Exhibit 4.2.1
FORM OF POOLING AND SERVICING
AGREEMENT
among
ACE Securities Corp. [
]
Issuing Enity,
[
],
as Depositor, and
[
],
in its individual capacity, and as
Servicer
Dated as of [
], 200[ ]
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
1
Section 1.01
Definitions
1
Section 1.02
Usage of Terms
36
Section 1.03
Section References
36
Section 1.04
Accounting Terms
37
ARTICLE II
FUNDINGS OF TRUST; TRANSFERS OF
CONTRACTS
37
Section 2.01
Creation and Funding of Trust; Transfer
of Transferred Assets
to Trust
37
Section 2.02
Acceptance by Trust
38
Section 2.03
Conveyance of Substitute
Contracts
38
Section 2.04
Release of Excluded Amounts
40
Section 2.05
Waiver
40
ARTICLE III
REPRESENTATIONS AND WARRANTIES
41
Section 3.01
Representations and Warranties of
[_________]
41
Section 3.02
Representations and Warranties of the
Depositor
41
Section 3.03
Representations and Warranties of the
Servicer
44
ARTICLE IV
PERFECTION OF TRANSFERS AND PROTECTION
OF
SECURITY INTERESTS
46
Section 4.01
Custody of Contracts
46
Section 4.02
Filings
47
Section 4.03
Name Change or Relocation
47
ARTICLE V
SERVICING OF CONTRACTS
48
Section 5.01
Initial Servicer’s Appointment and
Acceptance; Responsibility
for Contract Administration
48
Section 5.02
General Duties
48
Section 5.03
Assignment or Replacement
49
Section 5.04
Disposition Upon Termination of
Contract
49
Section 5.05
Subservicers
49
Section 5.06
Further Assurance
49
Section 5.07
Notice to Obligors
49
Section 5.08
Collection Efforts; Modification of
Contracts
50
Section 5.09
Prepayments of Certain
Contracts
51
Section 5.10
Certain Extensions;
Acceleration
51
Section 5.11
Taxes and Other Amounts
51
Section 5.12
Suits by Servicer
51
Section 5.13
Remittances
52
Section 5.14
Servicer Advances
52
Section 5.15
Realization Upon Liquidated
Contract
52
Section 5.16
Maintenance of Insurance
Policies
52
Section 5.17
Certain Other Duties With Respect to
Trust
52
Section 5.18
Servicing Compensation
53
Section 5.19
Payment of Certain Expenses by
Servicer
53
Section 5.20
Records
53
Section 5.21
Inspection
53
Section 5.22
Trust To Cooperate in Releases
54
Section 5.23
Separate Entity Existence
54
Section 5.24
Assignment of Servicing
54
Section 5.25
Optional Repurchase of Defaulted
Contracts
54
ARTICLE VI
COVENANTS OF THE DEPOSITOR
55
Section 6.01
LLC Existence
55
Section 6.02
Contracts Not to be Evidenced by
Promissory Notes
55
Section 6.03
Security Interests
55
Section 6.04
Delivery of Collections
55
Section 6.05
Regulatory Filings
55
Section 6.06
Compliance With Law
55
Section 6.07
Activities
55
Section 6.08
Indebtedness
56
Section 6.09
Guarantees
56
Section 6.10
Investments
56
Section 6.11
Merger; Transfers
56
Section 6.12
Payments
56
Section 6.13
Other Agreements
56
Section 6.14
Separate Entity Existence
57
Section 6.15
Location; Records
58
Section 6.16
Liability of Depositor;
Indemnities
58
Section 6.17
Bankruptcy Limitations
60
Section 6.18
Limitation on Liability of Depositor and
Others
60
ARTICLE VII
ESTABLISHMENT OF ACCOUNTS;
PAYMENTS
60
Section 7.01
Trust Accounts; Collections
60
Section 7.02
Reserve Account
62
Section 7.03
Trust Account Procedures
63
Section 7.04
Securityholder Payments
63
Section 7.05
Allocations and Payments
63
Section 7.06
Repurchases of, or Substitution for,
Contracts for Breach of
Representations and Warranties
66
Section 7.07
Reassignment of Repurchased or
Substituted Contracts
66
Section 7.08
The Servicer’s Purchase
Option
67
ARTICLE VIII
SERVICER DEFAULTS; SERVICING
TRANSFER
67
Section 8.01
Servicer Default
67
Section 8.02
Servicing Transfer
68
Section 8.03
Appointment of Successor Servicer;
Reconveyance; Successor
Servicer to Act
69
Section 8.04
Notifications to Noteholders and the
Equity Certificateholders
70
Section 8.05
Effect of Transfer
70
Section 8.06
Database File
71
Section 8.07
Successor Servicer
Indemnification
71
Section 8.08
Responsibilities of the Successor
Servicer
71
Section 8.09
Servicer Not to Resign
72
ARTICLE IX
SERVICER REPORTING
72
Section 9.01
Monthly Servicer’s
Reports
72
Section 9.02
Officer’s Certificate
72
Section 9.03
Other Data
72
Section 9.04
Annual Reporting; Evidence as to
Compliance
73
Section 9.05
Annual Statement of Compliance from
Servicer
73
Section 9.06
Reports to the Commission
73
ARTICLE X
TERMINATION
74
Section 10.01
Sale of Trust
Assets
74
ARTICLE XI
MISCELLANEOUS
74
Section 11.01
Amendments
74
Section 11.02
Governing Law
76
Section 11.03
Notices
76
Section 11.04
Severability of Provisions
78
Section 11.05
Third Party Beneficiaries
78
Section 11.06
Counterparts
78
Section 11.07
Headings
78
Section 11.08
No Bankruptcy Petition; Disclaimer and
Subordination
78
Section 11.09
Jurisdiction
80
Section 11.10
Servicer Indemnity
80
Section 11.11
Limitation of Liability of Owner
Trustee
80
Section 11.12
WAIVER OF JURY TRIAL
80
EXHIBITS
Exhibit A
Form of [__] Assignment
Exhibit B
Initial Schedule of Contracts
Exhibit C
Form of Monthly Servicer’s
Report
Exhibit D
Form of Substitution Transfer
Agreement
Exhibit E
Schedule of Representations and
Warranties
Exhibit F
Minimum Value Filing
Exceptions
[Exhibit [C-1]
Form of Initial Certification of
Custodian]
[Exhibit [C-2]
Form of Final Certification of
Custodian]
Exhibit [D]
Form of Power of Attorney
Exhibit [E-1]
Form of Assessment of
Compliance
[Exhibit [E-2]
Form of Custodian’s Assessment of
Compliance]
Exhibit [F]
Form 10-D Disclosure
Exhibit [G]
Form 10-K Disclosure
Exhibit [H]
Form 8-K Disclosure
Exhibit [I]
Additional Disclosure
Notification
Exhibit [J]
Form of Annual Notification
Exhibit [K]
Relevant Servicing Criteria
Schedule 1
Mortgage Loan Schedule
Schedule 2
[Prepayment Charge Schedule]
Schedule 3
[Reserved.]
This Pooling and Servicing Agreement, is
dated and effective as of [_____________], 200[__], among ACE
SECURITIES CORP., as Depositor, [_________________], as Servicer,
[_________________], as Master Servicer and Securities
Administrator and [_________________], as Trustee.
WHEREAS the Depositor desires to fund the
Trust by selling, conveying and assigning from time to time,
pursuant hereto or pursuant to Substitution Transfer Agreements
hereunder, designated Contracts or pools of Contracts together with
certain related security therefor and other related rights and
property as further described herein, which Contracts were
originated by one or more Financing Originators, or acquired by
purchase and assignment by a Financing Originator from the prior
owner thereof, and subsequently conveyed (i) by the Financing
Originators to [_____________]; (ii) by [_____________] to the
Depositor, with respect to Contracts and related assets acquired by
[_____________] from Financing Originators as described in clause
(i) above; (iii) in the case of the [_____________], by the
Depositor to the [_____________] (as defined herein); and
(iv) in the case of the [_____________] warehoused in the
[_____________], by the [_____________] back to the
Depositor;
WHEREAS the Trust is willing to purchase
and accept assignment of such Contracts and related assets;
and
WHEREAS the Servicer is willing to
service such Contracts and related assets for the benefit and
account of the Trust and the Holders pursuant to the terms
hereof.
NOW, THEREFORE, in consideration of the
premises and the mutual covenants herein contained, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01
Definitions . Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires,
shall have the following meanings:
“Accounting Date” means, with
respect to a Payment Date, the last day of the preceding calendar
month.
“Accountant’s Report”
has the meaning specified in Section 9.04.
“Accrual Period” means, with
respect to any Payment Date, with respect to the Class [__] Notes,
the period from and including the immediately preceding Payment
Date to but excluding such Payment Date (or, in the case of the
initial Accrual Period, from and including the Closing Date to but
excluding the first Payment Date following the Closing Date), and
with respect to each other Class of Notes, the period from and
including the 20th day of the immediately preceding calendar month
to but excluding the 20th day of the related calendar month,
provided, that in each case, the initial Accrual Period following
the Closing Date shall be the period from and including the Closing
Date to but excluding [___________] 20[ ].
“ACE Assignment” means the
Release and Assignment instrument dated the Closing Date,
substantially in the form attached hereto as Exhibit A ,
executed by the ACE Trust conveying, assigning and releasing the
ACE Contract Assets to the Depositor.
“ACE Contract Assets” means
the Contract Assets pertaining to the ACE Contracts.
“ACE Contracts” means
Contracts conveyed by the ACE Trust to the Depositor pursuant to
the ACE Assignment, as listed in the Schedule of Contracts attached
to the ACE Assignment.
“ACE Conveyancing Agreement”
means the Amended and Restated Conveyancing Agreement dated as of
[_________] 20[ ], among the [__________] and [_________], as
the same has been or may be amended, supplemented, restated or
otherwise modified from time to time.
“ACE Pooling Agreement” means
the Amended and Restated Pooling and Servicing Agreement dated as
of [_________] 20[ ], by and among the ACE Trust, the
Depositor and [_________], as the same has been or may be amended,
supplemented, restated or otherwise modified from time to
time.
“ACE Purchase Agreement”
means the Amended and Restated Sale and Contribution Agreement
dated as of [________] 200[ ], by and among [_________],
[_________], and the Depositor, as the same has been or may be
amended, supplemented, restated or otherwise modified from time to
time.
“ACE Trust” means the ACE
Equipment Trust – ACE Series created and existing pursuant to
the Trust Agreement dated as of [________] 200[ ], by and
between the Depositor and [_________], as owner trustee, as the
same has been or may be amended, supplemented, restated or
otherwise modified from time to time.
“Addition Notice”
means, with respect to any transfer of Subsequent Contracts to the
Trust pursuant to Section 2.03 (and the Depositor’s
corresponding prior purchase of such Contracts from [_________]), a
notice, which shall be given at least five days prior to the
related Subsequent Transfer Date, identifying the Subsequent
Contracts to be transferred, the Contract Principal Balance of such
Subsequent Contracts and the related Substitution Event (with
respect to an identified Contract or Contracts then in the Contract
Pool) to which such Subsequent Contract relates, with such notice
to be signed both by the Depositor and [_____________].
“Administration Agreement”
means the Administration Agreement dated as of [_____________], 20[
] (as amended, restated, supplemented, or otherwise modified
from time to time in accordance with the terms thereof) by and
among the Trust, [_____________], the Depositor and the Indenture
Trustee.
“Administrator” shall be the
party named as such under the Administration Agreement.
“Affiliate” of any specified
Person means any other Person controlling or controlled by, or
under common control with, such specified Person. For the
purposes of this definition, “control” when used with
respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or
otherwise; and the terms “controlling” or
“controlled” have meanings correlative to the
foregoing.
“Aggregate Principal Amount”
means, with respect to any group of Notes of any Class, at any date
of determination, the sum of the Principal Amounts of such Notes on
such date of determination.
“Agreement” means this
Pooling and Servicing Agreement, as amended, restated, supplemented
or otherwise modified from time to time in accordance with the
terms hereof.
“Allocation Criteria” means,
with respect to the allocation of Insurance Proceeds or Liquidation
Proceeds between the Trust (for inclusion as Collections) and the
Depositor, as contemplated in the definition of Available Funds,
that Insurance Proceeds or Liquidation Proceeds with respect to the
Contracts consisting of Leases are allocable pro rata between
inclusion as Available Funds in respect of the Contract Pool, on
the one hand, and directly to the Depositor, on the other, based
upon (i) for allocation to Available Funds, the Required Payoff
Amount for such Lease (determined as of the last day of the
Collection Period during which such Lease became a Liquidated
Contract), and (ii) for allocation to the Depositor, the Book Value
of the related Equipment; provided, that in the event the Insurance
Proceeds or Liquidation Proceeds in respect of a particular Lease
exceed the sum of such Required Payoff Amount for such Lease
plus the Book Value of the related Equipment, any such
excess shall be allocated solely to the Depositor.
“Applicable Security” means,
with respect to a Vendor Loan, any (i) Secondary Contract securing
such Vendor Loan and (ii) Equipment securing such Vendor Loan or a
related Secondary Contract.
“Available Funds” means, as
to any Payment Date, the sum of (i) the Related Collection Period
Collections for such Payment Date, (ii) any Servicer Advances on
deposit in the Collection Account as of the immediately preceding
Deposit Date and (iii) to the extent necessary to pay interest,
amounts of the type described in clause (i) above that the Trust
received after the end of the related Collection Period; provided,
however, that Available Funds shall not include any amount
allocable to the Depositor as representing Excluded Residual
Investments.
“Available Reserve Amount”
means, with respect to a Payment Date, the amount of funds equal to
the lesser of (i) the amount on deposit in the Reserve Account
(determined (a) exclusive of any Investment Earnings thereon
and (b) before giving effect to any deposit to be made or
withdrawals from the Reserve Account with respect to such Payment
Date), and (ii) the Specified Reserve Account Balance.
“Bankruptcy Code” means The
United States Bankruptcy Code, Title 11 et seq., of the United
States Code, as amended from time to time.
“Book Value” means, with
respect to any Equipment subject to a Lease, the value of such
Equipment as shown on the accounting books and records of the
applicable Financing Originator (or the Depositor, in the case of
Equipment relating to Contracts being transferred pursuant to the
ACE Assignment), as of the Cut-Off Date for the related Lease (it
being understood that Book Value constitutes a measure of the
lessor’s residual interest in the Equipment as shown on its
books and records as of such date, net of the financial asset shown
on such books and records represented by the discounted Scheduled
Payments owing on the Lease).
“Business Day” means any day
which is neither a Saturday or a Sunday, nor another day on
which banking institutions in the states of New Jersey, New York or
Texas are authorized or obligated by law, executive order,
or governmental decree to be closed.
“Casualty Loss” means, with
respect to any item of Equipment, the loss, theft, damage beyond
repair or governmental condemnation or seizure of such item of
Equipment.
“Certificate of Formation”
means the limited liability company Certificate of Formation of the
Depositor.
“Certificate of Trust” has
the meaning given such term in the Trust Agreement.
“Certificate Register” has
the meaning specified in the Trust Agreement.
“Class” means any of the
group of Notes, or the Equity Certificate identified herein as the
Class [__] Notes, the Class [__] Notes, the Class [__] Notes, the
Class [__] Notes, the Class [__] Notes, the Class C Notes
and the Class D Notes or the Equity Certificate, as
applicable.
“Class [__] Notes” means the
Class [__] Notes, the Class [__] Notes, the Class [__] Notes and
the Class [__] Notes.
“Class [__] Percentage” means
[__]%.
“Class [__] Principal Payment
Amount” means: (a) with respect to any Payment Date on or
prior to the Payment Date on which the Principal Amount of the
Class [__] Notes has been reduced to zero, the greater of
(i) the excess , if any, of (1) the Principal Amount of the
Class [__] Notes over (2) the Class [__] Scheduled Principal
Balance and (ii) the excess , of (1) the sum of the
Principal Amount of the Class [__], Class [__], Class [__] and
Class [__] Notes over (2) the Class [__] Target Principal
Amount; and (b) with respect to any Payment Date thereafter, the
excess of (i) the sum of the Principal Amount of the Class
[__], Class [__] and Class [__] Notes over (ii) the Class
[__] Target Principal Amount.
“Class [__] Target Principal
Amount” means, with respect to any Payment Date, the product
of (i) the Class [__] Percentage and (ii) the Contract Pool
Principal Balance as of the related Accounting Date.
“Class [__] Interest Carryover
Shortfall” means, with respect to any Payment Date, the
excess, if any, of the Class [__] Interest Payment Amount for the
preceding Payment Date over the amount that was actually paid in
respect of interest on the Class [__] Notes on such preceding
Payment Date, plus , to the extent permitted by law, an
amount equal to the product of (i) the Class [__] Interest Rate,
(ii) such excess, and (iii) a fraction equal to the number of days
in the related Accrual Period divided by 360.
“Class [__] Interest Payment
Amount” means, with respect to any Payment Date, the sum of
the Class [__] Monthly Interest Payment Amount and the Class [__]
Interest Carryover Shortfall for such Payment Date.
“Class [__] Interest Rate”
means [__]% per annum.
“Class [__] Maturity Date”
means [________], 20[ ] (or, if such day is not a Business
Day, the next succeeding Business Day).
“Class [__] Monthly Interest
Payment Amount” means (a) with respect to the first Accrual
Period and the related Payment Date, an amount equal to the product
of (i) the Class [__] Interest Rate, (ii) the Initial Class [__]
Principal Amount, and (iii) a fraction equal to the number of days
in such Accrual Period divided by 360, and (b) with respect to each
subsequent Accrual Period and the related Payment Date, an amount
equal to the product of (i) the Class [__] Interest Rate, (ii)
the Principal Amount of the Class [__] Notes on the immediately
preceding Payment Date, after giving effect to all payments of
principal to Class [__] Noteholders on or prior to such immediately
preceding Payment Date, and (iii) a fraction equal to the
number of days in such Accrual Period divided by 360.
“Class [__] Notes” means the
[__]% Class [__] Receivable-Backed Notes in the Aggregate Principal
Amount of $[__], issued pursuant to the Indenture.
“Class [__] Scheduled Principal
Balance” means, with respect to each Payment Date, the
balance for such Payment Date as set forth in the following
table.
|
Payment Date
|
Class [__] Scheduled Principal Balance
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
“Class [__] Interest Carryover
Shortfall” means, with respect to any Payment Date, the
excess, if any, of the Class [__] Interest Payment Amount for the
preceding Payment Date over the amount that was actually paid in
respect of interest on the Class [__] Notes on such preceding
Payment Date, plus , to the extent permitted by law,
an amount equal to the product of (i) the Class [__] Interest
Rate, (ii) such excess, and (iii) a fraction equal to
one-twelfth.
“Class [__] Interest Payment
Amount” means, with respect to any Payment Date, the sum of
the Class [__] Monthly Interest Payment Amount and the Class [__]
Interest Carryover Shortfall for such Payment Date.
“Class [__] Interest Rate”
means [__]% per annum.
“Class [__] Maturity Date”
means, [_________], 20[ ] (or, if such day is not a Business
Day, the next succeeding Business Day thereafter).
“Class [__] Monthly Interest
Payment Amount” means (a) with respect to the first Accrual
Period and the related Payment Date, an amount equal to the product
of (i) the Class [__] Interest Rate, (ii) the Initial Class [__]
Principal Amount, and (iii) a fraction equal to the number of days
in such Accrual Period divided by 360, and (b) with respect to each
subsequent Accrual Period and the related Payment Date, an amount
equal to the product of (i) the Class [__] Interest Rate, (ii)
the Principal Amount of the Class [__] Notes on the immediately
preceding Payment Date, after giving effect to all payments of
principal to Class [__] Noteholders on or prior to such immediately
preceding Payment Date, and (iii) a fraction equal to the
number of days in such accrual period divided by 360.
“Class [__] Notes” means the
[__]% Class [__] Receivable-Backed Notes in the Aggregate Principal
Amount of $[__], issued pursuant to the Indenture.
“Class [__] Interest Carryover
Shortfall” means, with respect to any Payment Date, the
excess, if any, of the Class [__] Interest Payment Amount for the
preceding Payment Date over the amount that was actually paid in
respect of interest on the Class [__] Notes on such preceding
Payment Date, plus , to the extent permitted by law,
an amount equal to the product of (i) the Class [__] Interest
Rate, (ii) such excess, and (iii) a fraction equal to
one-twelfth.
“Class [__] Interest Payment
Amount” means, with respect to any Payment Date, the sum of
the Class [__] Monthly Interest Payment Amount and the Class [__]
Interest Carryover Shortfall for such Payment Date.
“Class [__] Interest Rate”
means [__]% per annum.
“Class [__] Maturity Date”
means [_________], 200[ ] (or, if such day is not a Business
Day, the next succeeding Business Day thereafter).
“Class [__] Monthly Interest
Payment Amount” means (a) with respect to the first Accrual
Period and the related Payment Date, an amount equal to the product
of (i) the Class [__] Interest Rate, (ii) the Initial Class [__]
Principal Amount, and (iii) a fraction equal to the number of days
in such Accrual Period divided by 360, and (b) with respect to each
subsequent Accrual Period and the related Payment Date, an amount
equal to the product of (i) the Class [__] Interest Rate, (ii)
the Principal Amount of the Class [__] Notes on the immediately
preceding Payment Date, after giving effect to all payments of
principal to Class [__] Noteholders on or prior to such immediately
preceding Payment Date, and (iii) a fraction equal to [the
number of days in such Accrual Period divided by 360].
“Class [__] Notes” means the
[__]% Class [__] Receivable-Backed Notes in the Aggregate Principal
Amount of $[__], issued pursuant to the Indenture.
“Class [__] Interest Carryover
Shortfall” means, with respect to any Payment Date, the
excess, if any, of the Class [__] Interest Payment Amount for the
preceding Payment Date over the amount that was actually paid in
respect of interest on the Class [__] Notes on such preceding
Payment Date, plus , to the extent permitted by law,
an amount equal to the product of (i) the Class [__] Interest
Rate, (ii) such excess, and (iii) a fraction equal to
one-twelfth.
“Class [__] Interest Payment
Amount” means, with respect to any Payment Date, the sum of
the Class [__] Monthly Interest Payment Amount and the Class [__]
Interest Carryover Shortfall for such Payment Date.
“Class [__] Interest Rate”
means [__]% per annum.
“Class [__] Maturity Date”
means [__________], 20[ ] or, if such day is not a Business Day,
the next succeeding Business Day thereafter).
“Class [__] Monthly Interest
Payment Amount” means (a) with respect to the first Accrual
Period and the related Payment Date, an amount equal to the product
of (i) the Class [__] Interest Rate, (ii) the Initial Class [__]
Principal Amount, and (iii) a fraction equal to the number of days
in such Accrual Period divided by 360, (b) with respect to each
subsequent Accrual Period and the related Payment Date, an amount
equal to the product of (i) the Class [__] Interest Rate, (ii)
the Principal Amount of the Class [__] Notes on the immediately
preceding Payment Date, after giving effect to all payments of
principal to Class [__] Noteholders on or prior to such immediately
preceding Payment Date.
“Class [__] Notes” means the
[__]% Class [__] Receivable-Backed Notes in the Aggregate Principal
Amount of $[__], issued pursuant to the Indenture.
“Class [__] Floor” means,
with respect to any Payment Date, an amount equal to (i) [__]% of
the Initial Contract Pool Principal Balance, plus (ii) the
Unfunded Loss Amount, if any, for such Payment Date, minus
(iii) the sum of the Principal Amount of the Class C Notes and the
Principal Amount of the Class D Notes (prior to giving effect to
any payments of principal on the Class C Notes or the Class D Notes
on such Payment Date) and the amount on deposit in the Reserve
Account (after giving effect to withdrawals and releases to be made
on such Payment Date); provided , however , that in
no event will the Class [__] Floor be greater than the Principal
Amount of the Class [__] Notes immediately prior to such Payment
Date or less than zero.
“Class [__] Interest Carryover
Shortfall” means, with respect to any Payment Date, the
excess, if any, of the Class [__] Interest Payment Amount for the
preceding Payment Date over the amount that was actually paid in
respect of interest on the Class [__] Notes on such preceding
Payment Date, plus , to the extent permitted by law, an
amount equal to the product of (i) the Class [__] Interest Rate,
(ii) such excess, and (iii) a fraction equal to
one-twelfth.
“Class [__] Interest Payment
Amount” means, with respect to any Payment Date, the sum of
the Class [__] Monthly Interest Payment Amount and the Class [__]
Interest Carryover Shortfall for such Payment Date.
“Class [__] Interest Rate”
means [__]% per annum.
“Class [__] Maturity Date”
means [_________], 20[ ] or, if such day is not a Business
Day, the next succeeding Business Day thereafter).
“Class [__] Monthly Interest
Payment Amount” means (a) with respect to the first Accrual
Period and the related Payment Date, an amount equal to the product
of (i) the Class [__] Interest Rate, (ii) the Initial Class [__]
Principal Amount, and (iii) a fraction equal to the number of days
in such Accrual Period divided by 360, and (b) with respect to each
subsequent Accrual Period and the related Payment Date, an amount
equal to the product of (i) the Class [__] Interest Rate, (ii) the
Principal Amount of the Class [__] Notes on the immediately
preceding Payment Date, after giving effect to all payments of
principal to Class [__] Noteholders on or prior to such immediately
preceding Payment Date, and (iii) a fraction equal to
one-twelfth.
“Class [__] Notes” means the
[__]% Class [__] Receivable-Backed Notes in the Aggregate Principal
Amount of $[__], issued pursuant to the Indenture.
“Class [__] Percentage” means
[__]%.
“Class [__] Principal Payment
Amount” means the lesser of (a) the excess, if any, of
(i) the Total Principal Payment Amount over (ii) the Class
[__] Principal Payment Amount and (b) the excess, if any, of
(i) the Principal Amount of the Class [__] Notes over (ii) the
Class [__] Target Principal Amount; provided, however, that in no
event will the Class [__] Principal Payment Amount exceed the
Principal Amount of the Class [__] Notes.
“Class [__] Target Principal
Amount” means, with respect to any Payment Date, the product
of (i) the Class [__] Percentage and (ii) the Contract Pool
Principal Balance as of the related Accounting Date.
“Closing Date” means
[____________] 20[ ].
“Code” means the Internal
Revenue Code of 1986, as amended.
“Collection Account” means
the account so designated established pursuant to
Section 7.01.
“Collection Account Property”
means the Collection Account, all amounts and investments held from
time to time in the Collection Account (whether in the form of
deposit accounts, physical property, book-entry securities,
uncertificated securities or otherwise), and all proceeds of the
foregoing.
“Collection Period” means a
period beginning on the first day of a calendar month and ending
on, but not including, the first day of the next calendar month,
provided that the first Collection Period shall be the two calendar
months preceding the month in which the first Payment Date
occurs.
“Collections” means the sum
of (i) all Scheduled Payments on the Contracts, including (without
duplication) Scheduled Payments on Defaulted Contracts, received on
or after the Cut-Off Date (excluding the Excluded Amounts); (ii)
any Prepayments received on the Contracts on or after the Cut-Off
Date (other than (a) in the case of a Lease, any Excluded Residual
Investment which shall be allocated to the Depositor, or (b) in the
case of a Prepaid Contract for which a substitution has been made
in accordance with Section 2.03 of this Agreement, that portion
thereof to which the Depositor is entitled pursuant to Section
2.03); (iii) the Purchase Amount of any Contracts purchased by
[_________] in accordance with Section 7.06 of this Agreement
(other than any portion thereof attributable in the case of a Lease
to the Excluded Residual Investments); (iv) the amount paid by
[_________] or the Depositor to purchase the Contracts pursuant to
Section 7.08 of this Agreement; (v) that portion of the
Liquidation Proceeds received in respect of any Contracts and the
disposition of the related Equipment on or after the Cut-Off Date
allocated to the Trust; and any earnings on the investment of
amounts credited to amounts of deposit in the Collection Account;
provided that, Collections shall not include any amounts received
with respect to any Excluded Residual Investment.
“Commission” means the United
States of America Securities and Exchange Commission.
“Computer Disk” means the
computer disk generated by the Servicer (or any subservicer under
Section 5.05), which provides information relating to
Contracts in the Contract Pool and which was used by such party in
selecting the related Contracts for conveyance and inclusion in
such Contract Pool, and includes the master file and the history
file as well as servicing information with respect to such
Contracts.
“Contract” means each
End-User Contract and each Vendor Loan listed on any Schedule of
Contracts but, unless otherwise specified herein, shall not refer
to any Secondary Contract.
“Contract Assets” means, with
respect to any Contracts (including Substitute Contracts) and
related assets conveyed or being conveyed to the Depositor pursuant
to a Substitution Assignment Agreement, the ACE Assignment or the
Non-ACE Purchase Agreement, and concurrently conveyed or being
conveyed by the Depositor to the Trust pursuant to this Agreement
or a Substitution Transfer Agreement, all right, title and interest
of [_________] or the ACE Trust, as the case may be, in, to and
under:
(i)
such Contracts, and all monies due or to
become due in payment of such Contracts on and after the relevant
Cut-Off Date, and including Scheduled Payments due but not yet
received prior to the relevant Cut-Off Date and all other Scheduled
Payments (including in respect of any Guaranteed Residual
Investment) due or becoming due on or after the relevant Cut-Off
Date, any Prepayments, any payments in respect of a casualty or
early termination, any Liquidation Proceeds received with respect
thereto, but excluding any Scheduled Payments both due and actually
received and processed prior to the related Cut-Off Date and any
Excluded Amounts;
(ii)
the Financed Items related to such
Contracts and, in the case of any Vendor Loan, related Applicable
Security, including all proceeds from any sale or other disposition
of such Financed Items (but subject to the exclusion and release
herein of Excluded Amounts) and any Guaranteed Residual
Investment;
(iii)
the related Contract Files;
(iv)
all payments made or to be made in the
future with respect to such Contracts or the Obligor thereunder
under any Vendor Agreements with the relevant Financing Originator
and under any guarantee or similar credit enhancement with respect
to such Contracts;
(v)
all Insurance Proceeds with respect to
each such Contract; and
(vi)
all income from and proceeds of the
foregoing.
“Contract File” means, with
respect to each Contract, the fully executed original counterpart
(for UCC purposes) of the Contract, the original certificate of
title or other title document with respect to the related Equipment
(if applicable) or, in each case, if (but only if) such original
documents are intangible documents, the electronic files of such
originals, and otherwise such documents or electronic entries, if
any, that the Servicer (or applicable Financing Originator) keeps
on file in accordance with Customary Policies and Procedures
evidencing ownership of such Equipment (if applicable), and
all other documents originally delivered to the Financing
Originator or held by the Servicer (or subservicer under
Section 5.05) with respect to any Contract.
“Contract Pool” means, as of
any date of determination, the aggregate of the Contracts which
have been conveyed to the Trust and which constitute as of such
date Trust Assets under the terms and provisions hereof.
“Contract Pool Principal
Balance” means with respect to any Payment Date, the sum of
the Contract Principal Balances (computed as of the related
Accounting Date) for all Contracts; provided that, on any Payment
Date on which the Contract Pool Principal Balance is determined to
be less than or equal to $[__], then the Contract Pool Principal
Balance will be deemed equal to $0.
“Contract Principal Balance”
means as of any Accounting Date, with respect to any Contract, the
present value of the unpaid Scheduled Payments due on such Contract
after such Accounting Date (excluding all Scheduled Payments due on
or prior to, but not received as of, such Accounting Date, as well
as any Scheduled Payments due after, but received as of, such
Accounting Date), after giving effect to any Prepayments received
on or prior to such Accounting Date, discounted monthly at the
Discount Rate (assuming, for purposes of such calculation, that
each Scheduled Payment is due on the last day of the applicable
Collection Period); provided that, for purposes of computing the
Total Principal Payment Amount, or the Specified Reserve Account
Balance for a given Payment Date (as well as all Payment Dates
thereafter), the Contract Principal Balance of any Contract, which
became a Defaulted Contract during the related Collection Period or
was required to be purchased by [_________] as of the last day of
the related Collection Period in accordance with Section 5.01 of
the Purchase and Sale Agreement, will be deemed to be zero on and
after the last day of such Collection Period.
“Corporate Trust Office”
means the corporate trust office of the Owner Trustee, which office
initially shall be located at 500 Stanton Christiana Road, 3/OPS 4,
Newark, Delaware 19713, or such other office at such other address
as the Owner Trustee may designate from time to time by notice to
the Equity Certificateholder, the Servicer, the Administrator and
the Depositor.
“Cumulative Net Loss Event”
means, with respect to any Collection Period, the Cumulative Net
Loss Ratio for such Collection Period exceeds the Cumulative Net
Loss Trigger for such Collection Period.
“Cumulative Net Loss Ratio”
means the ratio of (a) the Cumulative Reported Net Losses
recognized with respect to the Contracts in the Contract Pool since
the Initial Cut-Off Date over (b) the Initial Contract Pool
Principal Balance.
“Cumulative Net Loss Trigger”
means, for each of the Collection Periods set forth below, the
Cumulative Net Loss Ratio percentage opposite such Collection
Period (and measured on each of the Payment Dates following the
Collection Periods specified below):
|
Collection
Period
|
Cumulative Net Loss Ratio
|
|
|
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
|
|
“Cumulative Reported Net
Losses” means, with respect to any Collection Period, the
aggregate Contract Principal Balances of Defaulted Contracts
(immediately prior to the applicable default) minus the sum of any
subsequent cash collections on Defaulted Contracts, including
Liquidation Proceeds.
“CSA” means each conditional
sales agreement, including, as applicable, schedules, subschedules,
supplements and amendments to a master conditional sales agreement,
pursuant to which specified assets were conditionally sold to an
Obligor at specified monthly, quarterly, semi-annual or annual
payments.
“Customary Policies and
Procedures” means, with respect to any Contract Assets, the
customary standards, policies and procedures of the relevant
Financing Originator with respect to such Contract Assets in effect
at the time of the Cut-Off Date with respect thereto, as the same
may be changed from time to time (provided that any such change
does not materially impair (i) the collectibility of the
related Contract, or (ii) the Servicer’s ability to perform
its obligations under this Agreement with respect
thereto).
“Cut-Off Date” means
[___________] 20[ ], and with respect to any Substitute
Contract, the Substitution Cut-Off Date (as the context may
require).
“Date of Processing” means,
with respect to any transaction or Collection, the date on which
such transaction or Collection is first recorded (and, in the case
of a transaction or Collection related to a particular Contract,
identified as to such particular Contract as part of Available
Funds) on the related Financing Originator’s or the
Servicer’s computer master file of Contracts (without regard
to the effective date of such recordation).
“Defaulted Contract” means as
to any Collection Period, any Contract (a) (i) which the Servicer
has determined in its sole discretion, in accordance with Customary
Policies and Procedures (and taking into account any available
Vendor recourse), that such Contract is not collectible; or, (ii)
the End-User under such Contract (or applicable Vendor, if such
Contract is a Vendor Loan) becomes the subject of an Insolvency
Event or, (b) as to which during the Collection Period [__]% or
more of a Scheduled Payment shall have become delinquent 180 days
or more, or (c) as to which the End-User has suffered an insolvency
event.
“Delaware Statutory Trust
Act” has the meaning specified in the Trust
Agreement.
“Delinquent Contract” means
any Contract as to which all or a portion of a Scheduled Payment
(constituting at least $25 of such Scheduled Payment due) is more
than 60 days delinquent from its original due date.
“Deposit Date” means the
Business Day immediately preceding each Payment Date.
“Depositor” means the
“Depositor” as defined in the preamble hereto, or any
successor entity thereto.
“Determination Date” means,
with respect to any Payment Date, the second Business Day prior to
such Payment Date.
“Discount Rate” means
[__]%.
“Dollar” and “$”
means lawful currency of the United States of America.
“Eligible Contract” means
each Contract owned (prior to its conveyance by a Financing
Originator to [_________] under the ACE Conveyancing Agreement or
the Non-ACE Conveyancing Agreement, as the case may be; prior to
its conveyance by [_________] to the Depositor under the ACE
Purchase Agreement or the Non-ACE Purchase Agreement, as the case
may be, and prior to its conveyance by the ACE Trust to the
Depositor pursuant to the ACE Assignment, if a ACE Contract) by a
Financing Originator, [_________] or the ACE Trust, as the case may
be, and with respect to which each of the following is true (to the
extent applicable to such type of Contract) at the time of its
conveyance to the Trust on the Closing Date (or Substitution
Transfer Date, as applicable):
(a)
the information with respect to the
Contract, any Secondary Contract securing the obligations under
such Contract, and the Financed Items related to the Contract,
delivered to the Servicer by or at the direction of [_________]
under the Series 20[ ]-[__] Purchase Agreement or the Non-ACE
Purchase Agreement, as the case may be, or by or at the direction
of the ACE Trust pursuant to the ACE Assignment is true and correct
in all material respects;
(b)
immediately prior to the transfer of such
Contract and any related Equipment (or security interest therein)
or Applicable Security to the Depositor (and the Depositor’s
concurrent transfer thereof to the Trust), [_________] or the ACE
Trust owned and had good and marketable title to (and following the
transfer by [_________] or the ACE Trust, the Depositor owns and
has good and marketable title to) the Contracts, free and clear of
any Liens, other than Permitted Liens; and immediately prior to the
transfer of such Contract and any related Equipment (or security
interest therein) or Applicable Security by the applicable
Financing Originator to [_________], such Contract was owned by the
applicable Financing Originator free and clear of any Liens, other
than with respect to Permitted Liens;
(c)
the Contract is neither a Defaulted
Contract nor a Delinquent Contract;
(d)
no provision of the Contract has been
waived, altered or modified in any material respect, except as
indicated in the Contract File;
(e)
the Contract is a valid and binding
payment obligation of the Obligor and is enforceable in accordance
with its terms (except as may be limited by applicable Insolvency
Laws and the availability of equitable remedies);
(f)
the Contract is not subject to
litigation, or to rights of rescission, setoff, counterclaim or
defense and, to [_________]’s or the Servicer’s
knowledge, no such rights have been asserted or threatened with
respect to the Contract;
(g)
the Contract, at the time it was made,
had been originated in compliance (in all material respects) with
applicable law, and did not violate the laws of the United States
of America or any state in any material respect;
(h)
(i) the Contract and any related Financed
Item or interest therein (other than Excluded Residual Investments)
have not been sold, transferred, assigned or pledged by the
Financing Originator or, [_________] or the ACE Trust to any other
Person (other than (a) the sale of Contracts and any Financed Item
financed or interest therein to [_________] or to the Depositor and
then the ACE Trust and (b) the financed sale of Equipment to an
End-User effected through an End-User Contract), or (ii) if such
Contract finances Equipment, such Contract is secured by a fully
perfected lien or ownership interest in favor of the Financing
Originator or, in the case of Equipment relating to the ACE
Contracts, the Depositor, on or in respect of the related Equipment
(other than as contemplated by the Minimum Value Filing Exception),
or, if the Contract is a Vendor Loan, the Vendor Loan is secured by
a fully perfected lien or ownership interest in favor of the
Financing Originator or the ACE Trust in the related Applicable
Security;
(i)
if the Contract constitutes an
“instrument” or “tangible chattel paper”
for purposes of the UCC, there is not more than one “secured
party’s original” counterpart of the Contract and such
original counterpart is in the Contract File;
(j)
all filings (including filings of UCC
financing statements) necessary (i) in respect of all Contracts, to
evidence or perfect the conveyance or transfer of the relevant
Financing Originator’s ownership interest in the Contract,
and the Financing Originator’s corresponding interest in the
related Equipment or Applicable Security, as applicable,
to [_________], and (ii) in respect of all Contracts, to
evidence or perfect the conveyance or transfer of
[_________]’s or the ACE Trust’s ownership interest in
the Contract, and [_________]’s or ACE Trust’s
corresponding interest in the related Equipment or Applicable
Security, as applicable, to the Depositor (as well as the
concurrent conveyance of such property hereunder, other than
ownership interests in Equipment, from the Depositor to the Trust),
have been made or provided for in all appropriate jurisdictions;
provided, that UCC financing statement filings with respect to
Equipment or Applicable Security which name the Financing
Originator as secured party have not been amended to indicate
either [_________], the Depositor or the Trust as an assignee
(although separate UCC filings were made against the relevant
Financing Originator’s interest in Applicable Security in
each jurisdiction where a related Vendor is located); and provided
further, that only filings in the State of Delaware have been made
in favor of the Trust as secured party against the Depositor as
debtor describing as collateral (among other things)
the Depositor’s ownership interest in Equipment, in
respect of the security interest in Equipment owned by the
Depositor which has been granted to the Trust pursuant to
Section 2.01 hereof.
(k)
the Obligor is not, to
[_________]’s knowledge, subject to bankruptcy or other
insolvency proceedings;
(l)
the Obligor’s billing address is in
the United States of America or Puerto Rico, and the Contract is a
U.S. dollar-denominated obligation;
(m)
the Contract does not require the prior
written notification to or consent of an Obligor or contain any
other restriction on the transfer or assignment of the Contract, or
all consents and approvals required by the terms of the Contract
for the sale of the Contract hereunder have been
received;
(n)
either (x) the obligations of the related
Obligor under such Contract are irrevocable and unconditional and
non-cancelable (it being understood that Contracts which are
prepayable in accordance with their terms shall not, by virtue of
that fact alone, be deemed revocable, conditional or cancelable)
or, if not irrevocable and unconditional, have the benefit of a
Vendor Guarantee or (y) with respect to Leases with Lessees that
are governmental entities or municipalities, if such Lease is
canceled in accordance with its terms, either (1) the Vendor that
assigned such Lease to the applicable Financing Originator is
unconditionally obligated to repurchase such lease from the
Financing Originator for a purchase price not less than the
Contract Principal Balance of such Lease (as of the date of
cancellation), or (2) pursuant to the Purchase and Sale Agreements,
[_________] has indemnified the Depositor against such cancellation
in an amount at least equal to the Contract Principal Balance of
such Lease (as of the date of cancellation), less any amounts paid
by the Vendor pursuant to clause (1);
(o)
no selection procedure adverse to the
interests of the Trust or the Equity Certificateholder was used in
selecting the Contract for the Contract Pool;
(p)
the Obligor under the Contract is
required to maintain casualty insurance or to self-insure with
respect to the related Equipment in accordance with the Customary
Policies and Procedures;
(q)
the Contract constitutes tangible chattel
paper, an account, an instrument or a general intangible, in
each case as defined under the UCC;
(r)
the Contract is not a “consumer
lease” as defined in Section 2A-103(1)(e) of the
UCC;
(s)
if such Contract is a Lease, to the best
knowledge of the relevant Financing Originator, the Lessee
thereunder has accepted and has had reasonable opportunity to
inspect the related Equipment;
(t)
except as provided in clause (n) above,
the Contract is not subject to any guarantee by the relevant
Financing Originator, nor has the relevant Financing Originator
established any specific credit reserve with respect to the related
Obligor;
(u)
if such Contract is a Lease, such Lease
is a “triple net lease” under which the Obligor is
responsible for the maintenance, taxes and insurance with respect
to the related Equipment in accordance with general industry
standards applicable to such item of Equipment;
(v)
if such Contract is a Vendor Loan, such
Vendor Loan is secured by an Eligible Secondary Contract having an
aggregate Contract Principal Balance for such Eligible Secondary
Contract (determined as of the relevant Cut-Off Date for such
Vendor Loan) not less than the outstanding principal amount of such
Vendor Loan;
(w)
such Contract is not an obligation of the
United States of America or an agency, department, or
instrumentality of the United States of America;
(x)
such Contract contains provisions
customary to similar financing agreements for Financed Items, which
provisions are sufficient and enforceable (except as may be limited
by applicable Insolvency Laws and the availability of equitable
remedies) to enable the relevant Financing Originator (or its
assignees, including [_________], the ACE Trust, the Depositor and
the Trust) to realize against the Financed Items related thereto
(to the extent such Financed Items secure or support the payment of
the Contract);
(y)
if the Obligor in respect of such
Contract is a state or local governmental entity or municipality,
the conveyance of such a Contract under and pursuant to the
Transaction Documents does not violate applicable state or
municipal laws or regulations (if any) restricting or
prohibiting the assignment of claims against or obligations of such
Obligor; and
(z)
such Contract was originated or acquired
by the applicable Financing Originator in accordance with its
Customary Policies and Procedures as in effect at the time of such
origination or acquisition.
“Eligible Investments” means
any of the following:
(i)
direct obligations of, and obligations
fully guaranteed by, the United States of America, the Federal Home
Loan Mortgage Corporation (if then rated “Aaa” by
Moody’s), the Federal National Mortgage Association, or any
agency or instrumentality of the United States of America the
obligations of which are backed by the full faith and credit of the
United States of America and which are non-callable;
(ii)
demand and time deposits in, certificates
of deposit of, bankers’ acceptances issued by, or federal
funds sold by any depository institution or trust company
(including the Trustees or any Affiliate of the Trustees, acting in
their commercial capacity) incorporated under the laws of the
United States of America or any state thereof or the District of
Columbia (or any domestic branch or agency of a foreign bank) and
subject to supervision and examination by federal and/or state
authorities, so long as, at the time of such investment or
contractual commitment providing for such investment, the
commercial paper or other short-term debt obligations of such
depository institution or trust company have been rated at least
“P-1” or higher from Moody’s, “A-1+”
from Standard & Poor’s and, if rated by Fitch,
“F1+” from Fitch; or any other demand or time deposit
or certificate of deposit which is fully insured by the Federal
Deposit Insurance Corporation and which is rated at least
“P-1” by Moody’s or A-1+ from Standard &
Poor’s.
(iii)
repurchase obligations with respect to
any security described in either clause (i) or (ii) above and
entered into with any institution whose commercial paper is at
least rated “P-1” from Moody’s, at least
“A-1+” by Standard & Poor’s and, if rated by
Fitch, at least “F1+” by Fitch;
(iv)
securities bearing interest or sold at a
discount issued by any corporation incorporated under the laws of
the United States of America or any state thereof which have a
credit rating of at least “A2” or “P-1”
from Moody’s, at least “AAA” from Standard &
Poor’s and, if rated by Fitch, at least “AAA”
from Fitch, at the time of such investment;
(v)
commercial paper (which may be issued by
Ace Securities Corp) having a rating of at least “P-1”
from Moody’s, at least “A-1+” from Standard &
Poor’s and, if rated by Fitch, at least “F1+”
from Fitch, at the time of such investment;
(vi)
money market funds which are rated
“Aaa” by Moody’s, at least
“AAAm” or “AAAm-G” by Standard &
Poor’s and, if rated by Fitch, at least “AAA” by
Fitch, including funds which meet such rating requirements for
which the Trustees or an affiliate of the Trustees serves as an
investment advisor, administrator, shareholder servicing agent
and/or custodian or subcustodian, notwithstanding that (i) such
Trustee or an affiliate of such Trustee charges and collects fees
and expenses from such funds for services rendered, (ii) such
Trustee charges and collects fees and expenses for services
rendered pursuant to this instrument, and (iii) services
performed for such funds and pursuant to this instrument may
converge at any time. (The Depositor and the Servicer
specifically authorize such Trustee or an affiliate of such Trustee
to charge and collect all fees and expenses from such funds for
services rendered to such funds, in addition to any fees and
expenses such Trustee may charge and collect for services rendered
pursuant to this instrument); and
(vii)
any other investments that satisfy the
Rating Agency Condition.
“Eligible Secondary Contract”
shall mean each Secondary Contract
(i)
that satisfies all the criteria set forth
in the definition of “Eligible Contract” except clauses
(b) and (h) (in each case, with respect to ownership by the
Financing Originator, [_________], the Depositor, or ACE Trust of
the Contract) and (w) thereof, and except that the term
“Obligor” shall mean “End-User” in all such
criteria;
(ii)
with respect to which Secondary Contract
and the proceeds thereof the Financing Originator (or, in the case
of ACE Contracts, the ACE Trust, as assignee) has a duly perfected
first priority lien; and
(iii)
with respect to which if such Secondary
Contract secures a Vendor Loan constituting a Contract, the
transfer of the applicable Financing Originator’s security
interest in such Secondary Contract and the proceeds thereof to
[_________], the transfer of [_________]’s interest so
acquired to the Depositor, and, if applicable, the
Depositor’s transfer of its interest therein to the ACE Trust
and the ACE Trust’s transfer of such interest back to the
Depositor, is effective to create in favor of the Depositor a lien
therein and such lien has been duly perfected.
“Eligible Servicer” means
[_________] or any of its Affiliates, the Trustees or any other
Person qualified to act as Servicer of the Contracts under
applicable federal and state laws and regulations, which Person
services not less than $[__] in outstanding principal amount of
equipment financing contracts.
“End-User” shall mean any
party that uses the Financed Items pursuant to an End-User
Contract.
“End-User Contract” shall
mean any CSA, Secured Note, Lease, IPA, or other Financing
Agreement covering Financed Items originated or acquired by an
Originator.
“Equipment” means with
respect to any Contract, the tangible assets constituting
“goods” within the meaning of the UCC, in each case
financed or leased by an Obligor pursuant to a Contract, or which
otherwise provide security for the payment of amounts payable
thereunder.
“Equity Certificate” has the
meaning specified in the Trust Agreement.
“Equity Certificateholder”
means the Person in whose name the Equity Certificate is registered
in the Certificate Register, which initially shall be the
Depositor.
“ERISA” means the Employee
Retirement Income Security Act of 1974, as amended from time
to time.
“Event of Default” has the
meaning specified in the Indenture.
“Exchange Act” means the
Securities Exchange Act of 1934, as amended or supplemented from
time to time.
“Excluded Amounts” means (i)
any collections on deposit in the Collection Account or otherwise
received by the Servicer on or with respect to the Contract Pool or
related Equipment, which collections are attributable to any taxes,
fees or other charges imposed by any Governmental Authority, (ii)
any collections representing reimbursements of insurance premiums
or payments for services that were not financed by the applicable
Originator, (iii) collections relating to security deposits,
and (iv) collections representing Late Charges, documentation fees,
administrative charges or extension fees on any Contract, or
maintenance premiums in respect of related Equipment.
“Excluded Residual
Investments” means Residual Investments, other than
Guaranteed Residual Investments.
“FDIC” shall mean the Federal
Deposit Insurance Corporation, or any successor thereto.
“Financed Items” means
Equipment and other property and services that are permitted to be
financed under Contracts in accordance with Customary Policies and
Procedures of the applicable Financing Originator.
“Financing Agreement” means
each financing agreement covering Financed Items, other than a CSA,
a Secured Note, a Lease or an IPA.
“Financing Originator” means
[_______], [________] and [________].
“Fitch” means Fitch, Inc., or
any successor thereto.
“Governmental Authority”
means the United States of America, any state or other political
subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of,
or pertaining to, government.
“Guaranteed Residual
Investment” means each Residual Investment with respect to
which the applicable Financing Originator has an agreement with
either the Vendor or the related Obligor on an End-User Contract
for payment of such Residual Investment.
“Holder” has the meaning
specified in the Indenture.
“Indebtedness” means, with
respect to any Person at any date, without duplication, (a) all
indebtedness of such person for borrowed money or for the deferred
purchase price of property or services (other than current
liabilities incurred in the ordinary course of business and payable
in accordance with customary trade practices) or which is evidenced
by a note, bond, debenture or similar instrument, (b) all
obligations of such Person under capital leases, (c) all
obligations of such Person in respect of acceptances or letters of
credit issued or created for the account of such Person, (d) all
liabilities secured by any Lien on any property owned by such
Person even though such Person has not assumed or otherwise become
liable for the payment thereof, and (e) obligations of such Person
under direct or indirect guaranties in respect of, and obligations
(contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of,
indebtedness or obligations of others of the kinds referred to in
clauses (a) through (d) above.
“Indenture” means the
Indenture, dated as of the date hereof, between the Trust and the
Indenture Trustee, as amended, supplemented or otherwise modified
from time to time.
“Indenture Trustee” means the
Person acting as Indenture Trustee under the Indenture, its
successors in interest and any successor trustee under the
Indenture.
“Independent”, when used with
respect to any specified Person, means such a Person who (i) is in
fact independent of the Trust, the Depositor or the Servicer, (ii)
is not a director, officer or employee of any Affiliate of the
Trust, the Depositor or the Servicer, (iii) is not a person related
to any officer or director of the Trust, the Depositor or the
Servicer or any of their respective Affiliates, (iv) is not a
holder (directly or indirectly) of more than [__]% of any voting
securities of the Trust, the Depositor or the Servicer or any of
their respective Affiliates, and (v) is not connected with the
Trust, the Depositor or the Servicer as an officer, employee,
promoter, underwriter, trustee, partner, director or person
performing similar functions.
“Independent Accountants” has
the meaning specified in Section 9.04.
“Ineligible Contract” has the
meaning specified in Section 7.06.
“Initial Class [__] Principal
Amount” means $[__].
“Initial Class [__] Principal
Amount” means $[__].
“Initial Class [__] Principal
Amount” means $[__].
“Initial Class [__] Principal
Amount” means $[__].
“Initial Class [__] Principal
Amount” means $[__].
“Initial Contract Assets”
means those Contract Assets conveyed to the Trust on the Closing
Date.
“Initial Contract Pool Principal
Balance” means $[__].
“Initial Contracts” means
those Contracts conveyed to the Trust on the Closing
Date.
“Initial Principal Amount”
means, when used in the context of a reference to an individual
Class of Notes, the initial principal amount applicable to
such Class [__]s defined above.
“Insolvency Event” means,
with respect to a specified Person, (a) the filing of a decree or
the entry of an order for relief by a court having jurisdiction in
the premises in respect of such Person or any substantial part of
its property in an involuntary case under any applicable Insolvency
Law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its
property, or ordering the winding-up or liquidation of such
Person’s affairs, and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or (b)
the commencement by such Person of a voluntary case under any
applicable Insolvency Law now or hereafter in effect, or the
consent by such Person to the entry of an order for relief in an
involuntary case under such law, taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its
property; or (c) the making by such Person of any general
assignment for the benefit of creditors; or (d) the failure by
such Person generally to pay its debts as such debts become due; or
(e) the admission by such Person in writing of its inability
generally to pay its debts when the same become due; or (f) the
taking of action by such Person in furtherance of any of the
foregoing.
“Insolvency Laws” means the
Bankruptcy Code and all other applicable liquidation,
conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, suspension of payments,
or similar debtor relief laws from time to time in effect affecting
the rights of creditors generally.
“Insolvency Proceeds” has the
meaning specified in Section 10.01.
“Insurance Policy” means,
with respect to any Contract, an insurance policy covering physical
damage to or loss of the related Equipment.
“Insurance Proceeds” means,
depending on the context, any amounts payable or any payments made,
to the Servicer (or applicable Financing Originator) under any
Insurance Policy.
“Internal Revenue Code” means
the Internal Revenue Code of 1986, as amended from time to
time.
“Investment Earnings” means,
the investment earnings (net of losses and investment expenses) on
amounts on deposit in the Collection Account and the Reserve
Account.
“IPA” means each installment
payment agreement, including as applicable, schedules,
subschedules, supplements and amendments, pursuant to which the
relevant Originator financed the purchase or acquisition of
specified assets by an Obligor for specified monthly, quarterly,
semiannual or annual payments.
“Late Charges” means any late
payment fees paid by Obligors on Contracts.
“Lease” means each lease
agreement granting the use of equipment or other assets for a
specified time in exchange for payments and including, as
applicable, schedules, subschedules, supplements and amendments to
a master lease, pursuant to which the Originator, as lessor, leased
specified assets to a Lessee at a specified monthly, quarterly,
semiannual or annual rental.
“Lessee” means, with respect
to any Lease, the Obligor with respect to such Lease.
“Lien” means any mortgage,
deed of trust, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), equity
interest, participation interest, preference, priority or other
security agreement or preferential arrangement of any kind or
nature whatsoever, including, without limitation, any conditional
transfer or other title retention agreement, and any financing
lease having substantially the same economic effect as any of the
foregoing.
“Liquidated Contract” means,
as to any Collection Period, any Contract or Defaulted Contract (a)
which the Servicer has determined is uncollectible in accordance
with the Customary Policies and Procedures, (b) for which the
Equipment securing such Contract has been disposed of or any
Applicable Security has been disposed or (c) has been repurchased
by the Servicer pursuant to Section 5.25.
“Liquidation Expenses” means,
with respect to any Liquidated Contract, the aggregate amount of
all out-of-pocket expenses reasonably incurred by the Servicer
(including amounts paid to or expenses incurred by any subservicer,
other than subservicing fees, if any) in accordance with Customary
Policies and Procedures in connection with the repossession,
refurbishing and disposition of any related Equipment or any other
Applicable Security, and other out-of-pocket costs related to the
liquidation of any such Equipment or such other Applicable
Security, including reasonable attorneys’ fees incurred in
the attempted collection of any amount owing pursuant to such
Liquidated Contract, and including amounts determined by the
Servicer in its reasonable discretion as payable in respect of any
sales, use, personal property or other taxes assessed or to be
assessed on repossessed or liquidated Equipment or any other
Applicable Security.
“Liquidation Proceeds” means,
with respect to a Liquidated Contract, proceeds from the transfer,
lease or re-lease of the related Financed Items or other Applicable
Security, Insurance Proceeds, and any other recoveries with respect
to such Liquidated Contract and the related Financed Items or other
Applicable Security (including, without limitation, amounts
received pursuant to a Program Agreement and Scheduled Payments
received on such Defaulted Contracts), but net of Liquidation
Expenses, Late Charges, amounts payable to a Vendor in respect of
(and in amounts not exceeding) amounts previously paid by such
Vendor in respect of such Contract under Vendor recourse
provisions, and amounts, if any, so received that are required to
be refunded to the Obligor on such Contract.
“Material Adverse Effect”
means, with respect to any event or circumstance, a material
adverse effect on:
(i)
the ability of [_________], any Financing
Originator, the ACE Trust, the Depositor, the Trust or the Servicer
to perform in all material respects its obligations under this
Agreement or any other Transaction Document;
(ii)
the validity or enforceability of this
Agreement, any other Transaction Document, or the Contracts, or the
collectibility of the Contracts; or
(iii)
the status, existence, perfection,
priority or enforceability of the Trust’s interest in the
Contracts and the other Trust Assets.
“Material Modification” means
a termination or release (including pursuant to prepayment), or an
amendment, modification or waiver, or equivalent similar
undertaking or agreement, by the Servicer with respect to a
Contract which would not otherwise be permitted under the standards
and criteria set forth in Sections 5.08, 5.09 and/or 5.10
hereof.
“Maturity Date” means, as
applicable, the Class [__] Maturity Date, Class [__] Maturity Date,
Class [__] Maturity Date, Class [__] Maturity Date or Class [__]
Maturity Date.
“Minimum Value Filing
Exception” means the variation from the relevant Financing
Originator’s normal policies and practices with respect to
filing UCC financing statements against an Obligor describing
Equipment which is the subject of a Contract, in each case as set
forth in Exhibit F hereto.
“Monthly Servicer’s
Report” has the meaning specified in
Section 9.01.
“Moody’s” means
Moody’s Investors Service, Inc., or any successor
thereto.
“Nonrecoverable Advance”
means with respect to any Determination Date and any Contract, the
amount, if any, advanced by the Servicer pursuant to
Section 5.14 which the Servicer has as of such Determination
Date determined in good faith will not be ultimately recoverable by
the Servicer.
“Non-ACE Contract Assets”
means the Contract Assets pertaining to the Non-ACE
Contracts.
“Non-ACE Contracts” means
Contracts conveyed by [_________] to the Depositor pursuant to the
Non-ACE Purchase Agreement, as listed in Schedule A to the Non-ACE
Purchase Agreement.
“Non-ACE Conveyancing
Agreement” means the Non-ACE Conveyancing Agreement, dated as
of [___________] 20[ ], by and among [_________], [_________]
and [_________], as the same may be amended, supplemented,
restated or otherwise modified from time to time.
“Non-ACE Purchase Agreement”
means the Non-ACE Purchase and Sale Agreement, dated [___________]
20[ ], by and among [_________], as the seller, and the
Depositor, as purchaser, as the same may be amended,
supplemented, restated or otherwise modified from time to
time.
“Note” means any one of the
notes of the Trust of any Class executed and authenticated in
accordance with the Indenture.
“Noteholder” means any
registered holder of a Note.
“Note Register” has the
meaning specified in the Indenture.
“Notes” means the Class [__]
Notes, Class [__] Notes, Class [__] Notes, Class [__] Notes or
Class [__] Notes.
“Obligor” means, with respect
to any Contract, the Person or Persons obligated to make payments
with respect to such Contract, including any guarantor thereof (and
including, with respect to a Contract consisting of a Vendor Loan,
the Vendor obligated in respect of such Vendor Loan).
“Officer’s Certificate”
means, with respect to any Person, a certificate signed by an
authorized officer of such Person and delivered to the party
entitled to receipt thereof under any applicable Transaction
Document.
“Opinion of Counsel” means a
written opinion of counsel, who may be counsel (including internal
counsel) for the Depositor or the Servicer and who shall be
reasonably acceptable to the Trust and the Indenture
Trustee.
“Originator” means, with
respect to each Contract, the party that is the original lessor or
financing party thereunder.
“Outstanding” has the meaning
specified in the Indenture.
“Owner Trustee” means Chase
Bank USA, National Association, not in its individual capacity, but
solely as Owner Trustee under the Trust Agreement, its successors
in interest and any successor owner trustee under the Trust
Agreement.
“Payment Date” shall mean the
twentieth (20th) day of each calendar month or, if such
twentieth (20th) day is not a Business Day, the next succeeding
Business Day, with the first such Payment Date being [_______] 20[
].
“Paying Agent” means any
Person described as such in Section 7.04(b).
[“Permitted Liens”
means
(a)
with respect to Contracts in the Contract
Pool:
(i)
Liens for state, municipal or other local
taxes if such taxes shall not at the time be due and payable or if
the Depositor shall currently be contesting the validity thereof in
good faith by appropriate proceedings and shall have set aside on
its books adequate reserves with respect thereto;
(ii)
Liens in favor of [_________] created by
a Financing Originator, or Liens in favor of the Depositor created
pursuant to the Purchase and Sale Agreements or Liens in favor of
the ACE Trust created pursuant to the ACE Pooling Agreement, in
each case transferred to the Trust pursuant hereto;
(iii)
Liens in favor of a Financing Originator
in respect of Contracts which have been transferred to such
Financing Originator and pursuant to the Purchase and Sale
Agreements by such Financing Originator to the Depositor (through
[_________] and the ACE Conveyancing Agreement or the Non-ACE
Conveyancing Agreement, as the case may be, in the case of
[_________] Contracts, and through [_________], the Depositor and
the ACE Trust and the ACE Assignment in the case of the ACE
Contracts) and in each case transferred to the Trust pursuant
hereto;
(iv)
Liens created pursuant to this Agreement
in favor of the Trust; and
(v)
Liens in favor of the Indenture Trustee
created pursuant to the Indenture and/or this Agreement;
and
(b)
with respect to the related Equipment or
to any other Applicable Security (to the extent
applicable):
(i)
materialmen’s,
warehousemen’s, mechanics’ and other liens arising by
operation of law in the ordinary course of business for sums not
due;
(ii)
Liens for state, municipal or other local
taxes if such taxes shall not at the time be due and payable or if
the Depositor shall currently be contesting the validity thereof in
good faith by appropriate proceedings and shall have set aside on
its books adequate reserves with respect thereto;
(iii)
Liens in favor of [_________] created by
a Financing Originator pursuant to the ACE Conveyancing Agreement
or the Non-ACE Conveyancing Agreement, as the case may be, or Liens
in favor of the Depositor created pursuant to the Purchase and Sale
Agreements, in each case transferred to the Trust pursuant hereto
or Liens in favor of the Depositor created pursuant to the ACE
Purchase Agreement;
(iv)
Liens created pursuant to this Agreement
in favor of the Trust;
(v)
Liens in favor of an Originator which
have been transferred to the applicable Financing Originator and
pursuant to the Purchase and Sale Agreements by such Financing
Originator to the Depositor (through [_________] and the ACE
Conveyancing Agreement or the Non-ACE Conveyancing Agreement, as
the case may be, in the case of [_________] Contracts, and through
[_________], the Depositor and the ACE Trust and the ACE Assignment
in the case of the ACE Contracts) and in each case transferred to
the Trust pursuant hereto;
(vi)
Liens in favor of the Indenture Trustee
created pursuant to the Indenture and/or this Agreement;
(vii)
[Liens created pursuant to the underlying
loan documents relative to Contracts, transferred by the Depositor
or other depositor, as applicable to:
(A)
[___________] created pursuant to the
Amended and Restated Trust Agreement, dated as of [___________] 20
[ ], by and between [___________] and
[___________];
(viii)
interests in favor of (A) [___________]
and which have been transferred by [___________] along with the
related Contract to its limited purpose affiliate, [___________],
(B) S[___________]; and (C) a Vendor, which, in each case,
are subject to the prior payment of all Obligor obligations
in respect of Scheduled Payments on the related Contract;
and
(ix)
Liens granted by the End-Users which are
subordinated to the interest of the Trust in such
Equipment.]
[Topic of Permitted Liens subject to
reformulation after conversations with CIT]
“Person” means any
individual, corporation, estate, partnership, limited liability
company, joint venture, association, joint stock company, trust
(including any beneficiary thereof), unincorporated organization or
government or any agency or political subdivision
thereof.
“Prepaid Contract” means any
Contract that has terminated or been prepaid in full prior to its
scheduled expiration date (including because of a Casualty Loss),
other than a Defaulted Contract.
“Prepayment” means with
respect to any Collection Period for any Contract, a partial
or full prepayment of amounts due and owing under such
Contract.
“Principal Amount” means,
with respect to a Class of Notes, the aggregate Initial
Principal Amount thereof reduced by the aggregate amount of any
payments applied in reduction of such principal amount.
“Program Agreement” means
each vendor finance program agreement pursuant to which End-User
Contracts originated by a Vendor are assigned to the applicable
Financing Originator.
“Purchase Amount” means, with
respect to Ineligible Contracts, on any date of determination, the
aggregate Required Payoff Amount for such Ineligible Contracts as
of the related Accounting Date.
“Purchase and Sale
Agreements” means, collectively, the Non-ACE Purchase
Agreement, the ACE Purchase Agreement, and the Series 20[
]-[__] Purchase Agreement.
“Purchase Price” means, with
respect to any Contract conveyed on the Closing Date (or any
Subsequent Transfer Date, as applicable), an amount equal to the
Contract Principal Balance of such Contract as of the applicable
Cut-Off Date.
“Qualified Institution” means
(a) the corporate trust department of the Indenture Trustee or (b)
a depository institution organized under the laws of the United
States of America or any one of the states thereof or the District
of Columbia (or any domestic branch of a foreign bank), (i) (A)
which has (or the parent corporation of which has) either (1) a
long-term unsecured debt rating acceptable to the Rating Agencies
or (2) a short-term unsecured debt rating or certificate of deposit
rating acceptable to the Rating Agencies or (B) which is otherwise
acceptable to the Rating Agencies and (ii) whose deposits are
insured by the FDIC.
“Rating Agency” as of any
date means each of the nationally recognized statistical rating
organizations requested by the Depositor to provide ratings on the
Notes which is rating the Notes on such date.
“Rating Agency Condition”
means, with respect to any action or series of related actions or
proposed transaction or series of related proposed transactions,
that each Rating Agency, after being notified in writing of such
action or series of related actions or series of related
transactions, shall have notified the Depositor, the Owner Trustee
and the Indenture Trustee in writing that such action or series of
related actions or the consummation of such proposed transaction or
series of related transactions will not result in a Ratings
Effect.
“Ratings Effect” means, with
respect to any action or series of related actions or proposed
transaction or series of related proposed transactions, a reduction
or withdrawal of the rating of any outstanding Class with
respect to which a Rating Agency has previously issued a rating as
a result of such action or series of related actions or the
consummation of such proposed transaction or series of related
transactions.
“Reallocated Principal”
means, with respect to any Payment Date, an amount equal to (a) the
Total Principal Payment Amount, less (b) the sum of the Class [__]
Principal Payment Amount and the Class [__] Principal Payment
Amount.
“Receivables System” means
the accounting system administered and utilized by the Servicer,
including all accounting data inputs therein, including those
relating to the accounting for the Contracts.
“Record Date” means, with
respect to any Payment Date, the Business Day immediately preceding
such Payment Date (so long as the Notes are in book-entry form) or
the last day of the prior calendar month (if certificated Notes
have been issued).
“Redemption Date” has the
meaning specified in Section 7.08 hereof.
“Redemption Price” has the
meaning specified in Section 7.08 hereof.
“Regulation AB” means the
rule codified at 17 CFR § 229.110 et seq., promulgated by the
Commission for the registration, disclosure and reporting of
asset-backed securities under the Securities Act and the Exchange
Act.
“Related Collection Period
Collections” means, as of any Payment Date, the amount of
Collections on deposit in the Collection Account as of the Deposit
Date which were received and processed by the Servicer during the
related Collection Period, including all Liquidation Proceeds as to
Defaulted or Liquidated Contracts (other than in respect of an
Excluded Residual Investment) so received but excluding any
Purchase Amounts.
“Replaced Assets” has the
meaning assigned such term in Section 2.03.
“Replaced Contracts” has the
meaning assigned such term in Section 2.03.
“Required Holders” means (i)
prior to the payment in full of the Class [__]-Notes, Class [__]
Noteholders, Class [__] Noteholders, Class [__] Noteholders and/or
Class [__] Noteholders, holding Class [__] Notes, Class [__] Notes,
Class [__] Notes and/or Class [__] Notes, respectively, evidencing
more than 66 2/3% of the Aggregate Principal Amount of all Class
[__]-Notes Outstanding, (ii) from and after the payment in full of
the Class [__]-Notes, Holders of Class [__] Notes holding Class
[__] Notes evidencing more than 66 2/3% of the Aggregate Principal
Amount of all Class [__] Notes Outstanding and (iii) from and after
the payment in full of the Class [__] Notes.
“Required Payoff Amount”
means (a) with respect to any Collection Period for a Contract
(other than a Defaulted Contract), the sum of (i) the Scheduled
Payment due in such Collection Period, together with any Scheduled
Payments due in prior Collection Periods but not yet received,
plus (ii) the Contract Principal Balance of such Contract
(after taking into account the Scheduled Payment due in such
Collection Period and any Scheduled Payments due in prior
Collection Periods whether or not actually received) and, (b) with
respect to Contracts that are Defaulted Contracts, zero.
“Requirements of Law” for any
Person means the certificate of incorporation or articles of
association and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation,
or order or determination of an arbitrator or Governmental
Authority, in each case applicable to or binding upon such Person
or to which such Person is subject, whether Federal, state or local
(including, without limitation, usury laws, the Federal Truth in
Lending Act and Regulation Z and Regulation B of the Board of
Governors of the Federal Reserve System).
“Reserve Account” means the
Reserve Account established and maintained pursuant to
Section 7.01 hereof.
“Reserve Account Amount”
means, as of any Payment Date, the then current amount then on
deposit in the Reserve Account.
“Reserve Account Floor” means
[__]% of the Initial Contract Pool Principal Balance,
provided that, the Reserve Account Floor shall be reduced by
an amount equal to [__]% of the Initial Contract Pool Principal
Balance on each of the Payment Dates following the Collection
Periods below if the Cumulative Net Loss Ratio is less than the
percentage set forth opposite such Collection Period
below:
|
Collection
Period
|
Reserve
Account Cumulative
Net Loss
Trigger
|
|
|
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
|
[__]
|
[__]
|
“Residual Investment” means,
with respect to certain Leases, any funds that the applicable
Financing Originator shall have advanced against all or any portion
of the anticipated residual value of the leased Equipment upon the
expiration of such Lease in accordance with its terms in excess of
the Contract Principal Balance of such Lease.
“Responsible Officer” means,
with respect to the Owner Trustee, any officer in its Corporate
Trust Administration Department (or any similar group of a
successor Owner Trustee) who has primary responsibility for
administering the Trust or the Trust Agreement, or to whom a
corporate trust matter is referred because of knowledge of,
familiarity with, and authority to act with respect to a particular
matter.
“Scheduled Payment” means,
with respect to any Contract, the monthly or quarterly or
semi-annual or annual rent or financing (whether principal or
principal and interest) payment or other payment scheduled to be
made by the related Obligor under the terms of such Contract; it
being understood that Scheduled Payments do not include any
Excluded Amount or Excluded Residual Investment.
“Schedule of Contracts” means
the schedule of Contracts which are conveyed to the Trust pursuant
to this Agreement, executed and delivered on the Closing Date,
which schedule shall identify by any reasonable means or
designation the applicable Financing Originator with respect to
each Contract identified in such Schedule, and which includes the
Contracts listed on Exhibit B hereto (which may be in
electronic form rather than as an exhibit hereto). Such
Schedule shall be supplemented from time to time (a) by each
subsequent Substitution Schedule of Contracts with respect to each
Substitution Transfer Agreement and related Substitute Contracts,
which Schedules of Contracts shall be deemed incorporated and made
a part of the original Schedule of Contracts on Exhibit B
hereto; and (b) by the Servicer from time to time to reflect the
release by and removal from the Trust Assets of (i) Contracts
released in connection with (A) in respect of a Contract becoming a
Prepaid Contract in accordance herewith or having its final
Scheduled Payment paid in full in accordance with the Contract, or
(B) in respect of a repurchase from the Trust through payment of a
Purchase Amount, and (ii) Replaced Contracts. The Schedule of
Contracts is to be maintained by the Servicer (with copies thereof,
as the same shall be supplemented or amended as described above, to
be provided promptly to the Trust).
“Schedule of Representations”
means the Schedule of Representations and Warranties set forth on
Exhibit E hereto.
“Secondary Contract” shall
mean, with respect to a Vendor Loan, each End-User Contract
securing such Vendor Loan.
“Secured Note” means each
promissory note with a related security interest evidenced by
written agreement, pursuant to which the purchase of specified
assets by an Obligor or End-User is financed for specified monthly,
quarterly, semiannual or annual payments.
“Securities” means the Notes
and the Equity Certificate, or any of them.
“Securities Act” means the
Securities Act of 1933, as amended from time to time.
“Securityholders” means the
Holders of the Notes or the Equity Certificate.
“Series 20[ ]-[__] Purchase
Agreement” means the Series 20[ ]-[__] Purchase and
Sale Agreement, dated as of [___________] 20[ ], among
[_________] and the Depositor, as the same may be amended,
supplemented, restated or otherwise modified from time to
time.
“Servicer” means initially
[__], until any Successor Servicer is appointed pursuant to Article
VIII hereof, and thereafter, means the Successor Servicer so
appointed.
“Servicer Advance” means,
with respect to any Payment Date, the amounts, if any,
deposited by the Servicer in the Collection Account for such
Payment Date in respect of Scheduled Payments pursuant to
Section 5.14 hereof.
“Servicer Default” has the
meaning given such term in Section 8.01.
“Servicer Letter of Credit”
has the meaning given such term in Section 7.01(b)(ii)(B)
hereof.
“Services ” means, in
connection with the financing of Software by an Originator, the
support and consulting services related to such Software, the
procurement of which was also financed by such Originator pursuant
to a Contract.
“Servicing Fee” has the
meaning specified in Section 5.18 hereof.
“Servicing Fee Percentage”
means [__]%.
“Servicing Officer” means any
officer of the Servicer involved in, or responsible for, the
administration and servicing of Contracts.
“Servicing Standard” means,
with respect to the servicing and collection activities of the
Servicer concerning the Contract Assets, the conduct of such
activities with reasonable care, using that degree of skill and
attention that the relevant Financing Originator for such Contract
Assets exercises with respect to all comparable contracts and
related assets that it services for itself or others, and in
accordance with Customary Policies and Procedures and applicable
law.
“Servicing Transfer” is
defined in Section 8.02(b).
“Software” means the
telephone switching or networking systems operating software
financed or leased by an Obligor pursuant to a Contract.
“Solvent” means, as to any
Person at any time, that (a) the fair value of the Property of such
Person is greater than the amount of such Person’s
liabilities (including disputed, contingent and unliquidated
liabilities) as such value is established or such liabilities
evaluated for purposes of Section 101(31) of the Bankruptcy
Code; (b) the present fair saleable value of the Property of such
Person in an orderly liquidation of such Person is not less than
the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and matured; (c)
such Person is able to realize upon its Property and pay its debts
and other liabilities (including disputed, contingent and
unliquidated liabilities) as they mature in the normal course of
business; (d) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such Person’s
ability to pay as such debts and liabilities mature; and (e) such
Person is not engaged in business or a transaction, and is not
about to engage in a business or a transaction, for which such
Person’s property would constitute unreasonably small
capital.
“Specified Reserve Account
Balance” means with respect to any Payment Date, an amount
equal to the greater of (a) the sum of (i) an amount equal to [__]%
of the Contract Pool Principal Balance as of the related Accounting
Date plus (ii) the excess, if any, of (A) the sum of the Principal
Amounts of the Notes, after giving effect to all payments of
principal on such Payment Date, over (B) the Contract Pool
Principal Balance as of the related Accounting Date, and (b) the
Reserve Account Floor.
“Standard & Poor’s”
means Standard & Poor’s Ratings Service, a division of
The McGraw-Hill Companies, or any successor
thereto.
“Subsidiary” means with
respect to a Person, any corporation or other entity of which
securities or other ownership interests (whether directly or
indirectly in connection with contract rights) having ordinary
voting power to elect a majority of the board of directors or other
persons performing similar functions are at the time directly or
indirectly owned by such Person.
“Substitute Contract” means
any Contract conveyed, assigned and transferred by the Depositor or
[_________] to the Trust pursuant to Section 2.03.
“Substitute Contract Assets”
means Contract Assets relating to Substitute Contracts.
“Substitute Contract Qualification
Conditions” means, with respect to any Substitute Contract
being transferred to the Trust pursuant to Section 2.03, the
accuracy of each of the following statements as of the related
Cut-Off Date for such Contract: (a) the Contract Principal
Balance of such Substitute Contract is not less than that of the
related Replaced Contract(s); (b) no adverse selection procedure
shall have been employed in the selection of such Substitute
Contract from the applicable Financing Originator’s
portfolio; and (c) each such Substitute Contract satisfied the
criteria set forth in the definition of Eligible Contract
herein.
(2)
with respect to any such Substitute
Contract which is replacing a Replaced Contract of the type
described in clause (a) of the definition of Substitution Event,
the condition that after giving effect to such transfer, the
Contract Pool Principal Balance of all Substitute Contracts
transferred to the Trust since the Closing Date in respect of
Replaced Contracts of the same type shall not exceed [__]% of the
Initial Contract Pool Principal Balance.
“Substitute Transferred
Assets” has the meaning assigned such term in
Section 2.03.
“Substitution Assignment
Agreement” means, with respect to any Substitute Contracts,
the agreement between the Servicer and the Depositor pursuant to
which the Servicer transfers the identified Substitute Contracts to
the Depositor pursuant to the Series 20[ ]-[__] Purchase
Agreement.
“Substitution Cut-Off Date”
means the date specified as such for the relevant Substitute
Contracts, in the related Substitution Transfer
Agreement.
“Substitution Event” means,
with respect to any transfer of a related Substitute Contract to
the Trust under Section 2.03, the occurrence of any of the
following: (a) one or more Contracts identified in the related
Substitution Notice as being an intended Replaced Contract with
respect to such Substitute Contract, has become a Defaulted
Contract, (b) one or more Contracts identified in the related
Substitution Notice as being an intended Replaced Contract with
respect to such Substitute Contract, has been subjected to a
Material Modification, (c) one or more Contracts identified in the
related Substitution Notice as being an intended Replaced Contract
with respect to such Substitute Contract, has become an Ineligible
Contract, or (d) one or more Contracts identified in the related
Substitution Notice as being an intended Replaced Contract with
respect to such Substitute Contract, has become a Prepaid Contract
and the Trust has not yet received the related
Prepayment.
“Substitution Notice” means,
with respect to any transfer of Substitute Contracts to the Trust
pursuant to Section 2.03 (and the applicable Financing
Originator’s corresponding conveyance and assignment of such
Substitute Contracts), a notice, which shall be given at least five
days prior to the related Substitution Transfer Date, identifying
the Substitute Contracts to be transferred, the Contract Principal
Balance of such Substitute Contracts and the related Substitution
Event (with respect to an identified Contract or Contracts then in
the Contract Pool, which will upon such substitution become a
Replaced Contract) to which such Substitute Contract relates, with
such notice to be signed both by the Depositor and the applicable
Financing Originator(s).
“Substitution Schedule of
Contracts” means a schedule or list, substantially in the
form of the initial Schedule of Contracts delivered on the Closing
Date, but listing each Substitute Contract being transferred to the
Trust pursuant to a related Substitution Transfer Agreement, as
well as the related Replaced Contracts being removed from the
existing Contract Pool by virtue of such substitution.
“Substitution Transfer
Agreement” means the agreement identified as such in
Section 2.03(b)(iv) hereof.
“Substitution Transfer Date”
means any date on which Substitute Contracts are transferred to the
Trust.
“Successor Servicer” has the
meaning given such term in Section 8.02(b).
“Tax Opinion” means, with
respect to any action, an Opinion of Counsel to the effect that,
for federal income tax purposes, (i) following such action the
Trust will not be deemed to be an association (or publicly traded
partnership) taxable as a corporation, (ii) following such
action the Trust will be disregarded as a separate entity from the
Depositor, and (iii) such action will not affect the tax
characterization as debt of Notes of any outstanding
Class issued by the Trust for which an Opinion of Counsel has
been provided that such Notes are debt.
“Third Party Source” means
any affiliate of [_________], Vendor or other manufacturer, dealer,
lender or intermediary from which [_________] purchased a
Contract.
“Total Principal Payment
Amount” means, with respect to any Payment Date, the
difference between (a) the aggregate Principal Amount of all
Classes of Notes immediately prior to that Payment Date and (b) the
Contract Pool Principal Balance as of the related Accounting
Date.
“Transaction Documents” means
this Agreement, any Substitution Transfer Agreement, the ACE
Conveyancing Agreement, the ACE Purchase Agreement, the ACE
Assignment, the ACE Pooling Agreement, the Non-ACE Conveyancing
Agreement, the Non-ACE Purchase Agreement, the Series 20[
]-[__] Purchase Agreement, the Trust Agreement, the
Administration Agreement, the Indenture and any other agreements
contemplated herein or therein.
“Transferred Assets” means
with respect to any Contracts (including Substitute Contracts)
conveyed or being conveyed to the Trust pursuant to this Agreement,
all right and interest of the Depositor in, to and under the
following:
(i)
such Contracts and other related Contract
Assets (subject to the proviso below);
(ii)
related rights of the Depositor under the
Purchase and Sale Agreements and Substitution Assignment Agreement
(if any) and the ACE Assignment, including, without limitation, in
respect of the obligation of the Servicer to repurchase or
substitute for such Contracts under certain circumstances as
specified therein;
(iii)
rights under this Agreement and each
Substitution Transfer Agreement; and
(iv)
all income from and proceeds of the
foregoing;
provided, that Transferred Assets shall
not include any title to or ownership interest (other than any
Guaranteed Residual Investment) in the Equipment related to such
Contracts (although security interests in such Equipment
established pursuant to the related Contract, and proceeds thereof,
shall constitute Transferred Assets), and provided further, that
the security interest granted by the Depositor pursuant to
Section 2.01 hereof in related Equipment owned by it, shall
constitute part of Transferred Assets.
“Trust” means the trust
governed by the Trust Agreement, the assets and property of which
consists of the Trust Assets.
“Trust Account Property”
means the Trust Accounts, all amounts and investments held from
time to time in any Trust Account (whether in the form of deposit
accounts, physical property, book-entry securities, uncertificated
securities or otherwise), and all proceeds of the
foregoing.
“Trust Accounts” means,
collectively, the Collection Account and the Reserve Account, or
either of them.
“Trust Agreement” means the
Amended and Restated Trust Agreement, dated as of the date hereof,
between the Depositor and the Owner Trustee, as amended, restated,
supplemented or otherwise modified from time to time.
“Trust Assets” has the
meaning given to such term in the Trust Agreement.
“Trust Estate” shall have the
meaning specified in the Trust Agreement.
“Trustees” means the Owner
Trustee and the Indenture Trustee, or any of them individually as
the context may require.
“UCC” means the Uniform
Commercial Code as enacted from time to time in the State of New
York.
“Unfunded Loss Amount” means,
for any Payment Date, an amount equal to any excess of: (a)
the Aggregate Principal Amount of the Notes, prior to giving effect
to the payment of principal on the Notes on that Payment Date,
minus (b) the lesser of (i) the Contract Pool Principal Balance as
of the last day of the Collection Period immediately preceding the
preceding Payment Date, minus the Contract Pool Principal Balance
as of the last day of the Collection Period immediately preceding
the current Payment Date; or (ii) the Available Funds remaining
after payment of amounts owing to the Servicer and interest due on
the Notes on the Payment Date plus any withdrawal from the Reserve
Account for payment of principal on the Notes on the Payment Date,
minus (c) the Contract Pool Principal Balance as of the last day of
the related Collection Period.
“Unreimbursed Servicer
Advances” means, at any time, the amount of all previous
Servicer Advances (or portions thereof) as to which the Servicer
has not been reimbursed as of such time pursuant to
Section 7.05 and which the Servicer has determined in its sole
discretion are Nonrecoverable Advances, and with respect to which
the Servicer has given a written certification to such effect to
the Trust (which certification may take the form of an entry on a
Monthly Servicer’s Report identifying Unreimbursed Servicer
Advances).
“Vendor” means, with respect
to a Contract, the equipment manufacturer, dealer or distributor,
or software licensor or distributor, or other Person that provided
financing under such Contract in connection with the acquisition or
use by an End-User of such party’s Equipment, Software,
Services or other products.
“Vendor Agreements” means,
collectively, Vendor Assignments and Program Agreements.
“Vendor Assignment” means
each assignment agreement pursuant to which an individual End-User
Contract originated by a Vendor is assigned by such Vendor to a
Financing Originator.
“Vendor Guarantee” means the
irrevocable obligation of a Vendor to pay to a Financing Originator
the aggregate outstanding principal amount of a Contract which has
been canceled by the related Obligor pursuant to the terms of such
Contract.
“Vendor Loan” means a limited
recourse loan agreement payable by a Vendor and secured by the
Vendor’s interest in Secondary Contracts and by the
Equipment, if any, related thereto.
“Vice President” of any
Person means any vice president of such Person, whether or not
designated by a number or words before or after the title
“Vice President,” who is a duly elected officer of such
Person.
“Voting Power” means, with
respect to any outstanding membership interest of the Depositor,
the power (expressed as a percentage) represented by such
membership interest of the aggregate voting power of all
outstanding membership interests of the Depositor having ordinary
voting power, including the power to vote for election of members
of the Board of Directors (and, if any class thereof has power to
designate members of the Board of Directors or any special
committee thereof, the power so to designate).
Section 1.02
Usage of Terms . With respect to all terms in this Agreement,
the singular includes the plural and the plural the singular;
words importing any gender include the other gender; references to
“writing” include printing, typing, lithography and
other means of reproducing words in a visible form; references to
agreements and other contractual instruments include all
amendments, modifications and supplements thereto or any changes
therein entered into in accordance with their respective terms and
not prohibited by this Agreement; references to Persons include
their permitted successors and assigns; and the term
“including” means “including without
limitation.”
Section 1.03
Section References
. All section references, unless
otherwise indicated, shall be to Sections in this
Agreement.
Section 1.04
Accounting Terms
. All accounting terms used but not
specifically defined herein shall be construed in accordance with
generally accepted accounting principles in the United States of
America.
ARTICLE II
FUNDINGS OF TRUST; TRANSFERS OF CONTRACTS
Section 2.01
Creation and Funding of Trust;
Transfer of Transferred Assets to Trust . (a) The Trust has been created (i) pursuant
to an initial trust agreement as amended and restated by the Trust
Agreement, and (ii) by the filing by the Owner Trustee of an
appropriately completed Certificate of Trust under the Delaware
Statutory Trust Act. The Depositor, as settlor of the Trust,
shall fund and convey assets to the Trust pursuant to the terms and
provisions hereof. The Trust shall be administered pursuant
to the provisions of this Agreement, the Administration Agreement
and the Trust Agreement for the benefit of the Noteholders and the
Equity Certificateholder. Each of the Owner Trustee and the
Administrator (as defined in the Administration Agreement) is
hereby specifically recognized by the parties hereto as empowered
to conduct business dealings on behalf of the Trust in accordance
with the terms hereof and of the Trust Agreement and Administration
Agreement.
(b)
Subject to the terms and conditions set
forth herein, the Depositor, in consideration of the purchase price
of the Contracts and the related Transferred Assets and the
retention of the Equity Certificate, does hereby transfer, assign,
set over and otherwise convey to the Trust, on the Closing Date, by
execution of this Agreement, without recourse (other than as
expressly provided herein), (i) all the right, title and interest
of the Depositor in and to the Contracts and the related
Transferred Assets identified in this Agreement, and (ii) all
income from and proceeds of the foregoing. The
“purchase price” for the Contracts and the related
Transferred Assets shall be an amount equal to $[___________].
Such purchase price shall be payable in immediately available
funds on the Closing Date.
(c)
The parties hereto hereby agree and
acknowledge that title to or ownership of any related Equipment
shall not be transferred to the Trust upon such conveyance and that
the Depositor shall retain its ownership interest (to the extent
the same has been so conveyed to the Depositor pursuant to the ACE
Purchase Agreement, the Non-ACE Purchase Agreement, the Series 20[
]-[__] Purchase Agreement and the ACE Assignment) in such
Equipment (provided, that the parties agree and intend that any
mere security interest, as opposed to title or ownership interest,
in the related Equipment which secures the Contract pursuant to the
terms thereof, is being assigned and conveyed as part of the
Transferred Assets in accordance with the definition thereof).
The Depositor and the Trust further intend and agree that,
except as described in the preceding sentence with respect to
ownership interests in related Equipment, any such transfer is
intended to be a conveyance and transfer of ownership of the
Contracts and the related Transferred Assets (or Substitute
Transferred Assets conveyed as described in Section 2.03
below) and that such Contracts and the related Transferred Assets
shall not be part of the Depositor’s estate in the event of
the filing of a bankruptcy petition by or against the Depositor
under any bankruptcy law. In the event, however, that
notwithstanding such intent and agreement, a transfer and
assignment contemplated hereby (or Substitution Transfer Agreement,
as applicable) is determined not to be a conveyance of ownership,
the Depositor hereby grants to the Trust a first priority perfected
security interest in (i) the right, title, and interest of the
Depositor in and to such Contracts and the related Transferred
Assets identified herein (or Substitution Transfer Agreement,
as applicable), and (ii) all income from and proceeds of the
foregoing, and this Agreement (or Substitution Transfer Agreement,
as applicable), collectively, shall constitute a security agreement
under applicable law, securing the related obligations of the Trust
to the Noteholder and the Equity Certificateholder, in the order
and priorities, and subject to the other terms and conditions of,
this Agreement and the other Transaction Documents, together with
such other obligations or interests as may arise hereunder and
thereunder with respect to such Contracts and the related
Transferred Assets in favor of the parties hereto and
thereto.
(d)
In furtherance of and not in limitation
of any of the foregoing, the Depositor with respect to each
item of Equipment owned by it as described above, by execution and
delivery of this Agreement (or Substitution Transfer Agreement, as
applicable), hereby on and as of the Closing Date (or Substitution
Transfer Date, as applicable) grants to the Trust and the Indenture
Trustee a first priority perfected security interest in the right,
title, and interest of the Depositor in and to such item of owned
Equipment, securing in each case an amount payable by the Trust in
respect of the Notes corresponding to the Contract Principal
Balance from time to time of the related Contract; it being
understood, however, that (i) recourse to such Equipment in
realization of the benefits of such security interest shall only
occur if the related Contract has become a Liquidated Contract, and
(ii) the application of Liquidation Proceeds realized therefrom
shall be governed in accordance with the provisions hereof
generally applicable to such Collections and allocation in
accordance with the Allocation Criteria.
(e)
The Depositor, by execution and delivery
of this Agreement (or Substitution Transfer Agreement, as
applicable) authorizes the Trust to file UCC financing statements
naming the Depositor as Debtor, the Trust as Secured Party and the
Indenture Trustee as Assignee in each jurisdiction that the
Depositor deems necessary in order to protect its security
interests in the Contracts and Equipment.
Section 2.02
Acceptance by Trust
. On the Closing Date the Trust
shall issue, and the Owner Trustee, or the Indenture Trustee as its
authenticating agent under the Trust Agreement, shall authenticate,
to, or upon the order of, the Depositor and in accordance with the
Trust Agreement, the Equity Certificate representing ownership of a
beneficial interest in 100% of the Trust and the Trust shall issue,
and the Indenture Trustee shall authenticate, to, or upon the order
of, the Depositor in accordance with the terms of the Indenture the
Notes secured by the Collateral. The Trust hereby
acknowledges its acceptance of the Trust Assets, and declares that
it shall maintain such right and interest in the Trust Assets in
accordance with the terms of this Agreement and the Trust Agreement
upon the trust herein and therein set forth.
Section 2.03
Conveyance of Substitute
Contracts . (a) Subject
to the limitations set forth in (and the other terms and conditions
of) this Section 2.03, the Depositor may substitute other
Contracts and related assets for Contracts and related Transferred
Assets previously conveyed to the Trust and in the Contract Pool,
by conveying such other Contracts and related assets to the Trust
pursuant to all procedures and documentation specified below.
Upon the effectiveness of such substitution, such other
Contracts and related Transferred Assets (such Contracts,
“Substitute Contracts”, and collectively,
“Substitute Transferred Assets”) shall, for all
purposes of this Agreement and the Trust Agreement, constitute and
be considered as part of the Trust Assets, and the Contracts
already in the Contract Pool and related Transferred Assets for
which the Substitute Contract Assets have been substituted (such
Contracts, “Replaced Contracts”, and collectively,
“Replaced Assets”) shall no longer constitute Trust
Assets. Upon consummation of such substitution, the Trust
shall be deemed to have assigned to the Depositor all of the
Trust’s right, title and interest in and to the Replaced
Assets, without recourse, representation or warranty.
In addition, the parties hereto intend
and agree that any conveyance described in this Section 2.03
is made with the intent and effect described in subsection (c) of
Section 2.01 above.
(b)
Subject to the conditions set forth in
this subsection (b) below, and pursuant to one or more related
Substitution Transfer Agreements, the Depositor shall transfer,
assign, set over and otherwise convey to the Trust, without
recourse (other than as expressly provided herein), (i) all the
right and interest of the Depositor in and to the Substitute
Contracts listed on the related Substitution Schedule of Contracts,
and (ii) all other rights and property interests consisting of
Transferred Assets related to such Substitute Contracts, provided,
that the Depositor may not (x) make substitutions for Prepaid
Contracts until the Class [__] Notes have been paid in full, (y)
make substitution for Prepaid Contracts or Defaulted Contracts in
excess of 10% of the Initial Contract Pool Principal Balance and
(z) make substitutions for Prepaid Contracts or Defaulted Contracts
after [________], 20[ ]. The Depositor shall effect
such transfers only upon the satisfaction of each of the following
conditions on or prior to the related Substitution Transfer Date
(and the delivery of a related Substitution Notice by the Depositor
shall be deemed a representation and warranty by the Depositor that
such conditions have been or will be, as of the related
Substitution Transfer Date, satisfied):
(i)
at least five days prior to the related
Substitution Transfer Date, the Depositor shall have provided the
Owner Trustee on behalf of the Trust and the Indenture Trustee with
a Substitution Notice complying with the definition thereof
contained herein;
(ii)
there shall have occurred, with respect
to each such Substitute Contract, a corresponding Substitution
Event with respect to one or more intended Replaced Contracts then
constituting Contracts in the Contract Pool;
(iii)
the Substitute Contract(s) being conveyed
to the Trust, satisfy the Substitute Contract Qualification
Conditions;
(iv)
the Depositor shall have delivered to the
Owner Trustee on behalf of the Trust a duly executed written
assignment agreement in substantially the form of Exhibit D
hereto (a “Substitution Transfer Agreement”), which
shall include a Substitution Schedule of Contracts identifying the
Substitute Contracts and the related Replaced Contracts;
(v)
[_________] sh
