Exhibit 4.2
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CDF FINANCING, L.L.C.
Seller
GE COMMERCIAL DISTRIBUTION FINANCE CORPORATION
Servicer
and
[ ]
Trustee
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SERIES [ ] SUPPLEMENT
Dated as of [ ]
to
AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT
Dated as of April 1, 2000
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DISTRIBUTION FINANCIAL SERVICES FLOORPLAN MASTER TRUST
SERIES [ ]
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TABLE OF CONTENTS
PAGE
ARTICLE I
CREATION OF THE SERIES [] CERTIFICATES
SECTION 1.1 Designation......................................................3
ARTICLE II
SECTION 2.1 Definitions......................................................4
ARTICLE III
SERVICING FEE
SECTION 3.1 Servicing Compensation..........................................16
SECTION 3.2 Servicer Advances...............................................17
ARTICLE IV
RIGHTS OF SERIES [] CERTIFICATEHOLDERS AND ALLOCATION AND
APPLICATION OF COLLECTIONS
SECTION 4.1 Allocations; Payments to Seller.................................18
SECTION 4.2 Monthly Interest; Determination of Certificate Rate.............18
SECTION 4.3 Determination of Monthly Principal..............................19
SECTION 4.4 Establishment of Reserve Fund and Funding Accounts..............20
SECTION 4.5 Deficiency Amount...............................................23
SECTION 4.6 Application of Investor Non-Principal Collections, Investment
Proceeds, Servicer Advances and Available Investor
Principal Collections...........................................24
SECTION 4.7 Distributions to Series [] Certificateholders...................27
SECTION 4.8 Application of Reserve Fund.....................................28
SECTION 4.9 Investor Charge-Offs............................................29
SECTION 4.10 Excess Servicing................................................29
SECTION 4.11 Excess Principal Collections....................................30
SECTION 4.12 Excess Funding Account..........................................30
SECTION 4.13 Yield Supplement Account........................................31
ARTICLE V
DISTRIBUTION AND REPORTS TO SERIES [] CERTIFICATEHOLDERS
SECTION 5.1 Distributions...................................................32
SECTION 5.2 Reports and Statements to Series [] Certificateholders..........32
ARTICLE VI
EARLY AMORTIZATION EVENTS
SECTION 6.1 Additional Early Amortization Events............................33
ARTICLE VII
OPTIONAL REPURCHASE
SECTION 7.1 Optional Repurchase.............................................34
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TABLE OF CONTENTS
(continued)
PAGE
ARTICLE VIII
FINAL DISTRIBUTIONS
SECTION 8.1 Sale of Certificateholders' Interest Pursuant to Section 2.3
of the Agreement; Distributions Pursuant to Section 7.1 of
this Series Supplement or Section 2.3 or 12.2(c) of the
Agreement.......................................................35
SECTION 8.2 Distribution of Proceeds of Sale, Disposition or Liquidation
of the Receivables Pursuant to Section 9.2 of the Agreement.....37
ARTICLE IX
MISCELLANEOUS PROVISIONS
SECTION 9.1 Securities Law Filings..........................................37
SECTION 9.2 Ratification of Agreement.......................................37
SECTION 9.3 Counterparts....................................................37
SECTION 9.4 Governing Law...................................................38
SECTION 9.5 Limitation of Class C Certificates..............................38
SECTION 9.6 The Trustee; Paying Agent; Transfer Agent and Registrar.........42
SECTION 9.7 Instructions in Writing.........................................42
SECTION 9.8 Initial Funding of Reserve Fund.................................42
SECTION 9.9 Severability; Certificate Rate Limitation.......................43
SECTION 9.10 Headings........................................................43
SECTION 9.11 Certain Matters Relating to Luxembourg Stock Exchange Listing...43
EXHIBITS
Exhibit A Form of Certificate
Exhibit B Distribution Date Statement
Exhibit C Form of Representation Letter
SCHEDULES
Schedule 1 Accounts
Schedule 2 Initial Principal Amounts of Certificates
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SERIES [ ] SUPPLEMENT dated as of [ ] (this "Series Supplement"), among CDF
FINANCING, L.L.C., a Delaware limited liability company ("LLC"), as Seller, GE
COMMERCIAL DISTRIBUTION FINANCE CORPORATION, a Nevada corporation, as Servicer,
and [ ], a [ ], as Trustee.
Pursuant to Section 6.3 of the Amended and Restated Pooling and Servicing
Agreement, dated as of April 1, 2000 (as amended, the "Agreement"), among the
Seller, the Servicer and the Trustee, the Seller may from time to time direct
the Trustee to issue, on behalf of the Trust, one or more new Series of Investor
Certificates.
Pursuant to this Series Supplement, the Seller and the Trustee shall create
a new Series of Investor Certificates and specify the Principal Terms thereof.
ARTICLE I
Creation of the Series [ ] Certificates
SECTION 1.1 Designation. (a) There is hereby created a Series of Investor
Certificates to be issued pursuant to the Agreement and this Series Supplement
to be known as the "Floating Rate Asset Backed Certificates, Series [ ]" or the
"Series [ ] Certificates", which shall consist of three Classes to be known,
respectively, as the "Floating Rate Asset Backed Certificates, Series [ ], Class
A," "Floating Rate Asset Backed Certificates, Series [ ], Class B" and "Floating
Rate Asset Backed Certificates, Series [ ], Class C."
(b) In the event that any term or provision contained herein shall conflict
with or be inconsistent with any term or provision contained in the Agreement,
the terms and provisions of this Series Supplement shall govern.
ARTICLE II
Definitions
SECTION 2.1 Definitions. (a) Whenever used in this Series Supplement the
following words and phrases shall have the following meanings:
"Accumulation Period" shall mean, unless an Early Amortization Event shall
have occurred prior thereto (other than an Early Amortization Event which has
resulted in an Early Amortization Period which has ended as described in clause
(c) of the definition of Early Amortization Period in the Agreement), the period
commencing on the Accumulation Period Commencement Date and ending upon the
earlier of (a) the commencement of an Early Amortization Period and (b) the
Expected Final Payment Date.
"Accumulation Period Commencement Date" shall mean the first day of the
calendar month which is the fourth calendar month prior to the calendar month in
which the Expected Final Payment Date occurs; provided, however, that upon
written notice to the Trustee, the Servicer may elect to postpone the
Accumulation Period Commencement Date so that the number of months included in
the Accumulation Period shall equal or exceed the Accumulation Period Length;
provided further, however, that such election shall only be permitted if the
Accumulation Period Length is less than four months; provided further, however,
that the Accumulation Period Commencement Date shall not be postponed beyond the
first day of the calendar month which is the second calendar month prior to the
calendar month in which the Expected Final Payment Date occurs.
"Accumulation Period Length" shall mean, as determined by the Servicer on
each Determination Date, beginning with the Determination Date occurring in the
calendar month which is the fifth calendar month prior to the calendar month in
which the Expected Final Payment Date occurs, the number of calendar months that
the Servicer expects to be required so that sufficient funds are on deposit in
the Principal Funding Account no later than the Expected Final Payment Date to
pay the outstanding principal balances of the Certificates, based on (a) the
expected monthly collections of Principal Receivables expected to be
distributable to the Series [ ] Certificateholders assuming a principal payment
rate no greater than the lowest Monthly Payment Rate on the Receivables for the
preceding three months, so that, for example, if the lowest Monthly Payment Rate
for that preceding three month period is 50% or more, the number of calendar
months required would be two; if the lowest Monthly Payment Rate for that
preceding three month period is between 33.33% and 50%, the number of calendar
months required would be three; and if the lowest Monthly Payment Rate for that
preceding three month period is between 25% and 33.33%, the number of calendar
months required would be four; and (b) the amount of principal expected to be
distributable to Investor Certificateholders of other Series which are expected
to be in their accumulation or amortization periods during the Accumulation
Period.
"Additional Early Amortization Event" shall have the meaning specified in
Section 6.1.
"Additional Interest" shall mean the sum of the Class A Additional
Interest, the Class B Additional Interest and the Class C Additional Interest.
"Adjustment Date" shall mean, with respect to any Interest Period, the
second London Business Day preceding such Interest Period; provided that with
respect to the first Interest Period, the Adjustment Date shall be [ ].
"Allocable Miscellaneous Payments" shall mean, with respect to any
Distribution Date, the product of (a) a fraction, the numerator of which is the
Series [ ] Allocation Percentage for the related Collection Period and the
denominator of which is the sum of the series allocation percentages for all
Series not in their revolving periods, and (b) Miscellaneous Payments with
respect to the related Collection Period.
"Available Investor Principal Collections" shall mean, with respect to any
Distribution Date, the sum of (a) an amount equal to Investor Principal
Collections for such Distribution Date, (b) Allocable Miscellaneous Payments
with respect to such Distribution Date, (c) any funds remaining in the Yield
Supplement Account at the beginning of the Accumulation Period or upon the
occurrence of an Early Amortization Event and (d) on the Termination Date, any
funds in the Reserve Fund after giving effect to Section 4.8.
"Carry-over Amount" shall mean the sum of the Class A Carry-over Amount,
the Class B Carry-over Amount and the Class C Carry-over Amount.
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"Certificate Rate" means any of the Class A Certificate Rate, the Class B
Certificate Rate or the Class C Certificate Rate.
"Certificateholders" shall mean, collectively, the Class A
Certificateholders, the Class B Certificateholders and the Class C
Certificateholders.
"Certificateholders' Monthly Servicing Fee" shall have the meaning
specified in Section 3.1.
"Certificates" shall mean, collectively, the Class A Certificates, the
Class B Certificates and the Class C Certificates.
"Class A Additional Interest" shall have the meaning specified in Section
4.2(a).
"Class A Carry-over Amount" shall mean, with respect to a Distribution Date
an amount equal to the excess, if any, of (a) the amount equal to the Class A
Monthly Interest for such Distribution Date calculated as if the Class A
Certificate Rate for such Distribution Date were based on LIBOR rather than the
Net Receivables Rate, over (b) the actual Class A Monthly Interest for such
Distribution Date.
"Class A Carry-over Amount Additional Interest" for a Distribution Date
shall mean an amount equal to the product of:
(a) the Class A Certificate Rate for the Interest Period then ended;
(b) a fraction, the numerator of which is the actual number of days in
that Interest Period and the denominator of which is 360; and
(c) any unpaid Class A Carry-over Amount, if any, for the previous
Distribution Date.
"Class A Certificate Rate" shall mean, for an Interest Period and the
Distribution Date immediately following such Interest Period, a rate per annum
equal to the lesser of (i) LIBOR plus [ ] per annum and (ii) the related Net
Receivables Rate.
"Class A Certificateholders" shall mean the Holders of Class A
Certificates.
"Class A Certificates" shall mean any one of the "Floating Rate Asset
Backed Certificates, Series [ ], Class A" executed by the Seller and
authenticated by the Trustee, substantially in the form of Exhibit A.
"Class A Initial Invested Amount" shall mean, for any date, the initial
principal amount of the Class A Certificates, which is set forth in Schedule 2,
plus (x) the product of (i) the Class A Percentage multiplied by (ii) the amount
of any withdrawals from the Excess Funding Account in connection with an
increase in Pool Balance since the Closing Date, minus (y) the product of (i)
the Class A Percentage multiplied by (ii) the amount of any additions to the
Excess Funding Account in connection with a reduction in the Pool Balance since
the Closing Date.
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"Class A Interest Shortfall" shall have the meaning specified in Section
4.2(a).
"Class A Invested Amount" shall mean, for any date, an amount equal to the
result of (i) the Class A Initial Invested Amount, minus (ii) the aggregate
amount of principal payments made to Class A Certificateholders prior to such
date, minus (iii) the aggregate amount of all unreimbursed Class A Investor
Charge-Offs; provided that the Class A Invested Amount shall not be less than
zero.
"Class A Investor Charge-Off" shall have the meaning specified in Section
4.9.
"Class A Monthly Interest" on any Distribution Date shall be an amount
equal to the product of (i) the Class A Certificate Rate, (ii) a fraction the
numerator of which is the actual number of days in the related Interest Period
and the denominator of which is 360, and (iii) (A) the outstanding principal
balance of the Class A Certificates as of the close of business on the preceding
Distribution Date (after giving effect to all repayments of principal made to
Class A Certificateholders on such preceding Distribution Date, if any) or (B)
in the case of the first Distribution Date with respect to Series [ ], the
initial principal amount of the Class A Certificates as set forth in Schedule 2.
"Class A Percentage" shall mean the percentage equivalent of a fraction,
the numerator of which is the outstanding principal balance of the Class A
Certificates and the denominator of which is the outstanding principal balance
of all Certificates.
"Class A Pool Factor" shall mean, with respect to any Determination Date, a
number carried out to eleven decimals representing the ratio of the outstanding
principal balance of the Class A Certificates as of such Determination Date
(determined after taking into account any reduction in the outstanding principal
balance of the Class A Certificates which shall occur on the following
Distribution Date) to the initial principal balance of the Class A Certificates.
"Class B Additional Interest" shall have the meaning specified in Section
4.2(a).
"Class B Carry-over Amount" shall mean, with respect to a Distribution
Date, an amount equal to the excess, if any, of (a) the amount equal to the
Class B Monthly Interest for such Distribution Date calculated as if the Class B
Certificate Rate for such Distribution Date were based on LIBOR rather than the
Net Receivables Rate, over (b) the actual Class B Monthly Interest for such
Distribution Date.
"Class B Carry-over Amount Additional Interest" for a Distribution Date
shall mean an amount equal to the product of:
(a) the Class B Certificate Rate for the Interest Period then ended;
(b) a fraction, the numerator of which is the actual number of days in
that Interest Period and the denominator of which is 360; and
(c) any unpaid Class B Carry-over Amount, if any, for the previous
Distribution Date.
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"Class B Certificate Rate" shall mean, for an Interest Period and the
Distribution Date immediately following such Interest Period, a rate per annum
equal to the lesser of (i) LIBOR plus [ ] per annum and (ii) the related Net
Receivables Rate.
"Class B Certificateholders" shall mean the Holders of Class B
Certificates.
"Class B Certificates" shall mean any one of the "Floating Rate Asset
Backed Certificates, Series [ ], Class B" executed by the Seller and
authenticated by the Trustee, substantially in the form of Exhibit A.
"Class B Initial Invested Amount" shall mean, for any date, the initial
principal amount of the Class B Certificates, which is set forth in Schedule 2,
plus (x) the product of (i) the Class B Percentage multiplied by (ii) the amount
of any withdrawals from the Excess Funding Account in connection with an
increase in Pool Balance since the Closing Date, minus (y) the product of (i)
the Class B Percentage multiplied by (ii) the amount of any additions to the
Excess Funding Account in connection with a reduction in the Pool Balance since
the Closing Date.
"Class B Interest Shortfall" shall have the meaning specified in Section
4.2(a).
"Class B Invested Amount" shall mean, for any date, an amount equal to the
result of (i) the Class B Initial Invested Amount, minus (ii) the aggregate
amount of principal payments made to Class B Certificateholders prior to such
date, minus (iii) the aggregate amount of all unreimbursed Class B Investor
Charge-Offs; provided that the Class B Invested Amount shall not be less than
zero.
"Class B Investor Charge-Off" shall have the meaning specified in Section
4.9.
"Class B Monthly Interest" on any Distribution Date shall be an amount
equal to the product of (i) the Class B Certificate Rate, (ii) a fraction the
numerator of which is the actual number of days in the related Interest Period
and the denominator of which is 360, and (iii) (A) the outstanding principal
balance of the Class B Certificates as of the close of business on the preceding
Distribution Date (after giving effect to all repayments of principal made to
Class B Certificateholders on such preceding Distribution Date, if any) or (B)
in the case of the first Distribution Date with respect to Series [ ], the
initial principal amount of the Class B Certificates as set forth in Schedule 2.
"Class B Percentage" shall mean the percentage equivalent of a fraction,
the numerator of which is the outstanding principal balance of the Class B
Certificates and the denominator of which is the outstanding principal balance
of all Certificates.
"Class B Pool Factor" shall mean, with respect to any Determination Date, a
number carried out to eleven decimals representing the ratio of the outstanding
principal balance of the Class B Certificates as of such Determination Date
(determined after taking into account any reduction in the outstanding principal
balance of the Class B Certificates which shall occur on the following
Distribution Date) to the initial principal balance of the Class B Certificates.
"Class C Additional Interest" shall have the meaning specified in Section
4.2(a).
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"Class C Carry-over Amount" shall mean, with respect to a Distribution
Date, an amount equal to the excess, if any, of (a) the amount equal to the
Class C Monthly Interest for such Distribution Date calculated as if the Class C
Certificate Rate for such Distribution Date were based on LIBOR rather than the
Net Receivables Rate, over (b) the actual Class C Monthly Interest for such
Distribution Date.
"Class C Carry-over Amount Additional Interest" for a Distribution Date
shall mean an amount equal to the product of:
(a) the Class C Certificate Rate for the Interest Period then ended;
(b) a fraction, the numerator of which is the actual number of days in
that Interest Period and the denominator of which is 360; and
(c) any unpaid Class C Carry-over Amount, if any, for the previous
Distribution Date.
"Class C Certificate Rate" shall mean, for an Interest Period and the
Distribution Date immediately following such Interest Period, a rate per annum
equal to the lesser of (i) LIBOR plus [ ] per annum and (ii) the related Net
Receivables Rate.
"Class C Certificateholders" shall mean the Holders of Class C
Certificates.
"Class C Certificates" shall mean any one of the "Floating Rate Asset
Backed Certificates, Series [ ], Class C" executed by the Seller and
authenticated by the Trustee, substantially in the form of Exhibit A.
"Class C Initial Invested Amount" shall mean, for any date, the initial
principal amount of the Class C Certificates, which is set forth in Schedule 2,
plus (x) the product of (i) the Class C Percentage multiplied by (ii) the amount
of any withdrawals from the Excess Funding Account in connection with an
increase in Pool Balance since the Closing Date, minus (y) the product of (i)
the Class C Percentage multiplied by (ii) the amount of any additions to the
Excess Funding Account in connection with a reduction in the Pool Balance since
the Closing Date.
"Class C Interest Shortfall" shall have the meaning specified in Section
4.2(a).
"Class C Invested Amount" shall mean, for any date, an amount equal to the
result of (i) the Class C Initial Invested Amount, minus (ii) the aggregate
amount of principal payments made to Class C Certificateholders prior to such
date, minus (iii) the aggregate amount of all unreimbursed Class C Investor
Charge-Offs; provided that the Class C Invested Amount shall not be less than
zero.
"Class C Investor Charge-Off" shall have the meaning specified in Section
4.9.
"Class C Monthly Interest" on any Distribution Date shall be an amount
equal to the product of (i) the Class C Certificate Rate, (ii) a fraction the
numerator of which is the actual number of days in the related Interest Period
and the denominator of which is 360, and (iii) (A) the outstanding principal
balance of the Class C Certificates as of the close of business on the
6
preceding Distribution Date (after giving effect to all repayments of principal
made to Class C Certificateholders on such preceding Distribution Date, if any)
or (B) in the case of the first Distribution Date with respect to Series [ ],
the initial principal amount of the Class C Certificates as set forth in
Schedule 2.
"Class C Percentage" shall mean the percentage equivalent of a fraction,
the numerator of which is the outstanding principal balance of the Class C
Certificates and the denominator of which is the outstanding principal balance
of all Certificates.
"Class C Pool Factor" shall mean, with respect to any Determination Date, a
number carried out to eleven decimals representing the ratio of the outstanding
principal balance of the Class C Certificates as of such Determination Date
(determined after taking into account any reduction in the outstanding principal
balance of the Class C Certificates which shall occur on the following
Distribution Date) to the initial principal balance of the Class C Certificates.
"Closing Date" shall mean [ ].
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Controlled Accumulation Amount" shall mean the quotient obtained by
dividing the Invested Amount as of the Determination Date on which the
Accumulation Period Length is determined (after giving effect to any changes
therein on such date) by the number of months comprising the Accumulation Period
Length.
"Controlled Deposit Amount" shall mean, for any Distribution Date with
respect to the Accumulation Period, the excess, if any, of (i) the product of
the Controlled Accumulation Amount and the number of Distribution Dates from and
including the first Distribution Date during the Accumulation Period through and
including such Distribution Date over (ii) the sum of amounts on deposit in the
Excess Funding Account and the Principal Funding Account, in each case before
giving effect to any withdrawals from or deposits to such accounts on such
Distribution Date.
"Deficiency Amount" shall have the meaning specified in Section 4.5.
"Distribution Date Statement" shall have the meaning specified in Section
5.2(a).
"Early Amortization Event" shall mean any Early Amortization Event
specified in Section 9.1 of the Agreement, together with any Additional Early
Amortization Event specified in Section 6.1 of this Series Supplement.
"Early Amortization Period" shall mean an Early Amortization Period (as
defined in the Agreement) with respect to Series [ ].
"Excess Funding Account" shall have the meaning specified in Section
4.4(d).
"Excess Principal Collections" shall mean the amounts equal to the balances
referred to as such in Sections 4.6(b)(ii) and 4.6(c)(ii).
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"Excess Servicing" shall mean, with respect to any Distribution Date, the
amount, if any, specified pursuant to Section 4.6(a)(xi) with respect to such
Distribution Date.
"Expected Final Payment Date" shall mean the [ ] Distribution Date.
"Floating Allocation Percentage" shall mean, with respect to any Collection
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Invested Amount as of the last day of
the immediately preceding Collection Period and the denominator of which is the
Unconcentrated Pool Balance as of such last day; provided, however, for the
Collection Period in which the Closing Date occurs, the Floating Allocation
Percentage shall mean the percentage equivalent of a fraction, the numerator of
which is the sum of the initial principal balances of the Series [ ]
Certificates and the denominator of which is the Unconcentrated Pool Balance on
the last day of the Collection Period immediately preceding the Closing Date.
"Initial Invested Amount" shall equal the sum of the Class A Initial
Invested Amount, the Class B Initial Invested Amount and the Class C Initial
Invested Amount.
"Interest Funding Account" shall have the meaning specified in Section
4.4(b).
"Interest Period" shall mean, with respect to any Distribution Date, the
period from and including the Distribution Date immediately preceding such
Distribution Date (or, in the case of the first Distribution Date, from and
including the Closing Date) to but excluding such Distribution Date.
"Invested Amount" shall mean, for any date, the sum of the Class A Invested
Amount, the Class B Invested Amount and the Class C Invested Amount.
"Investment Proceeds" shall mean, with respect to any Distribution Date,
all interest and other investment earnings (net of losses and investment
expenses) on the related Determination Date on funds on deposit in the
Series [ ] Accounts, together with an amount equal to the Series [ ] Allocation
Percentage of the interest and other investment earnings (net of losses and
investment expenses) on funds held in the Collection Account credited as of the
related Determination Date to the Collection Account pursuant to Section 4.2 of
the Agreement.
"Investor Default Amount" shall mean, with respect to any Distribution
Date, an amount equal to the product of (a) the Defaulted Amount for the related
Collection Period, after giving effect to any allocation of any portion of that
Defaulted Amount to the Dealer Overconcentration Series, and (b) the Floating
Allocation Percentage for the related Collection Period.
"Investor Non-Principal Collections" shall mean, with respect to any
Distribution Date, an amount equal to the product of (i) the Floating Allocation
Percentage for the related Collection Period and (ii) Non-Principal Collections
deposited in the Collection Account for the related Collection Period after
giving effect to any allocations to the Dealer Overconcentration Series for such
Collection Period.
"Investor Principal Collections" shall mean, with respect to any
Distribution Date, the sum of (a) the product of (i) the Floating Allocation
Percentage, with respect to the Revolving
8
Period, or the Principal Allocation Percentage, with respect to the Accumulation
Period or an Early Amortization Period, for the related Collection Period (or
the portion of the Collection Period which occurs as part of the first
Collection Period during an Early Amortization Period), and (ii) Principal
Collections for the related Collection Period after giving effect to any
allocations to the Dealer Overconcentration Series for such Collection Period
and (b) the amount, if any, of Non-Principal Collections to be allocated with
respect to the Investor Default Amount or unreimbursed Class A, Class B or Class
C Investor Charge-Offs pursuant to Section 4.6(a)(vi) or 4.6(a)(vii); provided
that in the case of clause (a), if for any Distribution Date the sum of the
Floating Allocation Percentage (if the Revolving Period is in effect), the
Principal Allocation Percentage (if the Early Amortization Period or the
Accumulation Period is in effect), the floating allocation percentages for all
other outstanding Series of Investor Certificates in their revolving periods and
the principal allocation percentages for all other outstanding Series of
Investor Certificates in their early amortization or accumulation periods
exceeds 100%, then, after giving effect to any allocations to the Dealer
Overconcentration Series, Principal Collections shall be allocated among all
Series (including Series [ ]) pari passu and pro rata on the basis of such
floating allocation percentages and principal allocation percentages.
"LIBOR" shall mean, with respect to any Interest Period, the offered rates
for deposits in United States dollars having a maturity of one month (the "Index
Maturity") commencing on the related Adjustment Date which appears on the
Telerate Page 3750 as of approximately 11:00 A.M., London time, on the date of
calculation as determined by the Trustee. If at least two such offered rates
appear on the Telerate Page 3750, LIBOR shall be the arithmetic mean (rounded
upwards, if necessary, to the nearest one-sixteenth of a percent) of such
offered rates. If fewer than two such offered rates appear, LIBOR with respect
to such Interest Period shall be determined at approximately 11:00 A.M., London
time, on such Adjustment Date on the basis of the rate at which deposits in
United States dollars having the Index Maturity are offered to prime banks in
the London interbank market by four major banks in the London interbank market
selected by the Trustee and in a principal amount equal to an amount of not less
than U.S. $1,000,000 and that is representative for a single transaction in such
market at such time. The Trustee shall request the principal London office of
each of such banks to provide a quotation of its rate. If at least two such
banks quote rates to the Trustee, LIBOR shall be the arithmetic mean (rounded
upwards, if necessary, as aforesaid) of such quotations. If fewer than two of
such banks quote rates to the Trustee, LIBOR with respect to such Interest
Period shall be the arithmetic mean (rounded upwards as aforesaid) of the rates
quoted at approximately 11:00 A.M., New York City time, on such Adjustment Date
by three major banks in New York, New York selected by the Trustee for loans in
United States dollars to leading European banks having the Index Maturity and in
a principal amount equal to an amount of not less than U.S. $1,000,000 and that
is representative for a single transaction in such market at such time;
provided, however, that if the banks selected as aforesaid are not providing
quotations as mentioned in this sentence, LIBOR in effect for the applicable
period shall be LIBOR in effect for the previous period. If any Certificates are
listed on the Luxembourg Stock Exchange, then, on or prior to each Distribution
Date, the Trustee shall cause the Listing Agent (pursuant to a listing agency
agreement between the Trustee and the Listing Agent which is mutually
satisfactory to the Servicer, the Trustee and the Listing Agent) to notify the
Luxembourg Stock Exchange of the interest rates applicable to such Certificates
for the Interest Period commencing on such Distribution Date.
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"Listing Agent" shall mean, if the Class A Certificates or Class B
Certificates are listed on the Luxembourg Stock Exchange, Kredietbank S.A.
Luxembourgeoise, as additional Paying Agent and additional Transfer Agent and
Registrar in Luxembourg for the Class A Certificates and the Class B
Certificates, or any successor thereto.
"London Business Day" shall mean any business day on which dealings in
deposits in United States dollars are transacted in the London interbank market.
"Monthly Interest" shall have the meaning specified in Section 4.2.
"Monthly Principal" shall have the meaning specified in Section 4.3.
"Monthly Servicing Fee" shall have the meaning specified in Section 3.1.
"Net Receivables Rate" shall mean, with respect to each Distribution Date
immediately following an Interest Period, (i) the weighted average of the
interest rates borne by the Receivables during the second Collection Period
preceding such Distribution Date (interest payments on the Receivables at such
rates being due and payable in the Collection Period preceding such Distribution
Date) plus (ii) the product of (x) the Monthly Payment Rate for the Collection
Period preceding such Distribution Date, (y) the Discount Factor for such
Distribution Date and (z) twelve less (iii) 2% per annum, unless the Monthly
Servicing Fee has been waived in whole or in part for such Distribution Date, in
which case, solely for that Distribution Date, "2% per annum" will be deemed to
be replaced by "0% per annum".
"Principal Allocation Percentage" shall mean, with respect to any
Collection Period, the percentage equivalent (which percentage shall never
exceed 100%) of a fraction, the numerator of which is the Invested Amount as of
the last day of the Revolving Period and the denominator of which is the
Unconcentrated Pool Balance as of the last day of the immediately preceding
Collection Period.
"Principal Funding Account" shall have the meaning specified in Section
4.4(c).
"Private Holder" shall mean each holder of a right to receive interest or
principal in respect of any direct or indirect interest in the Trust, including
any financial instrument or contract the value of which is determined in whole
or part by reference to the Trust (including the Trust's assets, income of the
Trust or distributions made by the Trust), excluding any interest in the Trust
represented by any Series or Class of Certificates or any other interests as to
which the Trustee has received an Opinion of Counsel to the effect that such
Series, Class or other interest shall be treated as debt or otherwise not as an
equity interest in either the Trust or the Receivables for federal income tax
purposes (unless such interest is convertible or exchangeable into an interest
in the Trust or the Trust's income or such interest provides for payment of
equivalent value). Notwithstanding the immediately preceding sentence, "Private
Holder" shall also include any other Person that the Seller determines is a
"partner" within the meaning of Section 1.7704-1(h)(1)(ii) of the U.S. Treasury
Regulations (including by reason of Section 1.7704-1(h)(3)) or any successor
provision of law. Any Person holding more than one interest in the Trust, each
of which separately would cause such Person to be a Private Holder, shall be
treated as a single Private Holder. Each holder of an interest in a Private
Holder which is a partnership, S corporation or a grantor trust under the
Internal Revenue Code shall be treated as a
10
Private Holder unless excepted with the consent of the Seller (which consent
shall be based on an Opinion of Counsel generally to the effect that the action
taken pursuant to the consent shall not cause the Trust to become a publicly
traded partnership treated as a corporation). Notwithstanding anything to the
contrary herein, each Class C Certificateholder shall be considered to be a
Private Holder.
"Reassignment Amount" shall mean, with respect to any Distribution Date,
after giving effect to any deposits and distributions otherwise to be made on
such Distribution Date, the sum of (i) the Invested Amount on such Distribution
Date and (ii) the amounts distributable pursuant to Section 4.7(a)(i).
"Required Participation Percentage" shall mean, with respect to Series [ ],
105%; provided, however, that the Seller may, upon 10 days' prior notice to the
Trustee, each Rating Agency and any Enhancement Provider, reduce the Required
Participation Percentage to a percentage which shall not be less than 100%;
provided, however, that the Rating Agency Condition is satisfied.
"Reserve Fund" shall have the meaning specified in Section 4.4(a).
"Reserve Fund Deposit Amount" shall mean, with respect to any Distribution
Date, the amount, if any, by which (i) the Reserve Fund Required Amount for such
Distribution Date exceeds (ii) the amount of funds in the Reserve Fund after
giving effect to any withdrawals therefrom on such Distribution Date.
"Reserve Fund Required Amount" shall mean, with respect to any Distribution
Date, an amount equal to the product of (a) three and one-half percent (3.5%)
and (b) the aggregate outstanding principal balance of the Series [ ]
Certificates as of such Distribution Date (after giving effect to any changes
therein on such Distribution Date).
"Revolving Period" shall mean the period beginning at the opening of
business on the Closing Date and ending on the earlier of (a) the close of
business on the day immediately preceding the Accumulation Period Commencement
Date, and (b) the close of business on the day an Early Amortization Period
commences; provided, however, that, if any Early Amortization Period ends as
described in clause (c) of the definition of Early Amortization Period in the
Agreement, the Revolving Period shall recommence as of the close of business on
the day such Early Amortization Period ends.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Series [ ]" or the "Series [ ] Certificates" shall mean the Series of
Investor Certificates, the terms of which are specified in this Series
Supplement.
"Series [ ] Accounts" shall have the meaning specified in Section 4.4(f).
"Series [ ] Allocation Percentage" for a Collection Period shall mean the
percentage equivalent of a fraction, the numerator of which is the Invested
Amount on the last Business Day of the Collection Period immediately preceding
such Collection Period and the denominator of which is the Trust Invested Amount
on such last Business Day.
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"Series [ ] Certificateholders" shall mean, collectively, the Class A
Certificateholders, the Class B Certificateholders and the Class C
Certificateholders.
"Series [ ] Certificateholders' Interest" shall mean that portion of the
Certificateholders' Interest evidenced by the Series [ ] Certificates.
"Series [ ] Certificates" shall mean, collectively, the Class A
Certificates, the Class B Certificates and the Class C Certificates.
"Series [ ] Excess Principal Collection" shall mean that portion of Excess
Principal Collections allocated to Series [ ] pursuant to Section 4.11.
"Series [ ] Principal Shortfall" with respect to any Distribution Date,
shall equal the excess of (i) (x) for any Distribution Date with respect to the
Accumulation Period, the Controlled Deposit Amount or (y) for any Distribution
Date with respect to an Early Amortization Period, the Invested Amount, over
(ii) Available Investor Principal Collections for such Distribution Date
(excluding any portion thereof attributable to Excess Principal Collections).
"Servicer Advance" shall have the meaning specified in Section 3.2.
"Servicing Fee Rate" shall mean, with respect to Series [ ], two percent
(2%).
"Special Payment Date" shall mean each Distribution Date with respect to an
Early Amortization Period (other than an Early Amortization Period that has
ended as described in clause (c) of the definition of Early Amortization Period
in the Agreement).
"Telerate Page 3750" shall mean the display designated as page 3750 on
Telerate (or such other page as may replace such page on that service for the
purpose of displaying London interbank offered rates of major banks).
"Termination Date" for Series [ ] shall mean the [ ] Distribution Date.
"Termination Proceeds" shall mean any proceeds arising out of a sale of
Receivables (or interests therein) pursuant to Section 12.2(c) of the Agreement
with respect to Series [ ].
"Yield Supplement Account" shall have the meaning specified in Section
4.4(e).
"Yield Supplement Account Deposit Amount" shall mean, with respect to any
Distribution Date, the amount, if any, by which the Yield Supplement Account
Required Amount exceeds the amount on deposit in the Yield Supplement Account
after giving effect to any withdrawals from the Yield Supplement Account on that
Distribution Date.
"Yield Supplement Account Required Amount" shall mean an amount equal to
one-half of one percent (0.5%) of the aggregate initial principal balance of the
Series [ ] Certificates.
(b) Notwithstanding anything to the contrary in this Series Supplement or
the Agreement, the term "Rating Agency" shall mean, whenever used in this Series
Supplement or
12
the Agreement with respect to Series [ ], Standard & Poor's, Xxxxx'x and Fitch.
As used in this Series Supplement and in the Agreement with respect to Series
[ ], "highest investment category" shall mean (i) in the case of Standard &
Poor's, AAA and A-1+, as applicable, (ii) in the case of Xxxxx'x, Aaa and P-1,
as applicable, and (iii) in the case of Fitch, AAA and F-1+, as applicable.
(c) All capitalized terms used herein and not otherwise defined herein have
the meanings ascribed to them in the Agreement. The definitions in Section 2.1
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.
(d) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Series Supplement shall refer to this Series Supplement
as a whole and not to any particular provision of this Series Supplement;
references to any Article, Section or Exhibit are references to Articles,
Sections and Exhibits in or to this Series Supplement unless otherwise
specified; and the term "including" means "including without limitation".
(e) All references to any agreement (including the Agreement) shall be
understood to be references to such agreement as it may be amended, amended and
restated or otherwise modified from time to time.
ARTICLE III
Servicing Fee
SECTION 3.1 Servicing Compensation. A monthly servicing fee for your series
(the "Monthly Servicing Fee") shall be payable to the Servicer, in arrears, on
each Distribution Date in respect of any Collection Period (or portion thereof)
occurring prior to the first Distribution Date on which the Invested Amount is
zero, in an amount equal to one-twelfth of the product of (a) the Servicing Fee
Rate and (b) the product of (i) the Series [ ] Allocation Percentage and (ii)
the Pool Balance as of the last day of the second Collection Period preceding
such Distribution Date. The share of the Monthly Servicing Fee allocable to the
Series [ ] Certificateholders with respect to any Distribution Date (the
"Certificateholders' Monthly Servicing Fee") shall be equal to one-twelfth of
the product of (a) the Servicing Fee Rate and (b) the Invested Amount as of the
last day of the second Collection Period second preceding such Distribution Date
and shall be payable in the manner set forth in Section 4.6 and Section 4.10;
provided, however, that with respect to the first Distribution Date for Series
[ ], clause (b) of this sentence shall be deemed to refer to the Invested Amount
on the Closing Date. Notwithstanding the foregoing, with respect to the first
Distribution Date for Series [ ], each reference in the preceding sentences of
this Section to one-twelfth shall be deemed to be replaced by a fraction, the
numerator of which is the number of days from but excluding the Closing Date to
and including the last day of the month in which the Closing Date occurs and the
denominator of which is 360.
The remainder of the Monthly Servicing Fee shall be paid by the Seller and
in no event shall the Trust, the Trustee or the Series [ ] Certificateholders be
liable for the share of the Monthly Servicing Fee to be paid by the Seller; and
the remainder of the Servicing Fee shall be paid by the Seller and the Investor
Certificateholders of other Series, the Trustee and the Series [ ]
13
Certificateholders shall in no event be liable for the share of the Servicing
Fee to be paid by the Seller or the Investor Certificateholders of other Series.
The Certificateholders' Monthly Servicing Fee shall be payable to the Servicer
solely to the extent amounts are available for distribution in accordance with
the terms of this Series Supplement or to the extent that amounts may be netted
with respect thereto in accordance with the terms of this Series Supplement or
the Agreement.
The Servicer shall be permitted, in its sole discretion, to waive the
Monthly Servicing Fee for any Distribution Date, in whole or in part, by notice
to the Trustee on or before the related Determination Date; provided that the
Servicer reasonably believes that sufficient Non-Principal Collections shall be
available on any future Distribution Date to pay the waived portion of Monthly
Servicing Fee. The waived portion of such Monthly Servicing Fee shall be paid on
a future Distribution Date to the extent amounts are available therefor pursuant
to Section 4.10(a) or to the extent that amounts may be netted with respect
thereto in accordance with the terms of this Series Supplement or the Agreement;
provided, however, that, to the extent any such waived Monthly Servicing Fee is
so paid, the related portion of the Monthly Servicing Fee to be paid by the
Seller shall be paid by the Seller to the Servicer.
If the Servicer is CDF, and payment of any portion of the Monthly Servicing
Fee to CDF on a Distribution Date would require a withdrawal from the Reserve
Fund, then absent affirmative notice to the Trustee by CDF to the contrary, CDF
shall be deemed to have waived payment of that portion on that Distribution
Date; provided that a deemed waiver described in this sentence shall not occur
on more than two Distribution Dates in any twelve month period and shall not
occur on any two consecutive Distribution Dates.
SECTION 3.2 Servicer Advances. On or before each Distribution Date, the
Servicer will deposit into the Collection Account as an advance (a "Servicer
Advance") an amount equal to the amount of interest due but unpaid on any
Receivable for the related Collection Period (but only to the extent that the
Servicer reasonably expects to recover that Servicer Advance from subsequent
payments on that delinquent Receivable). No Servicer Advance shall be made by
the Servicer for the principal portion of the Receivables or for Defaulted
Receivables. The Servicer shall reimburse itself for a Servicer Advance on the
subsequent Determination Date or Distribution Date (and, if necessary, on other
Determination Dates or Distribution Dates) out of funds collected on all
Receivables prior to the deposit of funds in the Collection Account.
ARTICLE IV
Rights of Series [ ] Certificateholders and
Allocation and Application of Collections
SECTION 4.1 Allocations; Payments to Seller. (a) Subject to Section 4.3(c)
of the Agreement, and after giving effect to any allocations to the Dealer
Overconcentration Series, Collections of Non-Principal Receivables and Principal
Receivables, Miscellaneous Payments and Defaulted Amounts, as they relate to
Series [ ], shall be allocated and distributed as set forth in this Article IV.
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(b) The Servicer shall instruct the Trustee to withdraw from the Collection
Account and pay (and the Trustee shall so withdraw and pay) to the Seller on
each Deposit Date any funds not required to be held therein (or not required to
be transferred from the Collection Account to a deposit account for the benefit
of Investor Certificateholders of any Series).
The withdrawals to be made from the Collection Account pursuant to this
Section 4.1(b) do not apply to deposits into the Collection Account that do not
represent Collections, including Miscellaneous Payments, payment of the purchase
price for the Certificateholders' Interest pursuant to Section 2.3 of the
Agreement, payment of the purchase price for the Series [ ] Certificateholders'
Interest pursuant to Section 7.1 of this Series Supplement and proceeds from the
sale, disposition or liquidation of Receivables pursuant to Section 9.2 or 12.2
of the Agreement.
SECTION 4.2 Monthly Interest; Determination of Certificate Rate. (a)
"Monthly Interest" with respect to the Series [ ] Certificates on any
Distribution Date shall be an amount equal to the sum of the Class A Monthly
Interest, the Class B Monthly Interest and the Class C Monthly Interest.
Interest on the respective outstanding principal balance of each Class of
Certificates shall accrue at the Class A Certificate Rate, Class B Certificate
Rate or Class C Certificate Rate, as applicable, and shall be payable to
Certificateholders on each Distribution Date.
On the Determination Date preceding each Distribution Date, the Servicer
shall determine the excess, if any (the "Class A Interest Shortfall"), of (x)
the Class A Monthly Interest for the Interest Period applicable to such
Distribution Date over (y) the amount which shall be available to be paid to the
Class A Certificateholders as Class A Monthly Interest from the Interest Funding
Account on such Distribution Date pursuant to this Series Supplement. "Class A
Additional Interest" shall mean, as of any Distribution Date, an amount equal to
the product of (i) the Class A Certificate Rate for the Interest Period then
ended, (ii) a fraction the numerator of which is the actual number of days in
that Interest Period and the denominator of which is 360, and (iii) the Class A
Interest Shortfall, if any, for the previous Distribution Date. Notwithstanding
anything to the contrary herein, Class A Additional Interest shall be payable to
the Interest Funding Account or distributed to Class A Certificateholders only
to the extent permitted by applicable law.
On the Determination Date preceding each Distribution Date, the Servicer
shall determine the excess, if any (the "Class B Interest Shortfall"), of (x)
the Class B Monthly Interest for the Interest Period applicable to such
Distribution Date over (y) the amount which shall be available to be paid to the
Class B Certificateholders as Class B Monthly Interest from the Interest Funding
Account on such Distribution Date pursuant to this Series Supplement. "Class B
Additional Interest" shall mean, as of any Distribution Date, an amount equal to
the product of (i) the Class B Certificate Rate for the Interest Period then
ended, (ii) a fraction the numerator of which is the actual number of days in
that Interest Period and the denominator of which is 360, and (iii) the Class B
Interest Shortfall, if any, for the previous Distribution Date. Notwithstanding
anything to the contrary herein, Class B Additional Interest shall be payable to
the Interest Funding Account or distributed to Class B Certificateholders only
to the extent permitted by applicable law.
15
On the Determination Date preceding each Distribution Date, the
Servicer shall determine the excess, if any (the "Class C Interest Shortfall"),
of (x) the Class C Monthly Interest for the Interest Period applicable to such
Distribution Date over (y) the amount which shall be available to be paid to the
Class C Certificateholders as Class C Monthly Interest from the Interest Funding
Account on such Distribution Date pursuant to this Series Supplement. "Class C
Additional Interest" shall mean, as of any Distribution Date, an amount equal to
the product of (i) the Class C Certificate Rate for the Interest Period then
ended, (ii) a fraction the numerator of which is the actual number of days that
Interest Period and the denominator of which is 360, and (iii) such Class C
Interest Shortfall, if any, for the previous Distribution Date. Notwithstanding
anything to the contrary herein, Class C Additional Interest shall be payable to
the Interest Funding Account or distributed to Class C Certificateholders only
to the extent permitted by applicable law.
(b) The Distribution Date Statement shall specify the applicable Net
Receivables Rate for the next Interest Period. Based on such Distribution Date
Statement (and on the Trustee's calculation of LIBOR) the Trustee shall
determine the Class A, Class B and Class C Certificate Rates for each Interest
Period on the Determination Date immediately preceding each Interest Period. The
Trustee shall notify the Servicer and the Listing Agent on each Adjustment Date
of the Trustee's determination of LIBOR. The establishment of LIBOR on each
Adjustment Date (or in the case of the date specified in the proviso to the
definition of Adjustment Date, promptly following such date) by the Trustee and
the Trustee's calculation of the Class A, Class B and Class C Certificate Rates
shall (in the absence of manifest error) be final and binding.
SECTION 4.3 Determination of Monthly Principal. The amount of monthly
principal ("Monthly Principal") distributable with respect to the Series [ ]
Certificates on each Distribution Date with respect to an Early Amortization
Period and the Accumulation Period shall be equal to the Available Investor
Principal Collections with respect to such Distribution Date; provided, however,
that for each Distribution Date with respect to the Accumulation Period, Monthly
Principal, at the option of the Seller, may be increased to include amounts
otherwise payable or distributable to the Seller (including without limitation
(i) amounts allocable to other Series but not required to be paid to such other
Series on such Distribution Date and not required to be kept in a deposit
account for such other Series after such Distribution Date and (ii) Collections
otherwise allocable to the Seller's Interest)) or may be limited to the
Controlled Deposit Amount for such Distribution Date; and provided further,
however, that Monthly Principal shall not exceed the outstanding principal
balance of the Series [ ] Certificates.
SECTION 4.4 Establishment of Reserve Fund and Funding Accounts. (a)(i) The
Trustee, for the benefit of the Series [ ] Certificateholders, shall cause to be
established and maintained in the name of the Trustee, on behalf of the Trust,
an Eligible Deposit Account (the "Reserve Fund") which shall be identified as
the "Reserve Fund for the Distribution Financial Services Floorplan Master
Trust, Series [ ]" and shall bear a designation clearly indicating that the
funds deposited therein are held for the benefit of the Series [ ]
Certificateholders.
(ii) At the direction of the Servicer, funds on deposit in the Reserve
Fund shall be invested by the Trustee in Eligible Investments selected by
the Servicer that shall mature so that such funds shall be available at the
close of business on or before the
16
Business Day next preceding the following Distribution Date. All Eligible
Investments shall be held by the Trustee for the benefit of the Series [ ]
Certificateholders. On each Distribution Date, all interest and other
investment earnings (net of losses and investment expenses) on funds on
deposit in the Reserve Fund and received prior to such Distribution Date
shall be applied as set forth in Section 4.6(a) of this Series Supplement.
Funds deposited in the Reserve Fund on the Business Day preceding a
Distribution Date are not required to be invested overnight.
(b) (i) The Trustee, for the benefit of the Series [ ] Certificateholders,
shall establish and maintain in the name of the Trustee, on behalf of the Trust,
an Eligible Deposit Account (the "Interest Funding Account"), which shall be
identified as the "Interest Funding Account for the Distribution Financial
Services Floorplan Master Trust, Series [ ]" and shall bear a designation
clearly indicating that the funds deposited therein are held for the benefit of
the Series [ ] Certificateholders.
(ii) At the direction of the Servicer, funds on deposit in the
Interest Funding Account shall be invested by the Trustee in Eligible
Investments selected by the Servicer that shall mature so that such funds
shall be available at the close of business on or before the Business Day
next preceding the following Distribution Date. All such Eligible
Investments shall be held by the Trustee for the benefit of the Series [ ]
Certificateholders. On each Distribution Date, all interest and other
investment earnings (net of losses and investment expenses) on funds on
deposit in the Interest Funding Account and received prior to such
Distribution Date shall be applied as set forth in Section 4.6(a) of this
Series Supplement. Funds deposited in the Interest Funding Account on the
Business Day preceding a Distribution Date are not required to be invested
overnight.
(c) (i) The Trustee, for the benefit of the Series [ ] Certificateholders,
shall establish and maintain in the name of the Trustee, on behalf of the Trust,
an Eligible Deposit Account (the "Principal Funding Account"), which shall be
identified as the "Principal Funding Account for Distribution Financial Services
Floorplan Master Trust, Series [ ]" and shall bear a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Series [ ] Certificateholders.
(ii) At the direction of the Servicer, funds on deposit in the
Principal Funding Account shall be invested by the Trustee in Eligible
Investments selected by the Servicer that shall mature so that such funds
shall be available at the close of business on or before the Business Day
next preceding the following Distribution Date. All such Eligible
Investments shall be held by the Trustee for the benefit of the Series [ ]
Certificateholders. On each Distribution Date all interest and other
investment earnings (net of losses and investment expenses) on funds on
deposit in the Principal Funding Account and received prior to such
Distribution Date shall be applied as set forth in Section 4.6(a) of this
Series Supplement. Funds deposited in the Principal Funding Account on the
Business Day preceding the Expected Final Payment Date are not required to
be invested overnight.
17
(d) (i) The Trustee, for the benefit of the Series [ ] Certificateholders,
shall establish and maintain in the name of the Trustee, on behalf of the Trust,
an Eligible Deposit Account (the "Excess Funding Account"), which shall be
identified as the "Excess Funding Account for Distribution Financial Services
Floorplan Master Trust, Series [ ]" and shall bear a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Series [ ] Certificateholders.
(ii) At the direction of the Servicer, funds on deposit in the Excess
Funding Account shall be invested by the Trustee in Eligible Investments
selected by the Servicer. All such Eligible Investments shall be held by
the Trustee for the benefit of the Series [ ] Certificateholders. On each
Distribution Date, all interest and other investment earnings (net of
losses and investment expenses) on funds on deposit in the Excess Funding
Account and received prior to such Distribution Date shall be applied as
set forth in Section 4.6(a) of this Series Supplement. Funds deposited in
the Excess Funding Account on any Distribution Date shall be invested in
Eligible Investments that shall mature so that such funds shall be
available on or before the close of business on the Business Day next
preceding the following Distribution Date; provided that if, pursuant to
Section 4.12, deposits to and withdrawals from the Excess Funding Account
are being made on a weekly or daily basis, then such Eligible Investments
shall mature on each Business Day on a weekly or daily basis, as the case
may be; provided further that such Eligible Investments shall still mature
so that funds shall be available on or before the close of business on the
Business Day next preceding the following Distribution Date. Funds
deposited in the Excess Funding Account on the Business Day preceding a
Distribution Date are not required to be invested overnight.
(e) (i) The Trustee, for the benefit of the Series [ ] Certificateholders,
shall establish and maintain in the name of the Trustee, on behalf of the Trust,
an Eligible Deposit Account (the "Yield Supplement Account"), which shall be
identified as the "Yield Supplement Account for the Distribution Financial
Services Floorplan Master Trust, Series [ ]" and shall bear a designation
clearly indicating that the funds deposited therein are held for the benefit of
the Series [ ] Certificateholders.
(ii) At the direction of the Servicer, funds on deposit in the Yield
Supplement Account shall be invested by the Trustee in Eligible Investments
selected by the Servicer that shall mature so that such funds shall be
available at the close of business on or before the Business Day next
preceding the following Distribution Date. All such Eligible Investments
shall be held by the Trustee for the benefit of the Series [ ]
Certificateholders. On each Distribution Date, all interest and other
investment earnings (net of losses and investment expenses) on funds on
deposit in the Yield Supplement Account and received prior to such
Distribution Date shall be applied as set forth in Section 4.6(a) of this
Series Supplement. Funds deposited in the Yield Supplement Account on the
Business Day preceding a Distribution Date are not required to be invested
overnight.
(f) (i) The Trustee shall possess all right, title and interest in and to
all funds on deposit from time to time in, and all Eligible Investments credited
to, the Reserve Fund, the Interest Funding Account, the Principal Funding
Account, the Yield Supplement Account and
18
the Excess Funding Account (collectively, the "Series [ ] Accounts") and in all
proceeds thereof. The Series [ ] Accounts shall be under the sole dominion and
control of the Trustee for the benefit of the Certificateholders. If, at any
time, any of the Series [ ] Accounts ceases to be an Eligible Deposit Account,
the 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 Series [ ] Account meeting the conditions
specified in paragraph (a)(i), (b)(i), (c)(i), (d)(i) or (e)(i) above, as
applicable, as an Eligible Deposit Account and shall transfer any cash and/or
investments to such new Series [ ] Account. Neither the Seller, the Servicer nor
any other Person or entity claiming by, through or under the Seller, the
Servicer or any such other Person or entity shall have any right, title or
interest in, or any right to withdraw any amount from, any Series [ ] Account,
except as expressly provided herein. Schedule 1, which is hereby incorporated
into and made part of this Series Supplement, identifies each Series [ ] Account
by setting forth the account number of each such account, the account
designation of each such account and the name of the institution with which such
account has been established. If a substitute Series [ ] Account is established
pursuant to this Section, the Servicer shall provide to the Trustee an amended
Schedule 1, setting forth the relevant information for such substitute Series
[ ] Account.
(ii) Pursuant to the authority granted to the Servicer in Section
3.1(a) of the Agreement, the Servicer shall have the power, revocable by
the Trustee, to make withdrawals and payments or to instruct the Trustee to
make withdrawals and payments from the Series [ ] Accounts for the purposes
of carrying out the Servicer's or the Trustee's duties hereunder.
(g) Unless otherwise agreed to by the Rating Agencies, at no time may funds
on deposit in any Series [ ] Account in an amount greater than 10% of the
outstanding principal balance of the Certificates be invested in Eligible
Investments (other than obligations of the United States government or
investments in a mutual fund that does not have credit concentrations greater
than 10%) of any single entity or its Affiliates.
(h) Upon payment in full of all amounts payable on the Series [ ]
Certificates pursuant to this Series Supplement, or any earlier date
contemplated by this Series Supplement, any funds remaining on deposit in any
Series [ ] Account shall be paid to the Seller.
SECTION 4.5 Deficiency Amount. On each Determination Date, with respect to
the related Distribution Date (the "current Distribution Date"), the Servicer
shall determine the amount (the "Deficiency Amount"), if any, by which
(a) the sum of
(i) the Monthly Interest for the current Distribution Date,
(ii) any Monthly Interest for any prior Distribution Dates not
distributed to the Certificateholders on a prior Distribution Date,
(iii) Additional Interest, if any, for the current Distribution
Date and any Additional Interest for any prior Distribution Date not
distributed
19
to the Certificateholders on such prior Distribution Date (but only to
the extent permitted by applicable law),
(iv) the Certificateholders' Monthly Servicing Fee for the
current Distribution Date,
(v) the Investor Default Amount for the current Distribution
Date, and
(vi) the Series [ ] Allocation Percentage of the amount of any
Adjustment Payment required to be deposited in the Collection Account
pursuant to Section 3.9(a) of the Agreement with respect to the
related Collection Period that has not been so deposited as of such
Determination Date
exceeds
(b) the sum of Investor Non-Principal Collections for the current
Distribution Date plus any Investment Proceeds, if any, with respect to
such Distribution Date.
SECTION 4.6 Application of Investor Non-Principal Collections, Investment
Proceeds, Servicer Advances and Available Investor Principal Collections. The
Servicer shall direct the Trustee (by setting forth the following amounts in the
related Distribution Date Statement) to make the following distributions on each
Distribution Date (and the Trustee shall distribute):
(a) On each Distribution Date, an amount equal to the sum of Investor
Non-Principal Collections on deposit in the Collection Account (after giving
effect to repayment to the Servicer of any Servicer Advances from any previous
Distribution Dates) and any Investment Proceeds and the Servicer Advance, if
any, for such Distribution Date, with respect to such Distribution Date in the
following priority:
(i) first, an amount equal to the Class A Monthly Interest for such
Distribution Date, plus the amount of any Class A Monthly Interest for any
prior Distribution Dates not distributed to the Class A Certificateholders
on such prior Distribution Dates plus (but only to the extent permitted
under applicable law) the amount of any Class A Additional Interest for the
current Distribution Date and, without duplication, any Class A Additional
Interest previously due but not distributed to the Class A
Certificateholders on prior Distribution Dates, shall be deposited to the
Interest Funding Account;
(ii) second, an amount equal to the Class B Monthly Interest for such
Distribution Date, plus the amount of any Class B Monthly Interest for any
prior Distribution Dates not distributed to the Class B Certificateholders
on such prior Distribution Dates plus (but only to the extent permitted
under applicable law) the amount of any Class B Additional Interest for the
current Distribution Date and, without duplication, any Class B Additional
Interest previously due but not distributed to the
20
Class B Certificateholders on prior Distribution Dates, shall be deposited
to the Interest Funding Account;
(iii) third, an amount equal to the Class C Monthly Interest for such
Distribution Date, plus the amount of any Class C Monthly Interest for any
prior Distribution Dates not distributed to the Class C Certificateholders
on such prior Distribution Dates plus (but only to the extent permitted
under applicable law) the amount of any Class C Additional Interest for the
current Distribution Date and, without duplication any Class C Additional
Interest previously due but not distributed to the Class C
Certificateholders on prior Distribution Dates, shall be deposited to the
Interest Funding Account;
(iv) fourth, so long as CDF is not the Servicer, an amount equal to
the Certificateholders' Monthly Servicing Fee for such Distribution Date
shall be distributed to the Servicer (unless such amount has been netted
against deposits to the Collection Account);
(v) fifth, an amount equal to the Reserve Fund Deposit Amount, if any,
for such Distribution Date shall be deposited in the Reserve Fund;
(vi) sixth, an amount equal to the Investor Default Amount, if any,
for such Distribution Date shall be treated as a portion of Investor
Principal Collections for such Distribution Date;
(vii) seventh, an amount required to reimburse unreimbursed Class A
Investor Charge-Offs, Class B Investor Charge-Offs and Class C Investor
Charge-Offs pursuant to Section 4.9 shall be treated as a portion of
Investor Principal Collections for such Distribution Date;
(viii) eighth, so long as CDF is the Servicer, an amount equal to the
Certificateholders' Monthly Servicing Fee for that Distribution Date shall
be distributed to the Servicer, unless that amount has been netted against
deposits to the Collection Account by CDF or waived;
(ix) ninth, any unpaid Class A Carry-over Amount, Class B Carry-over
Amount or Class C Carry-over Amount for any previous Distribution Date,
plus to the extent permitted under applicable law, the amount of any Class
A Carry-over Amount Additional Interest, Class B Carry-over Amount
Additional Interest and Class C Carry-over Amount Additional Interest for
the current Distribution Date and, without duplication, any Class A
Carry-over Amount Additional Interest, Class B Carry-over Amount Additional
Interest and Class C Carry-over Amount Additional Interest previously due
but not distributed to the Class A Certificateholders, Class B
Certificateholders and Class C Certificateholders, respectively, shall be
deposited in the Interest Funding Account;
(x) tenth, if that Distribution Date occurs prior to the beginning of
the Accumulation Period and prior to the occurrence of an Early
Amortization Event, an
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amount equal to the Yield Supplement Account Deposit Amount, if any, for
that Distribution Date will be deposited in the Yield Supplement Account;
and
(xi) eleventh, the balance, if any, shall constitute "Excess
Servicing" and shall be allocated and distributed as set forth in Section
4.10.
(b) On each Distribution Date with respect to the Revolving Period, the
Servicer shall direct the Trustee in writing by setting forth the following
amounts on the Distribution Date Statement to apply an amount equal to the
Available Investor Principal Collections deposited in the Collection Account for
the related Collection Period shall be applied in the following priority:
(i) first, if (A) the Unconcentrated Pool Balance at the end of the
preceding Collection Period is less than the Unconcentrated Pool Balance at
the end of the second preceding Collection Period and (B) the
Unconcentrated Pool Balance at the end of the preceding Collection Period
is less than the Required Participation Amount for such Distribution Date
(calculated before giving effect to any deposits to be made on such
Distribution Date to the Excess Funding Account and any excess funding
account for any other Series in their revolving periods to be made on such
Distribution Date), then the Servicer shall direct the Trustee to deposit
(and the Trustee shall deposit) Available Investor Principal Collections
into the Excess Funding Account in an amount which shall reduce the
Invested Amount such that, together with the deposits to the excess funding
accounts, if any, (and any resulting reductions in the invested amounts)
for other outstanding Series in their revolving periods for such
Distribution Date, the Unconcentrated Pool Balance is equal to the Required
Participation Amount, and
(ii) second, an amount equal to the balance (such balance being part
of "Excess Principal Collections"), if any, of such Available Investor
Principal Collections shall be applied in accordance with Section 4.4 of
the Agreement.
For purposes of determining the amount to be applied pursuant to subparagraph
(i) above, allocations of the amounts to be deposited in the Excess Funding
Account and the excess funding account for other outstanding Series shall be
made pro rata on the basis of the invested amounts (including the Invested
Amount for Series [ ]).
If the Servicer has elected in respect of a Collection Period to make
withdrawals from the Excess Funding Account on a daily or weekly basis pursuant
to Section 4.12(b), then deposits into the Excess Funding Account required by
this Section 4.6(b) shall be made on each Business Day in such Collection Period
(if daily withdrawals and deposits have been elected) or on each Wednesday (or
the next succeeding Business Day if such Wednesday is not a Business Day) in
such Collection Period (if weekly withdrawals and deposits have been elected).
In the case of such election, the Unconcentrated Pool Balance referred to in
clause (B) above shall be the Unconcentrated Pool Balance on the preceding
Business Day, in the case of an election to make daily deposits and withdrawals,
and on the Monday next preceding the related Wednesday, in the case of an
election to make weekly deposits and withdrawals.
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(c) On each Distribution Date (x) with respect to the Accumulation Period
or (y) an Early Amortization Period (if a Responsible Officer of the Trustee has
actual knowledge of such Early Amortization Period), an amount equal to the
Available Investor Principal Collections on deposit in the Collection Account
shall be distributed in the following priority:
(i) first, an amount equal to Monthly Principal for such Distribution
Date shall be deposited by the Servicer or the Trustee into the Principal
Funding Account; and
(ii) second, for each Distribution Date with respect to the
Accumulation Period (unless an Early Amortization Event has occurred), an
amount equal to the balance (such balance being part of "Excess Principal
Collections"), if any, of such Available Investor Principal Collections
shall be applied in accordance with the written instructions of the
Servicer in accordance with Section 4.4 of the Agreement.
SECTION 4.7 Distributions to Series [ ] Certificateholders. (a) The
Servicer shall direct the Trustee (by setting forth the amounts in Section
4.7(a)(i) in the related Distribution Date Statement) to make (and the Trustee
shall make) the following distributions at the following times from the Interest
Funding Account, the Principal Funding Account and the Excess Funding Account:
(i) on each Distribution Date, available amounts on deposit in the
Interest Funding Account shall be distributed to the Series [ ]
Certificateholders in the following order of priority:
(A) first, to the Class A Certificateholders, an amount equal to
the sum of (i) the Class A Monthly Interest for the current
Distribution Date, plus (ii) any Class A Monthly Interest that was not
distributed on any prior Distribution Date to the Class A
Certificateholders, plus (iii) to the extent permitted under
applicable law, the amount of any Class A Additional Interest for the
current Distribution Date and, without duplication, any Class A
Additional Interest previously due but not distributed to the Class A
Certificateholders;
(B) second, to the Class B Certificateholders, an amount equal to
the sum of (i) the Class B Monthly Interest for the current
Distribution Date, plus (ii) any Class B Monthly Interest that was not
distributed on any Distribution Date prior to the current Distribution
Date to the Class B Certificateholders, plus (iii) to the extent
permitted under applicable law, the amount of any Class B Additional
Interest for the current Distribution Date and, without duplication,
any Class B Additional Interest previously due but not distributed to
the Class B Certificateholders;
(C) third, to the Class C Certificateholders, an amount equal to
the sum of (i) the Class C Monthly Interest for the current
Distribution Date, plus (ii) any Class C Monthly Interest that was not
distributed on any Distribution Date prior to the current Distribution
Date to the Class C Certificateholders, plus (iii) to the extent
permitted under applicable law, the amount of any Class C Additional
Interest for the current Distribution Date and, without duplication,
any Class C
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Additional Interest previously due but not distributed to the Class C
Certificateholders;
(D) fourth, to the Class A Certificateholders, the sum of any
Class A Carry-over Amount for the current Distribution Date plus any
unpaid Class A Carry-over Amount for any previous Distribution Date
plus to the extent permitted under applicable law, the amount of any
Class A Carry-over Amount Additional Interest for the current
Distribution Date and, without duplication, any Class A Carry-over
Amount Additional Interest previously due but not distributed to the
Class A certificateholders;
(E) fifth, to the Class B Certificateholders, the sum of any
Class B Carry-over Amount for the current Distribution Date plus any
unpaid Class B Carry-over Amount for any previous Distribution Date
plus to the extent permitted under applicable law, the amount of any
Class B Carry-over Amount Additional Interest for the current
Distribution Date and, without duplication, any Class B Carry-over
Amount Additional Interest previously due but not distributed to the
Class B certificateholders; and
(F) sixth, to the Class C Certificateholders, the sum of any
Class C Carry-over Amount for the current Distribution Date plus any
unpaid Class C Carry-over Amount for any previous Distribution Date
plus to the extent permitted under applicable law, the amount of any
Class C Carry-over Amount Additional Interest for the current
Distribution Date and, without duplication, any Class C Carry-over
Amount Additional Interest previously due but not distributed to the
Class C certificateholders.
(ii) on each Special Payment Date (if a Responsible Officer of the
Trustee has actual knowledge of the Early Amortization Period) and on the
Expected Final Payment Date, all amounts on deposit in the Principal
Funding Account shall be distributed to the Series [ ] Certificateholders
in the following order of priority: (A) first, to the Class A
Certificateholders until the outstanding principal balance of the Class A
Certificates has been reduced to zero; (B) second, to the Class B
Certificateholders until the outstanding principal balance of the Class B
Certificates has been reduced to zero; and (C) to the Class C
Certificateholders until the outstanding principal balance of the Class C
Certificates has been reduced to zero; provided, however, that the maximum
amount distributed pursuant to this clause (ii) on any Distribution Date
shall not exceed the excess, if any, of (x) the sum of the outstanding
principal balance of the Class A, Class B and Class C Certificates, over
(y) the sum of the unreimbursed Class A Investor Charge-Offs, Class B
Investor Charge-Offs and Class C Investor Charge-Offs, each on such
Distribution Date.
(b) The distributions to be made pursuant to this Section are subject to
the provisions of Sections 2.3, 9.2, 10.1 and 12.2 of the Agreement and Section
8.1 and 8.2 of this Series Supplement.
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SECTION 4.8 Application of Reserve Fund. (a) If Investor Non-Principal
Collections and Investment Proceeds on any Distribution Date (plus the amount of
any Servicer Advance for such Distribution Date) are not sufficient to make the
entire distributions required on such Distribution Date by Sections 4.6(a)(i),
(ii), (iii), (iv), (vi) and (viii), the Servicer shall direct the Trustee to
withdraw (and the Trustee shall withdraw) funds from the Reserve Fund to the
extent available therein, and apply such funds to complete the distributions
pursuant to Section 4.6(a)(i), (ii), (iii), (iv), (vi) and (viii) in the
numerical order thereof.
(b) On the Termination Date, any funds in the Reserve Fund shall be treated
as Available Investor Principal Collections. Upon payment in full of the
outstanding principal balance of the Series [ ] Certificates, any funds
remaining on deposit in the Reserve Fund shall be paid to the Seller.
SECTION 4.9 Investor Charge-Offs. If on any Distribution Date (after giving
effect to the allocations, distributions, withdrawals and deposits to be made on
such Distribution Date) the balance of the Reserve Fund is zero, then the Class
C Invested Amount shall be reduced by the lesser of the Deficiency Amount for
that Distribution Date and the Investor Default Amount for that Distribution
Date (the lesser of such Deficiency Amount and such Investor Default Amount
being a "Class C Investor Charge-Off"). In the event that any such reduction of
the Class C Invested Amount would cause the Class C Invested Amount to be a
negative number, the Class C Invested Amount shall be maintained at or reduced
to zero, and the Class B Invested Amount shall be reduced by the amount of such
excess (the amount of such reduction being a "Class B Investor Charge-Off"). In
the event that any such reduction of the Class B Invested Amount would cause the
Class B Invested Amount to be a negative number, the Class B Invested Amount
shall be maintained at or reduced to zero, and the Class A Invested Amount shall
be reduced by the amount of such excess but not by more than the Class A
Invested Amount on such Distribution Date (the amount of such reduction being a
"Class A Investor Charge-Off"). Class A Investor Charge-Offs, Class B Investor
Charge-Offs and Class C Investor Charge-Offs shall thereafter be reimbursed (in
that order) and the Class A Invested Amount, Class B Invested Amount and Class C
Invested Amount increased (in that order) (but not by an amount in excess of the
aggregate unreimbursed Class A Investor Charge-Offs, Class B Investor
Charge-Offs and Class C Investor Charge-Offs, as the case may be) on any
Distribution Date by the sum of (a) Allocable Miscellaneous Payments with
respect to such Distribution Date and (b) the amount allocated and available for
that purpose pursuant to Section 4.6(a)(vii). The Servicer shall be responsible
for calculating Class A, Class B and Class C Investor Charge-Offs and shall give
the Trustee notice thereof by setting forth such amounts in the Distribution
Date Statement.
SECTION 4.10 Excess Servicing. The Servicer shall direct the Trustee to
apply (and the Trustee shall so apply), on each Distribution Date, Excess
Servicing for such Distribution Date to make the following distributions in the
following priority:
(a) an amount equal to the aggregate outstanding amounts of the
Monthly Servicing Fee which have been previously waived pursuant to Section
3.1 shall be distributed to the Servicer; and
(b) the balance, if any, shall be distributed to the Seller.
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SECTION 4.11 Excess Principal Collections.
"Series [ ] Excess Principal Collections", with respect to any Distribution
Date, shall mean an amount equal to the lesser of (a) the Series [ ] Principal
Shortfall, if any, for such Distribution Date and (b) an amount equal to the
product of (x) excess principal collections for all Series for such Distribution
Date and (y) a fraction, the numerator of which is the Series [ ] Principal
Shortfall for such Distribution Date and the denominator of which is the
aggregate amount of principal shortfalls for all Series for such Distribution
Date.
SECTION 4.12 Excess Funding Account. (a) Any funds on deposit in the Excess
Funding Account at the beginning of the Accumulation Period or upon the
occurrence of an Early Amortization Event shall be deposited in the Principal
Funding Account. In addition, no funds shall be deposited in the Excess Funding
Account during the Accumulation Period or any Early Amortization Period.
(b) If (i) on any Determination Date during the Revolving Period there are
any funds in the Excess Funding Account and (ii) the Unconcentrated Pool Balance
at the end of the preceding Collection Period is greater than the Unconcentrated
Pool Balance at the end of the second preceding Collection Period, then, subject
to the other provisions of this Section 4.12(b) and to Sections 4.12(c) and (d),
the Invested Amount and the invested amounts (but, in each case, not in excess
of the initial principal amount of such Series) for all other outstanding Series
that provide for an excess funding account or similar arrangement and are in
their revolving periods shall be increased such that, after giving effect to
such increases, the Required Participation Amount is at least equal to the
Unconcentrated Pool Balance. On such Determination Date, the Servicer shall
notify the Trustee of the amount, if any, of such increase in the Invested
Amount and the Trustee shall withdraw from the Excess Funding Account and pay to
the Seller or allocate to one or more other Series, on the immediately
succeeding Distribution Date, an amount equal to the amount of such increase in
the Invested Amount. To the extent that the Invested Amount is increased by any
payment to the Seller or any allocation to one or more other Series, the
Seller's Interest or such other Series' invested amount, as applicable, shall be
reduced by the amount of such payment. In addition, any increase in the Invested
Amount is subject to the condition that after giving effect to such increase the
Unconcentrated Pool Balance equals or exceeds the Required Participation Amount.
In connection with the foregoing, the Seller shall endeavor (taking into account
any seasonality experienced in the Accounts in the Trust) to minimize the
amounts on deposit, from time to time, in the Excess Funding Account.
The Seller may elect to make withdrawals from the Excess Funding Account
and the excess funding accounts or similar arrangements for other Series on a
daily or weekly basis during a Collection Period by giving the Trustee notice of
such election at least two Business Days and no more than five Business Days
prior to the commencement of such daily or weekly withdrawals. If such election
is made, then deposits into the Excess Funding Account and excess funding
accounts or similar arrangements for other Series shall be made on a similar
basis for the related Collection Period. If such election is for withdrawals on
a daily basis, then such withdrawals shall be made on each Business Day and the
Unconcentrated Pool Balance to be referenced shall be the Unconcentrated Pool
Balance on the next preceding Business Day. If such election is for withdrawals
on a weekly basis, then such withdrawals shall be made on each
26
Wednesday (or if such Wednesday is not a Business Day, then on the Business Day
next succeeding such Wednesday) and the Unconcentrated Pool Balance to be
referenced shall be the Unconcentrated Pool Balance on the preceding Monday.
(c) In the event that other Series issued by the Trust provide for excess
funding accounts or other arrangements similar to the Excess Funding Account
involving fluctuating levels of investments in Principal Receivables, (i) the
allocation of additional Principal Receivables to increase the Invested Amount
and the invested amounts of such other Series (and the related withdrawals from
the Excess Funding Account and the other excess funding or similar accounts)
shall be based on the proportion that the amount on deposit in the Excess
Funding Account bears to amounts on deposit in the excess funding accounts
(including the Excess Funding Account) of all Series providing for excess
funding accounts or such similar arrangements or to amounts otherwise similarly
available and (ii) the deposit of amounts into the Excess Funding Account and
the excess funding accounts of such other Series shall be pro rata based on the
proportion that the Invested Amount bears to the invested amounts (including the
Invested Amount) of all Series providing for excess funding accounts or such
similar arrangements.
(d) In the event that any other Series is in an amortization period, early
amortization period or accumulation period, the amounts of any withdrawals from
the Excess Funding Account shall be applied first to satisfy in full any then
applicable funding or payment requirements of such Series and second to make a
payment to the Seller. In the event that more than one other Series is in an
amortization period, early amortization period or accumulation period, the
amounts of any withdrawals from the Excess Funding Account shall be allocated
(and, if necessary, reallocated) among such Series as specified in the related
Supplements for such Series, to meet the funding or payment requirements of each
such Series first to satisfy in full all then applicable funding or payment
requirements of each such Series and second to make a payment to the Seller.
SECTION 4.13 Yield Supplement Account. On each Distribution Date prior to
the beginning of the Accumulation Period and prior to the occurrence of an Early
Amortization Event, the Trustee shall deposit Non-Principal Collections and
Investment Proceeds, if any--to the extent available pursuant to Section
4.6(a)(x)--into the Yield Supplement Account in an amount equal to the Yield
Supplement Account Deposit Amount, if any, for that Distribution Date.
If the Class A Monthly Interest, Class B Monthly Interest or Class C
Monthly Interest for any Distribution Date, determined as if the interest rate
were based on LIBOR plus the applicable margin, exceeds the applicable monthly
interest determined on the basis of the related Net Receivables Rate, the
Servicer shall direct the Trustee to withdraw (and the Trustee shall withdraw)
funds from the Yield Supplement Account, to the extent available, and apply
those funds to deposit the amount of such excess into the Interest Funding
Account first, for the benefit of the Class A Certificates, second, for the
benefit of the Class B Certificates, and third, for the benefit of the Class C
Certificates.
27
Any funds on deposit in the Yield Supplement Account at the beginning of
the Accumulation Period or upon the occurrence of an Early Amortization Event
shall be deposited in the Principal Funding Account.
ARTICLE V
Distribution and Reports to
Series [ ] Certificateholders
SECTION 5.1 Distributions. (a) On each Distribution Date, the Trustee as
paying agent shall distribute to each Series [ ] Certificateholder of record on
the preceding Record Date (other than as provided in Section 12.2 of the
Agreement respecting a final distribution) such Series [ ] Certificateholder's
pro rata share (based on the outstanding principal balances of the Series [ ]
Certificates held by such Certificateholder) of the amounts on deposit in the
Series [ ] Accounts as is payable to Series [ ] Certificateholders on such
Distribution Date pursuant to and subject to the applicable priorities set forth
in Section 4.7.
(b) Except as provided in Section 12.2 of the Agreement with respect to a
final distribution, distributions to Series [ ] Certificateholders hereunder
shall be made by check mailed to each Series [ ] Certificateholder at such
Certificateholder's address appearing in the Certificate Register without
presentation or surrender of any Series [ ] Certificate or the making of any
notation thereon; provided, however, that with respect to Series [ ]
Certificates registered in the name of a Depository, such distributions shall be
made to such Depository in immediately available funds.
(c) For so long as any of the Series [ ] Certificates are listed on the
Luxembourg Stock Exchange, the Trustee shall notify the Luxembourg Stock
Exchange in the event that any of such Series [ ] Certificates listed on the
Luxembourg Stock Exchange do not receive scheduled distributions of interest or
principal on any Distribution Date in accordance with instructions from the
Servicer (which may be standing instructions).
SECTION 5.2 Reports and Statements to Series [ ] Certificateholders. (a) At
least two Business Days prior to each Distribution Date, the Servicer shall
provide to the Trustee, the Rating Agencies and, for so long as any Series [ ]
Certificates are listed on the Luxembourg Stock Exchange, such exchange, a
statement substantially in the form of Exhibit B (a "Distribution Date
Statement"), and on each Distribution Date the Trustee shall forward to each
Series [ ] Certificateholder such statement prepared by the Servicer setting
forth certain information relating to the Trust and the Series [ ] Certificates.
(b) A copy of each statement provided pursuant to paragraph (a) and a copy
of the Pooling and Servicing Agreement (without exhibits) and this Series
Supplement shall be made available to Series [ ] Certificateholders of record
for inspection at the Corporate Trust Office during the Trustee's normal
business hours.
(c) On or before January 31 of each calendar year, beginning with calendar
year [ ], the Trustee shall furnish or cause to be furnished to each Person who
at any time during the preceding calendar year was a Series [ ]
Certificateholder, a statement prepared by the Servicer
28
containing the information which is required to be contained in the statement to
Series [ ] Certificateholders as set forth in paragraph (a) above, aggregated
for such calendar year or the applicable portion thereof during which such
Person was a Series [ ] Certificateholder, together with other information as is
required to be provided by an issuer of indebtedness under the Internal Revenue
Code for the preceding calendar year and such other customary information as is
necessary to enable the Series [ ] Certificateholders (or Certificate Owners) to
prepare their tax returns. Such obligation of the Trustee shall be deemed to
have been satisfied to the extent that substantially comparable information
shall be provided by the Trustee pursuant to any requirements of the Internal
Revenue Code as from time to time in effect.
(d) For so long as the Class A Certificates or the Class B Certificates are
listed on the Luxembourg Stock Exchange and so long as the rules of such
exchange so require, notices to the holders of the Class A Certificates and the
Class B Certificates shall also be given by publication in an Authorized
European Newspaper. The Trustee shall have the right to cause the Listing Agent,
pursuant to a listing agency agreement between the Trustee and the Listing Agent
which is mutually satisfactory to the Servicer, the Trustee and the Listing
Agent, to give such notices by such publication.
ARTICLE VI
Early Amortization Events
SECTION 6.1 Additional Early Amortization Events. The occurrence of any of
the following events shall, immediately upon the occurrence thereof without
notice or other action on the part of the Trustee or the Series [ ]
Certificateholders, be deemed to be an Early Amortization Event solely with
respect to Series [ ] (each, an "Additional Early Amortization Event"):
(a) on any Distribution Date, the balance of the Reserve Fund is less
than [ ] percent of the aggregate outstanding principal balance of the
Series [ ] Certificates, in each case after giving effect to all deposits,
withdrawals and distributions on such Distribution Date; or
(b) any Servicer Default occurs; or
(c) a Class A Carry-over Amount, Class B Carry-over Amount or Class C
Carry-over Amount is outstanding on six consecutive Distribution Dates
(after giving effect to the distributions on each of those Distribution
Dates); or
(d) on any Determination Date, the average of the Monthly Payment
Rates for the three preceding Collection Periods is less than [ ] percent
(or a lower percentage if the Rating Agency Condition has been satisfied
with respect to that lower percentage); or
(e) the outstanding principal amount of the Series [ ] Certificates is
not fully repaid on the Expected Final Payment Date; or
29
(f) the ratio (expressed as a percentage) of (i) the average for each
month of the net losses on the Receivables (exclusive of the Ineligible
Receivables) owned by the Trust (i.e., gross losses less recoveries on any
Receivables) (including recoveries from collateral security in addition to
recoveries from the products, recoveries from Manufacturers and insurance
proceeds) during any three consecutive calendar months, to (ii) the average
of the month-end aggregate balances of those Receivables (without deducting
therefrom the Discount Portion) for such three-month period, exceeds [ ]
percent ([ ]%) on an annualized basis; provided, that the percentage in
this clause (f) may be changed, or any Early Amortization Event relating to
this clause (f) may be waived, at the direction of the Seller and without
the consent of any Series [ ] Certificateholder upon the satisfaction of
the Rating Agency Condition; or
(g) the sum of all Eligible Investments and amounts on deposit in the
Excess Funding Account and any excess funding accounts for any other Series
represents more than [ ] percent of the total assets of the Trust on each
of six or more consecutive Determination Dates, after giving effect to all
payments made or to be made on the Distribution Date next succeeding each
such respective Determination Date; or
(h) the Overconcentration Amount exceeds [ ] for a period of five
Business Days after any Distribution Date, unless the Rating Agency
Condition shall have been satisfied with respect to the existence of the
Overconcentration Amount.
ARTICLE VII
Optional Repurchase
SECTION 7.1 Optional Repurchase. (a) On any Distribution Date occurring
after the date on which the Invested Amount is reduced to less than ten percent
(10%) of the initial principal amount of the Series [ ] Certificates on the
Closing Date or less, the Seller shall have the option, subject to the condition
set forth in paragraph (c), to purchase the entire, but not less than the
entire, Series [ ] Certificateholders' Interest, at a purchase price equal to
the Reassignment Amount for such Distribution Date.
(b) The Seller shall give the Servicer and the Trustee at least 10 Business
Days' prior written notice of the Distribution Date on which the Seller intends
to exercise such purchase option. Not later than 12:00 noon, New York City time,
on such Distribution Date the Seller shall deposit the Reassignment Amount into
the Collection Account in immediately available funds. Such purchase option is
subject to payment in full of the Reassignment Amount and if for any reason the
Seller fails to deposit the Reassignment Amount, payments shall continue to be
made to Certificateholders as provided herein. The Reassignment Amount shall be
distributed as set forth in Section 8.1(b).
(c) If at the time the Seller exercises its purchase option hereunder the
Seller's unsecured debt is unrated or has a rating lower than the lowest
investment grade rating of any
30
Rating Agency, the Seller shall deliver to the Trustee on such Distribution Date
an Opinion of Counsel (which must be an independent outside counsel) to the
effect that, in reliance on certain certificates to the effect that the Series
[ ] Certificateholders' Interest purchased by the Seller constitutes fair value
for the consideration paid therefor and as to the Seller is solvent, the
purchase of the Series [ ] Certificateholders' Interest would not be considered
a fraudulent conveyance under applicable law.
So long as any Series [ ] Certificates are listed on the Luxembourg Stock
Exchange and the rules of such exchange so require, the Trustee shall cause
notice of any such optional repurchase under this Section to be published in an
Authorized European Newspaper at least one Business Day prior to the related
Distribution Date and shall cause notice to be given by first-class mail,
postage prepaid, mailed not less than ten Business Days prior to the applicable
repurchase date, to each Holder of Class A and Class B Certificates at the
Holder's address in the register maintained by the Trustee under the Pooling and
Servicing Agreement, and shall inform the Luxembourg Stock Exchange thereof one
Business Day prior thereto in accordance with instructions from the Servicer
(which may be standing instructions).
ARTICLE VIII
Final Distributions
SECTION 8.1 Sale of Certificateholders' Interest Pursuant to Section 2.3 of
the Agreement; Distributions Pursuant to Section 7.1 of this Series Supplement
or Section 2.3 or 12.2(c) of the Agreement. (a) The amount to be paid by the
Seller to the Collection Account with respect to Series [ ] in connection with a
purchase of the Certificateholders' Interest pursuant to Section 2.3 of the
Agreement shall equal the Reassignment Amount for the Distribution Date on which
such repurchase occurs.
(b) With respect to the Reassignment Amount deposited into the Collection
Account pursuant to Section 7.1 or 8.1 of this Series Supplement or Section 2.3
of the Agreement or any Termination Proceeds deposited into the Collection
Account pursuant to Section 12.2(c) of the Agreement, the Trustee shall, not
later than 12:00 noon, New York time, on the Distribution Date on which such
amounts are deposited (or, if such date is not a Distribution Date, on the
immediately following Distribution Date) (in the priority set forth below): (i)
first, deposit an amount equal to the Invested Amount on such Distribution Date
into the Principal Funding Account, (ii) second, deposit an amount equal to the
amount distributable on such Distribution Date pursuant to Section 4.7(a)(i)
into the Interest Funding Account and (iii) third, pay the remainder of any
Termination Proceeds to the Seller; provided, however, that the sum of the
amounts allocated pursuant to clauses (i) through (iii) shall not exceed the
Reassignment Amount for Series [ ].
(c) Notwithstanding anything to the contrary in this Series Supplement or
the Agreement, any Termination Proceeds deposited in the Principal Funding
Account and the Interest Funding Account pursuant to Section 8.1 of this Series
Supplement and all other amounts on deposit therein on the applicable
Distribution Date shall be distributed in full to the Series [ ]
Certificateholders on such date in the following order of priority:
31
(i) first to Class A Certificateholders, in an amount equal to the sum
of (x) the Class A Monthly Interest for the current Distribution Date and,
without duplication, any unpaid Class A Monthly Interest for any previous
Distribution Date, (y) to the extent permitted by applicable law, any Class
A Additional Interest for the current Distribution Date and, without
duplication, any unpaid Class A Additional Interest for any previous
Distribution Date, and (z) the Class A Invested Amount;
(ii) second to Class B Certificateholders, in an amount equal to the
sum of (x) the Class B Monthly Interest for the current Distribution Date
and, without duplication, any unpaid Class B Monthly Interest for any
previous Distribution Date, (y) to the extent permitted by applicable law,
any Class B Additional Interest for the current Distribution Date and,
without duplication, any unpaid Class B Additional Interest for any
previous Distribution Date, and (z) the Class B Invested Amount; and
(iii) third to Class C Certificateholders, in an amount equal to the
sum of (x) the Class C Monthly Interest for the current Distribution Date
and, without duplication, any unpaid Class C Monthly Interest for any
previous Distribution Date, (y) to the extent permitted by applicable law,
any Class C Additional Interest for the current Distribution Date and,
without duplication, any unpaid Class C Additional Interest for any
previous Distribution Date and (z) the Class C Invested Amount.
No Class A Carry-over Amount, Class B Carry-over Amount, Class C Carry-over
Amount, Class A Carry-over Amount Additional Interest, Class B Carry-over Amount
Additional Interest or Class C Carry-over Amount Additional Interest will be
paid as part of this distribution.
Any remaining funds shall be paid to the Seller.
Any distribution made pursuant to paragraph (b) above and this paragraph
(c) shall be deemed to be a final distribution pursuant to Section 12.2 of the
Agreement with respect to Series [ ].
SECTION 8.2 Distribution of Proceeds of Sale, Disposition or Liquidation of
the Receivables Pursuant to Section 9.2 of the Agreement. (a) Not later than
12:00 noon, New York City time, on the Distribution Date following the date on
which the Insolvency Proceeds are deposited into the Collection Account pursuant
to Section 9.2(b) of the Agreement, the Trustee shall (after giving effect to
any deposits and distributions otherwise to be made on such Distribution Date)
(x) deduct an amount equal to the amount distributable on such Distribution Date
pursuant to Section 4.7(a)(ii) from the Series [ ] Allocation Percentage of the
Insolvency Proceeds and deposit such amount in the Principal Funding Account,
(y) deduct an amount equal to the amount distributable on such Distribution Date
pursuant to Section 4.7(a)(i) from the Series [ ] Allocation Percentage of the
Insolvency Proceeds, and deposit such amount in the Interest Funding Account,
and (z) allocate the remainder of the Series [ ] Allocation Percentage of the
Insolvency Proceeds to the Seller's Interest and release the same to the Seller
on such Distribution Date.
32
(b) Notwithstanding anything to the contrary in this Series Supplement or
the Agreement, the entire amount deposited in the Principal Funding Account and
the Interest Funding Account pursuant to this Section and all other amounts on
deposit therein shall be distributed in full to the Series [ ]
Certificateholders in the order of priority set forth in Section 4.7 on the
Distribution Date on which funds are deposited pursuant to this Section 8.2 (or,
if not so deposited on a Distribution Date, on the immediately following
Distribution Date) and any distribution made pursuant to this Section 8.2 shall
be deemed to be a final distribution pursuant to Section 12.2 of the Agreement
with respect to Series [ ].
ARTICLE IX
Miscellaneous Provisions
SECTION 9.1 Securities Law Filings. The Seller shall cause the Class A and
Class B Certificates to be registered under the Securities Exchange Act of 1934,
as amended, to the extent required to do so under applicable law.
SECTION 9.2 Ratification of Agreement. As supplemented by this Series
Supplement, the Agreement is in all respects ratified and confirmed and the
Agreement as so supplemented by this Series Supplement shall be read, taken and
construed as one and the same instrument.
SECTION 9.3 Counterparts. This Series Supplement may be executed in two or
more counterparts (and by different parties on separate counterparts), each of
which shall be an original, but all of which together shall constitute one and
the same instrument.
SECTION 9.4 Governing Law. This Series Supplement shall be governed by and
construed in accordance with the laws of the State of New York without reference
to its conflict of law provisions, and the obligations, rights and remedies of
the parties hereunder shall be determined in accordance with such laws.
SECTION 9.5 Limitation of Class C Certificates. Each purchaser of a Class C
Certificate (other than the LLC) (each, the "Purchaser") hereby represents and
warrants to the Trustee and the LLC, and hereby agrees with the Trustee and the
LLC, and the Purchaser hereby acknowledges, as follows (except to the extent
that such provisions have been waived or modified by the LLC in accordance with
the Agreement or this Series Supplement):
(1) The Class C Certificates have not been and will not be registered
under the Securities Act or the securities laws of any jurisdiction.
Consequently, the Class C Certificates are not transferable other than
pursuant to an exemption from the registration requirements of the
Securities Act and satisfaction of certain provisions of this Series
Supplement.
(2) The Purchaser is a "qualified institutional buyer" ("QIB") within
the meaning of Rule 144A under the Securities Act ("Rule 144A") and is
purchasing for its own account (and not for the account of others) or as a
fiduciary or agent for others (which others also are QIBs and have executed
a letter substantially in the form of Exhibit C to this Series Supplement
and have delivered a copy of such letter to the LLC
33
and the Trustee). The Purchaser is aware that it (or any account for which
it is purchasing) may be required to bear the economic risk of an
investment in the Class C Certificates for an indefinite period, and it (or
such account) is able to bear such risk for an indefinite period.
(3) No sale, pledge or other transfer of any Class C Certificate may
be made by any Person unless (a) either (i) such sale, pledge or other
transfer is made to the LLC, or (ii) so long as the Class C Certificates
are eligible for resale pursuant to Rule 144A under the Securities Act,
such sale, pledge or other transfer is made to a Person whom the transferor
reasonably believes after due inquiry is a QIB acting for its own account
(and not for the account of others) or as a fiduciary or agent for others
(which others also are QIBs) to whom notice is given that the sale, pledge
or transfer is being made in reliance on Rule 144A.
(4) The Class C Certificates may not be acquired by or for the account
of (i) an "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 the provisions of Title I of ERISA, (ii) a plan
described in Section 4975(e)(1) of the Code or (iii) any entity whose
underlying assets include plan assets by reason of a plan's investment in
the entity. By accepting and holding a Class C Certificate, the holder
thereof shall be deemed to have represented and warranted that it is not
within any of the categories described in the preceding sentence.
(5) The Purchaser acknowledges that it has been afforded an
opportunity to request from the LLC, the Servicer and Deutsche Bank
Securities Inc. (the "Initial Purchaser"), and has received and reviewed,
all information which it has deemed necessary in connection with its
decision to purchase the Class C Certificates. The Purchaser acknowledges
that none of the LLC, the Servicer, the Initial Purchaser nor any of their
respective affiliates or any Person representing any of them has made any
representation to it with respect to any information relating to the
offering or sale of the Class C Certificates, other than the information
contained in the private placement memorandum for the Class C Certificates,
a copy of which has been delivered to it.
(6) The Purchaser understands that all information furnished to it by
the LLC, the Servicer or the Initial Purchaser or representatives of the
LLC, the Servicer or the Initial Purchaser in connection with its
evaluation of an investment in the Class C Certificates was provided to it
on a confidential basis and it agrees not to disclose such information, in
whole or in part, to any other Person.
(7) The Purchaser further represents and warrants to the LLC and the
Trustee that, except to the extent permitted in paragraphs (8) and (9)
below, the Purchaser: (i) is properly classified as a "corporation" as
described in Section 7701(a)(3) of the Code which is created or organized
under the laws of the United States, any State thereof or the District of
Columbia, and will not knowingly take any action which will cause it not to
be so classified; and (ii) is not an S corporation as described in Section
1361 of the Code (an "S Corporation"), and will not knowingly take any
action which will cause it to be so classified.
34
(8) No Class C Certificates shall be transferred or sold to any
grantor trust, partnership or S Corporation (each a "Pass-Through Entity")
unless such entity represents that (i) not 25% or more (or that amount
which the Internal Revenue Service (or any successor thereto) may
subsequently indicate is an amount which prevents treating direct and/or
indirect owners of a Pass-Through Entity as partners in the Trust for
purposes of determining whether the Trust is a publicly traded partnership)
of the value of the assets of the Pass-Through Entity is attributable to
the Pass-Through Entity's ownership interest in certificates issued by the
Trust other than the Class A and Class B Certificates and (ii) the
Pass-Through Entity does not specially allocate to any of its beneficiaries
amounts received in respect of certificates issued by the Trust other than
Class A and Class B Certificates. Any purported transfer, assignment or
other conveyance (including any participation) of the Class C Certificates
in contravention of the immediately preceding sentence shall be null and
void ab initio and the purported transferor shall continue to be treated as
the owner of such Class C Certificates and the purported transferee shall
not be recognized as a Class C Certificateholder by the LLC or the Trustee.
(9) No Class C Certificates shall be transferred or sold to any
foreign investor ("Foreign Investor") which does not make the
representations contained in Annex 1 to the representation letter required
to be signed by a purchaser in connection with the purchase of Class C
Certificates. A Foreign Investor for this purpose includes any person who
is not: (1) a citizen or resident of the United States; (2) a corporation
or partnership or other entity treated for Federal income tax purposes as a
corporation or a partnership created or organized in or under the laws of
the United States, any State thereof or the District of Columbia; (3) an
estate, the income of which is subject to United States Federal income tax,
regardless of its source; or (4) a trust if a U.S. court is able to
exercise primary supervision over the administration of the trust and one
or more U.S. persons have the authority to control all substantial
decisions of the trust. Notwithstanding the preceding sentence, to the
extent provided in Treasury regulations, certain trusts in existence on
August 20, 1996, and treated as United States persons under the Code and
applicable Treasury regulations prior to that date, that elect to continue
to be treated as United States persons under the Code or applicable
Treasury regulations will not be Foreign Investors.
(10) The Purchaser confirms that is has neither acquired nor will it
sell, trade or transfer any interest in any Class C Certificate or cause an
interest in any Class C Certificate to be marketed on or through (i) an
"established securities market" within the meaning of Section 7704(b)(1) of
the Code and any proposed, temporary or final treasury regulation
thereunder, including, without limitation, an over-the-counter market or an
interdealer quotation system that regularly disseminates firm buy or sell
quotations or (ii) "secondary market" or "substantial equivalent thereof"
within the meaning of Section 7704(b)(2) of the Code and any proposed,
temporary or final treasury regulation thereunder, including a market
wherein interests in the Class C Certificates are regularly quoted by any
person making a market in those interests and a market wherein any person
regularly makes available bid or offer quotes with respect to interests in
the Class C Certificates and stands ready to effect buy or sell
transactions at the quoted prices for itself or on behalf of others. Any
purported transfer, assignment or other conveyance of any Class C
Certificate in contravention of the foregoing covenant will be null and
void
35
ab initio and the purported transferor will continue to be treated as the
holder of such Class C Certificate and the purported transferee will not be
recognized as a Class C Certificateholder by the LLC, the Servicer or the
Trustee.
(11) Notwithstanding the foregoing, at no time shall the aggregate
number of Private Holders exceed 100. Any purported transfer, assignment or
other conveyance (including any participation) of the Class C Certificates
in contravention of the immediately preceding sentence will be null and
void ab initio and the purported transferor will continue to be treated as
the holder of those Class C Certificates and the purported transferee will
not be recognized as a Class C Certificateholder by the LLC, the Servicer
or the Trustee. "Private Holder" means each holder of a right to receive
interest or principal in respect of any direct or indirect interest in the
Trust, including any financial instrument or contract the value of which is
determined in whole or part by reference to the Trust (including the
Trust's assets, income of the Trust or distributions made by the Trust),
excluding any interest in the Trust represented by any series or class of
certificates or any other interests as to which the Trustee has received an
opinion of counsel to the effect that that series, class or other interest
will be treated as debt or otherwise not as an equity interest in either
the Trust or the Receivables for federal income tax purposes (unless that
interest is convertible or exchangeable into an interest in the Trust or
the Trust's income or that interest provides for payment of equivalent
value). Notwithstanding the immediately preceding sentence, "Private
Holder" will also include any other person that the LLC determines is a
"partner" within the meaning of Section 1.7704-1(h)(1)(ii) of the U.S.
Treasury Regulations (including by reason of Section 1.7704-1(h)(3)) or any
successor provision of law. Any person holding more than one interest in
the Trust, each of which separately would cause that person to be a Private
Holder, will be treated as a single Private Holder. Each holder of an
interest in a Private Holder which is a partnership, S corporation or a
grantor trust under the Code will be treated as a Private Holder unless
excepted with the consent of the LLC (which consent will be based on an
opinion of counsel generally to the effect that the action taken pursuant
to the consent will not cause the Trust to become a publicly traded
partnership treated as a corporation). Notwithstanding anything to the
contrary herein, each Class C Certificateholder, and each holder of any
Class of any Series if with respect to such Class no opinion is delivered
to the effect that the Certificates of such Class will be treated as debt
for federal income tax purposes, will be considered to be a Private Holder.
(12) The Class C Certificates will be issued in denominations of
$1,000,000 and integral multiples of $100,000 in excess thereof. No Class C
Certificate may be subdivided upon transfer or exchange in a manner so that
the resulting Class C Certificate if it had been sold in the original
offering would have had an initial offering price of less than $1,000,000
and any purported transfer, assignment or conveyance of a Class C
Certificate in contravention of the immediately preceding sentence will be
void ab initio and the purported transferor will continue to be treated as
the owner of that Class C Certificate for all purposes.
(13) Without limiting the foregoing, no transfer, pledge, assignment
or conveyance may be made to any one Person for Class C Certificates with a
face amount of less than $1,000,000 and, in the case of any Person acting
on behalf of one or more
36
third parties (other than a bank (as defined in Section 3(a)(2) of the
Securities Act) acting in its fiduciary capacity), for Class C Certificates
with a face amount of less than that amount for each of those third
parties. Any purported transfer, assignment or conveyance in contravention
of the immediately preceding sentence will be void ab initio and the
purported transferor will continue to be treated as the owner of the Class
C Certificates for all purposes. Neither the LLC nor the Trustee will be
obligated to register the Class C Certificates under the Securities Act,
qualify the Class C Certificates under the securities laws of any state or
provide registration rights to any purchaser or holder thereof.
(14) No transfer, assignment or conveyance of a Class C Certificate
will be effective unless the LLC and the Trustee shall have received a
letter, substantially in the form of Exhibit C to this Series Supplement,
from the transferee, assignee or recipient of the conveyance.
(15) The Class C Certificates will bear legends substantially to the
effect of the matters contemplated by paragraphs (1) through (14) above,
unless the LLC determines otherwise in accordance with applicable law.
(16) If the Purchaser of the Class C Certificate is a Foreign
Investor, the representations and warranties contained in Annex 1 to the
form of letter in Exhibit C to this Series Supplement required to be signed
by Foreign Investors purchasing Class C Certificates are incorporated by
reference.
SECTION 9.6 The Trustee; Paying Agent; Transfer Agent and Registrar. (a)
The Trustee shall not be responsible in any manner whatsoever for or in respect
of the validity or sufficiency of this Series Supplement, for or in respect of
the calculation or verification of any of the amounts, allocation or
distributions set forth in Article IV and Article VIII or for or in respect of
the recitals contained herein, all of which recitals are made solely by the
Seller; provided, however, that this sentence shall not limit the obligations of
the Trustee contemplated by Section 4.2(b) of this Series Supplement.
(b) For so long as any Series [ ] Certificates are listed on the Luxembourg
Stock Exchange, an additional Paying Agent and an additional Transfer Agent and
Registrar for the Series [ ] Certificates shall be maintained in Luxembourg. The
Trustee is hereby directed to appoint Kredietbank S.A. Luxembourgeoise in
Luxembourg as an additional Paying Agent and as additional Transfer Agent and
Registrar for the Series [ ] Certificates and to enter into a listing agency
agreement with Kredietbank S.A. Luxembourgeoise which is not inconsistent with
the terms of this Series Supplement and which is mutually satisfactory to the
Servicer, the Trustee and the Listing Agent; provided, that unless Kredietbank
S.A. Luxembourgeoise shall be rated "P-1" by Xxxxx'x and "A-1" by S&P, it may
not hold funds pursuant to this Series Supplement overnight.
If the Listing Agent resigns or is removed and a successor is appointed,
notice of said appointment shall be given by publication in an Authorized
European Newspaper.
37
SECTION 9.7 Instructions in Writing. All instructions given by the Servicer
to the Trustee pursuant to this Series Supplement shall be in writing, and may
be included in a Distribution Date Statement.
SECTION 9.8 Initial Funding of Reserve Fund. On the Closing Date the Seller
shall cause to be deposited with the Trustee, and the Trustee shall deposit in
the Reserve Fund, available funds in an amount equal to [ ] percent of the
aggregate initial principal balance of the Series [ ] Certificates.
SECTION 9.9 Severability; Certificate Rate Limitation. (a) If any one or
more of the covenants, agreements, provisions or terms of this Series Supplement
or any Series [ ] Certificate shall for any reason whatsoever be held invalid,
then such covenants, agreements, provisions or terms shall be deemed severable
from the remaining covenants, agreements, provisions or terms of this Series
Supplement and shall in no way affect the validity or enforceability of the
other provisions of this Series Supplement or of such Series [ ] Certificate.
(b) Notwithstanding anything in this Series Supplement, the Agreement, or
any Series [ ] Certificate to the contrary, if at any time any Certificate Rate,
together with all fees, charges and other amounts which are treated as interest
on any Series [ ] Certificate under applicable law (collectively the "Charges"),
shall exceed the maximum lawful rate (the "Maximum Rate") which may be
contracted for, charged, taken, received or reserved by the Series [ ]
Certificateholders in accordance with the terms of this Series Supplement, the
Agreement or any Series [ ] Certificate, then such Certificate Rate, together
with all Charges payable in respect of the Series [ ] Certificate, shall be
limited to the Maximum Rate and, to the extent lawful, such Certificate Rate and
Charges that would have been payable in respect of the Series [ ] Certificates,
but were not payable as a result of the operation of this Section, shall be
cumulated and the Certificate Rate and Charges payable to the Series [ ]
Certificateholders in respect of other periods shall be increased (but not above
the Maximum Rate therefor) until such cumulated amount shall have been received
by the Series [ ] Certificateholders.
SECTION 9.10 Headings. The headings herein are for purposes of reference
only and shall not otherwise affect the meaning or interpretation of any
provision hereof.
SECTION 9.11 Certain Matters Relating to Luxembourg Stock Exchange Listing.
(a) For as long as any Series [ ] Certificates are listed on the Luxembourg
Stock Exchange, on each Date the Trustee shall notify the Listing Agent and the
Luxembourg Stock Exchange of the outstanding principal balance of each Class of
such Series [ ] Certificates after giving effect to distributions of principal,
if any, thereon on each Distribution Date (as soon as possible after the
determination of such principal balances but not later than the Distribution
Date on which a payment of principal is made) in accordance with instructions
from the Servicer (which may be standing instructions).
(b) Promptly upon receipt of notice of any qualification, reduction or
withdrawal of the rating assigned to any Class of Certificates listed on the
Luxembourg Stock Exchange, the Trustee shall notify the Listing Agent and the
Luxembourg Stock Exchange thereof in accordance with instructions from the
Servicer (which may be standing instructions).
38
(c) Prior to listing on the Luxembourg Stock Exchange, a legal notice
("Notice Legale") relating to the issuance of the Certificates, together with
certain documents relating to the Seller and the Trust, shall be deposited by
the Trustee (at the written direction of the Seller or the Servicer) with the
Chief Registrar of the District of Luxembourg ("Greffier en Chef du Tribunal
d'Arrondissement de et a Luxembourg"), where copies thereof may be obtained,
free of charge, upon request.
(d) For so long as the Class A or Class B Certificates are listed on the
Luxembourg Stock Exchange and the rules of such exchange so require, the
Servicer and the Trustee shall cause the following documents to be available
without charge for inspection (and copies of the documents listed in (1), (2) ,
(4) and (5) to be provided without charge) during regular business hours at the
office of the Listing Agent in the City of Luxembourg:
(1) an executed copy of the Agreement;
(2) an executed copy of this Series Supplement;
(3) an executed copy of the agreement between the Trustee and the
Listing Agent;
(4) a copy of the prospectus supplement relating to the public
offering of the Class A and the Class B Certificates and the accompanying
prospectus; and
(5) copies of each monthly statement prepared by the Servicer for each
Distribution Date.
(e) The parties hereto shall cooperate in good faith to take all actions
and execute all documents which are necessary and appropriate to cause the Class
A Certificates and the Class B Certificates to be listed on the Luxembourg Stock
Exchange and to maintain such listing.
[SIGNATURES FOLLOW]
39
IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee have caused
this Series Supplement to be duly executed as of the day and year first above
written.
CDF FINANCING, L.L.C.,
as Seller
By: ________________________________
GE COMMERCIAL DISTRIBUTION FINANCE
CORPORATION,
as Servicer
By: ________________________________
S-1
[ ],
as Trustee
By: ________________________________
Name:
Title:
S-2
EXHIBIT A
FORM OF CLASS [ ] CERTIFICATE
REGISTERED Initial
Principal Balance:(1)
$_____________________
Certificate No. R- CUSIP NO.
[Unless this Certificate 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 certificate
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.]
[FOR CLASS B CERTIFICATES, INSERT:
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF (I) AN "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 THE PROVISIONS
OF TITLE I OF ERISA, (II) A PLAN DESCRIBED IN SECTION 4975(e)(1) OF THE CODE OR
(III) ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF A
PLAN'S INVESTMENT IN THE ENTITY. BY ACCEPTING AND HOLDING THIS CERTIFICATE, THE
HOLDER THEREOF SHALL BE DEEMED TO HAVE REPRESENTED AND WARRANTED THAT IT IS NOT
WITHIN ANY OF THE CATEGORIES DESCRIBED IN THE PRECEDING SENTENCE.
[FOR CLASS C CERTIFICATES INSERT:
THE PURCHASER OF THIS CERTIFICATE (THE "PURCHASER") HEREBY REPRESENTS AND
WARRANTS TO THE TRUSTEE AND DEUTSCHE FRLP, AND HEREBY AGREES WITH THE TRUSTEE
AND DEUTSCHE FRLP, AND THE PURCHASER HEREBY ACKNOWLEDGES, AS FOLLOWS:
(1) THE CLASS C CERTIFICATES HAVE NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF ANY JURISDICTION.
CONSEQUENTLY, THE CLASS C CERTIFICATES ARE NOT TRANSFERABLE OTHER THAN
PURSUANT TO AN EXEMPTION FROM
_____________________
(1) Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SATISFACTION OF
CERTAIN PROVISIONS OF THE SERIES SUPPLEMENT.
(2) THE PURCHASER IS A "QUALIFIED INSTITUTIONAL BUYER" ("QIB") WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") AND IS
PURCHASING FOR ITS OWN ACCOUNT (AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A
FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS ALSO ARE QIBS AND HAVE EXECUTED
A LETTER SUBSTANTIALLY IN THE FORM OF EXHIBIT C TO THE SERIES SUPPLEMENT
AND HAVE DELIVERED A COPY OF SUCH LETTER TO THE LLC AND THE TRUSTEE). THE
PURCHASER IS AWARE THAT IT (OR ANY ACCOUNT FOR WHICH IT IS PURCHASING) MAY
BE REQUIRED TO BEAR THE ECONOMIC RISK OF AN INVESTMENT IN THE CLASS C
CERTIFICATES FOR AN INDEFINITE PERIOD, AND IT (OR SUCH ACCOUNT) IS ABLE TO
BEAR SUCH RISK FOR AN INDEFINITE PERIOD.
(3) NO SALE, PLEDGE OR OTHER TRANSFER OF ANY CLASS C CERTIFICATE MAY
BE MADE BY ANY PERSON UNLESS (A) EITHER (I) SUCH SALE, PLEDGE OR OTHER
TRANSFER IS MADE TO THE LLC, OR (II) SO LONG AS THE CLASS C CERTIFICATES
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT,
SUCH SALE, PLEDGE OR OTHER TRANSFER IS MADE TO A PERSON WHOM THE TRANSFEROR
REASONABLY BELIEVES AFTER DUE INQUIRY IS A QIB ACTING FOR ITS OWN ACCOUNT
(AND NOT FOR THE ACCOUNT OF OTHERS) OR AS A FIDUCIARY OR AGENT FOR OTHERS
(WHICH OTHERS ALSO ARE QIBS) TO WHOM NOTICE IS GIVEN THAT THE SALE, PLEDGE
OR TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A.
(4) THE CLASS C CERTIFICATES MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT
OF (I) AN "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 THE PROVISIONS OF TITLE I OF ERISA, (II) A PLAN
DESCRIBED IN SECTION 4975(e)(1) OF THE CODE OR (III) ANY ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN'S INVESTMENT IN
THE ENTITY. BY ACCEPTING AND HOLDING A CLASS C CERTIFICATE, THE HOLDER
THEREOF SHALL BE DEEMED TO HAVE REPRESENTED AND WARRANTED THAT IT IS NOT
WITHIN ANY OF THE CATEGORIES DESCRIBED IN THE PRECEDING SENTENCE.
(5) THE PURCHASER ACKNOWLEDGES THAT IT HAS BEEN AFFORDED AN
OPPORTUNITY TO REQUEST FROM THE LLC, THE SERVICER AND [ ]
(THE "INITIAL PURCHASER"), AND HAS RECEIVED AND REVIEWED, ALL INFORMATION
WHICH IT HAS DEEMED NECESSARY IN CONNECTION WITH ITS DECISION TO PURCHASE
THE CLASS C CERTIFICATES. THE PURCHASER ACKNOWLEDGES THAT NONE OF THE LLC,
THE SERVICER, THE INITIAL PURCHASER NOR ANY OF THEIR
2
RESPECTIVE AFFILIATES OR ANY PERSON REPRESENTING ANY OF THEM HAS MADE ANY
REPRESENTATION TO IT WITH RESPECT TO ANY INFORMATION RELATING TO THE
OFFERING OR SALE OF THE CLASS C CERTIFICATES, OTHER THAN THE INFORMATION
CONTAINED IN THE PRIVATE PLACEMENT MEMORANDUM FOR THE CLASS C CERTIFICATES,
A COPY OF WHICH HAS BEEN DELIVERED TO IT.
(6) THE PURCHASER UNDERSTANDS THAT ALL INFORMATION FURNISHED TO IT BY
THE LLC, THE SERVICER OR THE INITIAL PURCHASER OR REPRESENTATIVES OF
DEUTSCHE FRLP, THE SERVICER OR THE INITIAL PURCHASER IN CONNECTION WITH ITS
EVALUATION OF AN INVESTMENT IN THE CLASS C CERTIFICATES WAS PROVIDED TO IT
ON A CONFIDENTIAL BASIS AND IT AGREES NOT TO DISCLOSE SUCH INFORMATION, IN
WHOLE OR IN PART, TO ANY OTHER PERSON.
(7) THE PURCHASER FURTHER REPRESENTS AND WARRANTS TO DEUTSCHE FRLP AND
THE TRUSTEE THAT, EXCEPT TO THE EXTENT PERMITTED IN PARAGRAPHS (8) AND (9)
BELOW, THE PURCHASER: (I) IS PROPERLY CLASSIFIED AS A "CORPORATION" AS
DESCRIBED IN SECTION 7701(a)(3) OF THE CODE WHICH IS CREATED OR ORGANIZED
UNDER THE LAWS OF THE UNITED STATES, ANY STATE THEREOF OR THE DISTRICT OF
COLUMBIA, AND WILL NOT KNOWINGLY TAKE ANY ACTION WHICH WILL CAUSE IT NOT TO
BE SO CLASSIFIED; AND (II) IS NOT AN S CORPORATION AS DESCRIBED IN SECTION
1361 OF THE CODE, AND WILL NOT KNOWINGLY TAKE ANY ACTION WHICH WILL CAUSE
IT TO BE SO CLASSIFIED.
(8) NO CLASS C CERTIFICATES SHALL BE TRANSFERRED OR SOLD TO ANY
GRANTOR TRUST, PARTNERSHIP OR S CORPORATION (EACH A "PASS-THROUGH ENTITY")
UNLESS SUCH ENTITY REPRESENTS THAT (I) NOT 25% OR MORE (OR THAT AMOUNT
WHICH THE INTERNAL REVENUE SERVICE (OR ANY SUCCESSOR THERETO) MAY
SUBSEQUENTLY INDICATE IS AN AMOUNT WHICH PREVENTS TREATING DIRECT AND/OR
INDIRECT OWNERS OF A PASS-THROUGH ENTITY AS PARTNERS IN THE TRUST FOR
PURPOSES OF DETERMINING WHETHER THE TRUST IS A PUBLICLY TRADED PARTNERSHIP)
OF THE VALUE OF THE ASSETS OF THE PASS-THROUGH ENTITY IS ATTRIBUTABLE TO
THE PASS-THROUGH ENTITY'S OWNERSHIP INTEREST IN CERTIFICATES ISSUED BY THE
TRUST OTHER THAN THE CLASS A AND CLASS B CERTIFICATES AND (II) THE
PASS-THROUGH ENTITY DOES NOT SPECIALLY ALLOCATE TO ANY OF ITS BENEFICIARIES
AMOUNTS RECEIVED IN RESPECT OF CERTIFICATES ISSUED BY THE TRUST OTHER THAN
CLASS A AND CLASS B CERTIFICATES. ANY PURPORTED TRANSFER, ASSIGNMENT OR
OTHER CONVEYANCE (INCLUDING ANY PARTICIPATION) OF THE CLASS C CERTIFICATES
IN CONTRAVENTION OF THE IMMEDIATELY PRECEDING SENTENCE SHALL BE NULL AND
VOID AB INITIO AND THE PURPORTED TRANSFEROR SHALL CONTINUE TO BE TREATED AS
THE OWNER OF SUCH CLASS C CERTIFICATES AND THE
3
PURPORTED TRANSFEREE SHALL NOT BE RECOGNIZED AS A CLASS C CERTIFICATEHOLDER
BY THE LLC OR THE TRUSTEE.
(9) NO CLASS C CERTIFICATES SHALL BE TRANSFERRED OR SOLD TO ANY
FOREIGN INVESTOR ("FOREIGN INVESTOR") WHICH DOES NOT MAKE THE
REPRESENTATIONS CONTAINED IN ANNEX 1 TO THE REPRESENTATION LETTER REQUIRED
TO BE SIGNED BY A PURCHASER IN CONNECTION WITH THE PURCHASE OF CLASS C
CERTIFICATES. A FOREIGN INVESTOR FOR THIS PURPOSE INCLUDES ANY PERSON WHO
IS NOT: (1) A CITIZEN OR RESIDENT OF THE UNITED STATES; (2) A CORPORATION
OR PARTNERSHIP OR OTHER ENTITY TREATED FOR FEDERAL INCOME TAX PURPOSES AS A
CORPORATION OR A PARTNERSHIP CREATED OR ORGANIZED IN OR UNDER THE LAWS OF
THE UNITED STATES, ANY STATE THEREOF OR THE DISTRICT OF COLUMBIA; (3) AN
ESTATE, THE INCOME OF WHICH IS SUBJECT TO UNITED STATES FEDERAL INCOME TAX,
REGARDLESS OF ITS SOURCE; OR (4) A TRUST IF A U.S. COURT IS ABLE TO
EXERCISE PRIMARY SUPERVISION OVER THE ADMINISTRATION OF THE TRUST AND ONE
OR MORE U.S. PERSONS HAVE THE AUTHORITY TO CONTROL ALL SUBSTANTIAL
DECISIONS OF THE TRUST. NOTWITHSTANDING THE PRECEDING SENTENCE, TO THE
EXTENT PROVIDED IN TREASURY REGULATIONS, CERTAIN TRUSTS IN EXISTENCE ON
AUGUST 20, 1996, AND TREATED AS UNITED STATES PERSONS UNDER THE CODE AND
APPLICABLE TREASURY REGULATIONS PRIOR TO THAT DATE, THAT ELECT TO CONTINUE
TO BE TREATED AS UNITED STATES PERSONS UNDER THE CODE OR APPLICABLE
TREASURY REGULATIONS WILL NOT BE FOREIGN INVESTORS.
(10) THE PURCHASER CONFIRMS THAT IS HAS NEITHER ACQUIRED NOR WILL IT
SELL, TRADE OR TRANSFER ANY INTEREST IN ANY CLASS C CERTIFICATE OR CAUSE AN
INTEREST IN ANY CLASS C CERTIFICATE TO BE MARKETED ON OR THROUGH (I) AN
"ESTABLISHED SECURITIES MARKET" WITHIN THE MEANING OF SECTION 7704(b)(1) OF
THE CODE AND ANY PROPOSED, TEMPORARY OR FINAL TREASURY REGULATION
THEREUNDER, INCLUDING, WITHOUT LIMITATION, AN OVER-THE-COUNTER MARKET OR AN
INTERDEALER QUOTATION SYSTEM THAT REGULARLY DISSEMINATES FIRM BUY OR SELL
QUOTATIONS OR (II) "SECONDARY MARKET" OR "SUBSTANTIAL EQUIVALENT THEREOF"
WITHIN THE MEANING OF SECTION 7704(b)(2) OF THE CODE AND ANY PROPOSED,
TEMPORARY OR FINAL TREASURY REGULATION THEREUNDER, INCLUDING A MARKET
WHEREIN INTERESTS IN THE CLASS C CERTIFICATES ARE REGULARLY QUOTED BY ANY
PERSON MAKING A MARKET IN THOSE INTERESTS AND A MARKET WHEREIN ANY PERSON
REGULARLY MAKES AVAILABLE BID OR OFFER QUOTES WITH RESPECT TO INTERESTS IN
THE CLASS C CERTIFICATES AND STANDS READY TO EFFECT BUY OR SELL
TRANSACTIONS AT THE QUOTED PRICES FOR ITSELF OR ON BEHALF OF OTHERS. ANY
PURPORTED TRANSFER, ASSIGNMENT OR OTHER CONVEYANCE OF ANY CLASS C
CERTIFICATE IN CONTRAVENTION
4
OF THE FOREGOING COVENANT WILL BE NULL AND VOID AB INITIO AND THE PURPORTED
TRANSFEROR WILL CONTINUE TO BE TREATED AS THE HOLDER OF SUCH CLASS C
CERTIFICATE AND THE PURPORTED TRANSFEREE WILL NOT BE RECOGNIZED AS A
CLASS C CERTIFICATEHOLDER BY THE LLC, THE SERVICER OR THE TRUSTEE.
(11) NOTWITHSTANDING THE FOREGOING, AT NO TIME SHALL THE AGGREGATE
NUMBER OF PRIVATE HOLDERS EXCEED 100. ANY PURPORTED TRANSFER, ASSIGNMENT OR
OTHER CONVEYANCE (INCLUDING ANY PARTICIPATION) OF THE CLASS C CERTIFICATES
IN CONTRAVENTION OF THE IMMEDIATELY PRECEDING SENTENCE WILL BE NULL AND
VOID AB INITIO AND THE PURPORTED TRANSFEROR WILL CONTINUE TO BE TREATED AS
THE HOLDER OF THOSE CLASS C CERTIFICATES AND THE PURPORTED TRANSFEREE WILL
NOT BE RECOGNIZED AS A CLASS C CERTIFICATEHOLDER BY DEUTSCHE FRLP, THE
SERVICER OR THE TRUSTEE. "PRIVATE HOLDER" MEANS EACH HOLDER OF A RIGHT TO
RECEIVE INTEREST OR PRINCIPAL IN RESPECT OF ANY DIRECT OR INDIRECT INTEREST
IN THE TRUST, INCLUDING ANY FINANCIAL INSTRUMENT OR CONTRACT THE VALUE OF
WHICH IS DETERMINED IN WHOLE OR PART BY REFERENCE TO THE TRUST (INCLUDING
THE TRUST'S ASSETS, INCOME OF THE TRUST OR DISTRIBUTIONS MADE BY THE
TRUST), EXCLUDING ANY INTEREST IN THE TRUST REPRESENTED BY ANY SERIES OR
CLASS OF CERTIFICATES OR ANY OTHER INTERESTS AS TO WHICH THE TRUSTEE HAS
RECEIVED AN OPINION OF COUNSEL TO THE EFFECT THAT THAT SERIES, CLASS OR
OTHER INTEREST WILL BE TREATED AS DEBT OR OTHERWISE NOT AS AN EQUITY
INTEREST IN EITHER THE TRUST OR THE RECEIVABLES FOR FEDERAL INCOME TAX
PURPOSES (UNLESS THAT INTEREST IS CONVERTIBLE OR EXCHANGEABLE INTO AN
INTEREST IN THE TRUST OR THE TRUST'S INCOME OR THAT INTEREST PROVIDES FOR
PAYMENT OF EQUIVALENT VALUE). NOTWITHSTANDING THE IMMEDIATELY PRECEDING
SENTENCE, "PRIVATE HOLDER" WILL ALSO INCLUDE ANY OTHER PERSON THAT THE LLC
DETERMINES IS A "PARTNER" WITHIN THE MEANING OF SECTION 1.7704-1(h)(1)(ii)
OF THE U.S. TREASURY REGULATIONS (INCLUDING BY REASON OF SECTION
1.7704-1(h)(3)) OR ANY SUCCESSOR PROVISION OF LAW. ANY PERSON HOLDING MORE
THAN ONE INTEREST IN THE TRUST, EACH OF WHICH SEPARATELY WOULD CAUSE THAT
PERSON TO BE A PRIVATE HOLDER, WILL BE TREATED AS A SINGLE PRIVATE HOLDER.
EACH HOLDER OF AN INTEREST IN A PRIVATE HOLDER WHICH IS A PARTNERSHIP, S
CORPORATION OR A GRANTOR TRUST UNDER THE CODE WILL BE TREATED AS A PRIVATE
HOLDER UNLESS EXCEPTED WITH THE CONSENT OF DEUTSCHE FRLP (WHICH CONSENT
WILL BE BASED ON AN OPINION OF COUNSEL GENERALLY TO THE EFFECT THAT THE
ACTION TAKEN PURSUANT TO THE CONSENT WILL NOT CAUSE THE TRUST TO BECOME A
PUBLICLY TRADED PARTNERSHIP TREATED AS A CORPORATION). NOTWITHSTANDING
ANYTHING TO THE CONTRARY HEREIN, EACH CLASS C CERTIFICATEHOLDER, AND EACH
HOLDER OF ANY
5
CLASS OF ANY SERIES IF WITH RESPECT TO SUCH CLASS NO OPINION IS DELIVERED
TO THE EFFECT THAT THE CERTIFICATES OF SUCH CLASS WILL BE TREATED AS DEBT
FOR FEDERAL INCOME TAX PURPOSES, WILL BE CONSIDERED TO BE A PRIVATE HOLDER.
(12) THE CLASS C CERTIFICATES WILL BE ISSUED IN DENOMINATIONS OF
$1,000,000 AND INTEGRAL MULTIPLES OF $100,000 IN EXCESS THEREOF. NO CLASS C
CERTIFICATE MAY BE SUBDIVIDED UPON TRANSFER OR EXCHANGE IN A MANNER SO THAT
THE RESULTING CLASS C CERTIFICATE IF IT HAD BEEN SOLD IN THE ORIGINAL
OFFERING WOULD HAVE HAD AN INITIAL OFFERING PRICE OF LESS THAN $1,000,000
AND ANY PURPORTED TRANSFER, ASSIGNMENT OR CONVEYANCE OF A CLASS C
CERTIFICATE IN CONTRAVENTION OF THE IMMEDIATELY PRECEDING SENTENCE WILL BE
VOID AB INITIO AND THE PURPORTED TRANSFEROR WILL CONTINUE TO BE TREATED AS
THE OWNER OF THAT CLASS C CERTIFICATE FOR ALL PURPOSES.
(13) WITHOUT LIMITING THE FOREGOING, NO TRANSFER, PLEDGE, ASSIGNMENT
OR CONVEYANCE MAY BE MADE TO ANY ONE PERSON FOR CLASS C CERTIFICATES WITH A
FACE AMOUNT OF LESS THAN $1,000,000 AND, IN THE CASE OF ANY PERSON ACTING
ON BEHALF OF ONE OR MORE THIRD PARTIES (OTHER THAN A BANK (AS DEFINED IN
SECTION 3(a)(2) OF THE SECURITIES ACT) ACTING IN ITS FIDUCIARY CAPACITY),
FOR CLASS C CERTIFICATES WITH A FACE AMOUNT OF LESS THAN THAT AMOUNT FOR
EACH OF THOSE THIRD PARTIES. ANY PURPORTED TRANSFER, ASSIGNMENT OR
CONVEYANCE IN CONTRAVENTION OF THE IMMEDIATELY PRECEDING SENTENCE WILL BE
VOID AB INITIO AND THE PURPORTED TRANSFEROR WILL CONTINUE TO BE TREATED AS
THE OWNER OF THE CLASS C CERTIFICATES FOR ALL PURPOSES. NEITHER DEUTSCHE
FRLP NOR THE TRUSTEE WILL BE OBLIGATED TO REGISTER THE CLASS C CERTIFICATES
UNDER THE SECURITIES ACT, QUALIFY THE CLASS C CERTIFICATES UNDER THE
SECURITIES LAWS OF ANY STATE OR PROVIDE REGISTRATION RIGHTS TO ANY
PURCHASER OR HOLDER THEREOF.
(14) NO TRANSFER, ASSIGNMENT OR CONVEYANCE OF A CLASS C CERTIFICATE
WILL BE EFFECTIVE UNLESS DEUTSCHE FRLP AND THE TRUSTEE SHALL HAVE RECEIVED
A LETTER, SUBSTANTIALLY IN THE FORM OF EXHIBIT C TO THE SERIES SUPPLEMENT,
FROM THE TRANSFEREE, ASSIGNEE OR RECIPIENT OF THE CONVEYANCE.
(15) IF THE PURCHASER OF THE CLASS C CERTIFICATE IS A FOREIGN
INVESTOR, THE REPRESENTATIONS AND WARRANTIES CONTAINED IN ANNEX 1 TO THE
FORM OF LETTER IN EXHIBIT C TO THE SERIES SUPPLEMENT REQUIRED TO BE SIGNED
BY FOREIGN INVESTORS PURCHASING CLASS C CERTIFICATES ARE INCORPORATED BY
REFERENCE.]
6
$___________ FLOATING RATE ASSET BACKED CERTIFICATES,
SERIES [ ], CLASS [ ]
evidencing a fractional undivided interest in certain
assets of the
DISTRIBUTION FINANCIAL SERVICES FLOORPLAN MASTER TRUST.
This certificate ("Certificate") does not represent any interest in, or
obligation of, CDF Financing, L.L.C. ("the LLC" or the "Seller"), GE Commercial
Distribution Finance Corporation ("CDF"), General Electric Capital Corporation
or any affiliate thereof.
This certifies that [ ] (the "Class [ ] Certificateholder"), is the
registered owner of a fractional undivided interest in assets of the
Distribution Financial Services Floorplan Master Trust (the "Trust") created
pursuant to an Amended and Restated Pooling and Servicing Agreement, dated as of
April 1, 2000 (as amended, the "P&S"), as supplemented by the Series [ ]
Supplement dated as of [ ], 2002 (the "Series [ ] Supplement" or the "Series
Supplement"), among the LLC, as Seller, CDF, as Servicer, and [ ], as trustee
(the "Trustee"). The P&S and the Series [ ] Supplement are collectively referred
to herein as the "Pooling and Servicing Agreement."
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement or be valid
for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
This Certificate is issued under and is subject to the terms, provisions
and conditions of the Pooling and Servicing Agreement to which, as amended and
supplemented from time to time, the Certificateholder by virtue of the
acceptance hereof assents and is bound. Although a summary of certain provisions
of the Pooling and Servicing Agreement is set forth herein, this Certificate
does not purport to summarize the Pooling and Servicing Agreement and reference
is made to the Pooling and Servicing Agreement for information with respect to
the interests, rights, benefits, obligations, proceeds and duties evidenced
hereby and the rights, duties and obligations of the Trustee. In the event of
any conflict or inconsistency between this Certificate and the Pooling and
Servicing Agreement, the Pooling and Servicing Agreement shall control in all
respects. To the extent not defined herein, the capitalized terms used herein
have the meanings ascribed to them in the Pooling and Servicing Agreement.
The Seller has entered into the Pooling and Servicing Agreement and the
Series [ ] Certificates have been (or shall be) issued with the intention that
the Series [ ] Certificates shall qualify as indebtedness of the LLC secured by
the Receivables for Federal income taxes, state and local income, single
business and franchise taxes (imposed on or measured by income) and
7
any other taxes imposed on or measured by income. The Seller, each Beneficiary
and each Certificateholder and Certificate Owner, by the acceptance of its
Certificate or Book-Entry Certificate, as applicable, agrees to treat such
Series [ ] Certificate as indebtedness of the Seller secured by the Receivables
for Federal income taxes, state and local income, single business and franchise
taxes (imposed on or measured by income) and any other taxes imposed on or
measured by income.
[FOR CLASS B AND CLASS C CERTIFICATES, INSERT: THIS CERTIFICATE IS
SUBORDINATE TO THE CLASS A [AND CLASS B] CERTIFICATES IN ACCORDANCE WITH THE
SERIES SUPPLEMENT].
8
IN WITNESS WHEREOF, the Seller has caused this Certificate to be duly
executed.
CDF FINANCING, L.L.C.
By: ________________________________
Name:
Title:
Dated:
S-1
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned Pooling and
Servicing Agreement.
[ ],
as Trustee
By: ________________________________
Authorized Officer
Dated:
S-2
ASSIGNMENT
Social Security or other identifying number of assignee
------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
------------------------------
(name and address of assignee)
the within certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints _________________________, attorney, to transfer said
certificate on the books kept for registration thereof, with full power of
substitution in the premises.
Dated: ___________________ _______________________*
Signature Guaranteed:
-----------------------
(*) NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the within Certificate in every particular,
without alteration, enlargement or any change whatsoever.
EXHIBIT B
DISTRIBUTION DATE STATEMENT
(a) The aggregate amount of Collections, the aggregate amount of
Non-Principal Collections and the aggregate amount of Principal Collections
processed during the immediately preceding Collection Period, and the Pool
Balance as of the end of such Collection Period;
(b) The Floating Allocation Percentage, the Principal Allocation
Percentage and the Series [ ] Allocation Percentage relating to such Collection
Period;
(c) The total amount, if any, distributed on the Series [ ]
Certificates;
(d) The amount of such distribution allocable to principal on the Class
A Certificates, the Class B Certificates and the Class C Certificates;
(e) The amount of such distribution allocable to interest on the Class
A Certificates, the Class B Certificates and the Class C Certificates;
(f) The Investor Default Amount for the applicable Distribution Date;
(g) The Deficiency Amount, if any, for the preceding Collection Period;
(h) The amount of the Class A, Class B and Class C Investor Charge-Offs
and the amounts of reimbursements thereof for the preceding Collection Period;
(i) The amount of the Monthly Servicing Fee for the preceding
Collection Period;
(j) The Class A Invested Amount, the Class B Invested Amount, the Class
C Invested Amount, the Excess Funding Account balance and the outstanding
principal balance of the Class A, Class B and Class C Certificates for such
Distribution Date (after giving effect to all distributions which shall occur on
such Distribution Date);
(k) The Controlled Deposit Amount, if any;
(l) The Class A Pool Factor, Class B Pool Factor and Class C Pool
Factor;
(m) LIBOR and the applicable Net Receivables Rate for the next Interest
Period;
(n) The Reserve Fund balance with respect to the current Determination
Date;
(o) The Principal Funding Account balance, the Interest Funding Account
balance, he Yield Supplement Account balance and the Collection Account balance
with respect to the current Distribution Date;
(p) The Servicer Advance, if any, for the current Distribution Date and
reimbursement of any Servicer Advance;
(q) Any elective or "deemed" waiver of the Monthly Servicing Fee for
the current Distribution Date;
(r) If a Dealer Overconcentration exists, (i) the Unconcentrated Pool
Balance, (ii) the aggregate amount of such Dealer Overconcentration, (iii) the
applicable Unconcentrated Percentage and Overconcentrated Percentage, and (iv)
the portion of Collections, Miscellaneous Payments and the Defaulted Amount
allocated to the Dealer Overconcentration Series and other Series;
(s) the Class A Monthly Interest;
(t) the Class B Monthly Interest;
(u) the Class C Monthly Interest;
(v) the Class A Additional Interest;
(w) the Class B Additional Interest;
(x) the Class C Additional Interest;
(y) the Certificateholders' Monthly Servicing Fee;
(z) the Reserve Fund Deposit Amount;
(aa) the Investor Default Amount;
(bb) the Class A Carry-over Amount;
(cc) the Class B Carry-over Amount;
(dd) the Class C Carry-over Amount;
(ee) the Yield Supplement Account Deposit Amount;
(ff) the amount calculated pursuant to Section 4.6(b);
(gg) the amount calculated pursuant to Section 4.7(a)(i);
(hh) the amount calculated pursuant to Section 4.8;
(ii) the amount calculated pursuant to Section 4.10; and
(jj) Miscellaneous Payments, including Adjustment Payments, Transfer
Deposit Amounts and Unallocated Principal Collections.
EXHIBIT C
FORM OF REPRESENTATION LETTER
[Date]
[ ], as Trustee
CDF Financing, L.L.C.
000 Xxxxxxxxx Xxxxxx Xxxxx
Xx. Xxxxx, XX 00000
Re: Distribution Financial Services Floorplan Master Trust, Series [ ],
Class C Certificates
Ladies and Gentlemen:
This letter is being delivered by the undersigned (the "Purchaser")
pursuant to Section 9.5 of the Series [ ] Supplement dated as of [ ] (as
amended, amended and restated or otherwise modified from time to time, the
"Supplement") among CDF Financing, L.L.C., as Seller ("the LLC"), GE Commercial
Distribution Finance Corporation, as Servicer, and [ ], as Trustee, in
connection with the Purchaser's acquisition of a Class C Certificate.
Capitalized terms defined in (or by reference in) the Supplement and used herein
without definition shall have the meanings defined in (or by reference in) the
Supplement. The Purchaser hereby represents and warrants to the Trustee and the
LLC, and hereby agrees with the Trustee and the LLC, and the Purchaser hereby
acknowledges, as follows:
(1) The Class C Certificates have not been and will not be
registered under the Securities Act or the securities laws of any
jurisdiction. Consequently, the Class C Certificates are not
transferable other than pursuant to an exemption from the registration
requirements of the Securities Act and satisfaction of certain
provisions of the Supplement.
(2) The Purchaser is a "qualified institutional buyer" ("QIB")
within the meaning of Rule 144A under the Securities Act ("Rule 144A")
and is purchasing for its own account (and not for the account of
others) or as a fiduciary or agent for others (which others also are
QIBs and have executed a letter substantially in the form of this
letter and have delivered a copy of such letter to the LLC and the
Trustee). The Purchaser is aware that it (or any account for which it
is purchasing) may be required to bear the economic risk of an
investment in the Class C Certificates for an indefinite period, and it
(or such account) is able to bear such risk for an indefinite period.
(3) No sale, pledge or other transfer of any Class C Certificate
may be made by any Person unless (a) either (i) such sale, pledge or
other transfer is made to the LLC, or (ii) so long as the Class C
Certificates are eligible for resale pursuant to Rule 144A under the
Securities Act, such sale, pledge or other transfer is made to a Person
whom the transferor reasonably believes after due inquiry is a QIB
acting for its own account (and not for the account of others) or as a
fiduciary or agent for others (which others also are
1
QIBs) to whom notice is given that the sale, pledge or transfer is
being made in reliance on Rule 144A.
(4) The Class C Certificates may not be acquired by or for the
account of (i) an "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 the provisions of Title I of ERISA, (ii)
a plan described in Section 4975(e)(1) of the Code or (iii) any entity
whose underlying assets include plan assets by reason of a plan's
investment in the entity. By accepting and holding a Class C
Certificate, the holder thereof shall be deemed to have represented and
warranted that it is not within any of the categories described in the
preceding sentence.
(5) The Purchaser acknowledges that it has been afforded an
opportunity to request from the LLC, the Servicer and [ ] (the "Initial
Purchaser"), and has received and reviewed, all information which it
has deemed necessary in connection with its decision to purchase the
Class C Certificates. The Purchaser acknowledges that none of the LLC,
the Servicer, the Initial Purchaser nor any of their respective
affiliates or any Person representing any of them has made any
representation to it with respect to any information relating to the
offering or sale of the Class C Certificates, other than the
information contained in the private placement memorandum for the Class
C Certificates, a copy of which has been delivered to it.
(6) The Purchaser understands that all information furnished to it
by the LLC, the Servicer or the Initial Purchaser or representatives of
the LLC, the Servicer or the Initial Purchaser in connection with its
evaluation of an investment in the Class C Certificates was provided to
it on a confidential basis and it agrees not to disclose such
information, in whole or in part, to any other Person.
(7) The Purchaser further represents and warrants to the LLC and
the Trustee that, except to the extent permitted in paragraphs (8) and
(9) below, the Purchaser: (i) is properly classified as a "corporation"
as described in Section 7701(a)(3) of the Code which is created or
organized under the laws of the United States, any State thereof or the
District of Columbia, and will not knowingly take any action which will
cause it not to be so classified; and (ii) is not an S corporation as
described in Section 1361 of the Code (an "S Corporation"), and will
not knowingly take any action which will cause it to be so classified.
(8) No Class C Certificates shall be transferred or sold to any
grantor trust, partnership or S Corporation (each a "Pass-Through
Entity") unless such entity represents that (i) not 25% or more (or
that amount which the Internal Revenue Service (or any successor
thereto) may subsequently indicate is an amount which prevents treating
direct and/or indirect owners of a Pass-Through Entity as partners in
the Trust for purposes of determining whether the Trust is a publicly
traded partnership) of the value of the assets of the Pass-Through
Entity is attributable to the Pass-Through Entity's ownership interest
in certificates issued by the Trust other than the Class A and Class B
Certificates and (ii) the Pass-Through Entity does not specially
allocate to any of its beneficiaries amounts received in respect of
certificates issued by the Trust other than Class A and Class B
2
Certificates. Any purported transfer, assignment or other conveyance
(including any participation) of the Class C Certificates in
contravention of the immediately preceding sentence shall be null and
void ab initio and the purported transferor shall continue to be
treated as the owner of such Class C Certificates and the purported
transferee shall not be recognized as a Class C Certificateholder by
the LLC or the Trustee.
(9) No Class C Certificates shall be transferred or sold to any
foreign investor ("Foreign Investor") which does not make the
representations contained in Annex 1 to the representation letter
required to be signed by a purchaser in connection with the purchase of
Class C Certificates. A Foreign Investor for this purpose includes any
person who is not: (1) a citizen or resident of the United States; (2)
a corporation or partnership or other entity treated for Federal income
tax purposes as a corporation or a partnership created or organized in
or under the laws of the United States, any State thereof or the
District of Columbia; (3) an estate, the income of which is subject to
United States Federal income tax, regardless of its source; or (4) a
trust if a U.S. court is able to exercise primary supervision over the
administration of the trust and one or more U.S. persons have the
authority to control all substantial decisions of the trust.
Notwithstanding the preceding sentence, to the extent provided in
Treasury regulations, certain trusts in existence on August 20, 1996,
and treated as United States persons under the Code and applicable
Treasury regulations prior to that date, that elect to continue to be
treated as United States persons under the Code or applicable Treasury
regulations will not be Foreign Investors.
(10) The Purchaser confirms that is has neither acquired nor will
it sell, trade or transfer any interest in any Class C Certificate or
cause an interest in any Class C Certificate to be marketed on or
through (i) an "established securities market" within the meaning of
Section 7704(b)(1) of the Code and any proposed, temporary or final
treasury regulation thereunder, including, without limitation, an
over-the-counter market or an interdealer quotation system that
regularly disseminates firm buy or sell quotations or (ii) "secondary
market" or "substantial equivalent thereof" within the meaning of
Section 7704(b)(2) of the Code and any proposed, temporary or final
treasury regulation thereunder, including a market wherein interests in
the Class C Certificates are regularly quoted by any person making a
market in those interests and a market wherein any person regularly
makes available bid or offer quotes with respect to interests in the
Class C Certificates and stands ready to effect buy or sell
transactions at the quoted prices for itself or on behalf of others.
Any purported transfer, assignment or other conveyance of any Class C
Certificate in contravention of the foregoing covenant will be null and
void ab initio and the purported transferor will continue to be treated
as the holder of such Class C Certificate and the purported transferee
will not be recognized as a Class C Certificateholder by the LLC, the
Servicer or the Trustee.
(11) Notwithstanding the foregoing, at no time shall the aggregate
number of Private Holders exceed 100. Any purported transfer,
assignment or other conveyance (including any participation) of the
Class C Certificates in contravention of the immediately preceding
sentence will be null and void ab initio and the purported transferor
will continue to be treated as the holder of those Class C Certificates
and the purported transferee will not be recognized as a Class C
Certificateholder by the LLC,
3
the Servicer or the Trustee. "Private Holder" means each holder of a
right to receive interest or principal in respect of any direct or
indirect interest in the Trust, including any financial instrument or
contract the value of which is determined in whole or part by reference
to the Trust (including the Trust's assets, income of the Trust or
distributions made by the Trust), excluding any interest in the Trust
represented by any series or class of certificates or any other
interests as to which the Trustee has received an opinion of counsel to
the effect that that series, class or other interest will be treated as
debt or otherwise not as an equity interest in either the Trust or the
Receivables for federal income tax purposes (unless that interest is
convertible or exchangeable into an interest in the Trust or the
Trust's income or that interest provides for payment of equivalent
value). Notwithstanding the immediately preceding sentence, "Private
Holder" will also include any other person that the LLC determines is a
"partner" within the meaning of Section 1.7704-1(h)(1)(ii) of the U.S.
Treasury Regulations (including by reason of Section 1.7704-1(h)(3)) or
any successor provision of law. Any person holding more than one
interest in the Trust, each of which separately would cause that person
to be a Private Holder, will be treated as a single Private Holder.
Each holder of an interest in a Private Holder which is a partnership,
S corporation or a grantor trust under the Code will be treated as a
Private Holder unless excepted with the consent of the LLC (which
consent will be based on an opinion of counsel generally to the effect
that the action taken pursuant to the consent will not cause the Trust
to become a publicly traded partnership treated as a corporation).
Notwithstanding anything to the contrary herein, each Class C
Certificateholder, and each holder of any Class of any Series if with
respect to such Class no opinion is delivered to the effect that the
Certificates of such Class will be treated as debt for federal income
tax purposes, will be considered to be a Private Holder.
(12) The Class C Certificates will be issued in denominations of
$1,000,000 and integral multiples of $100,000 in excess thereof. No
Class C Certificate may be subdivided upon transfer or exchange in a
manner so that the resulting Class C Certificate if it had been sold in
the original offering would have had an initial offering price of less
than $1,000,000 and any purported transfer, assignment or conveyance of
a Class C Certificate in contravention of the immediately preceding
sentence will be void ab initio and the purported transferor will
continue to be treated as the owner of that Class C Certificate for all
purposes.
(13) Without limiting the foregoing, no transfer, pledge,
assignment or conveyance may be made to any one Person for Class C
Certificates with a face amount of less than $1,000,000 and, in the
case of any Person acting on behalf of one or more third parties (other
than a bank (as defined in Section 3(a)(2) of the Securities Act)
acting in its fiduciary capacity), for Class C Certificates with a face
amount of less than that amount for each of those third parties. Any
purported transfer, assignment or conveyance in contravention of the
immediately preceding sentence will be void ab initio and the purported
transferor will continue to be treated as the owner of the Class C
Certificates for all purposes. Neither the LLC nor the Trustee will be
obligated to register the Class C Certificates under the Securities
Act, qualify the Class C Certificates under the securities laws of any
state or provide registration rights to any purchaser or holder
thereof.
4
(14) No transfer, assignment or conveyance of a Class C
Certificate will be effective unless the LLC and the Trustee shall have
received a letter, substantially in the form of this letter, from the
transferee, assignee or recipient of the conveyance.
(15) The Class C Certificates will bear legends substantially to
the effect of the matters contemplated by paragraphs (1) through (14)
above, unless the LLC determines otherwise in accordance with
applicable law.
(16) This letter has been duly executed and delivered by the
Purchaser and constitutes the legal, valid and binding obligation of
the Purchaser, enforceable against the Purchaser in accordance with its
terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws or equitable
principles affecting the enforcement of creditors' rights generally and
general principles of equity.
(17) If the Purchaser is a Foreign Investor, the representations
and warranties contained in Annex 1 hereto are incorporated herein by
reference.
IN WITNESS WHEREOF, the Purchaser has signed this letter as of the date
first above written.
[NAME OF PURCHASER]
By:
---------------------------------
Name:
Title:
5
ANNEX 1
(18) The Purchaser's long term debt is rated investment grade by
an internationally recognized rating agency.
(19) The Purchaser agrees that, prior to the date on which the
first interest payment under the Supplement is due thereto, it shall
deliver to the LLC, the Servicer and the Trustee (i) two duly completed
copies of the United States Internal Revenue Service Form W-8ECI or
successor applicable form and (ii) an Internal Revenue Service Form W-8
or successor applicable form. The Purchaser also agrees to deliver to
the LLC, the Servicer and the Trustee two further copies of the said
Form W-8ECI and Form W-8, or successor applicable forms or other manner
of certification, as the case may be, on or before the date that any
such form expires or becomes obsolete or after the occurrence of any
event requiring a change in the most recent form previously delivered
by it and such extensions or renewals thereof as may reasonably be
requested by the Servicer, unless in any such case an event (including,
without limitation, any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise
be required which renders all such forms inapplicable or which would
prevent the Purchaser from duly completing and delivering any such form
with respect to it and the Purchaser so advises the Servicer, the
Trustee and the LLC.
(20) Notwithstanding anything to the contrary in this letter, the
Purchaser agrees that, upon written notice by the Servicer to the
Purchaser in accordance with paragraph (22) below that the U.S.
Internal Revenue Service ("IRS") has determined that amounts payable
under the Supplement are subject to withholding tax under Section 1446
of the Code (a "Withholding Tax" and such determination being a
"Withholding Event"):
a. The Purchaser shall, for tax years for which the Purchaser
has already filed, or was legally required to file, U.S. federal
income tax returns (each a "Prior Tax Year") prior to notice of
such Withholding Event in accordance with paragraph (22) below,
(A) provide to the LLC a signed officer's certificate of the
Purchaser stating that amounts paid under the Supplement have been
included in the Purchaser's U.S. federal income tax returns for
each such Prior Tax Year, and (B) upon the written request of the
LLC, which request shall provide assurances of confidentiality of
information reasonably satisfactory to the Purchaser, provide all
information in the Purchaser's possession or control to the LLC
or, at the Purchaser's option, to the IRS directly required by the
IRS in support of the application of Section 1463 of the Code for
each such Prior Tax Year to such Withholding Tax.
b. If Section 1463 of the Code is not applicable for any
Prior Tax Year of the Purchaser because the Purchaser did not
include amounts payable under the Supplement in its U.S. federal
income tax return for such Prior Tax Year and properly pay any
federal income tax due on such amounts or failed to file a U.S.
federal income return with respect to such Prior Tax Year, the
Purchaser shall (at the Purchaser's option) either (x) amend or
file, as the case may be, its U.S. federal income tax return for
such Prior Tax Year to properly
6
include amounts paid under the Supplement during such Prior Tax
Year, pay any federal income tax due on such amounts (and interest
and penalties thereon if required) and comply with the provisions
of clause (b) of this paragraph (20) with respect to such Prior
Tax Year or (y) pay to the LLC or the Trust, as applicable, the
amount of any Withholding Tax (and any interest or penalties
thereon) paid or payable by the LLC or the Trust to the IRS (which
payment by the Purchaser, if the applicable Withholding Tax has
not theretofore been remitted to the IRS, shall be paid over by
the LLC or the Trust, as applicable, to the IRS for application to
such Withholding Tax) on payments under the Supplement during such
Prior Tax Year which were not included on the Purchaser's U.S.
federal income tax return or with respect to which the Purchaser
did not so properly pay federal income tax.
c. No increased amounts shall be payable to the Purchaser if
any taxes are required to be withheld or deducted from any amount
payable to the Purchaser with respect to any Withholding Tax
unless, due to a change in law, treaty or regulation (or in the
interpretation or administration thereof by any governmental or
regulatory agency or body charged with the administration or
interpretation thereof), the credit for U.S. federal income tax
purposes available to the Purchaser under the Code (as in effect
on the Closing Date) resulting from such Withholding Tax is
discontinued or substantially reduced.
In connection with remitting to the IRS any required amount of
Withholding Tax on account of the Purchaser for any tax year subsequent
to the last Prior Tax Year, the amount thereof may be charged first
against the amount otherwise payable to the Purchaser pursuant to the
Supplement (a "Payable Amount") for the distribution date immediately
preceding such remittance and then against each successive Payable
Amount for subsequent distribution dates to the extent required to
aggregate such Withholding Tax amount.
(21) The Purchaser agrees that it shall use reasonable
efforts to take any actions that shall avoid any Withholding Tax
or the need for, or reduce the amount of, any amounts payable to
it for all present and future taxes, levies, imposts, duties,
deductions, withholdings, fees, liabilities and similar charges
("Taxes"); provided that the Purchaser shall not be obligated to
take any such actions that would, in the reasonable opinion of the
Purchaser, be unlawful or otherwise disadvantageous to the
Purchaser or would result in any unreimbursed cost or expense to
the Purchaser, which cost and expense would not have been incurred
but for such actions. If any amounts payable to the Purchaser for
Taxes (referred to above) shall not be eliminated or reduced by
the actions taken by the Purchaser and payment thereof under the
Supplement shall not be waived by the Purchaser within 15 days
after the LLC shall have given written notice to the Purchaser of
its intent to replace the Purchaser, the LLC shall have the right
to (A) request in writing that the Purchaser use reasonable
efforts, and the Purchaser hereby agrees upon receipt of such
request to use its reasonable efforts, to obtain a replacement
investor for the Class C Certificates owned by the Purchaser,
which replacement investor is reasonably acceptable to the LLC, or
(B) itself seek to replace the Purchaser with a new investor which
is reasonably acceptable to the LLC; provided that the Purchaser
shall not be replaced with a new investor until the Purchaser has
been repaid in full all amounts owed to it pursuant to the
Supplement. Subject to the provisions of this paragraph (21),
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the Purchaser hereby agrees to assign all of its rights and
obligations with respect to the Class C certificates (and with
respect to the Supplement) to the replacement investor pursuant to
an agreement in form and substance reasonably acceptable to the
Purchaser, the LLC, the Trustee and the replacement investor,
subject to payment in full of all amounts due to the Purchaser
under the Supplement.
(22) The Purchaser's address for notice is:
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8
SCHEDULE 1
Name of Series
[ ] Account Account No.
----------------- -----------
[ ]
Interest Funding Account [ ]
Principal Funding Account [ ]
Excess Funding Account [ ]
Reserve Fund [ ]
Yield Supplement Account [ ]
All of the foregoing accounts are maintained at the Trustee.
SCHEDULE 2
Initial Principal Amounts of the Series [ ] Certificates
Class Initial Principal Amount
----- ------------------------
Class A $[ ]
Class B $[ ]
Class C $[ ]
