity, the “Owner Trustee”) under the Trust Agreement, in the exercise of the powers and authority conferred and vested in it under the Trust Agreement, (b) each of the representations, under-takings and agreements herein made on the part of the Owner Trustee is made and intended not as personal representations, undertakings and agreements by [         ] but is made and intended for the purpose for binding only the Issuing Entity and (c) under no circumstances shall [     ] be personally liable for payment of any indebtedness or expense of the Issuing Entity or be liable for breach or failure of any obligation, representation, warranty, or covenant made or undertaken by the Issuing Entity under this Assignment or the other related documents.

 

[SIGNATURES APPEAR ON NEXT PAGE]

 

Sale and Servicing Agreement (Exhibit A)

  

  

 

IN WITNESS WHEREOF, the undersigned have caused this Assignment to be duly executed by their duly authorized officers.

 

 

 

	 	THE HUNTINGTON NATIONAL BANK,
	 	as Loan Seller 
	 	 
	 	 
	 	 
	 	
By: ______________________________

	 	 	
Name:

	 	 	
Title:

	 	 	 
	 	 	 
	 	 	 

	 	HUNTINGTON FUNDING, LLC,
	 	as Depositor 
	 	 
	 	 
	 	 
	 	
By: ______________________________

	 	 	
Name:

	 	 	
Title:

	 	 	 
	 	 	 
	 	 	 
	 	HUNTINGTON AUTO TRUST 20[  ]-[ ],
	 	as Issuing Entity 
	 	 	 
	 	
By:

	
[                 ], not individually but solely in

its capacity as Owner Trustee

	 	 	 
	 	 	 
	 	 	 
	 	 	

By: ______________________________

	 	 	 	
Name:  

	 	 	 	Title: 

 

 

Sale and Servicing Agreement (Exhibit A)

  

  

 

	
Acknowledged and Accepted

	 
	
[                         ],

	
not individually but solely in

	
its capacity as Indenture Trustee

	 	 
	 	 
	 	 
	By: 	________________________ 
	 	Name: 
	 	Title: 
	 	 
	 	 
	 	 
	By: 	________________________ 
	 	Name: 
	 	Title: 

 

 

Sale and Servicing Agreement (Exhibit A)

  

  

EXHIBIT B-1

 

FORM OF SERVICER’S MONTHLY CERTIFICATE

 

THE HUNTINGTON NATIONAL BANK

 

PURSUANT TO SECTION 4.09 OF THE SALE AND SERVICING AGREEMENT

 

[Determination Date]

 

This Servicer’s Certificate is delivered in connection with the sale by The Huntington National Bank, a national banking association (the “Company”) to Huntington Auto Trust 20[  ]-[ ] (the “Issuing Entity”) of the Conveyed Assets pursuant to a sale and servicing agreement dated as of [                     ] (the “Sale and Servicing Agreement”) by and among the Issuing Entity, the Company, Huntington, and [                         ] as indenture trustee (the “Indenture Trustee”).  All capitalized terms used but not defined herein shall have the meaning assigned thereto in the Sale and Servicing Agreement.

 

The undersigned, a Responsible Officer of the Company, hereby certifies that:

 

(i)           No Event of Default, Servicer Replacement Event has occurred and is continuing;

 

(ii)           The information attached hereto as Annex A is complete and accurate and among other things, contains all information necessary to make the payments to be made on this Payment Date pursuant to Section 5.06 of the Sale and Servicing Agreement for this Collection Period; and

 

(iii)           Attached hereto as Annex B is a copy of each schedule of collateral delivered by Huntington to the Federal Reserve Bank of Cleveland pursuant to the Federal Reserve Agreements in the previous Collection Period.

 

[SIGNATURE APPEAR ON NEXT PAGE]

 

Sale and Servicing Agreement (Exhibit B-1)

  

  

IN WITNESS WHEREOF, the undersigned, in my capacity as specified below, has caused this certificate to be executed as of the date first above written.

 

_______________________________

Name:

Title:

Sale and Servicing Agreement (Exhibit B-1)

  

  

Annex A

 

 

[EXCEL Spread Sheet Attached]

 

 

Annex B

 

 

[Copies of collateral schedules to be attached]

 

Sale and Servicing Agreement (Exhibit B-1)

  

  

EXHIBIT B-2

 

FORM OF SERVICER’S ANNUAL CERTIFICATION

 

THE HUNTINGTON NATIONAL BANK

 

PURSUANT TO SECTION 4.10 OF THE SALE AND SERVICING AGREEMENT

 

[DATE]

 

This Servicer’s Annual Certification is delivered pursuant to a sale and servicing agreement dated as of [                     ] (the “Sale and Servicing Agreement”) by and among, Huntington Auto Trust 20[  ]-[ ], Huntington Funding, LLC, The Huntington National Bank, as Loan Seller, Servicer, Administrator, Calculation Agent and Custodian (in such capacity, the “Servicer”), and [                         ], as indenture trustee (the “Indenture Trustee”).  All capitalized terms used but not defined herein shall have the meaning assigned thereto in the Sale and Servicing Agreement.

 

The undersigned, a Responsible Officer of the Servicer, hereby certifies that:

 

1.           A review of the activities of the Servicer and of the performance of their respective obligations under the Sale and Servicing Agreement during the period from [______], 20[__] to and including December 31, 20[__] (the “Review Period”) was conducted under my  supervision.

 

2.           Based on my knowledge and such review, except as otherwise disclosed pursuant to paragraph 3 below, the Servicer has fulfilled its obligations under the Sale and Servicing Agreement during the applicable Review Period and there is no significant deficiency known by me with respect to the applicable Review Period which has not been disclosed herein.

 

3.           Based on such review, to my knowledge, the following is a description of each significant deficiency during the Review Period in the performance of the Servicer’s obligations under the provisions of the Sale and Servicing Agreement, which sets forth in detail (i) the nature and status of each such deficiency and (ii) the action taken by the Servicer, if any, to remedy each such deficiency: [List Out]

 

4.           I have reviewed all distribution or servicing reports (the “Reports”) delivered by the Servicer in respect of periods included in the Review Period.

 

5.           Based on my knowledge, the information in these Reports, taken as a whole, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading as of the last day of the applicable Review Period.

 

6.           Based on my knowledge, the distribution or servicing information required to be provided to the Owner Trustee, Indenture Trustee, [the Cap Counterparty] and each Rating

 

Sale and Servicing Agreement (Exhibit B-2)

  

  

Agency by the Servicer under the Sale and Servicing Agreement for inclusion in these Reports is included in these Reports.

 

7.           I am responsible for reviewing the activities performed by the Servicer under the Sale and Servicing Agreement and based upon my knowledge and review, and except as disclosed in this Certificate or otherwise in writing, has fulfilled their respective obligations under the Sale and Servicing Agreement.

 

8.           To my knowledge, the Servicer has provided all of the reports and certificates required under the Sale and Servicing Agreement to the parties to which such reports and certificates are required to be provided with respect to the applicable Review Period.

 

[SIGNATURE APPEARS ON NEXT PAGE]

 

Sale and Servicing Agreement (Exhibit B-2)

  

  

 

IN WITNESS WHEREOF, the undersigned, in my capacity as specified below, has caused this certificate to be executed as of the date first above written.

 

 

 

	 	Dated: ________________________ 	__________________________ 	 
	 	 	Name: 	 
	 	 	Title: 	 

 

 

                                                                                   

 

 

 

 

Sale and Servicing Agreement (Exhibit B-2)

  

  

EXHIBIT C

 

SERVICING STANDARD

 

These Servicing Standards apply to Loans unless otherwise specified in this document.  The Servicer shall provide the loan accounting and servicing functions described in this document for the portfolio(s) attached hereto, and for any other portfolios that may become subject to this Agreement from time to time.  Servicing Fees shall cover all servicing costs, including various borrower account maintenance updates and title cures.  Servicing Fees do not cover the costs associated with the repossession and sale at auction process associated with Loan credit defaults.  The Servicer shall provide reconstitution support to the Purchaser if accounts in the portfolio are sold pursuant to a pass through transfer or a whole loan transfer.

 

Servicing Environment Setup:

Set up unique identification for the portfolio in the Servicer Loan accounting and servicing systems to provide servicing and process standards, reporting of results, data, and reports as mutually agreed upon for this portfolio.

 

Establish procedures for calculating and assigning Deficiency Balances to HNB recovery units, a third party vendor, or sale.

 

All customer statements, forms, letter, correspondence and default notices and resulting actions will be identified in the name of the Servicer and the Purchaser name shall not be conveyed in any written or verbal correspondence unless required by law.

 

Report monthly to the 3 major credit bureaus in the name of the Servicer and not the Purchaser.

 

Account Servicing and Reporting:

Maintain appropriate customer and account records for all accounts on the Servicer Accounting Systems.  The systems will accurately account for interest accruals, payoff calculations, late charge processing, payment application processing, delinquency processing and closed loan processing.

 

Process all payments in compliance with the related Contract.

 

Process on a daily basis all payments received from customers.

 

Perform all exception processing for non-exact items, misapplied payments, or other correspondence received from the customers.

 

Appropriately staff (including with bilingual counselors) the toll free customer service and collection line to respond to customer inquiries using live operators.

 

Respond to and resolve written customer inquiries regarding their accounts.

 

Process account maintenance changes to the Loan accounting systems as required.

 

Generate and mail late notices to customers when their account becomes past due.

 

Sale and Servicing Agreement (Exhibit C)

  

  

Generate and maintain an interface to the Servicer Collection Management System for all accounts that are past due to initiate collection efforts.

 

Investigate and process refunds on overpayment accounts.

 

Process and address any credit bureau disputes received from customers directly or the credit bureaus.

 

Update the credit bureau risk score for each account within the portfolio on a quarterly basis, and provide updates to Purchaser.

 

Periodically update the behavior score (as applicable) for each account in the portfolio.

 

Generate and mail appropriate forms and letters to customers throughout the life of the loan (i.e. payoff letters, final payment bills, paid letters, etc.).

 

Send any notices provided by the Purchaser or its designee to maintain compliance with the Privacy Act.

 

Maintain customer accounts in an automated accounting system ensuring the information contained in the account records is accurate and authorized change requests are processed.

 

Provide all payment processing for loan accounts including ACH, other electronic payment processes currently available and supported, and Lock Box account for receipt of customer payments.

 

Provide 24/7 toll-free incoming call service to loan customers for inquiries on their accounts.

 

Establish access to a VRU to provide automated balance and payoff information for customers.

 

Perform paid loan processing functions including credit bureau updates.

 

Process lien satisfactions for paid out/closed installment loans where appropriate.

 

Archive all loan documents on hard copy or film for the appropriate retention period.

 

Account Collection:

Establish and maintain collection records in the Servicer Collection Management System (CACS) for all past due accounts.  Record all collection efforts within the collection history for each account.

 

Process extensions in accordance with Servicer’s policy guidelines as applicable.

 

No Skip a Payment or other deferment programs (other than as provided in the relevant section of this agreement) other than existing pass a payment in current coupon books.

 

Early Stage Delinquency:

Utilize the Servicer’s STRATA Decisioning System including any Behavior Scoring System and updated FICO scores to assign collection strategies as specified herein.  Loans will have phone

 

Sale and Servicing Agreement (Exhibit C)

  

  

calls start as early as 1 day past due depending on the account level strategy.  First payment default loans must be called between the fifth and tenth day.  Contact per account ratios and call penetration rates to be actively managed.

 

Customer contact inquiries will be made to determine and provide the reason(s) for default including but not limited to status of employment and household income, status of insurance on and location and condition of collateral if applicable.

 

Collection actions and contact attempts will be taken in accordance with collection strategies as often as necessary and at various times of the day, evening, and weekend in compliance with applicable law.

 

Accounts with no contact after 10 days (or earlier, if there is no phone number in service for the related Account) will be escalated to manual review to determine on-going strategy.  If account has still not been contacted through the dialer, account will be assigned to an off-dialer collection resource for the purpose of a direct scheduled calling sequence that may include a targeted call period (evenings, weekends, breaks, etc.).  This process will occur approximately 17-20 days after scheduled due date.

 

At any stage (either by on-dialer recognition or through off-dialer review) the account can be forwarded to an off-dialer resource or to a supervisor.  No promise in excess of ten days will be allowed.  An account is currently considered a broken promise 3 days after the date made.  Advanced collection resources will become involved if the customer has broken an existing promise to pay.  These resources will work the account within two business days after the broken promise.  In special circumstances, the account can be issued directly to supervisor for review for repossession, or to the skip department for advance location review.  Broken promises are sent to a specific queue and will be prioritized in CACS to maximize the next day call rate.

 

Skip tracing will commence as soon as indicated (telephone disconnected, mail returned), and no later than 10 days after no contact.  Making borrower contacts attempts based on information obtained through methods such as credit reports, internet services, place of employment and co-signor information, door knocks, etc.  If all account information is still considered to be valid, account will be placed back into the dialer for 2nd random call sequencing.

 

Mid-Stage and Front-end Collections:

A supervisor reviews most accounts that progress to beyond 30-days delinquent, or that have been referred to the supervisor by the collector due to an adverse situation or unacceptable customer request.  Generally, no accounts (other than, potentially, accounts with a balance of less than $2,500) will remain in front-end collections for longer than 45 days.

 

For accounts 30 or more days past due, continued regular phone attempts to contact the Borrower will be made.

 

Customers 30 or more days past due will be requested to send payments via overnight mail,through an automatic payment service, or through a local branch.

 

Exclusive of any on-line automated late notices, the collection resource will have the ability to generate an on-line collection letter to the debtor.  These notices to range from a friendly

 

Sale and Servicing Agreement (Exhibit C)

  

  

reminder to a firm demand letter based upon the severity of the delinquency and the history of the account.

 

Account will remain in the collection resource’s queue with a follow-up code.  This code will only be changed if the customer makes a payment, or the collection resource performs an action on the account.  Accounts are typically sorted based upon the oldest follow-up date and the outstanding balance of delinquency.  Account follow-up should not exceed two business days without the account being reviewed.

 

Between the 45th and 60th day of delinquency of accounts where no payment arrangements have been made, Servicer may order a current credit bureau report, verify title lien, obtain a current value of the collateral, and order a copy of the Contract as needed.

 

The supervisor can submit the account for repossession during the standard review process, or during special request by the off-dialer collection resource.  This will occur when the account has progressed to approximately 55 days, but no more than 70 days contractually delinquent, but may occur at any time based upon the supervisor’s/portfolio manager’s determination.

 

Advance Collections:

Late Stage Collectors will be dedicated to collect accounts at or near 45 days contractually delinquent.  No more than 200 accounts will be assigned to any one Late Stage Collector at any one time.

 

Advance collections include:

 

	
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Accounts that are skip and cannot be located

	
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Accounts that have broken multiple promises to pay without activity by the customer

	
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Accounts that are out for repossession or liquidation

	
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Accounts with pending insurance activity

 

For most accounts that becomes 60 days past due, a supervisor shall review the account and determine and execute a collection strategy.  Strategies will be based upon the borrowers ability to pay, delinquency status, payment history and the asset’s value/location.  If it is not conceivable that arrangements can be made to bring the customer current over a period of time through a repayment plan or extension (in accordance with the agreed upon procedures), the supervisor will submit the account to the collateral management group for review for asset liquidation.

 

The account is placed into a special queue, where a mini-skip routine is performed to secure the whereabouts of the asset prior to assigning the account for repossession.  This process is designed to expedite the recovery and sale process, and minimizes acquisition and storage costs.  A decision to recover and liquidate the asset is made and the account is passed to the Asset Recovery and Remarketing team.

 

The Asset Recovery and Remarketing team within collections will examine the collateral type and value, and make an evaluation as to the time necessary to liquidate the asset, and estimate the potential selling price prior to the final decision to liquidate.

 

Sale and Servicing Agreement (Exhibit C)

  

  

Servicer will charge off accounts from the applicable Accounting System at the earliest of:

 

	i) 	when the account is deemed uncollectible, or
	ii) 	when the asset has been sold and proceeds received, or
	iii) 	60 days after repossession, if the asset is still in inventory, or
	
iv)

	
by the end of the month during which a loan becomes 120 days past due

	 	
and is not in repossession inventory, or

	
v)

	
by the end of the month during which a loan becomes 180 days past due.

 

Un-recovered balances will be charged off promptly after collateral liquidation and receipt of funds.  Servicing functions supporting the collection, repossession and remarketing, or securing of insurance or other proceeds due on the account will continue regardless of the charge off designation.  Servicing and Accounting systems, reports and data files must contain an identifier for Repossession, and/or Charge-off status.

 

In cases of loan default and charge offs only, Servicer will apply for and use reasonable efforts to realize upon insurance proceeds, including GAP insurance and rebates on insurance and warranty policies in order to mitigate the loss incurred.  In all other cases, customers will be directed to the originating dealership for cancellations, refunds, and all other insurance and warranty matters.

 

Accounts in repossession and bankruptcy status remain in special queues that are not accessed by the general collection resources unless redemption, reaffirmation, dismissal, or other action has occurred which would qualify the account for general collection processing.

 

Repossession:

Servicer will maintain a repossession and remarketing network and contract with such third party service providers.

 

Contracts assigned for repossession shall be handled in accordance with the following standards and procedures:

 

	
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Verify lien on title.

	
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Order copy of contract and original title, if appropriate.

	
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Complete assignment to repossessor with borrower and collateral information within 48 hours of receipt in repossession department.

	
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Follow up with repossessor on progress weekly.

	
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Continue to attempt contact and payment arrangements with borrower.

	
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When contacted by repossessor that property has been repossessed, obtain condition report, storage location and costs.

	
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Follow state requirements regarding borrower notification and redemption or reinstatement periods.

	
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If appropriate, negotiate redemption, notify storage lot of redemption and terms.  Provide borrower with redemption release to claim property once terms have been met.

	
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If no redemption, determine value of collateral, set floor price and proceed with sale at auction.

	
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All auction expenses to be netted from proceeds of sale and net proceeds applied to the loan balance.  Repossession expenses are paid by invoice and added to account balance.

 

Sale and Servicing Agreement (Exhibit C)

  

  

 

	
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Calculate deficiency balance and send deficiency letter to borrower.

	
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Obtain any warranty or insurance proceeds due on account.

	
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Charge off deficiency, or if overage exists after full payment of account and expenses, send overage to borrower with notice of sale.

 

Servicer remarketing specialist to attend auctions on a regular basis to inspect collateral, validate the auction process, and/or evaluate the remarketing strategy.

 

Recovery:

Account collection activities will continue after charge-off by following recovery procedures in accordance with this Agreement.  The scope of these practices will range from Servicer in-house recovery efforts, outsourced recovery efforts, or sales of the account.  These actions are determined by Huntington’s internal Recovery scorecard.   And in any case, all proceeds net of expenses are applied to the charged-off account for the benefit of the Purchaser.

 

Accounts may be outsourced to a collection agency immediately following charge-off as determined by Huntington’s recovery scorecard.  Accounts with respect to which such a determination is made will typically be maintained in-house for no more than 180 days and will be managed by Huntington Agency Management Specialists.  If in-house efforts will exceed 180 days the Supervisor of the unit will review the account and fully document the situation with his or her approval.

 

All collection agencies will be audited on a quarterly basis. Every such agency is required to adhere to the Huntington MARS Guidelines.

 

Accounts that are not immediately outsourced to a collection agency will be identified with one of the following “Excluded Status Codes:

 

	
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PPA - Accounts that are coded with a PPA Status Code, (Promise to Pay) will be excluded from the Recovery Score Strategy. Accounts may exceed 180 days in-house provided scheduled monthly payments are being made. Reduced costs to the investors and customer service are best practices.

	
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SEC - Accounts that are coded with a SEC Status Code, (Secured) will be excluded from the Recovery Score Strategy. Internal efforts along with skip trace vendors will be utilized to recover and liquidate the collateral. Efforts will be made for a period not to exceed 180 days. Once the internal efforts to secure the vehicle are exhausted the accounts will be referred to a collection agency to be worked under the Huntington MARS guidelines.

	
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FRD - Accounts that are coded with a FRD Status Code (Fraud), will be excluded from the Recovery Score Strategy. Huntington Fraud Investigators and/or Bank Security will handle investigation and recovery efforts. In some cases litigation and/or prosecution will be necessary. If it is determined that a fraudulent transaction has occurred the account will not be referred to a collection agency. Accounts will be worked to conclusion and then placed into a “uncollectible work queue”. Collection Agencies do not work fraudulent accounts.

	
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LGL - Accounts that are coded with a LGL Status Code, (Legal) will be excluded from the Recovery Score Strategy. Huntington Litigation Specialists will work with outside counsel to secure and liquidate collateral. Litigation Specialists may also enter into agreed upon payment arrangements of the deficiency balance through agreed judgment entries. Accounts, 

 

Sale and Servicing Agreement (Exhibit C)

  

  

	
  

	
in most cases will exceed the contractual number of days worked in-house. Collection agencies do not have the expertise to work through complex litigation matters and would not work the account without an increase in contingency fees.

	
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DEF - Accounts that are coded with a DEF Status Code, (Defense) will be excluded from the Recovery Strategy. Huntington Litigation Specialists will work with in-house or outside counsel to defend any actions brought against the bank. Accounts, in most cases will exceed the contractual number of days worked in-house. On going strategy will need to be identified on a case-by-case basis. Outside collection agencies do not have the expertise to work through complex litigation matters.

	
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BNK - Accounts that are coded with a bankruptcy status code, (BNK, B13, BO7 etc.,) will be excluded from the recovery strategy. Huntington Bankruptcy Specialists will work in-house and with outside counsel to represent the investor in the bankruptcy proceedings. Accounts in most cases will the contractual number of days worked in-house. On going strategy will need to be identified on a case-by-case basis. Collection Agencies do not work bankrupt accounts on a contingency fee agreement.

 

Guideline Costs associated with repossession and remarketing process (estimated):

Judicial Fees: $500

Repossessor charge:  $300 per unit (includes keys) average of voluntary and involuntary

Storage Fee:  $10 average per unit repossessed and sold

Standard Auction Clean-Up Fee:  $90 per vehicle

Auction or Sale fee: Average of $125 per unit sold

Title conversion or Duplicate Title (if applicable):  $50 per unit sold

Move collateral to auction:  $45 per vehicle

Impound fees if applicable:  Average of $45 per account processed

 

All costs are to be recouped from the liquidation sale proceeds.  Liquidation Proceeds cannot be less than zero.

 

Bankruptcy:

In the event that a debtor declares bankruptcy, servicer enters the bankruptcy transaction on the account the same or following business day that the notification is received.  The account is placed into the bankruptcy department’s worklist, where follow-up dates and codes are placed on the account to ensure that the servicer is following state and federal law in the handling of these accounts.  Servicer will perform all necessary actions for bankruptcy including, at a minimum, the following:

 

	
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Acknowledge receipt of bankruptcy notice

	
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Stop all collection activity to comply with Federal Stay Order, including property sale

	
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Conduct initial review verifying payment status, collateral, account balance and debtor’s attorney

	
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Obtain knowledge and understanding of the customer’s plan

	
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Lift stay on collateral, as needed

	
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Motion to discharge/dismiss, as needed

	
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Objection to confirmation, as needed

	
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File proof of claim on all BKs as necessary

 

Sale and Servicing Agreement (Exhibit C)

  

  

	
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Monitor customer’s compliance to the confirmed plan

	
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Aggressively pursue reaffirmation of debt

	
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Process Cram Down amount when received from the court

 

 

 

Sale and Servicing Agreement (Exhibit C)

  

  

EXHIBIT D

 

UNDERWRITING POLICY

 

[Copy of the Policy to be directly inserted]

 

 

Sale and Servicing Agreement (Exhibit D)

  

  

SCHEDULE A

 

LOANS CONVEYED ON THE CLOSING DATE

 

[CD-ROM to be directly attached]

 

Sale and Servicing Agreement

  

  

SCHEDULE B

 

LOCATION OF CUSTODIAL FILES

 

The Huntington National Bank

2361 Morse Road

Columbus, OH  43224

 

 

 

Sale and Servicing Agreement

  

  

EXHIBIT C

SERVICING CRITERIA TO BE ADDRESSED IN

INDENTURE TRUSTEE’S ASSESSMENT OF COMPLIANCE

The assessment of compliance to be delivered by the Indenture Trustee shall address, at a

minimum, the criteria identified below as “Applicable Servicing Criteria”:

	
Servicing Criteria

	
Applicable

Servicing Criteria

	
Reference

	
Criteria

	  
	  	
General Servicing Considerations

	  
	
1122(d)(1)(i)

	
Policies and procedures are instituted to monitor any performance or other triggers and events of default in accordance with the transaction agreements.

	  
	
1122(d)(1)(ii)

	
If any material servicing activities are outsourced to third parties, policies and procedures are instituted to monitor the third party’s performance and compliance with such servicing activities.

	  
	
1122(d)(1)(iii)

	
Any requirements in the transaction agreements to maintain a back-up servicer for the pool assets are maintained.

	  
	
1122(d)(1)(iv)

	
A fidelity bond and errors and omissions policy is in effect on the party participating in the servicing function throughout the reporting period in the amount of coverage required by and otherwise in accordance with the terms of the transaction agreements.

	  
	
 

	
Cash Collection and Administration

	  
	
1122(d)(2)(i)

	
Payments on pool assets are deposited into the appropriate custodial bank accounts and related bank clearing accounts no more than two business days following receipt, or such other number of days specified in the transaction agreements.

	  
	
1122(d)(2)(ii)

	
Disbursements made via wire transfer on behalf of an obligor or to an investor are made only by authorized personnel.

	
X

	
1122(d)(2)(iii)

	
Advances of funds or guarantees regarding collections, cash flows or distributions, and any interest or other fees charged for such advances, are made, reviewed and approved as specified in the transaction agreements.

	  
	
1122(d)(2)(iv)

	
The related accounts for the transaction, such as cash reserve accounts or accounts established as a form of overcollateralization, are separately maintained (e.g., with respect to commingling of cash) as set forth in the transaction agreements.

	
X

	
1122(d)(2)(v)

	
Each custodial account is maintained at a federally insured depository institution as set forth in the transaction agreements. For purposes of this criterion, “federally insured depository institution” with respect to a foreign financial institution means a foreign financial institution that meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange Act.

	
X

	
1122(d)(2)(vi)

	
Unissued checks are safeguarded so as to prevent unauthorized access.

	  
	
1122(d)(2)(vii)

	
Reconciliations are prepared on a monthly basis for all asset-backed securities related bank accounts, including custodial accounts and related bank clearing accounts. These reconciliations are (A) mathematically accurate; (B) prepared within 30 calendar days after the bank statement cutoff date, or such other number of days specified in the transaction agreements; (C) reviewed and approved by someone other than the person who prepared the reconciliation; and (D) contain explanations for reconciling items. These reconciling items are resolved within 90 calendar days of their original identification, or such other number of days specified in the transaction agreements.

	
X

 

 

	 	C-1	 Exhibit C to the
	 	 	 Sale and Servicing Agreement
	 	 	 

  

  

  

 

	
Servicing Criteria

	
Applicable

Servicing Criteria

	
Reference

	
Criteria

	  

	 	
Investor Remittances and Reporting

	  
	
1122(d)(3)(i)

	
Reports to investors, including those to be filed with the Commission, are maintained in accordance with the transaction agreements and applicable Commission requirements. Specifically, such reports (A) are prepared in accordance with timeframes and other terms set forth in the transaction agreements; (B) provide information calculated in accordance with the terms specified in the transaction agreements; (C) are filed with the Commission as required by its rules and regulations; and (D) agree with investors’ or the trustee’s records as to the total unpaid principal balance and number of pool assets serviced by the Servicer.

	  
	
1122(d)(3)(ii)

	
Amounts due to investors are allocated and remitted in accordance with timeframes, distribution priority and other terms set forth in the transaction agreements.

	
(solely with respect to

remittance)

X

	
1122(d)(3)(iii)

	
Disbursements made to an investor are posted within two business days to the Servicer’s investor records, or such other number of days specified in the transaction agreements.

	
X

	
1122(d)(3)(iv)

	
Amounts remitted to investors per the investor reports agree with cancelled checks, or other form of payment, or custodial bank statements.

	
X

	
 

	
Pool Asset Administration

	  
	
1122(d)(4)(i)

	
Collateral or security on pool assets is maintained as required by the transaction agreements or related asset pool documents.

	  
	
1122(d)(4)(ii)

	
Pool assets and related documents are safeguarded as required by the transaction agreements

	  
	
1122(d)(4)(iii)

	
Any additions, removals or substitutions to the asset pool are made, reviewed and approved in accordance with any conditions or requirements in the transaction agreements.

	  
	
1122(d)(4)(iv)

	
Payments on pool assets, including any payoffs, made in accordance with the related pool asset documents are posted to the Servicer’s obligor records maintained no more than two business days after receipt, or such other number of days specified in the transaction agreements, and allocated to principal, interest or other items (e.g., escrow) in accordance with the related asset pool documents.

	  
	
1122(d)(4)(v)

	
The Servicer’s records regarding the accounts and the accounts agree with the Servicer’s records with respect to an obligor’s unpaid principal balance.

	  
	
1122(d)(4)(vi)

	
Changes with respect to the terms or status of an obligor's account  (e.g., loan modifications or re-agings) are made, reviewed and approved by authorized Personnel in accordance with the transaction agreements and related pool asset documents.

	  
	
1122(d)(4)(vii)

	
Loss mitigation or recovery actions (e.g., forbearance plans, modifications and deeds in lieu of foreclosure, foreclosures and repossessions, as applicable) are initiated, conducted and concluded in accordance with the timeframes or other requirements established by the transaction agreements.

	  
	
1122(d)(4)(viii)

	
Records documenting collection efforts are maintained during the period a pool asset is delinquent in accordance with the transaction agreements. Such records are maintained on at least a monthly basis, or such other period specified in the transaction agreements, and describe the entity’s activities in monitoring delinquent pool assets including, for example, phone calls, letters and payment rescheduling plans in cases where delinquency is deemed temporary (e.g., illness or unemployment).

	  
	
1122(d)(4)(ix)

	
Adjustments to interest rates or rates of return for pool assets with variable rates are computed based on the related pool asset documents.

	  

 

 

	 	C-2	 Exhibit C to the
	 	 	 Sale and Servicing Agreement
	 	 	 

  

  

  

 

	
Servicing Criteria

	
Applicable

Servicing Criteria

	
Reference

	
Criteria

	  

	
1122(d)(4)(x)

	
Regarding any funds held in trust for an obligor (such as escrow accounts): (A) such funds are analyzed, in accordance with the obligor’s Account documents, on at least an annual basis, or such other period specified in the transaction agreements; (B) interest on such funds is paid, or credited, to obligors in accordance with applicable Account documents and state laws; and (C) such funds are returned to the obligor within 30 calendar days of full repayment of the related Accounts, or such other number of days specified in the transaction agreements.

	  
	
1122(d)(4)(xi)

	
Payments made on behalf of an obligor (such as tax or insurance payments) are made on or before the related penalty or expiration dates, as indicated on the appropriate bills or notices for such payments, provided that such support has been received by the servicer at least 30 calendar days prior to these dates, or such other number of days specified in the transaction agreements.

	  
	
1122(d)(4)(xii)

	
Any late payment penalties in connection with any payment to be made on behalf of an obligor are paid from the servicer’s funds and not charged to the obligor, unless the late payment was due to the obligor’s error or omission.

	  
	
1122(d)(4)(xiii)

	
Disbursements made on behalf of an obligor are posted within two business days to the obligor’s records maintained by the servicer, or such other number of days specified in the transaction agreements.

	  
	
1122(d)(4)(xiv)

	
 Delinquencies, charge-offs and uncollectible accounts are recognized and recorded in accordance with the transaction agreements.

	  
	
1122(d)(4)(xv)

	
Any external enhancement or other support, identified in Item 1114(a)(1) through (3) or Item 1115 of Regulation AB, is maintained as set forth in the transaction agreements.

	  

 

 

 

	 	C-3	 Exhibit C to the
	 	 	 Sale and Servicing Agreement
	 	 	 

  

  

  

EXHIBIT D

FORM OF INDENTURE TRUSTEE’S ANNUAL CERTIFICATION

 

	
Re:

	
HUNTINGTON AUTO TRUST 20[  ]-[ ]

 

[                 ], not in its individual capacity but solely as indenture trustee  (the “Indenture Trustee”), certifies to Huntington Funding, LLC (the “Depositor”), and its officers, with the knowledge and intent that they will rely upon this certification, that:

 

(1)           It has reviewed the report on assessment of the Indenture Trustee’s compliance provided in accordance with Rules 13a-18 and 15d-18 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Item 1122 of Regulation AB (the “Servicing Assessment”), and the registered public accounting firm’s attestation report provided in accordance with Rules 13a-18 and 15d-18 under the Exchange Act and Item 1122(b) of Regulation AB (the “Attestation Report”) that were delivered by the Indenture Trustee to the Depositor pursuant to the Sale and Servicing Agreement (the “Agreement”), dated as of [        ], by and among Huntington Funding, LLC, the Depositor, the Indenture Trustee and Huntington Auto Trust 20[  ]-[ ];

 

(2)           To the best of its knowledge, the Servicing Assessment, taken as a whole, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in the light of the circumstances under which such statements were made, not misleading with respect to the period of time covered by the Servicing Assessment; and

 

(3)           To the best of its knowledge, all of the information required to be provided by the Indenture Trustee pursuant to Sections 9.21 and 9.22 of the Agreement has been provided to the Seller.

 

 

[             ], not in its individual capacity but solely 

as Indenture Trustee

 

 

Date:           _________________________

 

 

	 	D-1	 Exhibit D to the
	 	 	 Sale and Servicing Agreement
	 	 	 

  

  

  

EXHIBIT E

 

FORM OF INDENTURE TRUSTEE’S ANNUAL CERTIFICATION

REGARDING ITEM 1117 AND ITEM 1119 OF REGULATION AB

 

Reference is made to the Form 10-K of Fifth Third Auto Trust 2007-1 (the “Form 10-K”) for the fiscal year ended December 31, 20[   ].  Capitalized terms used but not otherwise defined herein shall have the respective meanings given to them in the Form 10-K.

 

[          ], a [                ] (“[   ]”), does hereby certify to the Sponsor, the Depositor and the Issuing Entity that:

 

1.      As of the date of the Form 10-K, there are no pending legal Proceedings against [      ] or Proceedings known to be contemplated by governmental authorities against [      ] that would be material to the investors in the Notes.

 

2.      As of the date of the Form 10-K, there are no affiliations, as contemplated by Item 1119 of Regulation AB, between [        ] and any of The Huntington National Bank, a national banking association (in its capacities as Sponsor, Servicer, Administrator, Calculation Agent, Custodian and Originator), Huntington Funding, LLC, the Indenture Trustee, the Owner Trustee and the Issuing Entity, or any affiliates of such parties.

 

IN WITNESS WHEREOF, [      ] has caused this certificate to be executed in its corporate name by an officer thereunto duly authorized.

 

Dated:  ____________, 20[   ]

 

[              ], as Indenture Trustee

 

 

By:__________________________________________                                                           

Name:

Title:

 

 

 

 

	 	E-1	 Exhibit E to the
	 	 	 Sale and Servicing Agreement

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