(vi)
one or more Officer’s Certificates, each executed by an Authorized Officer of the Master Issuer, dated as of the applicable Series Closing Date to the effect that:
(A)
the Senior ABS Leverage Ratio as of the applicable Series Closing Date is less than or equal to 6.50x after giving pro forma effect to the issuance of such Additional Notes and any repayment of existing Indebtedness from
such Additional Notes;
(B)
the Holdco Leverage Ratio is less than or equal to 7.00x after giving pro forma effect to the issuance of such
Additional Notes and any repayment of existing Indebtedness from such Additional Notes;
(C)
no Potential Rapid Amortization Event, Rapid Amortization Event, Default or Event of Default has occurred and is
continuing or will occur as a result of the issuance of the new Series of Notes;
(D)
all representations and warranties of the Master Issuer in this Base Indenture and the other Related Documents are
true and correct, and will continue to be true and correct after giving effect to such issuance on the Series Closing Date, in all material respects (other than any representation or warranty that, by its terms, is made only as of an earlier
date);
(E)
no Cash Trapping Period is in effect or will commence as a result of the issuance of the new Series of Notes;
(F)
the New Series Pro Forma DSCR is greater than or equal to 2.00x;
(G)
no Manager Termination Event or Potential Manager Termination Event has occurred and is continuing or will occur as a
result of such issuance;
(H)
the proposed issuance does not alter or change the terms of any Series of Notes Outstanding or the Series Supplement
relating thereto without such consents (if any) as are required under this Base Indenture or the Series Supplement for such Series;
(I)
all costs, fees and expenses with respect to the issuance of the new Series of Notes or relating to the actions taken
in connection with such issuance that are required to be paid on the applicable Series Closing Date have been paid or will be paid from the proceeds of the issuance of the new Series of Notes;
(J)
all conditions precedent with respect to the authentication and delivery of such new Series of Notes provided in this
Base Indenture, the Series Supplement for such Series and, if applicable, the related Variable Funding Note Purchase Agreement and any other related note purchase agreement executed in connection with the issuance of such new Series of Notes have
been satisfied or waived;
(K)
the Guarantee and Collateral Agreement is in full force and effect as to such new Series of Notes;
(L)
if such new Series of Notes includes Subordinated Notes, the terms of any such new Series of Notes include the Subordinated Notes Provisions to the extent applicable;
(M)
the
legal final maturity date for any new Class of Senior Notes will not be prior to the legal final maturity of any Class of Senior Notes then Outstanding;
provided
, that the legal final maturity of any new Class A-1 Notes may be prior to the
legal final maturity of any Class of Senior Notes (other than Class A-1 Notes that will not be simultaneously repaid) then Outstanding
;
(N)
the legal final maturity date for any new Class of Senior Subordinated Notes will not be prior to the legal final maturity of any Class of Senior Notes or any Class of Senior Subordinated Notes then Outstanding;
(O)
the legal final maturity date for any new Class of Subordinated Notes will not be prior to the legal final maturity of any Class of Senior Notes, any Class of Senior Subordinated Notes or any Class of Subordinated Notes
then Outstanding;
(P)
each of the parties to the Related Documents with respect to such new Series of Notes has covenanted and agreed in the Related Documents that, prior to the date which is one (1) year and one (1) day after the payment in
full of the latest maturing Note, it will not institute against, or join with any other Person in instituting against, any Securitization Entity, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings, under any federal or state bankruptcy or similar law;
(Q)
there is no action, proceeding, or investigation pending or threatened against any Non-Securitization Entity before any court or administrative agency that would reasonably be expected to result in a Material Adverse
Effect with respect to the Securitization Entities; and
(R)
if such issuance is of a Series of Senior Subordinated Notes or Subordinated Notes, the Master Issuer has established the applicable Collection Account Administrative Accounts set forth in
Section 5.07(a)
and such accounts are
subject to an Account Control Agreement in accordance with the terms herein;
provided
that none of the conditions set forth in the foregoing
clauses (A)
,
(B)
,
(C)
,
(E)
,
(F)
,
(G)
,
(H)
,
(M)
,
(N)
, and
(O)
of this
clause (vi)
shall apply and no Officer’s Certificates shall be required to include such representations under this
clause (vi)
, in each case, if there are no Series of Notes
Outstanding (apart from the new Series of Notes) on the applicable Series Closing Date, or if all Series of Notes Outstanding (apart from the new Series of Notes) will be repaid in full from the proceeds of issuance of the new Series of Notes or
otherwise on the applicable Series Closing Date;
(vii)
a Tax Opinion dated the applicable Series Closing Date;
provided
,
however
, that, if there are no Notes
Outstanding or if all Series of Notes Outstanding will be repaid in full from the proceeds of issuance of the new Series of Notes or otherwise on the applicable Series Closing Date or defeased in accordance with
Section 12.01(c)
, only the
opinions set forth in
clauses (b)
and
(c)
of the definition of Tax Opinion are required to be given in connection with the issuance of such new Series of Notes;
(viii)
one or more Opinions of Counsel, supported by one or more Officer’s Certificates, addressed to the Trustee and the
Control Party, subject to customary assumptions and qualifications, and in a form reasonably acceptable to the Control Party, dated the applicable Series Closing Date, substantially to the effect that:
(A)
all of the
instruments described in this
Section 2.02(b)
furnished to the Trustee and the Control Party conform to the requirements of this Base Indenture and the Series Supplement for such Series (or to the extent applicable, any Variable Funding
Note Purchase Agreement) and the new Series of Notes is permitted to be authenticated by the Trustee pursuant to the terms of this Base Indenture and the Series Supplement for such Series (or to the extent applicable, any Variable Funding Note
Purchase Agreement);
(B)
the Series Supplement for such Series and any Variable Funding Note Purchase Agreement have been duly authorized, executed and
delivered by the Master Issuer and constitute valid and binding agreements of the Master Issuer, enforceable against the Master Issuer in accordance with their terms;
(C)
such new Series of Notes have been duly authorized by the Master Issuer, and, when such Notes have been duly authenticated and
delivered by the Trustee, such Notes will be valid and binding obligations of the Master Issuer, enforceable against the Master Issuer in accordance with their terms;
(D)
none of the Securitization Entities is required to be registered under the 1940 Act;
(E)
the Lien and the security interests created by this Base Indenture and the Guarantee and Collateral Agreement on the Collateral remain perfected or
recorded as of such date to the extent required by this Base Indenture and the Guarantee and Collateral Agreement and such Lien and security interests as of such date extend to any assets transferred to the Securitization Entities through the
date of the issuance of such new Series of Notes
;
(F)
based on a reasoned analysis, (i) in the event of a bankruptcy or insolvency of a Non-Securitization Entity no Securitization
Entity would be substantively consolidated with such Non-Securitization Entity and (ii) as of the applicable Series Closing Date, each transfer of Collateral to any Securitization Entity pursuant to a Contribution Agreement would be treated as a
“true sale” or absolute transfer;
(G)
neither the execution and delivery by each Securitization Entity of the Indenture Documents to which it is a party nor the
performance by such Securitization Entity of its obligations under such Indenture Documents: (i) conflicts with the Charter Documents of such Securitization Entity, (ii) constitutes a violation of, or a default under, any material agreement to
which such Securitization Entity is a party (which agreements may be set forth in a schedule to such opinion), or (iii) contravenes any order or decree that is applicable to such Securitization Entity (which order and decree may be set forth in a
schedule to such opinion);
(H)
neither the execution and delivery by the Master Issuer of such Notes and the Series Supplement for such Series (and, to the
extent applicable, any Variable Funding Note Purchase Agreement) nor the performance by the Master Issuer of its obligations under each of such Notes and the Series Supplement for such Series (and, to the extent applicable, any Variable Funding
Note Purchase Agreement): (i) violates any law, rule or regulation of any relevant jurisdiction, or (ii) requires the consent, approval, licensing or authorization of, or any filing, recording or registration with, any Governmental Authority
under any law, rule or regulation of any relevant jurisdiction except for those consents, approvals, licenses and authorizations already obtained and those filings, recordings and registrations already made;
(I)
unless such Notes are being offered pursuant to a registration statement that has been declared effective under the 1933 Act,
it is not necessary in connection with the offer and sale of such Notes by the Master Issuer to the initial purchaser thereof or by the initial purchaser to the initial investors in such Notes to register such Notes under the 1933 Act;
(J)
unless the issuance of the Notes requires otherwise, the Base Indenture is not required to be qualified under the United
States Trust Indenture Act of 1939, as amended; and
(K)
all conditions precedent to such issuance have been satisfied and that the related Series Supplement is authorized or permitted pursuant to the
terms and conditions of this Base Indenture (except that no Opinion of Counsel relating to the satisfaction in all material respects of conditions precedent shall be required to be delivered in connection with the issuance of Notes on the Closing
Date)
; and
(iv)
such other documents, instruments, certifications, agreements or other items as the Trustee may reasonably require.
(b)
Upon satisfaction, or waiver by
the Control Party (as directed by the Controlling Class Representative) (which waiver shall be in writing), of the conditions set forth in
Section 2.02(b)
, the Trustee shall authenticate and deliver, as provided above, such Series of
Notes upon execution thereof by the Master Issuer.
(c)
With regard to any new Series of
Notes issued pursuant to this
Section 2.02
that constitutes Senior Notes, Senior Subordinated Notes or Subordinated Notes, the proceeds from such issuance may be used at any time prior to the Series Anticipated Repayment Date for such
Series of Notes to repay either Senior Notes, Senior Subordinated Notes or Subordinated Notes of any Series of Notes Outstanding;
provided
,
however
, that at any time on or after the Series Anticipated Repayment Date for any Series
of Notes that remains Outstanding, the proceeds from such issuance may only be used to repay (i) Senior Subordinated Notes if all Senior Notes have been repaid and (ii) Subordinated Notes if all Senior Notes and Senior Subordinated Notes have
been repaid.
(d)
The issuance of Additional Notes
shall not be subject to the consent of the Holders of any Series of Notes Outstanding. Subject to
Section 2.02(d)
, Additional Notes may be issued for any purpose consistent with the Related Documents, including acquisitions by the
Securitization Entities.
Section 2.03
Series Supplement for Each Series
. In conjunction with the issuance of a new Series, the parties hereto shall execute a Series Supplement (and, in the case such Series includes Class A-1 Notes, a Variable
Funding Note Purchase Agreement), which document(s) shall specify the relevant terms with respect to such new Series of Notes, which may include, without limitation:
(a)
its name or designation;
(b)
the Initial Principal Amount with respect to such new Series of Notes or, to the extent applicable, each Class, Subclass or Tranche of such new Series of Notes;
(c)
the Note Rate with respect to such new Series of Notes or, to the extent applicable, each Class, Subclass or Tranche of such new Series and the applicable default rate;
(d)
the Series Closing Date;
(e)
the Series Anticipated Repayment Date with respect to such new Series of Notes or, to the extent applicable, each Class, Subclass or
Tranche of such new Series of Notes, if any
;
(f)
the Series Legal Final Maturity Date;
(g)
the principal amortization schedule with respect to such new Series of Notes or, to the extent applicable, each
Class, Subclass or Tranche of such new Series of Notes, if any;
(h)
each Rating Agency rating such new Series of Notes, or, to the extent applicable, each Class, Subclass or Tranche of
such new Series of Notes;
(i)
the name of the Clearing Agency, if any, for such new Series of Notes or, to the extent applicable, each Class,
Subclass or tranche of such new Series of Notes;
(j)
the names of the Series Distribution Accounts and any other Series Accounts to be used with respect to such Series
and the terms governing the operation of any such account and the use of moneys therein;
(k)
the method of allocating amounts deposited into any Series Distribution Account with respect to such Series;
(l)
whether the Notes of such new Series will be issued in multiple Classes, Subclasses or Tranches, and the rights and
priorities of each such Class, Subclass or Tranche, if any;
(m)
any deposit of funds to be made in any Base Indenture Account or any Series Account on the Series Closing Date;
(n)
whether the Notes of such Series may be issued as either Definitive Notes or Book-Entry Notes and any limitations
imposed thereon;
(o)
whether the Notes of such Series include Senior Notes, Senior Subordinated Notes and/or Subordinated Notes;
(p)
whether the Notes of such Series include Class A-1 Notes or subfacilities of Class A-1 Notes issued pursuant to a
Variable Funding Note Purchase Agreement;
(q)
the terms of any related Enhancement and the Enhancement Provider thereof, if any;
(r)
the terms of any related Series Hedge Agreement and the applicable Hedge Counterparty, if any; and
(s)
any other relevant terms of such Series of Notes (all such terms, the “
Principal Terms
” of such Series);
provided
, the Series Supplement for any Series of Notes may alter the terms of this
Base Indenture solely as those terms apply to the terms of such Series.
Section 2.04
Execution
and Authentication
. (a) The Notes shall, upon issuance pursuant to
Section 2.02
, be executed on behalf of the Master Issuer by an Authorized Officer of the Master Issuer and delivered by the Master Issuer to the Trustee
for authentication and redelivery as provided herein. The signature of each such Authorized Officer on the Notes may be manual, scanned or facsimile. If an Authorized Officer of the Master Issuer whose signature is on a Note no longer holds
that office at the time the Note is authenticated, the Note shall nevertheless be valid.
(b)
At any time and from time to time after the execution and delivery of this Base Indenture, the Master Issuer may deliver Notes of any particular Series (issued pursuant to
Section
2.02
) executed by the Master Issuer to the Trustee for authentication, together with one or more Company Orders for the authentication and delivery of such Notes, and the Trustee, in accordance with such Company Order and this Base
Indenture, shall authenticate and deliver such Notes.
(c)
No Note shall be entitled to any benefit under the Indenture or be valid for any purpose unless there appears on such Note a certificate of authentication substantially in
the form provided for below, duly executed by the Trustee by the manual signature of a Trust Officer. Such signatures on such certificate shall be conclusive evidence, and the only evidence, that the Note has been duly authenticated under this
Base Indenture. The Trustee may appoint an authenticating agent acceptable to the Master Issuer to authenticate Notes. Unless limited by the term of such appointment, an authenticating agent may authenticate Notes whenever the Trustee may do
so. Each reference in this Base Indenture to authentication by the Trustee includes authentication by such authenticating agent. The Trustee’s certificate of authentication shall be in substantially the following form:
“This is one of the Notes of a Series issued under the within mentioned Indenture.
|
Citibank, N.A., as Trustee
|
________________________________
By:
Authorized Signatory”
(d)
Each Note shall be dated and issued as of the date of its authentication by the Trustee.
(e)
Notwithstanding the foregoing, if any Note shall have been authenticated and delivered hereunder but never issued and sold by the Master Issuer, and the Master Issuer shall
deliver such Note to the Trustee for cancellation as provided in
Section 2.14
together with a written statement to the Trustee and the Servicer (which need not comply with
Section 14.03
) stating that such Note has never been
issued and sold by the Master Issuer, for all purposes of the Indenture such Note shall be deemed never to have been authenticated and delivered hereunder and shall not be entitled to the benefits of the Indenture.
Section 2.05
Registrar
and Paying Agent
. (a) The Master Issuer shall (i) maintain an office or agency where Notes may be presented for registration of transfer or for exchange (the “
Registrar
”) and (ii) appoint a paying agent (which shall
satisfy the eligibility criteria set forth in
Section 10.08(a)
) (the “
Paying Agent
”) at whose office or agency Notes may be presented for payment. The Registrar shall keep a register of the Notes (including the name and address of
each such Noteholder) and of their transfer and exchange. The Trustee shall indicate in its books and records the commitment of each Noteholder, if applicable, and the principal (and stated interest) amount owing to each Noteholder from time to
time. The Master Issuer may appoint one or more co-registrars and one or more additional paying agents. The term “Paying Agent” shall include any additional paying agent and the term “Registrar” shall include any co-registrars. The Master
Issuer may change the Paying Agent or the Registrar without prior notice to any Noteholder. The Master Issuer shall notify the Trustee in writing of the name and address of any Agent not a party to this Base Indenture. The Trustee is hereby
initially appointed as the Registrar and the Paying Agent and shall send copies of all notices and demands received by the Trustee (other than those sent by the Master Issuer to the Trustee and those addressed to the Master Issuer) in connection
with the Notes to the Master Issuer. Upon any resignation or removal of the Registrar, the Master Issuer shall promptly appoint a successor Registrar or, in the absence of such appointment, the Master Issuer shall assume the duties of the
Registrar.
(b)
The Master Issuer shall enter into an appropriate agency agreement with any Agent not a party to this Base Indenture. Such
agency agreement shall implement the provisions of this Base Indenture that relate to such Agent. If the Master Issuer fails to maintain a Registrar or Paying Agent, the Trustee hereby agrees to act as such, and shall be entitled to appropriate
compensation in accordance with this Base Indenture until the Master Issuer shall appoint a replacement Registrar or Paying Agent, as applicable.
Section 2.06
Paying
Agent to Hold Money in Trust
. (a) The Master Issuer will cause the Paying Agent (if the Paying Agent is not the Trustee) to execute and deliver to the Trustee an instrument in which the Paying Agent shall agree with the Trustee
(and if the Trustee is the Paying Agent, it hereby so agrees), subject to the provisions of this
Section 2.06
, that the Paying Agent will:
(i)
hold all sums held by it for the payment of amounts due with respect to the Notes in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay such sums to such Persons as herein provided;
(ii)
give the Trustee notice of any default by the Master Issuer of which it has Actual Knowledge in the making of any
payment required to be made with respect to the Notes;
(iii)
at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the
Trustee all sums so held in trust by the Paying Agent;
(iv)
immediately resign as the Paying Agent and forthwith pay to the Trustee all sums held by it in trust for the payment
of Notes if at any time it ceases to meet the standards required to be met by a Trustee set forth in
Section 10.08
. at the time of its appointment; and
(v)
comply with all requirements of the Code and other applicable Requirements of Law with respect to the withholding
from any payments made by it on any Notes of any applicable withholding Taxes imposed thereon and with respect to any applicable reporting requirements in connection therewith.
(b)
The Master Issuer may at any time, for the purpose of obtaining the satisfaction and discharge of the Indenture or for any
other purpose, by Company Order direct the Paying Agent to pay to the Trustee all sums held in trust by the Paying Agent, such sums to be held by the Trustee in trust upon the same terms as those upon which the sums were held in trust by the
Paying Agent. Upon such payment by the Paying Agent to the Trustee, the Paying Agent shall be released from all further liability with respect to such money.
(c)
Subject to applicable laws with respect to escheat of funds, any money held by the Trustee or the Paying Agent in trust for
the payment of any amount due with respect to any Note and remaining unclaimed for two (2) years after such amount has become due and payable shall be discharged from such trust and be paid to the Master Issuer upon delivery of a Company Order.
The Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Master Issuer for payment thereof (but only to the extent of the amounts so paid to the Master Issuer), and all liability of the Trustee or the Paying
Agent with respect to such trust money paid to the Master Issuer shall thereupon cease;
provided
,
however
, that the Trustee or the Paying Agent, before being required to make any such repayment, may, at the expense of the Master
Issuer, cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in New York City notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than thirty (30) days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Master Issuer. The Trustee may also adopt and employ, at the expense of the Master
Issuer, any other commercially reasonable means of notification of such repayment.
Section 2.07
Noteholder
List
. (a) The Trustee shall furnish or cause to be furnished by the Registrar to the Master Issuer, the Manager, the Back-Up Manager, the Control Party, the Controlling Class Representative, the Paying Agent or any Class A-1
Administrative Agent, within five (5) Business Days after receipt by the Trustee of a request therefor from the Master Issuer, the Manager, the Back-Up Manager, the Control Party, the Controlling Class Representative, the Paying Agent or such
Class A-1 Administrative Agent, respectively, in writing, the names and addresses of the Noteholders of each Series as of the most recent Record Date for payments to such Noteholders. Unless otherwise provided in the Series Supplement for such
Series, the Trustee, after having been adequately indemnified by Note Owners satisfying the requirements set forth in
Section 11.05(b)
(“
Applicants
”) for its costs and expenses, shall afford or shall cause the Registrar to afford
such Applicants access during normal business hours to the most recent list of Noteholders held by the Trustee and shall give the Master Issuer notice that such request has been made, within five (5) Business Days after the receipt of such
application. Such list shall be as of a date no more than forty-five (45) days prior to the date of receipt of such Applicants’ request. Every Noteholder, by receiving and holding a Note, agrees with the Trustee that neither the Trustee, the
Registrar nor any of their respective agents shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Noteholders hereunder, regardless of the source from which such information was
obtained.
(b)
The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names
and addresses of Noteholders of each Series of Notes. If the Trustee is not the Registrar, the Master Issuer shall furnish to the Trustee at least seven (7) Business Days before each Quarterly Payment Date and at such other time as the Trustee
may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Noteholders of each Series of Notes.
Section 2.08
Transfer
and Exchange
. (a) Upon surrender for registration of transfer of any Note at the office or agency of the Registrar, if the requirements of
Section 2.08(f)
and Section 8‑401(a) of the New York UCC are met, the Master
Issuer shall execute and, after the Master Issuer has executed, the Trustee shall authenticate and deliver to the Noteholder, in the name of the designated transferee or transferees, one or more new Notes, in any authorized denominations, of the
same Series and Class (and, if applicable, Tranche or Subclass) and a like original aggregate principal amount of the Notes so transferred. At the option of any Noteholder, Notes may be exchanged for other Notes of the same Series and Class
(and, if applicable, Tranche or Subclass) in authorized denominations of like original aggregate principal amount of the Notes so exchanged, upon surrender of the Notes to be exchanged at any office or agency of the Registrar maintained for such
purpose. Whenever Notes of any Series are so surrendered for exchange, if the requirements of
Section 2.08(f)
and Section 8-401(a) of the New York UCC are met, the Master Issuer shall execute, and after the Master Issuer has executed,
the Trustee shall authenticate and deliver to the Noteholder, the Notes which the Noteholder making the exchange is entitled to receive.
(b)
Every Note presented or surrendered for registration of transfer or exchange shall be (i) duly endorsed by, or be accompanied
by a written instrument of transfer in form satisfactory to the Trustee, the Master Issuer and the Registrar duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing with a medallion signature guarantee and
(ii) accompanied by such other documents as the Trustee and the Registrar may require. The Master Issuer shall execute and deliver to the Trustee or the Registrar, as applicable, Notes in such amounts and at such times as are necessary to enable
the Trustee to fulfill its responsibilities under the Indenture and the Notes.
(c)
All Notes issued and authenticated upon any registration of transfer or exchange of the Notes shall be the valid obligations
of the Master Issuer, evidencing the same Indebtedness, and entitled to the same benefits under the Indenture, as the Notes surrendered upon such registration of transfer or exchange.
(d)
The preceding provisions of this
Section 2.08
notwithstanding, (i) the Master Issuer or the Registrar shall not be required (A) to issue, register the transfer of or
exchange any Note for a period beginning at the opening of business fifteen (15) days preceding the selection of any Note for redemption and ending at the close of business on the day of the mailing of the relevant notice of redemption or (B) to
register the transfer of or exchange any Note so selected for redemption, and (ii) no assignment or transfer of a Note or any commitment in respect thereof shall be effective until such assignment or transfer shall have been recorded in the Note
Register and in the books and records of the Trustee, as applicable, pursuant to
Section 2.05(a)
.
(e)
Unless otherwise provided in the Series Supplement for such Series, no service charge shall be payable for any registration of transfer or exchange of Notes, but the Master
Issuer, the Registrar or the Trustee, as the case may be, may require payment by the Noteholder of a sum sufficient to cover any Tax or other governmental charge that may be imposed in connection with any transfer or exchange of Notes.
(f)
Unless otherwise provided in the Series Supplement for such Series, registration of transfer of Notes containing a legend relating to the restrictions on transfer of such
Notes (which legend shall be set forth in the Series Supplement for such Series or, to the extent applicable, any Variable Funding Note Purchase Agreement) shall be effected only if the conditions set forth in such Series Supplement for such
Series and, to the extent applicable, any Variable Funding Note Purchase Agreement are satisfied. Notwithstanding any other provision of this
Section 2.08
and except as otherwise provided in
Section 2.13
, the typewritten Note or
Notes representing Book-Entry Notes for any Series, Class, Subclass or Tranche may be transferred, in whole but not in part, only to another nominee of the Clearing Agency for such Series, Class, Subclass or Tranche, or to a successor Clearing
Agency for such Series, Class, Subclass or Tranche selected or approved by the Master Issuer or to a nominee of such successor Clearing Agency, only if in accordance with this
Section 2.08
and
Section 2.12
.
Section 2.09
Persons Deemed Owners
. Prior to due presentment for registration of transfer of any Note, the Trustee, the Servicer, the Controlling Class Representative, any Agent and the Master Issuer shall deem and
treat the Person in whose name any Note is registered (as of the day of determination) as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Note and for all other purposes whatsoever (other
than purposes in which the vote or consent of a Note Owner is permitted pursuant to this Base Indenture, the Series Supplement for such Series or any Variable Funding Note Purchase Agreement and, to the extent applicable, the rules of a Clearing
Agency), whether or not such Note is overdue, and none of the Trustee, the Servicer, the Controlling Class Representative, any Agent nor the Master Issuer shall be affected by notice to the contrary.
Section 2.10
Replacement
Notes
. (a) If (i) any mutilated Note is surrendered to the Trustee, or the Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note and (ii) there is delivered to the Master Issuer and the
Trustee such security or indemnity as may be required by them to hold the Master Issuer and the Trustee harmless then,
provided
that the requirements of
Section 2.08(f)
and Section 8-405 of the New York UCC are met, the Master
Issuer shall execute and upon its request the Trustee or an authenticating agent appointed by the Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note. If,
after the delivery of such replacement Note or payment of a destroyed, lost or stolen Note pursuant to the preceding sentence, a protected purchaser (within the meaning of Section 8-303 of the New York UCC) of the original Note in lieu of which
such replacement Note was issued presents for payment such original Note, the Master Issuer and the Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such
replacement Note from such Person to whom such replacement Note was delivered or any assignee of such Person, except a protected purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any
loss, damage, cost or expense incurred by the Master Issuer or the Trustee in connection therewith.
(b)
Upon the issuance of any replacement Note under this
Section 2.10
, the Master Issuer may require the payment by the Holder of such Note of a sum sufficient to cover
any Tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the fees and expenses of the Trustee and the Registrar) connected therewith.
(c)
Every replacement Note issued pursuant to this
Section 2.10
in replacement of any mutilated, destroyed, lost or stolen Note shall constitute an original additional
contractual obligation of the Master Issuer and such replacement Note shall be entitled to all the benefits of the Indenture equally and proportionately with any and all other Notes duly issued under the Indenture (in accordance with the
priorities and other terms set forth herein and in each Series Supplement for such Series).
(d)
The provisions of this
Section 2.10
are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Notes.
Section 2.11
Treasury Notes
. In determining whether the Noteholders of the required Aggregate Outstanding Principal Amount of Notes or the required Outstanding Principal Amount of any Series, Class, Subclass or Tranche
of Notes, as the case may be, have concurred in any direction, waiver or consent, Notes owned, legally or beneficially, by the Master Issuer or any Affiliate of the Master Issuer shall be considered as though they are not Outstanding, except that
for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes of which a Trust Officer has received written notice of such ownership shall be so disregarded. Absent written
notice to a Trust Officer of such ownership, the Trustee shall not be deemed to have knowledge of the identity of the individual Note Owners.
Section 2.12
Book-Entry
Notes
. (a) Unless otherwise provided in any Series Supplement for such Series, the Notes of each Series, Class, Subclass and Tranche, upon original issuance, shall be issued in the form of typewritten Notes representing
Book-Entry Notes and delivered to the depository (or its custodian) specified in such Series Supplement which shall be the Clearing Agency on behalf of such Series, Class, Subclass or Tranche. The Notes of each Series, Class, Subclass and
Tranche shall, unless otherwise provided in the Series Supplement for such Series, initially be registered on the Note Register in the name of the Clearing Agency or the nominee of the Clearing Agency. No Note Owner will receive a definitive
note representing such Note Owner’s interest in the related Series, Class, Subclass or Tranche of Notes, except as provided in
Section 2.13
. Unless and until definitive, fully registered Notes of any Series or any Class, Subclass or
Tranche of any Series (“
Definitive Notes
”) have been issued to Note Owners pursuant to
Section 2.13
:
(i)
the provisions of this
Section 2.12
shall be in full force and effect with respect to each such Series, Class,
Subclass and/or Tranche;
(ii)
the Master Issuer, the Paying Agent, the Registrar, the Trustee, the Servicer and the Controlling Class Representative shall
deal with the Clearing Agency and the applicable Clearing Agency Participants for all purposes (including the payment of principal of, premium, if any, and interest on the Notes and the giving of instructions or directions hereunder or under the
Series Supplement for such Series) as the sole Holder of the Notes, and shall have no obligation to the Note Owners;
(iii)
to the extent that the provisions of this
Section 2.12
conflict with any other provisions of the Indenture, the
provisions of this
Section 2.12
shall control with respect to each such Tranche, Subclass, Class or Series of the Notes;
(iv)
subject to the rights of the Servicer and the Controlling Class Representative under the Indenture, and except for the rights
granted pursuant to
Section 11.05
, the rights of Note Owners of each such Series, Class, Subclass or Tranche of Notes shall be exercised only through the Clearing Agency and the applicable Clearing Agency Participants and shall be limited
to those established by law and agreements between such Note Owners and the Clearing Agency and/or the Clearing Agency Participants, and all references in the Indenture to actions by the Noteholders shall refer to actions taken by the Clearing
Agency upon instructions from the Clearing Agency Participants, and all references in the Indenture to distributions, notices, reports and statements to the Noteholders shall refer to distributions, notices, reports and statements to the Clearing
Agency, as registered Holder of the Notes of such Series, Class, Subclass or Tranche for distribution to the Note Owners in accordance with the Applicable Procedures of the Clearing Agency; and
(v)
subject to the rights of the Servicer and the Controlling Class Representative under the Indenture, and except for the rights
granted pursuant to
Section 11.05
, whenever the Indenture requires or permits actions to be taken based upon instructions or directions of Noteholders evidencing a specified percentage of the Aggregate Outstanding Principal Amount of
Notes or the Outstanding Principal Amount of a Series or Class, Subclass or Tranche of a Series of Notes, the applicable Clearing Agency shall be deemed to represent such percentage only to the extent that it has received instructions to such
effect from Note Owners and/or their related Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in the Outstanding Notes or such Series, Class, Subclass or Tranche of Notes
Outstanding, as the case may be, and has delivered such instructions in writing to the Trustee.
(b)
Pursuant to the Depository Agreement applicable to a Series, Class, Subclass or Tranche, unless and until Definitive Notes of such Series, Class, Subclass or Tranche are
issued pursuant to
Section 2.13
, the initial Clearing Agency will make book-entry transfers among the Clearing Agency Participants and receive and transmit distributions of principal, premium, if any, and interest on the Notes to such
Clearing Agency Participants.
(c)
Whenever notice or other communication to the Holders is required under the Indenture, unless and until Definitive Notes shall have been issued to Note Owners pursuant to
Section
2.13
, the Trustee and the Master Issuer shall give all such notices and communications specified herein to be given to Noteholders to the applicable Clearing Agency for distribution to the Note Owners in accordance with the Applicable
Procedures of the Clearing Agency.
Section 2.13
Definitive
Notes
. (a) The Notes of any Series, Class, Subclass or Tranche of any Series, to the extent provided in the Series Supplement for such Series, upon original issuance, may be issued in the form of Definitive Notes. All Class A-1
Notes of any Series, Class, Subclass or Tranche shall be issued in the form of Definitive Notes. The Series Supplement for such Series shall set forth the legend relating to the restrictions on transfer of such Definitive Notes and such other
restrictions as may be applicable.
(b)
With respect to the Notes of any Series, Class, Subclass or Tranche of any Series issued in the form of typewritten Notes
representing Book-Entry Notes, if (i) (A) the Master Issuer advises the Trustee in writing that the Clearing Agency with respect to any such Series of Notes is no longer willing or able to discharge properly its responsibilities under the
applicable Depository Agreement and (B) the Trustee or the Master Issuer are unable to locate a qualified successor or (ii) after the occurrence of a Rapid Amortization Event, with respect to any Series, Class, Subclass or Tranche of Notes
Outstanding, Note Owners holding a beneficial interest in excess of 50% of the aggregate Outstanding Principal Amount of such Series, Class, Subclass or Tranche of Notes advise the Trustee and the applicable Clearing Agency through the applicable
Clearing Agency Participants in writing that the continuation of a book-entry system through the applicable Clearing Agency is no longer in the best interests of such Note Owners, the Trustee shall notify all Note Owners of such Series, Class,
Subclass or Tranche, through the applicable Clearing Agency Participants, of the occurrence of any such event and of the availability of Definitive Notes to Note Owners of such Series, Class, Subclass or Tranche. Upon surrender to the Trustee of
the Notes of such Series, Class, Subclass or Tranche by the applicable Clearing Agency, accompanied by registration instructions from the applicable Clearing Agency for registration, the Master Issuer shall execute and the Trustee shall
authenticate, upon receipt of a Company Order, and deliver an equal aggregate principal amount of Definitive Notes in accordance with the instructions of the Clearing Agency. Neither the Master Issuer nor the Trustee shall be liable for any
delay in delivery of such instructions and may each conclusively rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive Notes of such Series, Class, Subclass or Tranche of such Series of Notes all
references herein to obligations imposed upon or to be performed by the applicable Clearing Agency shall be deemed to be imposed upon and performed by the Trustee, to the extent applicable with respect to such Definitive Notes, and the Trustee
shall recognize the Holders of the Definitive Notes of such Series, Class, Subclass or Tranche of such Series as Noteholders of such Series, Class, Subclass or Tranche of such Series hereunder and under the Series Supplement for such Series.
Section 2.14
Cancellation
.
The Master Issuer may at any time deliver to the Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Master Issuer or an Affiliate thereof may have acquired in any manner whatsoever, and all Notes so
delivered shall be promptly cancelled by the Trustee. Upon the written instruction of the Master Issuer (or the Manager on its behalf), the Trustee shall cancel any repurchased Notes delivered to it by the Master Issuer (or the Manager on its
behalf), either in certificated form or through the Applicable Procedures of DTC. Such cancelled Notes shall not be reissued and upon cancellation shall not be considered outstanding for purposes of calculating the DSCR, the Holdco Leverage
Ratio or the Senior ABS Leverage Ratio. Immediately upon the delivery of any Notes by the Master Issuer to the Trustee for cancellation pursuant to this
Section 2.14
, the security interest of the Secured Parties in such Notes shall
automatically be deemed to be released by the Trustee, and the Trustee shall execute and deliver to the Master Issuer any and all documentation reasonably requested and prepared by the Master Issuer at its expense to evidence such automatic
release. The Registrar and the Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee shall cancel all Notes surrendered for registration of transfer, exchange,
payment, replacement or cancellation. Except as provided in any Variable Funding Note Purchase Agreement executed and delivered in connection with the issuance of any Notes, the Master Issuer may not issue new Notes to replace Notes that it has
redeemed or paid or that have been delivered to the Trustee for cancellation. All cancelled Notes held by the Trustee shall be disposed of in accordance with the Trustee’s standard disposition procedures unless the Master Issuer shall direct
that cancelled Notes be returned to it for destruction pursuant to a Company Order. No cancelled Notes may be reissued. No provision of this Base Indenture or any Series Supplement that relates to prepayment procedures, penalties, fees,
make-whole payments or any other related matters shall be applicable to any Notes cancelled pursuant to and in accordance with this
Section 2.14
.
Section 2.15
Principal
and Interest
. (a) The principal of and premium, if any, on each Series, Class, Subclass or Tranche of Notes shall be due and payable at the times and in the amounts set forth in the Series Supplement for such Series (and, to the
extent applicable, each Variable Funding Note Purchase Agreement) and in accordance with the Priority of Payments.
(b)
Each Series, Class, Subclass and Tranche of Notes shall accrue interest as provided in the Series Supplement for such Series
(and, to the extent applicable, each Variable Funding Note Purchase Agreement) and such interest shall be due and payable for such Notes on each Quarterly Payment Date in accordance with the Priority of Payments.
(c)
Except as provided in the following sentence, the Person in whose name any Note is registered at the close of business on any
Record Date with respect to a Quarterly Payment Date for such Note shall be entitled to receive the principal, premium, if any, and interest payable on such Quarterly Payment Date notwithstanding the cancellation of such Note upon any
registration of transfer, exchange or substitution of such Note subsequent to such Record Date. Any interest payable at maturity shall be paid to the Person to whom the principal of such Note is payable.
(d)
Pursuant to the authority of the Paying Agent under
Section 2.06(a)(v)
, except as otherwise provided pursuant to a Variable Funding Note Purchase Agreement and only
to the extent that the Paying Agent has been notified in writing of such exception by the Master Issuer or the applicable Class A-1 Administrative Agent, the Paying Agent shall make all payments of interest on the Notes net of any applicable
withholding Taxes and Noteholders shall be treated as having received as payments of interest any amounts withheld with respect to such withholding Taxes.
Section 2.16
Tax Treatment
. The Master Issuer has structured this Base Indenture and the Notes have been (or will be) issued with the intention that the Notes will qualify under applicable tax law as Indebtedness of
the Master Issuer or, if the Master Issuer is treated as a division of another entity for federal income tax purposes, such other entity, and any entity or person acquiring any direct or indirect interest in any Note by acceptance of its Notes
(or, in the case of a Note Owner, by virtue of such Note Owner’s acquisition of a beneficial interest therein) agrees to treat the Notes (or beneficial interests therein) for all purposes of United States federal, state, local and foreign income
or franchise Taxes and any other Tax imposed on or measured by income, as Indebtedness of the Master Issuer or, if the Master Issuer is treated as a division of another entity for federal income tax purposes, such other entity.
Section 2.17
Tax Withholding
.
The Trustee, the Paying Agent and the Master Issuer (or other Person responsible for withholding of Taxes) has the right to withhold on payments with
respect to a Note (without any corresponding gross-up) where an applicable party fails to provide the Trustee, the Paying Agent or the Master Issuer, as applicable, with appropriate tax certifications (which includes, but is not limited to, (i)
an IRS Form W-9 for United States persons (as defined under Section 7701(a)(30) of the Code) or any applicable successor form or (ii) an applicable IRS Form W-8 and any required attachments, for Persons other than United States persons, or
applicable successor form, or the Trustee, the Paying Agent or the Master Issuer (or other Person responsible for withholding of Taxes) is otherwise required to so withhold under applicable law.
ARTICLE II
SECURITY
Section 3.01
Grant
of Security Interest
. (a) To secure the Obligations, the Master Issuer hereby pledges, assigns, conveys, delivers, transfers and sets over to the Trustee, for the benefit of the Secured Parties, and hereby grants to the Trustee,
for the benefit of the Secured Parties, a security interest in the Master Issuer’s right, title and interest in, to and under all accounts, chattel paper, commercial tort claims, deposit accounts, documents, equipment, fixtures, general
intangibles, health-care-insurance receivables, instruments, inventory, securities, securities accounts and other investment property and letter-of-credit rights (in each case, as defined in the New York UCC), including
all of the following property to the extent now owned or at any time hereafter acquired by the Master Issuer (collectively, the “
Indenture Collateral
”):
(i)
the limited liability company membership interests and stock owned by the Master Issuer that represent
the 100% ownership interest in the Securitization Entities owned by the Master Issuer as set forth on Schedule 4.5 of the Guarantee and Collateral Agreement,
together with all claims, rights,
privileges, authority and powers of the Master Issuer relating to such Equity Interests or granted to it under the organizational documents of such Securitization Entities, and all additional Equity Interests of any Subsidiary or Additional
Securitization Entity from time to time acquired by or issued to the Master Issuer in any manner, together with all claims, rights, privileges, authority and powers of the Master Issuer relating to any such Equity Interests or granted to it
under any organizational document of any such Subsidiary or Additional Securitization Entity
formed from time to time;
(ii)
the Accounts and all amounts on deposit in or otherwise credited to the Accounts;
(iii)
any Interest Reserve Letter of Credit;
(iv)
the books and records (whether in physical, electronic or other form) of the Master Issuer;
(v)
the rights, powers, remedies and authorities of the Master Issuer under each of the Related Documents (other than the
Indenture and the Notes) to which it is a party;
(vi)
any and all other property of the Master Issuer now owned or hereafter acquired; and
(vii)
all payments, proceeds, supporting obligations and accrued and future rights to payment with respect to the
foregoing;
provided
that (A) the Indenture Collateral shall exclude the Collateral Exclusions;
(B) the Master Issuer shall not be required to pledge more than 65% of the Equity Interests (and any rights associated with such Equity Interests) of (i) any foreign Subsidiary of the Master Issuer that is a Controlled Foreign Corporation or (ii)
any domestic Subsidiary of the Master Issuer, substantially all of the assets of which are the equity interests of Controlled Foreign Corporations (each, a “Foreign Subsidiary Holding Company”), a corporation for U.S. federal income tax purposes
and in no circumstance will any such foreign Subsidiary that is a Controlled Foreign Corporation or a Foreign Subsidiary Holding Company be required to pledge any assets, serve as Guarantor, or otherwise guarantee the Notes; (C) the security
interest in (1) the Senior Notes Interest Reserve Account and the related property shall only be for the benefit of the Senior Noteholders and the Trustee, in its capacity as trustee for the Senior Noteholders, (2) the Senior Subordinated Notes
Interest Reserve Account and the related property shall only be for the benefit of the Senior Subordinated Noteholders and the Trustee, in its capacity as trustee for the Senior Subordinated Noteholders and (3) each Series Distribution Account and
the related property thereto shall only be for the benefit of the applicable Series (or Class within such Series) Noteholders as set forth in the Series Supplement for such Series; and (D) any Cash Collateral deposited by any Non-Securitization
Entities with the Master Issuer to secure such Non-Securitization Entities’ obligations under any Letter of Credit Reimbursement Agreement shall not constitute Indenture Collateral until such time (if any) as the Master Issuer is entitled to
withdraw such funds from the applicable bank account pursuant to the terms of such Letter of Credit Reimbursement Agreement to reimburse the Master Issuer for any amounts due by such Non-Securitization Entities to the Master Issuer pursuant to such
Letter of Credit Reimbursement Agreement that such Non-Securitization Entities have not paid to the Master Issuer in accordance with the terms thereof.
(b)
“
Collateral Exclusions
” means the following property of the Master Issuer: (i) any lease, sublease, license, or other
contract or permit, in each case if the grant of a Lien or security interest in any of the Master Issuer’s right, title and interest in, to or under such lease, sublease, license, contract or permit (or any rights or interests thereunder) in the
manner contemplated by the Indenture (a) is prohibited by the terms of such lease, sublease, license, contract or permit (or any rights or interests thereunder) or would require the consent of a third party (unless such consent has been
obtained), (b) would constitute or result in the abandonment, invalidation or unenforceability of any right, title or interest of the applicable Securitization Entity therein or (c) would otherwise result in a breach thereof or the termination or
a right of termination thereof, except to the extent that any such prohibition, breach, termination or right of termination is rendered ineffective pursuant to the UCC or any other applicable law, (ii) the Excepted Securitization IP Assets, (iii)
all Real Estate Assets (other than Securitized Owned Real Property until the occurrence of a Mortgage Recordation Event and Mortgages are filed on such Securitized Owned Real Property), (iv) the Excluded Amounts, (v) amounts to be paid in respect
of the JIB Back-to-Back Lease Obligations and (vi) amounts to be paid in respect of the Restaurant Operating Expenses;
provided
,
further
, that the Master Issuer and the Guarantors will not be required to pledge more than 65% of
the Equity Interests (and any rights associated with such Equity Interests) of (x) any foreign Subsidiary of any of the Master Issuer or the Guarantors that is a Controlled Foreign Corporation or (y) any domestic Subsidiary of any of the Master
Issuer or the Guarantors that is a Foreign Subsidiary Holding Company, corporation for U.S. federal income tax purposes and in no circumstance will any such foreign Subsidiary that is a Controlled Foreign Corporation or a Foreign Subsidiary
Holding Company be required to pledge any assets, serve as Guarantor, or otherwise guarantee the Notes;
provided
,
further
,
that the security interest in (A) the Senior Notes Interest
Reserve Account and the related property will only be for the benefit of the Senior Noteholders and the Trustee, in its capacity as trustee for the Senior Noteholders, (B) the Senior Subordinated Notes Interest Reserve Account and the related
property will only be for the benefit of the Senior Subordinated Noteholders and the Trustee, in its capacity as trustee for the Senior Subordinated Noteholders and (C) each Series Distribution Account and the related property thereto will only
be for the benefit of the noteholders of the applicable Series (or Class within such Series) as set forth in the applicable Series Supplement. The Trustee, on behalf of the Secured Parties, acknowledges that it shall have no security interest in
any Collateral Exclusions. The foregoing grant is made in trust to secure the Obligations and to secure compliance with the provisions of this Base Indenture and the other Indenture Documents to which the Master Issuer is a party. The Trustee,
on behalf of the Secured Parties, acknowledges such grant, accepts the trusts under this Base Indenture in accordance with the provisions of this Base Indenture and agrees to perform its duties required in this Base Indenture. The Indenture
Collateral shall secure the Obligations equally and ratably without prejudice, priority or distinction (except, with respect to any Series, Class, Subclass or Tranche of Notes, as otherwise stated in the Series Supplement for such Series or in
the applicable provisions of this Base Indenture).
(c)
Upon the occurrence of a Mortgage Recordation Event, unless such Mortgage Recordation Event is waived by the Control Party (at the direction of the Controlling Class
Representative), the Trustee or its agent shall, at the direction of the Control Party, record each Mortgage in accordance with
Section 8.37.
(d)
The parties hereto agree and acknowledge that (a) each certificated Equity Interest may be held by the Trustee in a separate custodial account in the name of the Trustee for
the benefit of the Secured Parties and (b) each certificated Equity Interest and each Mortgage may be held by a custodian on behalf of the Trustee.
Section 3.02
Certain Rights and Obligations of the Master Issuer Unaffected
.
(a)
Notwithstanding the grant of the security interest in the Indenture Collateral hereunder to the Trustee, on behalf of the
Secured Parties, the Master Issuer acknowledges that the Manager, on behalf of the Securitization Entities, shall, subject to the terms and conditions of the Management Agreement, have the right, subject to the Trustee’s right to revoke such
right, in whole or in part, in the event of the occurrence of an Event of Default, (i) to give as Manager on behalf of the Securitization Entities, in accordance with the Managing Standard, all consents, requests, notices, directions, approvals,
extensions or waivers, if any, which are required or permitted to be given by the Master Issuer under the Collateral Transaction Documents, and to enforce all rights, remedies, powers, privileges and claims of the Master Issuer or any
Securitization Entity under the Collateral Transaction Documents, (ii) to give as Manager on behalf of the Securitization Entities, in accordance with the Managing Standard, all consents, requests, notices, directions and approvals, if any, which
are required or permitted to be given by any Securitization Entity under any IP License Agreement to which such Securitization Entity is a party and (iii) as Manager on behalf of the Securitization Entities, to take any other actions required or
permitted under the terms of the Management Agreement.
(b)
The grant of the security interest by the Master Issuer in the Indenture Collateral to the Trustee on behalf of and for the
benefit of the Secured Parties shall not (i) relieve the Master Issuer from the performance of any term, covenant, condition or agreement on the Master Issuer’s part to be performed or observed under or in connection with any of the Collateral
Transaction Documents or (ii) impose any obligation on the Trustee or any of the Secured Parties to perform or observe any such term, covenant, condition or agreement on the Master Issuer’s part to be so performed or observed or impose any
liability on the Trustee or any of the Secured Parties for any act or omission on the part of the Master Issuer or from any breach of any representation or warranty on the part of the Master Issuer.
(c)
The Master Issuer hereby agrees to indemnify and hold harmless the Trustee and each Secured Party (including its directors, officers, employees and agents) from and against
any and all losses, liabilities (including liabilities for penalties), claims, demands, actions, suits, judgments, reasonable and documented out-of-pocket costs and expenses arising out of or resulting from the security interest granted hereby,
whether arising by virtue of any act or omission on the part of the Master Issuer or otherwise, including, without limitation, the reasonable out-of-pocket costs, expenses and disbursements (including reasonable attorneys’ fees and expenses)
incurred by the Trustee or any Secured Party in enforcing the Indenture or any other Related Document or preserving any of its rights to, or realizing upon, any of the Collateral or, to the extent permitted by applicable law, the Securitized
Assets;
provided
,
however
, that the foregoing indemnification shall not extend to any action by the Trustee or any Secured Party which constitutes gross negligence, bad faith or willful misconduct by the Trustee or any Secured
Party or any other indemnified Person hereunder. The indemnification provided for in this
Section 3.02
shall survive the removal of, or a resignation by, any Person as Trustee as well as the termination of this Base Indenture or any
Series Supplement.
Section 3.03
Performance of Collateral Transaction Documents
. Upon the occurrence of a default or breach (after giving effect to any applicable grace or cure periods) by any Person party to (a) a Collateral Transaction
Document or (b) a Collateral Business Document (only if a Manager Termination Event or an Event of Default has occurred and is continuing), promptly following a request from the Trustee to do so and at the Master Issuer’s expense, the Master
Issuer agrees to take all such lawful action as permitted under this Base Indenture as the Trustee (acting at the direction of the Control Party (acting at the direction of the Controlling Class Representative)) may reasonably request to compel
or secure the performance and observance by such Person of its obligations to the Master Issuer, and to exercise any and all rights, remedies, powers and privileges lawfully available to the Master Issuer to the extent and in the manner directed
by the Trustee (acting at the direction of the Control Party (acting at the direction of the Controlling Class Representative)), including, without limitation, the transmission of notices of default and the institution of legal or administrative
actions or proceedings to compel or secure performance by such Person of its obligations thereunder. If (i) the Master Issuer shall have failed, within ten (10) days of receiving the direction of the Trustee (given at the direction of the
Control Party (at the direction of the Controlling Class Representative)), to take commercially reasonable action to accomplish such directions of the Trustee, (ii) the Master Issuer refuses to take any such action, as reasonably determined by
the Trustee in good faith, or (iii) the Control Party (acting at the direction of the Controlling Class Representative) reasonably determines that such action must be taken immediately, in any such case the Servicer may, but shall not be
obligated to, take, and the Trustee shall take (if so directed by the Control Party (acting at the direction of the Controlling Class Representative)), at the expense of the Master Issuer, such previously directed action and any related action
permitted under this Base Indenture which the Control Party (acting at the direction of the Controlling Class Representative) thereafter determines is appropriate (without the need under this provision or any other provision under this Base
Indenture to direct the Master Issuer to take such action), on behalf of the Master Issuer and the Secured Parties.
Section 3.04
Stamp, Other Similar Taxes and Filing Fees
. The Master Issuer shall indemnify and hold harmless the Trustee and each Secured Party from any present or future claim for liability for any stamp, documentary
or other similar tax and any penalties or interest and expenses with respect thereto, that may be assessed, levied or collected by any jurisdiction in connection with the Indenture, any other Related Document or the Securitized Assets. The
Master Issuer shall pay, and indemnify and hold harmless each Secured Party against, any and all amounts in respect of all search, filing, recording and registration fees, excise taxes and other similar imposts that may be payable or determined
to be payable in respect of the execution, delivery, performance and/or enforcement of the Indenture or any other Related Document.
Section 3.05
Authorization
to File Financing Statements
. (a) The Master Issuer hereby irrevocably authorizes the Control Party on behalf of the Secured Parties at any time and from time to time to file or record in any filing office in any applicable
jurisdiction financing statements and other filing or recording documents or instruments with respect to the Indenture Collateral to perfect the security interests of the Trustee for the benefit of the Secured Parties under this Base Indenture.
The Master Issuer authorizes the filing of any such financing statement naming the Trustee as secured party and indicating that the Indenture Collateral includes “all assets” or words of similar effect or import regardless of whether any
particular assets comprised in the Indenture Collateral fall within the scope of Article 9 of the UCC, including, without limitation, any and all Securitization IP. The Master Issuer agrees to furnish any information necessary to accomplish the
foregoing promptly upon the Servicer’s request. The Master Issuer also hereby ratifies and authorizes the filing on behalf of the Secured Parties of any financing statement with respect to the Indenture Collateral made prior to the date hereof.
(b)
The Master Issuer acknowledges that to the extent the Indenture Collateral includes certain rights of the Master Issuer as a
secured party under the Related Documents, the Master Issuer hereby irrevocably appoints the Trustee as its representative with respect to all financing statements filed to perfect or record evidence of such security interests and authorizes the
Servicer on behalf of and for the benefit of the Secured Parties to make such filings it deems necessary to reflect the Trustee as secured party of record with respect to such financing statements.
ARTICLE III
REPORTS
Section 4.01
Reports and Instructions to Trustee
.
(a)
Weekly Manager’s Certificate
. By 4:30 p.m. (Eastern time) on the Business Day prior to each Weekly Allocation Date,
the Master Issuer shall furnish, or cause the Manager to furnish, to the Trustee and the Servicer a certificate substantially in the form of
Exhibit A
specifying the allocation of Collections on the following Weekly Allocation Date (each
a “
Weekly Manager’s Certificate
”). The Weekly Manager’s Certificate shall be deemed confidential information and shall not be disclosed by the Trustee or the Servicer to any Holder or any other Person without the prior written consent of
the Master Issuer or the Manager. Notwithstanding anything herein to the contrary, the initial Weekly Manager’s Certificate shall not be required to be delivered, and amounts credited to the Accounts shall not be required to be allocated
pursuant to the Priority of Payments, until the first Weekly Allocation Date that occurs after the date that is twenty-one (21) days after the Closing Date.
(b)
Quarterly Noteholders’ Report
. On or before the third (3
rd
) Business Day prior to each Quarterly Payment Date, the Master Issuer shall furnish, or cause the Manager to furnish, a Quarterly Noteholders’ Report with respect to each Series of Notes Outstanding to the Trustee,
each Rating Agency with respect to such Series, the Servicer and each Paying Agent, with a copy to the Back-Up Manager.
(c)
Quarterly Compliance Certificates
. On or before the third (3
rd
) Business Day prior
to each Quarterly Payment Date, the Master Issuer shall deliver, or cause the Manager to deliver, to the Trustee and each Rating Agency with respect to each Series of Notes Outstanding (with a copy to each of the Servicer, the Manager and the
Back-Up Manager) an Officer’s Certificate to the effect that, except as provided in a notice delivered pursuant to
Section 8.08
, no Potential Rapid Amortization Event, Rapid Amortization Event, Default or Event of Default has occurred or
is continuing (each, a “
Quarterly Compliance Certificate
”).
(d)
Scheduled Principal Payments Deficiency Notices
. On the Quarterly Calculation Date with respect to any Quarterly Collection Period, the Master Issuer shall furnish,
or cause the Manager to furnish, to the Trustee and each Rating Agency (with a copy to each of the Servicer and the Back-Up Manager) written notice of any Scheduled Principal Payments Deficiency Event with respect to any Series, Class, Subclass
or Tranche of Notes that occurred with respect to such Quarterly Collection Period (any such notice, a “
Scheduled Principal Payments Deficiency Notice
”).
(e)
Annual Accountants’ Reports
. Within one hundred twenty (120) days after the end of each fiscal year, commencing with the fiscal year ending on or around September
30, 2019, the Master Issuer shall furnish, or cause to be furnished, to the Trustee, the Servicer and each Rating Agency with respect to each Series of Notes Outstanding the reports of the Independent Auditors or the Back-Up Manager required to
be delivered to the Master Issuer by the Manager pursuant to Section 3.3 of the Management Agreement.
(f)
Securitization Entity Financial Statements
. The Manager on behalf of the Securitization Entities shall provide to the
Trustee, the Servicer, the Back-Up Manager and each Rating Agency with respect to each Series of Notes Outstanding, the following financial statements:
(i)
within forty-five (45) days after the end of each of the first three (3) fiscal quarters of each fiscal
year (commencing with the fiscal quarter ending
September 30, 2019
), an unaudited combined consolidated balance sheet of the Holding Company Guarantor as of the end of such quarter and unaudited
combined consolidated statements of income or operations, changes in members’ equity and cash flows of the Securitization Entities for such fiscal quarter and for the fiscal year-to-date period then ended (in the case of the second and third
fiscal quarters of each fiscal year)
; and
(ii)
within one hundred twenty (120) days after the end of each fiscal year (commencing with the fiscal year ending on or around September 30,
2019), an audited combined consolidated balance sheet of the Holding Company Guarantor as of the end of such fiscal year and audited combined consolidated statements of income or operations, changes in members’ equity and cash flows of the
Securitization Entities for such fiscal year, setting forth in comparative form (where appropriate) the comparable amounts for the previous fiscal year, prepared in accordance with GAAP and accompanied by an opinion thereon of the Independent
Auditors stating that such audited financial statements present fairly, in all material respects, the financial position of the Securitization Entities as of the end of such fiscal year and the results of their operations and cash flows for such
fiscal year in accordance with GAAP.
(g)
Jack in the Box Inc. Financial Statements
. So long as Jack in the Box Inc. is the Manager, the Master Issuer shall
cause the Manager (on behalf of the Securitization Entities) to provide to the Trustee, the Servicer, the Back-Up Manager and each Rating Agency with respect to each Series of Notes Outstanding the following financial statements:
(i)
within forty-five (45) days after the end of each of the first three (3) fiscal quarters of each fiscal year, an
unaudited consolidated balance sheet of Jack in the Box Inc. and its Subsidiaries as of the end of such fiscal quarter and unaudited consolidated statements of income or operations, changes in stockholder’s equity and cash flows of Jack in the
Box Inc. and its Subsidiaries for such fiscal quarter and for the fiscal year-to-date period then ended (in the case of the second and third fiscal quarters of each fiscal year); and
(ii)
within one hundred and twenty (120) days after the end of each fiscal year, an audited consolidated balance sheet of
Jack in the Box Inc. and its Subsidiaries as of the end of such fiscal year and audited consolidated statements of income or operations, changes in stockholder’s equity and cash flows of Jack in the Box Inc. and its Subsidiaries for such fiscal
year, setting forth in comparative form the comparable amounts for the previous fiscal year prepared in accordance with GAAP and accompanied by an opinion thereon of the Independent Auditors stating that such audited financial statements present
fairly, in all material respects, the consolidated financial position of Jack in the Box Inc. and its Subsidiaries as of the end of such fiscal year and the consolidated results of their operations and cash flows for such fiscal year in
accordance with GAAP.
(iii)
Notwithstanding the foregoing, the obligations set forth in this
Section 4.01(g)
may be satisfied by
furnishing Jack in the Box Inc.’s Form 10-K or 10-Q, as applicable, filed with the SEC on the timeframe that the SEC shall provide or permit from time to time.
(h)
Additional Information
. The Master Issuer will furnish, or cause to be furnished, from time to time such additional
information regarding the financial position, results of operations or business of Jack in the Box Inc. or any Securitization Entity as the Trustee, the Servicer, the Manager or the Back-Up Manager may reasonably request, subject to Requirements
of Law and to the confidentiality provisions of the Related Documents to which such recipient is a party.
(i)
Instructions as to Withdrawals and Payments
. The Master Issuer will furnish, or cause to be furnished, to the Trustee
or the Paying Agent, as applicable (with a copy to each of the Servicer, the Manager and the Back-Up Manager), written instructions to make withdrawals and payments from the Collection Account and any other Base Indenture Account or Series
Account and to make drawings under any Enhancement, as contemplated herein and in any Series Supplement. The Trustee and the Paying Agent shall promptly follow any such written instructions.
(j)
Copies to Rating Agency
. The Master Issuer shall deliver, or shall cause the Manager to deliver, a copy of each report, certificate or instruction, as applicable,
described in this
Section 4.01
to each Rating Agency at its address as listed in or otherwise designated pursuant to
Section 14.01
or in the Series Supplement for such Series, including any e-mail address.
Section 4.02
Rule 144A Information
. The Master Issuer agrees to provide to any Holder, and to any prospective purchaser of Notes designated by such Holder upon the request of such Holder or prospective purchaser, any
information required to be provided to such Holder or prospective purchaser to satisfy the conditions set forth in Rule 144A(d)(4) under the 1933 Act.
Section 4.03
Reports,
Financial Statements and Other Information to Noteholders
. Subject to the last paragraph of this
Section 4.03
, the Trustee shall make this Base Indenture, the Guarantee and Collateral Agreement, the applicable offering
circular, each Series Supplement, the Quarterly Noteholders’ Reports, the Quarterly Compliance Certificates, the financial statements referenced in
Section 4.01(f)
and
Section 4.01(g)
and the reports referenced in
Section
4.01(e)
(collectively, the “
Noteholder Materials
”) available to (a) each Rating Agency pursuant to
Section 4.01(j)
above and (b) the Holders (
provided
that each Series Supplement and any related offering circular with
respect to a Series of Notes shall only be made available to the Holders (but not to prospective investors) of such Series of Notes), the Servicer, the Manager, the Back-Up Manager and each Rating Agency via the Trustee’s internet website at
www.sf.citidirect.com or such other address as the Trustee may specify from time to time;
provided
that prospective investors shall not be entitled to access the Trustee’s internet website, but may request the Noteholder Materials from
the Trustee in accordance with the requirements of this
Section 4.03
. Assistance in using such website can be obtained by calling the Trustee’s customer service desk at 888-855-9695 or such other telephone number as the Trustee may
specify from time to time. Unless requested by a prospective investor, the Noteholder Materials will only be accessible in a password-protected area of the internet website and the Trustee will require each party (other than the Servicer, the
Manager, the Back-Up Manager and each Rating Agency) accessing such password-protected area to register as a Holder and to make, for the benefit of the Master Issuer, the applicable representations and warranties described below in an investor
request certification (an “
Investor Request Certification
” in the form of
Exhibit D
. The Trustee may disclaim responsibility for any information distributed by it for which the Trustee was not the original source. Each time a
Holder accesses the internet website, it will be deemed to have confirmed such representations and warranties as of the date thereof. The Trustee will provide the Servicer and the Manager with copies of such Investor Request Certifications,
including the identity, address, contact information, email address and telephone number of such Holder upon request, but shall have no responsibility for any of the information contained therein. The Trustee shall have the right to change the
way such statements are electronically distributed in order to make such distribution more convenient and/or more accessible to the above parties and the Trustee shall provide timely and adequate notification to all above parties regarding any
such changes.
The Trustee shall (or shall request that the Manager) make available, upon reasonable advance notice and at the expense of the requesting party, the
Noteholder Materials to any Holder and to any prospective investor that provides the Trustee with an Investor Request Certification in the form of
Exhibit D
to the effect that
such party (i) is a Holder or prospective investor, as applicable, (ii) understands that the items contain confidential information, (iii) is requesting the information solely for use in evaluating such party’s investment or potential investment,
as applicable, in the Notes and will keep such information strictly confidential (
provided
,
however
,
(x) such materials have not been filed or furnished with the SEC and are not otherwise publicly available and (y) that such party may disclose such information only (A) to (1) those personnel employed by it who need to know such information which
have agreed to keep such information strictly confidential and to use such information only for evaluating such party’s investment or potential investment in the Notes, (2) its attorneys and outside auditors which have agreed to keep such
information strictly confidential and to use such information only for evaluating such party’s investment or possible investment in the Notes, or (3) a regulatory or self-regulatory authority pursuant to applicable law or regulation or (B) by
judicial process;
provided
, that it may disclose to any and all Persons without limitation of any kind, the tax treatment and tax structure of the transaction and any related
tax strategies to the extent necessary to prevent the transaction from being described as a “confidential transaction” under U.S. Treasury Regulations Section 1.6011-4(b)(3)) and (iv) who is not a Competitor).
Section 4.04
Manager
.
Pursuant to the Management Agreement, the Manager has agreed to provide certain reports, notices, instructions and other services on behalf of the Master Issuer. The Holders by their acceptance of the Notes consent to the provision of such
reports and notices to the Trustee by the Manager in lieu of the Master Issuer. Any such reports and notices that are required to be delivered to the Holders hereunder shall be delivered by the Trustee. The Trustee shall have no obligation
whatsoever to verify, reconfirm or recalculate any information or material contained in any of the reports, financial statements or other information delivered to it pursuant to this
Article IV
or the Management Agreement. All
distributions, allocations, remittances and payments to be made by the Trustee or the Paying Agent hereunder or under any Series Supplement or Variable Funding Note Purchase Agreement shall be made based solely upon the most recently delivered
written reports and instructions provided to the Trustee or Paying Agent, as the case may be, by the Manager.
Section 4.05
No Constructive Notice
. Delivery of reports, information, Officer’s Certificates and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such reports, information,
Officer’s Certificates and documents shall not constitute constructive notice to the Trustee of any information contained therein or determinable from information contained therein, including any Securitization Entity’s, the Manager’s or any
other Person’s compliance with any of its covenants under the Indenture, the Notes or any other Related Document (as to which the Trustee is entitled to rely exclusively on the most recent Quarterly Compliance Certificate described above).
ARTICLE IV
ALLOCATION AND APPLICATION OF COLLECTIONS
Section 5.01
Administration of Accounts and Additional Accounts
.
Each Account and any additional accounts described in this
Article V
, as of the Closing Date and at all
times thereafter, shall be (A) an Eligible Account, (B) pledged by the Master Issuer or another Securitization Entity to the Trustee for the benefit of the Secured Parties pursuant to
Section 3.01
hereof or Section 3.1 of the Guarantee
and Collateral Agreement, (C) except as provided in the immediately succeeding sentence, if not established with the Trustee or otherwise controlled by the Trustee under the New York UCC, subject to an Account Control Agreement and (D) subject to
the jurisdiction of the State of New York (i) for purposes of the UCC and (ii) for all issues specified in Article 2(1) of the Hague Securities Convention. For any Account required to be subject to an Account Control Agreement on the Closing Date
pursuant to the preceding sentence, such Account shall not be in violation of the requirements to be subject to an Account Control Agreement for a period of sixty (60) days following the Closing Date, so long as any amounts on deposit in such
Account are transferred on a daily basis to an Account meeting the requirements of the prior sentence.
Section 5.02
Management Accounts and Additional Accounts
.
(a)
Establishment of the Management Accounts
. The Manager has established and pledged or, in the case of such other
accounts as may be established by the Manager from time to time pursuant to the Management Agreement that the Manager designates as a “Management Account” for purposes of the Management Agreement, if such account has not already been established,
will establish with and pledge to the Trustee the following management accounts pursuant to the Management Agreement, each of which shall be an Eligible Account and subject to an Account Control Agreement (collectively, the “
Management
Accounts
”):
(i)
Securitized Company Restaurant Accounts
. One or more accounts maintained in the name of JIB Properties or any successor
account established for JIB Properties for such purpose pursuant to the Base Indenture and the Management Agreement, including any investment accounts related thereto into which funds are transferred for investment purposes pursuant to
Section
5.02(b)
of this Base Indenture (collectively, the “
Securitized Company Restaurant Accounts
”);
(ii)
Franchisor Capital Accounts
. One or more accounts maintained in the name of the Franchisor into which the Franchisor
and any Additional Securitization Entity that from time to time acts as the “franchisor” with respect to New Securitized Franchise Agreements and New Securitized Development Agreements entered into by the Additional Securitization Entity may (i)
deposit to the Franchisor Capital Accounts the proceeds of capital contributions thereto directed to be made to such account necessary to meet large-franchisor exemptions or similar exemptions under applicable franchise laws therein and (ii)
disburse funds from the Franchisor Capital Accounts to fund any loan or advance made in accordance with
Section 8.21
of this Base Indenture (collectively, the “
Franchisor Capital Accounts
”);
(iii)
Concentration Accounts
. One or more accounts maintained in the name of the Master Issuer, the Franchisor or JIB
Properties, as applicable, or any successor account established for the Master Issuer, the Franchisor or JIB Properties, as applicable, for such purpose pursuant to the Base Indenture and the Management Agreement, including any investment
accounts related thereto into which funds are transferred for investment purposes pursuant to
Section 5.02(b)
of this Base Indenture (the “
Concentration Accounts
”);
(iv)
Asset Disposition Proceeds Account
. The account maintained in the name of the Master Issuer or any successor account
established for the Master Issuer by the Manager for such purpose pursuant to the Base Indenture and the Management Agreement, including any investment accounts related thereto into which funds are transferred for investment purposes pursuant to
Section 5.02(b)
of this Base Indenture (collectively, the “
Asset Disposition Proceeds Account
”);
(v)
Insurance Proceeds Account
. The account maintained in the name of the Master Issuer, into which the Manager is required
to cause Insurance/Condemnation Proceeds to be deposited (the “
Insurance Proceeds Account
”); and
(vi)
Additional Management Accounts
. From time to time, the Master Issuer or any other Securitization Entity (other than the
Holding Company Guarantor) may establish additional accounts (each of which shall be an Eligible Account) for the purpose of depositing Collections or funds necessary to meet large-franchisor exemptions or similar exemptions under applicable
franchise laws therein (each such account and any investment accounts related thereto into which funds are transferred for investment purposes pursuant to
Section 5.02(b)
, an “
Additional Management Account
”). Each Additional
Management Account that is to be a Franchisor Capital Account or a Securitized Company Restaurant Account shall be designated as such by the Manager.
Notwithstanding anything to the contrary in this
paragraph (a)
, in the case of any Management Account established after
the Closing Date, the applicable Securitization Entity shall be permitted a period of five (5) Business Days after the establishment of such deposit account to cause such deposit account to be subject to an Account Control Agreement.
(b)
Administration of the Management Accounts
. All amounts held in the Management Accounts constituting “securities
accounts” within the meaning of Section 8-501 of the New York UCC may be invested or reinvested in Eligible Investments by the applicable Securitization Entity (or the Manager on its behalf) and such amounts may be transferred by the applicable
Securitization Entity (or the Manager on its behalf) into an investment account for the sole purpose of investing in Eligible Investments. Notwithstanding anything herein or in any other Related Document, the applicable Securitization Entity and
the Manager shall not transfer any funds into any such investment account until such time as an Account Control Agreement is entered into with respect thereto (if such account is not established with the Trustee or otherwise controlled by the
Trustee under the New York UCC). All income or other gain from such Eligible Investments shall be credited to the related Management Account, and any loss resulting from such investments shall be charged to the related Management Account. The
Master Issuer shall not direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.
(c)
Earnings from the Management Accounts
. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Management Accounts shall be
deemed to be Investment Income on deposit for distribution to the Collection Account in accordance with
Section 5.11
.
(d)
No Duty to Monitor
. The Trustee shall have no duty or responsibility to monitor the amounts of deposits into or withdrawals from any Management Account.
Section 5.03
Senior Notes Interest Reserve Account
.
(a)
Establishment of the Senior Notes Interest Reserve Account
. The Master Issuer has established with the Trustee the
Senior Notes Interest Reserve Account in the name of a Securitization Entity or the Trustee and has pledged such Senior Notes Interest Reserve Account to the Trustee for the benefit of the Senior Noteholders and the Trustee, solely in its
capacity as trustee for the Senior Noteholders, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the foregoing Secured Parties. The Senior Notes Interest Reserve Account may also serve as a
Franchisor Capital Account. The Senior Notes Interest Reserve Account shall be an Eligible Account.
(b)
Administration of the Senior Notes Interest Reserve Account
. All amounts held in the Senior Notes Interest Reserve
Account shall be invested in Eligible Investments at the written direction (which may be standing directions) of the Master Issuer (or the Manager on its behalf) and such amounts may be transferred by the Master Issuer (or the Manager on its
behalf) into an investment account for the sole purpose of investing in Eligible Investments. In the absence of written investment instructions hereunder, funds on deposit in the Senior Notes Interest Reserve Account shall be invested as fully
as practicable in one or more Eligible Investments of the type described in
clause (b)
of the definition thereof. All income or other gain from such Eligible Investments shall be credited to the Senior Notes Interest Reserve Account, and
any loss resulting from such investments shall be charged to the Senior Notes Interest Reserve Account. The Master Issuer shall not direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would
result in a loss of any portion of the initial purchase price of such Eligible Investment.
(c)
Earnings from the Senior Notes Interest Reserve Account
. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Senior
Notes Interest Reserve Account shall be deemed to be Investment Income on deposit for distribution to the Collection Account in accordance with
Section 5.11
.
Section 5.04
Senior Subordinated Notes Interest Reserve Account
.
(a)
Establishment of the Senior Subordinated Notes Interest Reserve Account
. The Master Issuer shall, prior to the issuance of any Series of Senior Subordinated Notes, establish with the Trustee the Senior Subordinated Notes Interest Reserve Account in the name of
a Securitization Entity or the
Trustee and shall pledge such Senior Subordinated Notes Interest Reserve Account to
the Trustee for the benefit of the Senior Subordinated Noteholders and the Trustee, solely in its capacity as trustee for the
Senior Subordinated Noteholders, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the foregoing Secured Parties. The Senior Subordinated Notes Interest Reserve Account, once established,
shall be an Eligible Account.
(b)
Administration of the Senior Subordinated Notes Interest Reserve Account
. All amounts held in the Senior Subordinated
Notes Interest Reserve Account shall be invested in Eligible Investments at the written direction (which may be standing directions) of the Master Issuer (or the Manager on its behalf) and such amounts may be transferred by the Master Issuer (or
the Manager on its behalf) into an investment account for the sole purpose of investing in Eligible Investments. In the absence of written investment instructions hereunder, funds on deposit in the Senior Subordinated Notes Interest Reserve
Account shall be invested as fully as practicable in one or more Eligible Investments of the type described in
clause (b)
of the definition thereof. All income or other gain from such Eligible Investments shall be credited to the Senior
Subordinated Notes Interest Reserve Account, and any loss resulting from such investments shall be charged to the Senior Subordinated Notes Interest Reserve Account. The Master Issuer shall not direct (or permit) the disposal of any Eligible
Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.
(c)
Earnings from the Senior Subordinated Notes Interest Reserve Account
. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in
the Senior Subordinated Notes Interest Reserve Account shall be deemed to be Investment Income on deposit for distribution to the Collection Account in accordance with
Section 5.11
.
Section 5.05
Cash Trap Reserve Account
.
(a)
Establishment of the Cash Trap Reserve Account
. The Trustee shall establish and maintain the Cash Trap Reserve Account
in the name of the Trustee for the benefit of the Secured Parties, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Secured Parties. The Cash Trap Reserve Account shall be an Eligible
Account.
(b)
Administration of the Cash Trap Reserve Account
. All amounts held in the Cash Trap Reserve Account shall be invested
in Eligible Investments at the written direction (which may be standing directions) of the Master Issuer (or the Manager on its behalf) and such amounts may be transferred by the Master Issuer (or the Manager on its behalf) into an investment
account for the sole purpose of investing in Eligible Investments. In the absence of written investment instructions hereunder, funds on deposit in the Cash Trap Reserve Account shall be invested as fully as practicable in one or more Eligible
Investments of the type described in
clause (b)
of the definition thereof. All income or other gain from such Eligible Investments shall be credited to the Cash Trap Reserve Account, and any loss resulting from such investments shall be
charged to the Cash Trap Reserve Account. The Master Issuer shall not direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price
of such Eligible Investment.
(c)
Earnings from the Cash Trap Reserve Account
. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Cash Trap Reserve
Account shall be deemed to be Investment Income on deposit for distribution to the Collection Account in accordance with
Section 5.11
.
Section 5.06
Collection Account
.
(a)
Establishment of Collection Account
. On or before the Closing Date, the Trustee shall establish the Collection Account
in the name of the Trustee for the benefit of the Secured Parties, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Secured Parties. The Collection Account shall be an Eligible Account.
Amounts deposited into the Collection Account on or prior to the Closing Date shall be distributed in accordance with the written instruction of the Master Issuer (or the Manager on its behalf).
(b)
Administration of the Collection Account
. All amounts held in the Collection Account shall be invested in Eligible
Investments at the written direction (which may be standing directions) of the Master Issuer (or the Manager on its behalf) and such amounts may be transferred by the Master Issuer (or the Manager on its behalf) into an investment account for the
sole purpose of investing in Eligible Investments. In the absence of written investment instructions hereunder, funds on deposit in the Collection Account shall be invested as fully as practicable in one or more Eligible Investments of the type
described in
clause (b)
of the definition thereof. All income or other gain from such Eligible Investments shall be credited to the Collection Account, and any loss resulting from such investments shall be charged to the Collection
Account. The Master Issuer shall not direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.
(c)
Earnings from Collection Account
. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Collection Account shall be
deemed to be Investment Income on deposit for distribution in accordance with
Section 5.12
.
Section 5.07
Collection Account Administrative Accounts
.
(a)
Establishment of Collection Account Administrative Accounts
. The Master Issuer has established, or, in the case of any
account relating to any Series of Senior Subordinated Notes or Subordinated Notes, if such account has not already been established, will establish on or prior to the issuance of such Series of Senior Subordinated Notes or Subordinated Notes, and
will maintain the following administrative accounts associated with the Collection Account, each of which shall be an Eligible Account, in the name of the Trustee for the benefit of the Secured Parties, bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the Secured Parties (collectively, the “
Collection Account Administrative Accounts
”):
(i)
an account no. 12205500 entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Senior Notes Interest Payment
Account” for the deposit of the Senior Notes Quarterly Interest Amount (together with any successor account, the “
Senior Notes Interest Payment Account
”);
(ii)
an account entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Senior Subordinated Notes Interest Payment
Account” for the deposit of the Senior Subordinated Notes Quarterly Interest Amount (together with any successor account, the “
Senior Subordinated Notes Interest Payment Account
”);
(iii)
an account entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Subordinated Notes Interest Payment Account”
for the deposit of the Subordinated Notes Quarterly Interest Amount (together with any successor account, the “
Subordinated Notes Interest Payment Account
”);
(iv)
an account no. 12205600 entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Class A-1 Notes Commitment Fees
Account” for the deposit of the Class A-1 Quarterly Commitment Fee Amount (together with any successor account, the “
Class A-1 Notes Commitment Fees Account
”);
(v)
an account no. 12205700 entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Senior Notes Principal Payment
Account” for the deposit of the amounts allocable to the payment of principal of the Senior Notes (together with any successor account, the “
Senior Notes Principal Payment Account
”);
(vi)
an account entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Senior Subordinated Notes Principal Payment
Account” for the deposit of the amounts allocable to the payment of principal of the Senior Subordinated Notes (together with any successor account, the “
Senior Subordinated Notes Principal Payment Account
”);
(vii)
an account entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Subordinated Notes Principal Payment Account”
for the deposit of the amounts allocable to the payment of principal of the Subordinated Notes (together with any successor account, the “
Subordinated Notes Principal Payment Account
”);
(viii)
an account no. 12205800 entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Senior Notes Post-ARD Contingent
Interest Account” for the deposit of the Senior Notes Quarterly Post-ARD Contingent Interest Amounts (together with any successor account, the “
Senior Notes Post-ARD Contingent Interest Account
”);
(ix)
an account entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Senior Subordinated Notes Post-ARD Contingent
Interest Account” for the deposit of the Senior Subordinated Notes Quarterly Post-ARD Contingent Interest Amounts (together with any successor account, the “
Senior Subordinated Notes Post-ARD Contingent Interest Account
”);
(x)
an account entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Subordinated Notes Post-ARD Contingent
Interest Account” for the deposit of the Subordinated Notes Quarterly Post‑ARD Contingent Interest Amounts (together with any successor account, the “
Subordinated Notes Post-ARD Contingent Interest Account
”); and
(xi)
an account no. 12205900 entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Securitization Operating Expense Account” for the deposit of Securitization Operating
Expenses (together with any successor account, the “
Securitization Operating Expense Account
”).
(b)
Administration of the Collection Account Administrative Accounts
. All amounts held in the Collection Account
Administrative Accounts shall be invested in Eligible Investments at the written direction (which may be standing directions) of the Master Issuer (or the Manager on its behalf) and such amounts may be transferred by the Master Issuer (or the
Manager on its behalf) into an investment account for the sole purpose of investing in Eligible Investments. In the absence of written investment instructions hereunder, funds on deposit in the Collection Account Administrative Accounts shall be
invested as fully as practicable in one or more Eligible Investments of the type described in
clause (b)
of the definition thereof. All income or other gain from such Eligible Investments shall be credited to the related Collection
Account Administrative Account, and any loss resulting from such investments shall be charged to the related Collection Account Administrative Account. The Master Issuer shall not direct (or permit) the disposal of any Eligible Investments prior
to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase price of such Eligible Investment.
(c)
Earnings from the Collection Account Administrative Accounts
. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the
Collection Account Administrative Accounts shall be deposited therein and shall be deemed to be Investment Income on deposit for distribution to the Collection Account in accordance with
Section 5.11
.
Section 5.08
Hedge Payment Account
.
(a)
Establishment of the Hedge Payment Account
. On or before the Series Closing Date of the first Series of Notes issued
pursuant to this Base Indenture providing for a Series Hedge Agreement, the Master Issuer, or the Manager on behalf of the Master Issuer, shall establish and maintain with the Trustee the Hedge Payment Account in the name of the Trustee for the
benefit of the Secured Parties, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Secured Parties.
(b)
Administration of the Hedge Payment Account
. All amounts held in the Hedge Payment Account shall be invested in
Eligible Investments at the written direction (which may be standing directions) of the Master Issuer (or the Manager on its behalf) and such amounts may be transferred by the Master Issuer (or the Manager on its behalf) into an investment
account for the sole purpose of investing in Eligible Investments. In the absence of written investment instructions hereunder, funds on deposit in the Hedge Payment Account shall be invested as fully as practicable in one or more Eligible
Investments of the type described in
clause (b)
of the definition thereof. All income or other gain from such Eligible Investments shall be credited to the Hedge Payment Account, and any loss resulting from such investments shall be
charged to the Hedge Payment Account. The Master Issuer shall not shall direct (or permit) the disposal of any Eligible Investments prior to the maturity thereof if such disposal would result in a loss of any portion of the initial purchase
price of such Eligible Investment.
(c)
Earnings from the Hedge Payment Account
. All interest and earnings (net of losses and investment expenses) paid on funds on deposit in the Hedge Payment Account
shall be deemed to be Investment Income on deposit for distribution to the Collection Account in accordance with
Section 5.11
.
Section 5.09
Trustee
as Securities Intermediary
. (a) The Trustee or other Person holding any Base Indenture Account held in the name of the Trustee for the benefit of the Secured Parties (collectively the “
Trustee Accounts
”) shall be the “
Securities
Intermediary
.” If the Securities Intermediary in respect of any Trustee Account is not the Trustee, the Master Issuer shall obtain the express agreement of such other Person to the obligations of the Securities Intermediary set forth in
this
Section 5.09
.
(b)
The Securities Intermediary agrees that:
(i)
the Trustee Accounts are accounts to which “financial assets” within the meaning of Section 8-102(a)(9) (“
Financial
Assets
”) of the UCC in effect in the State of New York (the “
New York UCC
”) will or may be credited;
(ii)
the Trustee Accounts are “securities accounts” within the meaning of Section 8-501 of the New York UCC and the
Securities Intermediary qualifies as a “securities intermediary” under Section 8-102(a) of the New York UCC;
(iii)
all securities or other property (other than cash) underlying any Financial Assets credited to any Trustee Account
shall be registered in the name of the Securities Intermediary, indorsed to the Securities Intermediary or in blank or credited to another securities account maintained in the name of the Securities Intermediary and in no case will any Financial
Asset credited to any Trustee Account be registered in the name of the Master Issuer, payable to the Master Issuer or specially indorsed to the Master Issuer;
(iv)
all property delivered to the Securities Intermediary pursuant to this Base Indenture will be promptly credited to
the appropriate Trustee Account;
(v)
each item of property (whether investment property, security, instrument or cash) credited to a Trustee Account shall
be treated as a Financial Asset under Article 8 of the New York UCC;
(vi)
if at any time the Securities Intermediary shall receive any entitlement order from the Trustee (including those
directing transfer or redemption of any Financial Asset) relating to the Trustee Accounts, the Securities Intermediary shall comply with such entitlement order without further consent by the Master Issuer or any other Person;
(vii)
For purposes of all applicable UCCs, New York shall be deemed to be the Securities Intermediary’s jurisdiction and
the Trustee Accounts (as well as the “securities entitlements” (as defined in Section 8-102(a)(17) of the New York UCC) related thereto) shall be governed by the laws of the State of New York; For purposes of the Hague Securities Convention, the
local law of the jurisdiction of the Trustee as Securities Intermediary is the law of the State of New York;
(viii)
the Securities Intermediary has not entered into, and until termination of this Base Indenture, will not enter into, any
agreement with any other Person relating to the Trustee Accounts and/or any Financial Assets credited thereto pursuant to which it has agreed to comply with entitlement orders (as defined in Section 8-102(a)(8) of the New York UCC) of such other
Person and the Securities Intermediary has not entered into, and until the termination of this Base Indenture will not enter into, any agreement with the Master Issuer purporting to limit or condition the obligation of the Securities Intermediary
to comply with entitlement orders as set forth in
Section 5.09(b)(vi)
; and
(ix)
except for the claims and interest of the Trustee, the Secured Parties, the Master Issuer and the other Securitization
Entities in the Trustee Accounts, neither the Securities Intermediary nor, in the case of the Trustee, any Trust Officer knows of any claim to, or interest in, the Trustee Accounts or in any Financial Asset credited thereto. If the Securities
Intermediary or, in the case of the Trustee, a Trust Officer has Actual Knowledge of the assertion by any other Person of any Lien, encumbrance, or adverse claim (including any writ, garnishment, judgment, warrant of attachment, execution or
similar process) against any Trustee Account or in any Financial Asset carried therein, the Securities Intermediary will promptly notify the Trustee, the Servicer, the Manager, the Back-Up Manager and the Master Issuer thereof.
(c)
At any time after the occurrence and during the continuation of an Event of Default, the Trustee shall possess all right,
title and interest in all funds on deposit from time to time in the Trustee Accounts and in all Proceeds thereof, and (acting at the direction of the Controlling Class Representative) shall be the only Person authorized to originate entitlement
orders in respect of the Trustee Accounts;
provided
,
however
, that at all other times the Master Issuer shall, subject to the terms of the Indenture and the other Related Documents, be authorized to instruct the Trustee to
originate entitlement orders in respect of the Trustee Accounts.
Section 5.10
Establishment of Series Accounts; Legacy Accounts
.
(a)
Establishment of Series Accounts
. To the extent specified in the Series Supplement with respect to any Series of
Notes, the Trustee may establish and maintain one or more Series Accounts and/or administrative accounts of any such Series Account in accordance with the terms of such Series Supplement.
(b)
Legacy Accounts
. In the case of any mandatory or optional redemption in full of any Series, Class, Subclass or Tranche of Notes issued pursuant to this Base
Indenture, on the Notes Discharge Date with respect to such Series, Class, Subclass or Tranche of Notes, the Master Issuer may (but is not required to) elect to have all or any portion of the funds held in any Legacy Account with respect to such
Series, Class, Subclass or Tranche of Notes transferred to the applicable distribution account for such Series, Class, Subclass or Tranche of Notes, for application toward the prepayment of such Series, Class, Subclass or Tranche of Notes. If
the Master Issuer does not elect to have such funds so transferred, or if the Master Issuer elects to have only a portion of such funds so transferred, any funds remaining in the applicable Legacy Account after the applicable Notes Discharge Date
shall be deposited into the Collection Account for application in accordance with the Priority of Payments. When the balance of any Legacy Account has been reduced to zero, the Trustee may close such account. The Trustee shall make the
distributions and transfers and shall close any accounts as contemplated by this
Section 5.10
pursuant to instructions delivered by the Master Issuer to the Trustee.
Section 5.11
Deposits, Withdrawals and Collections
.
(a)
Deposits and Withdrawals to the Management Accounts
. The Manager, the Master Issuer, the Franchisor or JIB Properties,
as applicable, shall deposit and withdraw available amounts from the respective Management Accounts in accordance with this
Section 5.11(a)
.
(i)
Deposits to the Securitized Company Restaurant Accounts
. After the Cut-Off Date, the Manager (on behalf of
JIB Properties) will deposit (or cause to be deposited) the following amounts into the Securitized Company Restaurant Accounts (A) all Securitized Company Restaurant Collections within two (2) Business Days following JIB Properties’ receipt
thereof; and (B) all proceeds from credit card and debit card processors or armored carrier providers for Securitized Company Restaurant Collections at Securitized Company Restaurants.
(ii)
Withdrawals from the Securitized Company Restaurant Accounts
. The Manager may withdraw available amounts on
deposit in the Securitized Company Restaurant Accounts at any time in accordance with the Managing Standard and as otherwise set forth in the Related Documents in order to pay (or to reimburse itself to the extent it has paid) any Restaurant
Operating Expenses;
provided
that, after the occurrence and during the continuance of any Warm Back-Up Management Trigger Event, Cash Trapping Period or Rapid Amortization Period, (A) all Restaurant Operating Expenses withdrawn from the
Securitized Company Restaurant Accounts shall be withdrawn substantially in accordance with each calendar month budget submitted to, and approved by, the Control Party (in consultation with the Back-Up Manager) prior to such withdrawal and (B)
withdrawals of any Restaurant Operating Expenses from the Securitized Company Restaurant Accounts in excess in any material respect of amounts set forth in the related calendar month budget will be subject to (i) the delivery by the Manager to
the Control Party and Back-Up Manager of an explanation in reasonable detail for the variance together with related information and (ii) the prior approval of the Control Party (in consultation with the Back-Up Manager). All Restaurant Operating
Expenses shall be paid, directly or indirectly, only from the Securitized Company Restaurant Accounts. For each Securitized Company Restaurant located on real property owned by JIB Properties, an amount that is equal to 9.5% of gross sales of
such Securitized Company Restaurant (for each restaurant, a “
Company Synthetic Lease Payment
”) shall be transferred from the Securitized Company Restaurant Account for such Securitized Company Restaurant to the applicable Concentration
Account. JIB Properties will endeavor to make Company Synthetic Lease Payments on the same timing as other Securitized Lease payments received, and at a minimum, all Company Synthetic Lease Payments accrued during any Four-Week Fiscal Period
shall be transferred to the applicable Concentration Account no later than the Business Day prior to the Weekly Allocation Date of the first Weekly Collection Period of the immediately succeeding Four-Week Fiscal Period. In addition, amounts
payable by JIB Properties in respect of JIB Properties Company Restaurant IP License Fees, at a rate equal to five percent (5%) of the Gross Sales of each Securitized Company Restaurant, shall be withdrawn from the applicable Securitized Company
Restaurant Account and paid to the applicable Concentration Account weekly.
(iii)
Deposits to the Concentration Accounts
. Until the Indenture is terminated pursuant to
Section 12.01
, the
Master Issuer, the Franchisor or JIB Properties, as the case may be, shall deposit (or cause to be deposited) the following amounts to the applicable Concentration Account to the extent owed to it or (in the case of the Master Issuer) its
Subsidiaries and promptly after receipt (unless otherwise specified below and, except in the case of Securitized Company Restaurant Accounts, amounts held as Securitized Company Restaurant Working Capital Reserve Amounts):
(A)
all Securitized Franchisee Payments and any Securitized Franchisee Note Payments shall be deposited directly to a
Concentration Account (or, in the case of any misdirected payments, deposited to the applicable Concentration Account) as soon as practicable, and in any event within three (3) Business Days of receipt (unless such deposit requires an
international funds transfer, in which case such funds must be deposited to the applicable Concentration Account within five (5) Business Days of receipt);
provided
, that for a transition period of up to sixty (60) days following the
Closing Date, a portion of Securitized Franchisee Payments and any Securitized Franchisee Note Payments may be paid to the Manager and deposited by the Manager in the applicable Concentration Account within three (3) Business Days of receipt
(unless such deposit requires an international funds transfer, in which case such funds must be deposited to the applicable Concentration Account within five (5) Business Days of receipt);
(B)
on or before the second (2nd) Business Day following the last day of each Weekly Collection Period, all Securitized
Owned-Property Franchisee Lease Payments, Franchisee Back-to-Back Sublease Payments, Company Synthetic Lease Payments, Non-Branded Restaurant Lease Payments and Non-Securitization Entity Lease Payments (if any) will be deposited directly to a
Concentration Account (or, in the case of any misdirected payments, deposited to the applicable Concentration Account) as soon as practicable, and in any event within three (3) Business Days of receipt (unless such deposit requires an
international funds transfer, in which case such funds must be deposited to the applicable Concentration Account within five (5) Business Days of receipt);
(C)
all Company Restaurant IP License Fees received under the Company Restaurant IP Licenses will be deposited directly
to a Concentration Account (or, in the case of any misdirected payments, deposited to the applicable Concentration Account) as soon as practicable, and in any event within three (3) Business Days of receipt (unless such deposit requires an
international funds transfer, in which case such funds must be deposited to the applicable Concentration Account within five (5) Business Days of receipt);
(D)
as soon as practicable, amounts repaid from any tax escrow account held by a third-party landlord with respect to a
Securitized Franchisee Back-to-Back Sublease shall be deposited directly to a Concentration Account and, in any event, within five (5) Business Days of receipt by the applicable Securitization Entity;
(E)
on or before the tenth (10th) Business Day following the last day of each Four-Week Fiscal Period of the
Securitization Entities, an amount, if positive, equal to the Four-Week Fiscal Period Estimated Securitized Company Restaurant Profits Amount
plus
the Four-Week Fiscal Period Securitized Company Restaurant Profits True-up Amount, from
amounts on deposit in the Securitized Company Restaurant Accounts;
(F)
as soon as practicable, and in any event within three (3) Business Days of receipt, equity contributions, if any,
made (directly or indirectly) by any Non-Securitization Entity to the Holding Company Guarantor and by the Holding Company Guarantor to the Master Issuer to the extent such equity contributions are directed to be made to a Concentration Account;
(G)
as soon as practicable, and in any event within three (3) Business Days of receipt (unless such deposit requires an
international funds transfer, in which case such funds must be deposited to the applicable Concentration Account within five (5) Business Days of receipt), all amounts, received in respect of the Securitization IP, including all license fees
(other than the Company Restaurant IP License Fees) and recoveries from the enforcement of the Securitization IP; and
(H)
as soon as practicable, and in any event within five (5) Business Days of receipt, all other amounts constituting
Collections not referred to in the preceding clauses other than Indemnification Amounts, Insurance/Condemnation Proceeds, Asset Disposition Proceeds and other amounts required to be deposited directly to other Management Accounts or to the
Collection Account.
(iv)
Withdrawals from the Concentration Accounts
. The Manager may, and with respect to
clauses (E)
and
(F)
shall, withdraw available amounts on deposit in any Concentration Account to make the following payments and deposits:
(A)
on a daily basis, as necessary, to the extent of amounts deposited to any Concentration Account that the Manager
determines were required to be deposited to another account or were deposited to such Concentration Account in error;
(B)
on a daily basis, as necessary, to distribute any Excluded Amounts;
(C)
on a daily basis, as necessary, to make payments of any refunds, credits or other amounts (i) owing to Franchisees
under the Franchise Documents, Securitized Owned-Property Franchisee Leases or otherwise, (ii) owing to any third-party under a Non-Branded Restaurant Lease or (iii) owing to any Non-Securitization Entity Company Restaurant;
(D)
as and when required to pay (or to transfer to a disbursement account to pay) JIB Back-to-Back Lease Obligations,
repay JIB Back-to-Back Lease Obligations Advances or to make payments of refunds, credits or other amounts owing to Franchisees under the Securitized Franchisee Back-to-Back Subleases;
(E)
on or before 4:00 p.m. (Eastern time) on the Business Day prior to the first Weekly Allocation Date following the first
Business Day of each calendar month, the Net Back-to-Back Franchisee Lease Payments received since the prior payment of the Net Back-to-Back Franchisee Lease Payments (or, with respect to the first payment of the Net Back-to-Back Franchisee Lease
Payments, since the Closing Date) to the Collection Account;
provided
that, notwithstanding the foregoing, the Manager will be entitled on each such Weekly Allocation Date to deduct from the amount of such Net Back-to-Back Franchisee
Lease Payments that would otherwise be required to be transferred to the Collection Account an amount (the “
Lease Reserve Amount
”), not to exceed on any Weekly Allocation Date the greater of (i) $5,000,000 and (ii) 10% of the aggregate
Collections attributable to Franchisee Back-to-Back Sublease Payments over the four immediately preceding Quarterly Collection Periods, reasonably anticipated by the Manager to be required to pay JIB Back-to-Back Lease Obligations within the next
month (which amount will be retained in the Concentration Account pending application to pay JIB Back-to-Back Lease Obligations or, at the election of the Manager, transferred to the Collection Account on a future date);
provided
that amounts transferred from the Master Issuer to a Concentration Account from the Residual Amount shall not be included in such calculation; and
(F)
on a weekly basis at or prior to 4:00 p.m. (Eastern time) on the Business Day prior to each Weekly Allocation Date, all
Retained Collections in excess of the sum of the Lease Reserve Amount and the Securitized Company Restaurant Working Capital Reserve Amount with respect to the preceding Weekly Collection Period then on deposit in the Concentration Accounts to
the Collection Account for application to make payments and deposits in the order of priority set forth in the Priority of Payments.
(v)
Deposits and Withdrawals from the Asset Disposition Proceeds Account
. Any Asset Disposition Proceeds received
by any Securitization Entity shall be deposited promptly following receipt thereof to the Asset Disposition Proceeds Account. At the election of any Securitization Entity, the Securitization Entities may direct the reinvestment of such Asset
Disposition Proceeds (or in the case of investments made with capital of the Master Issuer within the three (3) months prior to the Permitted Asset Disposition, deemed reinvested with such amounts) in Eligible Assets within one (1) calendar year
following receipt of such Asset Disposition Proceeds or, with respect to Refranchising Asset Dispositions or sale or sale-leasebacks of Securitized Owned Real Property, within three (3) months prior to (in the event that such Securitization
Entity elects to retroactively apply such Asset Disposition Proceeds to a past investment) and/or eighteen (18) months following receipt of such Asset Disposition Proceeds (each such period, an “
Asset Disposition Reinvestment Period
”);
provided
that after the occurrence and during the continuance of any Rapid Amortization Period, (A) all amounts withdrawn from the Asset Disposition Proceeds Account shall be withdrawn substantially in accordance with a calendar month budget submitted to,
and approved by, the Control Party (in consultation with the Back-Up Manager) prior to such withdrawal and (B) withdrawals of any amounts from the Asset Disposition Proceeds Account in excess in any material respect of amounts set forth in the
calendar month budget will be subject to (i) the delivery by the Manager to the Control Party and Back-Up Manager of an explanation in reasonable detail for the variance together with related information and (ii) the prior approval of the Control
Party (in consultation with the Back-Up Manager). To the extent such Asset Disposition Proceeds have not been so reinvested in Eligible Assets within the applicable Asset Disposition Reinvestment Period, the Master Issuer shall withdraw an
amount equal to all such uninvested Asset Disposition Proceeds promptly (but in no event later than five (5) Business Days) following the expiration of the applicable Asset Disposition Reinvestment Period and deposit such amount to the Collection
Account to be applied in accordance with
priority (i)
of the Priority of Payments on such Weekly Allocation Date immediately following the deposit of such Asset Disposition Proceeds to the Collection Account. In the event that such
Securitization Entity has elected not to reinvest such Asset Disposition Proceeds, such Asset Disposition Proceeds shall be deposited to the Collection Account promptly following such decision and applied in accordance with
priority (i)
of the Priority of Payments on the following Weekly Allocation Date. Any Asset Disposition Proceeds deemed reinvested in Eligible Assets will be transferred to the Collection Account where such proceeds will be treated as Collections (and not as
Asset Disposition Proceeds) for application on the following Weekly Allocation Date as indicated in the relevant Weekly Manager’s Certificate.
(vi)
Deposits and Withdrawals from the Insurance Proceeds Account
. All Insurance/Condemnation Proceeds received by
or on behalf of any Securitization Entity in respect of the Securitized Assets shall be deposited promptly following receipt thereof to the Insurance Proceeds Account;
provided
that up to $1,000,000 of Insurance/Condemnation Proceeds in
each calendar year, at the election of the Manager, may be excluded from payment into the Insurance Proceeds Account and shall be treated as Collections. At the election of such Securitization Entity (as notified by the Manager to the Trustee,
the Servicer and the Back-Up Manager promptly after receipt of the Insurance/Condemnation Proceeds) and so long as no Rapid Amortization Event shall have occurred and is continuing, the Securitization Entities may reinvest such
Insurance/Condemnation Proceeds in Eligible Assets and/or to repair or replace the assets in respect of which such proceeds were received, in each case, within one (1) calendar year following receipt of such Insurance/Condemnation Proceeds;
provided
that (i) in the event the Manager has repaired or replaced the assets with respect to which such Insurance/Condemnation Proceeds have been received prior to the receipt of such Insurance/Condemnation Proceeds, such Insurance/Condemnation Proceeds
shall be used to reimburse the Manager for any expenditures in connection with such repair or replacement. To the extent such Insurance/Condemnation Proceeds have not been so reinvested within such one (1) calendar year period (each such period,
a “
Casualty Reinvestment Period
”), the Master Issuer shall withdraw an amount equal to all such uninvested Insurance/Condemnation Proceeds no later than the Business Day immediately succeeding the expiration of the applicable Casualty
Reinvestment Period and deposit such amounts to the Collection Account to be applied in accordance with
priority (i)
of the Priority of Payments on the following Weekly Allocation Date. In the event that such Securitization Entity has
elected to not reinvest such Insurance/Condemnation Proceeds, such Insurance/Condemnation Proceeds shall instead be deposited to the Collection Account promptly following such decision to pay principal of each Series of Notes Outstanding in
accordance with
priority (i)
of the Priority of Payments on the following Weekly Allocation Date.
(b)
Deposits to the Collection Account
. In addition to the deposit of funds from the Concentration Accounts in accordance with
Section 5.11(a)(iv)
and the
deposit of funds from the Securitized Company Restaurant Accounts in accordance with
Section 5.11(a)(ii)
, the Manager (or with respect to deposits in connection with an Interest Reserve Release Event, the Trustee at the direction of the
Manager) will also deposit or cause to be deposited to the Collection Account the following amounts, in each case promptly after receipt (unless otherwise specified below):
(i)
Indemnification Amounts within two (2) Business Days following either (i) the receipt by the Manager of such amounts
if Jack in the Box Inc. is not the Manager or (ii) if Jack in the Box Inc. is the Manager, the date such amounts become payable by the related Indemnitor under the Management Agreement or any other Related Document, in each case if such
Indemnification Amounts are required to be so paid;
(ii)
Insurance/Condemnation Proceeds remaining in the Insurance Proceeds Account on the immediately succeeding Business
Day following the expiration of the Casualty Reinvestment Period and Insurance/Condemnation Proceeds where the applicable Securitization Entity elects not to reinvest such amounts promptly (but in no event later than five (5) Business Days) upon
the later of such election and receipt of such Insurance/Condemnation Proceeds;
(iii)
Asset Disposition Proceeds remaining in the Asset Disposition Proceeds Account on the immediately succeeding Business
Day following the expiration of the Asset Disposition Reinvestment Period and Asset Disposition Proceeds where the applicable Securitization Entity elects not to reinvest such amounts promptly (but in no event later than five (5) Business Days)
upon the later of such election and receipt of such Asset Disposition Proceeds;
(iv)
the Series Hedge Receipts, if any, received by the Securitization Entities in respect of any Series Hedge Agreements
entered into by the Securitization Entities in connection with the issuance of Additional Notes following the Closing Date upon receipt thereof;
(v)
upon the occurrence of any Interest Reserve Release Event, the Master Issuer (or the Manager on its behalf) shall
instruct the Trustee in writing to withdraw the amounts on deposit on the Senior Notes Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account, as applicable, and deposit such amount to the Collection Account to the
extent that no Senior Notes Interest Reserve Account Deficiency Amount or Senior Subordinated Notes Interest Reserve Account Deficiency Amount, as applicable, is outstanding immediately following such deposit; and
(vi)
any other amounts required to be deposited to the Collection Account hereunder or under any other Related Documents.
The Trustee will deposit or cause to be deposited into the Collection Account amounts obtained by the Trustee or the Control Party on account of or as a result of the
exercise by the Trustee or the Control Party of any of its rights under the Indenture, including without limitation under
Article IX
hereof, upon receipt thereof.
(c)
Investment Income
. On a weekly basis at or prior to 4:00 p.m. (Eastern time) on the Business Day prior to each Weekly
Allocation Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee in writing to transfer any Investment Income on deposit in the Indenture Trust Accounts (other than the Collection Account) to the Collection Account for
application as Collections on that Weekly Allocation Date.
(d)
Payment Instructions
. In accordance with and subject to the terms of the Management Agreement, the Master Issuer shall
cause the Manager to cause (i) each Franchisee obligated at any time to make any Securitized Franchisee Payments, Securitized Franchisee Note Payments, Securitized Owned-Property Franchisee Lease Payments or Franchisee Back-to-Back Sublease
Payments to a Concentration Account and (ii) any other Person (not an Affiliate of the Master Issuer) obligated at any time to make any payments with respect to the Securitized Assets, including, without limitation, the Securitization IP, to make
such payment to a Concentration Account or the Collection Account, as determined by the Master Issuer or the Manager.
(e)
Misdirected Collections
. The Master Issuer agrees that if any Collections shall be received by the Master
Issuer or any other Securitization Entity in an account other than an Account or in any other manner, such monies, instruments, cash and other proceeds will not be commingled by the Master Issuer or such other Securitization Entity with any of
their other funds or property, if any, but will be held separate and apart therefrom and shall be held in trust by the Master Issuer or such other Securitization Entity for, and, within three (3) Business Days of the identification of such
payment, paid over to, the Trustee, with any necessary endorsement. The Trustee shall withdraw from the Collection Account any monies on deposit therein that the Manager certifies to it and the Servicer are not Retained Collections and pay
such amounts to or at the direction of the Manager.
In addition, the Trustee shall withdraw any amounts from the Collection Account that are required to be returned to a deposit bank under any Account Control Agreement and remit such
funds in accordance with such Account Control Agreement.
All monies, instruments, cash and other proceeds of the Securitized Assets received by the Trustee pursuant to the Indenture shall be immediately
deposited in the Collection Account and shall be applied as provided in this
Article V
.
Section 5.12
Application of Weekly Collections on Weekly Allocation Dates
. On each Weekly Allocation Date (unless the Manager shall have failed to deliver by 4:30 p.m. (Eastern time) on the Business Day prior to such
Weekly Allocation Date the Weekly Manager’s Certificate relating to such Weekly Allocation Date, in which case the application of Retained Collections relating to such Weekly Allocation Date shall occur on the Business Day immediately following
the day on which such Weekly Manager’s Certificate is delivered) commencing no later than August 2, 2019, the Trustee shall, based solely on the information contained in the Weekly Manager’s Certificate, withdraw the amount on deposit in the
Collection Account as of 10:00 a.m. (Eastern time) in respect of such preceding Weekly Collection Period for allocation or payment in the following order of priority:
(i)
first
, solely with respect to any funds on deposit in the Collection Account on such Weekly Allocation Date
consisting of Indemnification Amounts, Asset Disposition Proceeds or Insurance/Condemnation Proceeds, in the following order of priority:
(A)
to reimburse the Trustee, and then, the Servicer, for any unreimbursed Advances (and accrued interest thereon at the
Advance Interest Rate); then
(B)
to reimburse the Manager for any unreimbursed Manager Advances (and accrued interest thereon at the Advance Interest
Rate); then
(C)
if a Class A-1 Notes Amortization Event is continuing, to make an allocation to the Senior Notes Principal Payment
Account, to prepay, until paid in full, and permanently reduce the commitments under all Class A-1 Notes on a
pro rata
basis based on commitment amounts and to cash collateralize any outstanding letters of credit; then
(D)
to make an allocation to the Senior Notes Principal Payment Account to prepay the Outstanding Principal Amount of all
Senior Notes of all Series other than Class A-1 Notes until paid in full; then
(E)
provided
clause (C)
does not apply, to make an allocation to the Senior Notes Principal Payment Account, to
prepay, until paid in full, and permanently reduce the commitments under all Class A-1 Notes on a
pro rata
basis based on commitment amounts and to cash collateralize any outstanding letters of credit; then
(F)
to make an allocation to the Senior Subordinated Notes Principal Payment Account, to prepay, until paid in full, the
Outstanding Principal Amount of all Senior Subordinated Notes; and then
(G)
to make an allocation to the Subordinated Notes Principal Payment Account, to prepay, until paid in full, the
Outstanding Principal Amount of all Subordinated Notes;
provided
that any prepayments pursuant to
clauses (C)
,
(D)
,
(E)
,
(F)
or
(G)
of this clause first shall be made on the Quarterly Payment Date indicated in the Weekly Manager’s Certificate;
(ii)
second
, (A) to reimburse the Trustee, and
then
, the Servicer, for any unreimbursed Advances (and
accrued interest thereon at the Advance Interest Rate),
then
(B) to reimburse the Manager for any unreimbursed Manager Advances (and accrued interest thereon at the Advance Interest Rate), and
then
(C) to pay the Servicer all
Servicing Fees, Liquidation Fees, if any, and Workout Fees, if any, for such Weekly Allocation Date;
(iii)
third
, to pay Successor Manager Transition Expenses, if any;
(iv)
fourth
, to pay the Weekly Management Fee to the Manager;
(v)
fifth
,
pro rata
,
(A)
to deposit to the Securitization Operating Expense Account, an amount equal to any previously accrued and unpaid
Securitization Operating Expenses together with any Securitization Operating Expenses that are expected to be payable prior to the immediately following Weekly Allocation Date, in an aggregate amount not to exceed the Capped Securitization
Operating Expense Amount with respect to the annual period in which such Weekly Allocation Date occurs after giving effect to all deposits previously made to the Securitization Operating Expense Account in such period, to be distributed
pro
rata
based on the amount of each type of Securitization Operating Expense payable on such Weekly Allocation Date pursuant to this
priority (v)
;
(B)
so long as an Event of Default has occurred and is continuing, to pay to the Trustee the Post-Default Capped Trustee
Expenses Amount for such Weekly Allocation Date;
(C)
after a Mortgage Preparation Event, to the payment of any Mortgage Preparation Fees incurred by the Master Issuer,
the Manager or the Servicer, as applicable; and
(D)
after a Mortgage Recordation Event, to the Trustee, all Mortgage Recordation Fees;
(vi)
sixth
, to deposit to the applicable Indenture Trust Account, ratably according to the amounts required to be
deposited as set forth in
subclauses (A)
through
(C)
below, the following amounts until the amount required to be deposited pursuant to each of
subclauses (A)
through
(C)
below is deposited in full:
(A)
to allocate to the Senior Notes Interest Payment Account for each Series of Senior Notes,
pro rata
by amount
due within each Series, an amount equal to the Senior Notes Accrued Quarterly Interest Amount;
(B)
to allocate to the Class A-1 Notes Commitment Fees Account, the Class A-1 Notes Accrued Quarterly Commitment Fee
Amount; and
(C)
to allocate to the Hedge Payment Account, the amount of the accrued and unpaid Series Hedge Payment Amount, if any,
payable on or before the next Quarterly Payment Date to a Hedge Counterparty, if any;
provided
that the deposit to the Hedge Payment Account pursuant to this
subclause (C)
will exclude any termination payment payable to a Hedge
Counterparty, if any;
(vii)
seventh
, to pay to each Class A-1 Administrative Agent pursuant to the related Variable Funding Note Purchase
Agreement an amount equal to the Capped Class A-1 Notes Administrative Expenses Amount due under such Variable Funding Note Purchase Agreement for such Weekly Allocation Date,
pro rata
based on the amounts owed under each such Variable
Funding Note Purchase Agreement on such Weekly Allocation Date;
(viii)
eighth
, to allocate to the Senior Subordinated Notes Interest Payment Account, an amount equal to the Senior
Subordinated Notes Accrued Quarterly Interest Amount, if any, in respect of the Senior Subordinated Notes;
(ix)
ninth
, first, to deposit in the Senior Notes Interest Reserve Account, an amount equal to any Senior Notes
Interest Reserve Account Deficiency Amount; and second, to deposit in the Senior Subordinated Notes Interest Reserve Account, an amount equal to any Senior Subordinated Notes Interest Reserve Account Deficiency Amount;
provided
,
however
, that no amounts, with respect to any Series of Notes, will be deposited into the Senior Notes Interest Reserve Account or the Senior Subordinated Notes
Interest Reserve Account, as applicable, pursuant to this
priority (ix)
on any Weekly Allocation Date that occurs during the Quarterly Collection Period immediately preceding the Series Legal Final Maturity Date relating to such Series of
Notes;
(x)
tenth
, to allocate to the Senior Notes Principal Payment Account an amount equal to the sum of (1) any Senior
Notes Accrued Quarterly Scheduled Principal Amount, (2) any Senior Notes Quarterly Scheduled Principal Deficiency Amount and (3) amounts then known by the Manager that will become due under each Variable Funding Note Purchase Agreement prior to
the immediately succeeding Quarterly Payment Date with respect to the cash collateralization of letters of credit issued under each Variable Funding Note Purchase Agreement;
(xi)
eleventh
, to pay any Supplemental Management Fee, together with any previously accrued and unpaid Supplemental
Management Fee;
(xii)
twelfth
, so long as no Rapid Amortization Period is continuing, if a Class A-1 Notes Amortization Event has
occurred and is continuing, to the Senior Notes Principal Payment Account to allocate to the Class A-1 Notes, on a
pro rata
basis based on commitment amounts, in an amount sufficient to reduce the Outstanding Principal Amount of all Class
A-1 Notes to zero and to fully cash collateralize all outstanding letters of credit thereunder on the next Quarterly Payment Date after giving effect to all deposits in the Senior Notes Principal Payment Account allocable to the Class A-1 Notes;
(xiii)
thirteenth
, so long as (x) no Rapid Amortization Period is continuing and (y) such Weekly Allocation Date
occurs during a Cash Trapping Period, to deposit into the Cash Trap Reserve Account an amount equal to the Cash Trapping Amount, if any, on such Weekly Allocation Date;
(xiv)
fourteenth
, so long as a Rapid Amortization Period is continuing, to allocate first, to the Senior Notes
Principal Payment Account to allocate to the Class A Notes (sequentially, in alphanumerical order of Class A Notes) in an amount sufficient to reduce the Outstanding Principal Amount of the Class A Notes to zero and to fully cash collateralize
all outstanding letters of credit thereunder on the next Quarterly Payment Date after giving effect to all deposits in the Senior Notes Principal Payment Account, and second, to the Senior Subordinated Notes Principal Payment Account in an amount
sufficient to reduce the Outstanding Principal Amount of the Senior Subordinated Notes to zero (sequentially, in alphanumerical order of the Senior Subordinated Notes) on the next Quarterly Payment Date after giving effect to all deposits in the
Senior Subordinated Notes Principal Payment Account;
(xv)
fifteenth
, so long as no Rapid Amortization Period is continuing, to allocate to the Senior Subordinated Notes
Principal Payment Account, an amount equal to the sum of (1) the Senior Subordinated Notes Accrued Quarterly Scheduled Principal Amount, if any, and (2) the Senior Subordinated Notes Quarterly Scheduled Principal Deficiency Amount, if any;
(xvi)
sixteenth
, to deposit to the Securitization Operating Expense Account an amount equal to any accrued and
unpaid Securitization Operating Expenses (together with any Securitization Operating Expenses that are expected to be payable prior to the immediately following Weekly Allocation Date) in excess of the Capped Securitization Operating Expense
Amount after giving effect to
priority (v)
above;
(xvii)
seventeenth
, to each Class A-1 Administrative Agent pursuant to the related Variable Funding Note Purchase
Agreement for payment of the Excess Class A-1 Notes Administrative Expenses Amounts due under each Variable Funding Note Purchase Agreement for such Weekly Allocation Date
pro rata
based on amounts due under each such Variable Funding
Note Purchase Agreement on such Weekly Allocation Date;
(xviii)
eighteenth
, to each Class A-1 Administrative Agent pursuant to the related Variable Funding Note Purchase
Agreement for payment of the Class A-1 Notes Other Amounts due under such Variable Funding Note Purchase Agreement for such Weekly Allocation Date
pro rata
based on amounts due under each such Variable Funding Note Purchase Agreement;
(xix)
nineteenth
, to allocate to the Subordinated Notes Interest Payment Account, an amount equal to the
Subordinated Notes Accrued Quarterly Interest Amount, if any, in respect of the Subordinated Notes;
(xx)
twentieth
, so long as no Rapid Amortization Period is continuing, to allocate to the Subordinated Notes
Principal Payment Account, (1) an amount equal to the Subordinated Notes Accrued Quarterly Scheduled Principal Amount, if any, and then (2) an amount equal to the Subordinated Notes Quarterly Scheduled Principal Deficiency Amount, if any;
(xxi)
twenty-first
, so long as a Rapid Amortization Period is continuing, to allocate to the Subordinated Notes
Principal Payment Account, with respect to the Subordinated Notes (to be allocated sequentially, in alphanumerical order of the Subordinated Notes) until the Outstanding Principal Amount of the Subordinated Notes will be reduced to zero on the
next Quarterly Payment Date after giving effect to all deposits in the Subordinated Notes Principal Payment Account;
(xxii)
twenty-second
, to allocate to the Senior Notes Post-ARD Contingent Interest Account, any Senior Notes Accrued
Quarterly Post-ARD Contingent Interest Amount for such Weekly Allocation Date;
(xxiii)
twenty-third
, to allocate to the Senior Subordinated Notes Post-ARD Contingent Interest Account, any Senior
Subordinated Notes Accrued Quarterly Post-ARD Contingent Interest Amount, for such Weekly Allocation Date;
(xxiv)
twenty-fourth
, to allocate to the Subordinated Notes Post-ARD Contingent Interest Account, any Subordinated
Notes Accrued Quarterly Post-ARD Contingent Interest Amount, for such Weekly Allocation Date;
(xxv)
twenty-fifth
, to deposit to the Hedge Payment Account, (A) any accrued and unpaid Series Hedge Payment Amount
that constitutes a termination payment payable to a Hedge Counterparty and (B) any other amount payable to a Hedge Counterparty, pursuant to the related Series Hedge Agreement, in each case
pro rata
to each Hedge Counterparty, if any,
according to the amount due and payable to each of them;
(xxvi)
twenty-sixth
, to allocate to the Senior Notes Principal Payment Account an amount equal to any unpaid premiums
and make-whole prepayment premiums with respect to Senior Notes;
(xxvii)
twenty-seventh
,
to allocate to the Senior Subordinated Notes Principal Payment Account, an amount equal to any unpaid premiums and make-whole prepayment premiums with respect to Senior Subordinated Notes;
(xxviii)
twenty-eighth
,
to allocate to the Subordinated Notes Principal Payment Account, an amount equal to any unpaid premiums and make-whole prepayment premiums with respect to Subordinated Notes;
(xxix)
twenty-ninth
, to make any other payments to or for the benefit of any Series of Notes as provided in the
related Series Supplement; and
(xxx)
thirtieth
, to pay the Residual Amount at the direction of the Master Issuer.
Section 5.13
Quarterly Payment Date Applications
.
(a)
Senior Notes Interest Payment Account
.
(i)
On each Quarterly Calculation Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee in
writing to withdraw on the related Quarterly Payment Date, after giving effect to any allocations set forth in the Priority of Payments on such date, the funds allocated to the Senior Notes Interest Payment Account on each Weekly Allocation Date
with respect to the immediately preceding Quarterly Collection Period (or, to the extent necessary to cover any Class A-1 Interest Adjustment Amount, the then-current Quarterly Collection Period), and, if applicable, funds allocated to the Senior
Notes Interest Payment Account pursuant to
subclause (ii)
below, to be paid for the benefit of the Holders of the Senior Notes, up to the accrued and unpaid Senior Notes Quarterly Interest Amount due on such Quarterly Payment Date,
sequentially in order of alphanumerical designation and
pro rata
among each Class of Senior Notes of the same alphanumerical designation based upon the amount of the Senior Notes Quarterly Interest Amount payable with respect to each such
Class, and deposit such funds into the applicable Series Distribution Accounts.
(ii)
If the amount of funds allocated to the Senior Notes Interest Payment Account referred to in
subclause (i)
with respect to the immediately preceding Quarterly Collection Period is insufficient to pay the accrued and unpaid Senior Notes Quarterly Interest Amount due on such Quarterly Payment Date, then a Quarterly Reallocation Event shall be triggered
and any funds reallocated as a result thereof into the Senior Notes Interest Payment Account shall be distributed in accordance with
subclause (i)
above. If such insufficiency is not eliminated following the reallocation of funds as a
result of the Quarterly Reallocation Event, the Master Issuer shall instruct the Trustee in writing to withdraw an amount equal to any remaining insufficiency from
first
, the Senior Notes Interest Reserve Account to the extent of funds on
deposit therein and
second
, from funds available to be drawn under any Interest Reserve Letter of Credit relating to the Senior Notes, and deposit such funds into the Senior Notes Interest Payment Account for further deposit to the
applicable Series Distribution Accounts pursuant to
subclause (i)
;
provided
that in the event amounts on deposit in the Senior Notes Interest Reserve Account or funds available to be drawn under any Interest Reserve Letter of
Credit relating to the Senior Notes are required to be withdrawn in connection with the Class A-1 Quarterly Commitment Fee Amount insufficiency, such amounts shall be allocated ratably based on the respective insufficiencies toward which such
amounts are required to be allocated.
(iii)
If the result of (i) the accrued and unpaid Senior Notes Quarterly Interest Amount for the Interest Accrual Period with
respect to each Class of Senior Notes ending most recently prior to the next succeeding Quarterly Payment Date
over
(ii) the amount that will be available to make payments of interest on the Senior Notes in accordance with
subclauses (i)
and
(ii)
above on such Quarterly Payment Date, is greater than zero (a “
Senior Notes Quarterly Interest Shortfall Amount
”), then in accordance with the terms and conditions of the Servicing Agreement, by 3:00 p.m. (Eastern time) on
the Business Day preceding such Quarterly Payment Date, the Servicer shall make a Debt Service Advance in such amount unless the Servicer notifies the Master Issuer, the Manager, the Back-Up Manager and the Trustee by such time that it has,
reasonably and in good faith, determined such Debt Service Advance (and interest thereon) is a Nonrecoverable Advance. If the Servicer fails to make such Debt Service Advance (unless the Servicer has, reasonably and in good faith, determined
that such Debt Service Advance (and interest thereon) would be a Nonrecoverable Advance), pursuant to
Section 10.01(k)
, the Trustee shall make the Debt Service Advance unless it determines that such Debt Service Advance (and interest
thereon) is a Nonrecoverable Advance. In determining whether any Debt Service Advance (and interest thereon) is a Nonrecoverable Advance, the Trustee may conclusively rely on the determination of the Servicer. All Debt Service Advances shall be
deposited into the Senior Notes Interest Payment Account. If, after giving effect to all Debt Service Advances made with respect to any Quarterly Payment Date, the Senior Notes Quarterly Interest Shortfall Amount with respect to such Quarterly
Payment Date remains greater than zero, then the payment of the Senior Notes Quarterly Interest Amount as reduced by such Senior Notes Quarterly Interest Shortfall Amount to be distributed on such Quarterly Payment Date to the Senior Notes shall
be paid to the Senior Notes, sequentially in order of alphanumerical designation and
pro rata
among each Class of Senior Notes of the same alphanumerical designation based upon the amount of the
Senior Notes Quarterly Interest Amount payable with respect to each such Class;
provided
that such reduction shall not be deemed to be a waiver of any default caused by the existence of such Senior
Notes Quarterly Interest Shortfall Amount. An additional amount of interest may accrue on the Senior Notes Quarterly Interest Shortfall Amount for each subsequent Interest Accrual Period until the Senior Notes Quarterly Interest Shortfall Amount
is paid in full, as set forth in the Series Supplement for such Series.
(b)
Class A-1 Notes Commitment Fees Account
.
(i)
On each Quarterly Calculation Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee in writing to withdraw on
the related Quarterly Payment Date, after giving effect to any allocations set forth in the Priority of Payments on such date,
the funds allocated to the Class A-1 Notes Commitment Fees Account on each Weekly
Allocation Date with respect to the immediately preceding Quarterly Collection Period (or, to the extent necessary to cover any Class A-1 Commitment Fee Adjustment Amount, the then-current Quarterly Collection Period), and, if applicable, funds
allocated to the Class A-1 Notes Commitment Fees Account pursuant to
subclause (ii)
below, to be paid for the benefit of the Holders of the applicable
Class A-1 Notes, up to the Class A-1 Quarterly Commitment Fee Amount accrued and unpaid with respect to the applicable Class A-1 Notes,
pro rata
among
each Series of Class A-1 Notes based upon the Class A-1 Quarterly Commitment Fee Amount payable with respect to each such Series, and deposit such funds into the applicable Series Distribution Account.
(ii)
If the amount of funds allocated to the Class A-1 Notes Commitment Fees Account referred to in
subclause (i)
with respect to the
immediately preceding Quarterly Collection Period is insufficient to pay the accrued and unpaid Class A-1 Quarterly Commitment Fee Amount due on such Quarterly Payment Date, then
a Quarterly Reallocation Event
pursuant to
Section 5.13(p)
shall be triggered and any funds reallocated as a result thereof into the
Class A-1 Notes Commitment Fees Account
shall be distributed in accordance with
subclause (i)
above. If such insufficiency is not eliminated following the
reallocation of funds as set forth in
Section 5.13(p)
, the Master Issuer shall instruct the Trustee in writing to withdraw an amount equal to any
remaining insufficiency from
first
, the Senior Notes Interest Reserve Account to the extent of funds on deposit therein and
second
, from funds available to be drawn under any Interest Reserve Letter of Credit relating to the Senior Notes, and deposit such funds into the Senior Notes Interest Payment
Account for further deposit to the applicable Series Distribution Accounts pursuant to
subclause (i); provided
that in the event amounts on deposit in
the Senior Interest Reserve Account or funds available to be drawn under any Interest Reserve Letter of Credit relating to the Senior Notes are required to be withdrawn in connection with the Senior Notes Quarterly Interest Amount
insufficiency, such amounts shall be allocated ratably based on the respective insufficiencies toward which such amounts are required to be allocated.
(iii)
If the result of (i) the accrued and unpaid Class A-1 Quarterly Commitment Fee Amounts for the Interest Accrual
Period ending most recently prior to the next succeeding Quarterly Payment Date
over
(ii) the amount that shall be available to make payments on the Class A-1 Quarterly Commitment Fee Amount in accordance with
subclauses (i)
and
(ii)
on such Quarterly Payment Date, is greater than zero (a “
Class A-1 Quarterly Commitment Fees Shortfall Amount
”), then such amount available to be distributed on such Quarterly Payment Date to the Class A-1 Notes shall be paid to the Class
A-1 Notes,
pro rata
among each Series of Class A-1 Notes based upon the amount of Class A-1 Quarterly Commitment Fee Amounts payable with respect to each such Series of Class A-1 Notes;
provided
that such reduction shall not be
deemed to be a waiver of any default caused by the existence of such Class A-1 Quarterly Commitment Fees Shortfall Amount. An additional amount of interest may accrue on each such Class A-1 Quarterly Commitment Fees Shortfall Amount for each
subsequent Interest Accrual Period until each such Class A-1 Quarterly Commitment Fees Shortfall Amount is paid in full, as set forth in the Series Supplement for such Series or Variable Funding Note Purchase Agreement, and as set forth in the
Quarterly Noteholders’ Report.
(c)
Senior Subordinated Notes Interest Payment Account
.
(i)
To the extent any Series of Senior Subordinated Notes has been issued, on each Quarterly Calculation Date, the Master Issuer (or the
Manager on its behalf) shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date, after giving effect to any allocations set forth in the Priority of Payments on such date,
the
funds allocated to the Senior Subordinated Notes Interest Payment Account, on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period, and, if applicable, funds allocated to the Senior Subordinated
Notes Interest Payment Account pursuant to
subclause (ii)
below, to be paid for the benefit of the Holders of the Senior Subordinated Notes, up to the
accrued and unpaid Senior Subordinated Notes Quarterly Interest Amount due on such Quarterly Payment Date, sequentially in order of alphanumerical designation and
pro rata
among each Class of Senior Subordinated Notes of the same alphanumerical designation based upon the amount of the Senior Subordinated Notes Quarterly Interest Amount payable with respect to each such Class, and
deposit such funds into the applicable Series Distribution Accounts.
(ii)
If the amount of funds allocated to the Senior Subordinated Notes Interest Payment Account referred to in
subclause (i)
is insufficient to pay the accrued and unpaid Senior Subordinated Notes Quarterly Interest Amount due on such Quarterly Payment Date, then a Quarterly Reallocation Event pursuant to
Section 5.13(p)
shall be triggered and any funds
reallocated as a result thereof into the Senior Subordinated Notes Interest Payment Account shall be distributed in accordance with
subclause (i)
above. If such insufficiency is not eliminated following the reallocation of funds as set
forth in
Section 5.13(p)
, the Master Issuer shall instruct the Trustee in writing to withdraw an amount equal to any remaining insufficiency from
first
, the Senior Subordinated Notes Interest Reserve Account to the extent of funds
on deposit therein and
second
, from funds available to be drawn under any Interest Reserve Letter of Credit relating to the Senior Subordinated Notes, and deposit such funds into the Senior Subordinated Notes Interest Payment Account for
further deposit to the applicable Series Distribution Accounts pursuant to
subclause (i)
.
(iii)
If the result of (i) the accrued and unpaid Senior Subordinated Notes Quarterly Interest Amount due on such Quarterly Payment
Date
over
(ii) the amount that shall be available to make payments of interest on the Senior Subordinated Notes on such Quarterly Payment Date in accordance with
subclauses (i)
and
(ii)
above, is greater than zero (a “
Senior
Subordinated Notes Quarterly Interest Shortfall
”), then such amount available to be distributed on such Quarterly Payment Date to the Senior Subordinated Notes shall be paid to the Senior Subordinated Notes, sequentially in order of
alphanumerical designation and
pro rata
among each Class of Senior Subordinated Notes of the same alphanumerical designation based upon the amount of the Senior Subordinated Notes Quarterly Interest Amount payable with respect to each
such Class;
provided
that such reduction shall not be deemed to be a waiver of any default caused by the existence of such Senior Subordinated Notes Quarterly Interest Shortfall. An additional amount of interest may accrue on the Senior
Subordinated Notes Quarterly Interest Shortfall for each subsequent Interest Accrual Period until the Senior Subordinated Notes Quarterly Interest Shortfall is paid in full, as set forth in the Series Supplement for such Series.
(d)
Senior Notes Principal Payment Account
.
(i)
On each Quarterly Calculation Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee in writing to withdraw on
the related Quarterly Payment Date, after giving effect to any allocations set forth in the Priority of Payments on such date,
the funds allocated to the Senior Notes Principal Payment Account on each Weekly
Allocation Date with respect to the immediately preceding Quarterly Collection Period, to be paid for the benefit of (A) in the case of funds allocated pursuant to
priority (i)
of the Priority of Payments, the Holders of each applicable Class of Senior Notes up to the aggregate amount of Indemnification Amounts, Asset Disposition Proceeds and Insurance/Condemnation Proceeds in the order
of priority set forth in
priority (i)
of the Priority of Payments and (B) in the case of funds allocated pursuant to
priorities (x)
,
(xii)
,
(xiv)
and
(xxvi)
of the Priority of Payments and
subclause (ii)
below, if applicable, excluding any applicable Principal Release Amounts, the Holders of each applicable Class of Senior Notes in the order of priority set forth in the Priority of Payments with respect to such
priorities (x)
,
(xii)
,
(xiv)
and
(xxvi)
, in the order and proportions such Notes are to be allocated funds in accordance with the Priority of Payments,
and deposit such funds into the applicable Series Distribution Account.
(ii)
If the aggregate amount of funds allocated to the Senior Notes Principal Payment Account pursuant to
priorities (x)
,
(xii)
,
(xiv)
and
(xxvi)
of the Priority of Payments on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period is insufficient to pay the sum (without duplication) of (A) the Senior Notes
Quarterly Scheduled Principal Amounts or any Senior Notes Quarterly Scheduled Principal Deficiency Amounts due with respect to each applicable Class of Senior Notes on such Quarterly Payment Date, (B) so long as no Rapid Amortization Period is
continuing, if a Class A-1 Notes Amortization Event has occurred and is continuing, the Outstanding Principal Amount of the Class A-1 Notes and (C) if a Rapid Amortization Event has occurred and is continuing, the Outstanding Principal Amount of
the Senior Notes, on the next Quarterly Payment Date, then a Quarterly Reallocation Event pursuant to
Section 5.13(p)
shall be triggered and any funds reallocated as a result thereof into the Senior Notes Principal Payment Account shall
be distributed in accordance with
subclause (i)
above.
(iii)
If any payment of principal of any Class A-1 Notes of any Series pursuant to
subclause (i)
above is required pursuant
to the Series Supplement for such Series or Variable Funding Note Purchase Agreement to be deposited with the applicable L/C Provider to serve as collateral and act as security (the “
Cash Collateral
”) for any obligations of the Master
Issuer relating to letters of credit issued thereunder (the “
Collateralized Letters of Credit
”), then upon the expiration of the Collateralized Letters of Credit the Cash Collateral shall be remitted to the Master Issuer in accordance with
such Series Supplement or Variable Funding Note Purchase Agreement, and as set forth in the Quarterly Noteholders’ Report.
(e)
Senior Subordinated Notes Principal Payment Account
.
(i)
To the extent any Series of Senior Subordinated Notes has been issued, on each Quarterly Calculation Date, the Master Issuer (or the
Manager on its behalf) shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date, after giving effect to any allocations set forth in the Priority of Payments on such date,
the
funds allocated to the Senior Subordinated Notes Principal Payment Account on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period, to be paid for the benefit of (A) in the case of funds allocated
pursuant to
priority (i)
of the Priority of Payments, the Holders of each applicable Class of Senior Subordinated Notes up to the aggregate amount of
Indemnification Amounts, Asset Disposition Proceeds and Insurance/Condemnation Proceeds in the order of priority set forth in
priority (i)
of the
Priority of Payments and (B) in the case of funds allocated pursuant to
priorities (xiv)
,
(xv)
and
(xxvii)
of the Priority of Payments, and
subclause (ii)
below, if applicable, excluding any applicable Principal Release Amounts, the Holders of each applicable Class of Senior Subordinated Notes in the order of priority set forth in the Priority of Payments with
respect to such
priorities (xiv)
,
(xv)
and
(xxvii)
, in each case sequentially in order of alphanumerical designation and
pro rata
among each such Class of Senior Subordinated Notes of the same alphanumerical designation based upon the Outstanding Principal Amount of the Senior Subordinated Notes of such Class, and deposit such funds into the applicable
Series Distribution Account.
(ii)
If the aggregate amount of funds allocated to the Senior Subordinated Notes Principal Payment Account pursuant to
priorities (xiv)
,
(xv)
and
(xxvii)
of the Priority of Payments on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period is insufficient to pay the sum (without duplication) of (A) the Senior Subordinated
Notes Quarterly Scheduled Principal Amount and any Senior Subordinated Notes Quarterly Scheduled Principal Deficiency Amounts due with respect to each applicable Class of Senior Subordinated Notes on such Quarterly Payment Date and (B) if a Rapid
Amortization Period is continuing, the Outstanding Principal Amount of the Senior Subordinated Notes, on the next Quarterly Payment Date, then a Quarterly Reallocation Event pursuant to
Section 5.13(p)
shall be triggered and any funds
reallocated as a result thereof into the Senior Subordinated Notes Principal Payment Account shall be distributed in accordance with
subclause (i)
above.
(f)
Subordinated Notes Interest Payment Account
.
(i)
To the extent any Series of Subordinated Notes has been issued, on each Quarterly Calculation Date, the Master Issuer (or the Manager on
its behalf) shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date, after giving effect to any allocations set forth in the Priority of Payments on such date,
the funds allocated
to the Subordinated Notes Interest Payment Account on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period, and, if applicable, funds allocated to the Subordinated Notes Interest Payment Account
pursuant to
subclause (ii)
below, to be paid for the benefit of the Holders of the Subordinated Notes, up to the accrued and unpaid Subordinated Notes
Quarterly Interest Amount
due on such Quarterly Payment Date
, sequentially in order of alphanumerical designation and
pro rata
among each Class of Subordinated Notes of the same alphanumerical designation based upon the amount of the Subordinated Notes Quarterly Interest Amount payable with respect to each such Class, and deposit such funds into the
applicable Series Distribution Accounts.
(ii)
If the amount of funds allocated to the Subordinated Notes Interest Payment Account referred to in
subclause (i)
is
insufficient to pay the accrued and unpaid Subordinated Notes Quarterly Interest Amount due on such Quarterly Payment Date, then a Quarterly Reallocation Event pursuant to
Section 5.13(p)
shall be triggered and any funds reallocated as a
result thereof into the Subordinated Notes Interest Payment Account shall be distributed in accordance with
subclause (i)
above.
(iii)
If the result of (i) the accrued and unpaid Subordinated Notes Quarterly Interest Amounts due on such Quarterly Payment Date
over
(ii) the amount that shall be available to make payments of interest on the Subordinated Notes in accordance with
subclauses (i)
and
(ii)
on such Quarterly Payment Date, is greater than zero (a “
Subordinated Notes Quarterly
Interest Shortfall
”), then such amount available to be distributed on such Quarterly Payment Date to the Subordinated Notes shall be paid to each Class of Subordinated Notes, sequentially in order of alphanumerical designation and
pro
rata
among each Class of Subordinated Notes of the same alphanumerical designation based upon the amount of the Subordinated Notes Quarterly Interest Amount payable with respect to each such Class;
provided
that such reduction shall
not be deemed to be a waiver of any default caused by the existence of such Subordinated Notes Quarterly Interest Shortfall. An additional amount of interest may accrue on the Subordinated Notes Quarterly Interest Shortfall for each subsequent
Interest Accrual Period until the Subordinated Notes Quarterly Interest Shortfall is paid in full, as specified in the Series Supplement for such Series.
(g)
Subordinated Notes Principal Payment Account
.
(i)
To the extent any Series of Subordinated Notes has been issued, on each Quarterly Calculation Date, the Master Issuer (or the Manager on
its behalf) shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date, after giving effect to any allocations set forth in the Priority of Payments on such date,
the funds allocated
to the Subordinated Notes Principal Payment Account on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period, to be paid for the benefit of (A) in the case of funds allocated pursuant to
priority (i)
of the Priority of Payments, the Holders of each applicable Class of Subordinated Notes up to the aggregate amount of Indemnification Amounts, Asset
Disposition Proceeds and Insurance/Condemnation Proceeds in the order of priority set forth in
priority (i)
of the Priority of Payments and (B) in the
case of funds allocated pursuant to
priorities (xx)
,
(xxi)
and
(xxviii)
of the Priority of Payments, and
subclause (ii)
below, if applicable, excluding any applicable Principal Release Amounts, the Holders of each applicable Class of Subordinated Notes in the order of priority set forth in the Priority of Payments with respect to such
priorities (xx)
,
(xxi)
and
(xxviii)
, in each case sequentially in order of alphanumerical designation and
pro rata
among each such Class of Subordinated Notes
of the same alphanumerical designation based upon the Outstanding Principal Amount of the Subordinated Notes of such Class and deposit such funds into the applicable Series Distribution Account.
(ii)
If the aggregate amount of funds allocated to the Subordinated Notes Principal Payment Account pursuant to
priorities (xx)
,
(xxi)
and
(xxviii)
of the Priority of Payments on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period is insufficient to pay the sum (without duplication) of (A) the Subordinated Notes
Quarterly Scheduled Principal Amounts and any Subordinated Notes Quarterly Scheduled Principal Deficiency Amounts due with respect to each applicable Class of Subordinated Notes on such Quarterly Payment Date and (B) if a Rapid Amortization
Period is continuing, the Outstanding Principal Amount of the Subordinated Notes, on the next Quarterly Payment Date, then a Quarterly Reallocation Event pursuant to
Section 5.13(p)
shall be triggered and any funds reallocated as a result
thereof into the Subordinated Notes Principal Payment Account shall be distributed in accordance with
subclause (i)
above.
(h)
Senior Notes Post-ARD Contingent Interest Account
.
(i)
On each Quarterly Calculation Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee in writing to withdraw on
the related Quarterly Payment Date
the funds allocated to the Senior Notes Post-ARD Contingent Interest Account on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection
Period, and, if applicable, funds allocated to the Senior Notes Post-ARD Contingent Interest Account pursuant to
subclause (ii)
below, to be paid for the benefit of the Holders of each applicable Class of Senior Notes, up to the accrued and unpaid Senior Notes Quarterly Post-ARD Contingent Interest Amount due on such Quarterly Payment Date,
sequentially in order of alphanumerical designation and
pro rata
among each such Class of Senior Notes of the same alphanumerical designation based upon
the Senior Notes Quarterly Post-ARD Contingent Interest Amount payable on each such Class, and deposit such funds into the applicable Series Distribution Accounts.
(ii)
If the aggregate amount of funds allocated to the Senior Notes Post-ARD Contingent Interest Account on each Weekly Allocation
Date with respect to the immediately preceding Quarterly Collection Period is insufficient to pay the Senior Notes Quarterly Post-ARD Contingent Interest Amount due on such Quarterly Payment Date, then a Quarterly Reallocation Event pursuant to
Section
5.13(p)
shall be triggered and any funds reallocated as a result thereof into the Senior Notes Post-ARD Contingent Interest Account shall be distributed in accordance with
subclause (i)
above.
(i)
Senior Subordinated Notes Post-ARD Contingent Interest Account
.
(i)
To the extent any Series of Senior Subordinated Notes has been issued, on each Quarterly Calculation
Date, the Master Issuer
(or the Manager on its behalf)
shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date the funds allocated to the Senior Subordinated Notes
Post-ARD Contingent Interest Account on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period, and, if applicable, the funds allocated to the Senior Subordinated Notes Post-ARD Contingent Interest
Account pursuant to
subclause (ii)
below, to be paid for the benefit of the Holders of each applicable Class of Senior Subordinated Notes, up to the
accrued and unpaid Senior Subordinated Notes Quarterly Post-ARD Contingent Interest Amount due on such Quarterly Payment Date, sequentially in order of alphanumerical designation and
pro rata
among each such Class of Senior Subordinated Notes of the same alphanumerical designation based upon the Senior Subordinated Notes Quarterly Post-ARD Contingent Interest Amount payable on each such Class, and
deposit such funds into the applicable Series Distribution Accounts.
(ii)
If the aggregate amount of funds allocated to the Senior Subordinated Notes Post-ARD Contingent Interest Account on each
Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period pursuant to
subclause (i)
above is insufficient to pay the Senior Subordinated Notes Quarterly Post‑ARD Contingent Interest Amount due on such
Quarterly Payment Date, then a Quarterly Reallocation Event pursuant to
Section 5.13(p)
shall be triggered and any funds reallocated as a result thereof into the Senior Subordinated Notes Post-ARD Contingent Interest Account shall be
distributed in accordance with
subclause (i)
above.
(j)
Subordinated Notes Post-ARD Contingent Interest Account
.
(i)
To the extent any Series of Senior Subordinated Notes has been issued, on each Quarterly Calculation
Date, the Master Issuer
(or the Manager on its behalf)
shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date the funds allocated to the Subordinated Notes Post-ARD
Contingent Interest Account on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period, and, if applicable, funds allocated to the Subordinated Notes Post-ARD Contingent Interest Account pursuant to
subclause (ii)
below, to be paid for the benefit of the Holders of each applicable Class of Subordinated Notes, up to the accrued and unpaid Subordinated Notes
Quarterly Post‑ARD Contingent Interest Amount due on such Quarterly Payment Date, sequentially in order of alphanumerical designation and
pro rata
among
each such Class of Subordinated Notes of the same alphanumerical designation based upon the Subordinated Notes Quarterly Post-ARD Contingent Interest Amount payable on each such Class, and deposit such funds into the applicable Series
Distribution Accounts.
(ii)
If the aggregate amount of funds allocated to the Subordinated Notes Post-ARD Contingent Interest Account on each Weekly
Allocation Date with respect to the immediately preceding Quarterly Collection Period pursuant to
subclause (i)
above is insufficient to pay the Subordinated Notes Quarterly Post-ARD Contingent Interest Amount due on such Quarterly
Payment Date, then a Quarterly Reallocation Event pursuant to
Section 5.13(p)
shall be triggered and any funds reallocated as a result thereof into the Subordinated Notes Post-ARD Contingent Interest Account shall be distributed in
accordance with
subclause (i)
above.
(k)
Amounts
on Deposit in the Senior Notes Interest Reserve Account, the Senior Subordinated Notes Interest Reserve Account and the Cash Trap Reserve Account
.
(i)
On each Quarterly Calculation Date (A) preceding a Quarterly Payment Date that is a Cash Trapping Release Date, the Master Issuer
(or the Manager on its behalf)
shall instruct the
Trustee in writing to withdraw on such Quarterly Payment Date from funds then on deposit in the Cash Trap Reserve Account an amount equal to the applicable Cash Trapping Release Amount and (B) preceding the first Quarterly Payment Date
occurring on or after the date on which all Senior Notes and all Senior Subordinated Notes have been paid in full, the Master Issuer
(or the Manager on its behalf)
shall instruct the Trustee in
writing to withdraw on the related Quarterly Payment Date all funds then on deposit in the Cash Trap Reserve Account (in each case, after giving effect to any allocations to be made as of such Quarterly Payment Date from the Cash Trap Reserve
Account) and deposit such funds into the Collection Account for distribution in accordance with the Priority of Payments.
(ii)
On
each Quarterly Calculation Date, the Master Issuer shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date funds allocated to the Cash Trap Reserve Account on each Weekly Allocation Date with respect to the
related Quarterly Collection Period and (I) apply such funds on the following Quarterly Payment Date to the extent necessary to pay, in the following order of priority (A) unreimbursed Advances of the Trustee (with interest thereon at the
Advance Interest Rate), (B) unreimbursed Advances of the Servicer (with interest thereon at the Advance Interest Rate) and (C) unreimbursed Manager Advances (with interest thereon at the Advance Interest Rate), (II) in the event of a Quarterly
Reallocation Event, allocate such funds in excess of the funds required to be paid pursuant to
subclause (ii)(I)
in accordance with
Section 5.13(p)
and (III) if a Rapid Amortization Period is continuing or a Rapid Amortization
Event will occur on the following Quarterly Payment Date, allocate any remaining funds to the Senior Notes Principal Payment Account until the Outstanding Principal Amount of the Senior Notes is paid in full, and allocate any remaining funds
thereafter to the Collection Account for distribution in accordance with the Priority of Payments.
(iii)
On
any Cash Trapping Release Date, the Trustee shall release from the Cash Trap Reserve Account, as directed in writing by the Master Issuer (or the Manager on its behalf), the Cash Trapping Release Amount with respect to such Cash Trapping
Release Date and deposit such amount into the Collection Account.
(iv)
Amounts on deposit in the Cash Trap Reserve Account will be available to make optional prepayments of principal of the Senior
Notes in accordance with the Series Supplement for such Series, at the sole discretion of the Master Issuer (or the Manager acting on its behalf). Any such amounts used to make optional prepayments on a Quarterly Payment Date (1) will be
allocated (after giving effect to all other payments to be made as of the related Quarterly Payment Date, including all other releases and payments from the Cash Trap Reserve Account) pursuant to
priorities (ii)
through
(xxviii)
of the Priority of Payments (except for
priority (xiii
) thereof), and then (2) will be allocated to the applicable Series Distribution Accounts to make optional prepayments of principal on the Senior Notes (either (a) if a Class A-1 Notes
Amortization Event has occurred and is continuing,
first
,
to prepay and permanently reduce the commitments under all Class A-1 Notes, on a
pro rata
basis based on commitment amounts and
then
,
to prepay all Senior Notes of all Series other than the Class A-1 Notes in alphanumeric order on a
pro rata
basis based on principal outstanding or (b) if a Class A-1 Notes Amortization Event is not continuing, to prepay all Senior Notes
of all Series other than the Class A-1 Notes on a
pro rata
basis based on principal outstanding so long as, immediately after giving effect to such prepayment, an amount is retained in the Cash Trap Reserve Account that is equal to the
aggregate principal amount outstanding under the Class A-1 Notes at such time);
provided
that any such optional prepayment will be accompanied by the payment of any make-whole prepayment premiums related thereto, to the extent such
prepayment premiums are otherwise payable in connection with the optional prepayment of such Notes in accordance with the Series Supplement for such Series.
(v)
If
the Master Issuer (or the Manager on its behalf) determines, with respect to any Series of Senior Notes, that the amount to be deposited in any Series Distribution Account in accordance with this
Section 5.13
on any Series Legal Final
Maturity Date related to such Series of Senior Notes is less than the Outstanding Principal Amount of such Series of Senior Notes, on the Quarterly Calculation Date immediately preceding such Series Legal Final Maturity Date, the Master Issuer
(or the Manager on its behalf) shall instruct the Trustee thereof in writing, and the Trustee shall, in accordance with such instruction on such Series Legal Final Maturity Date, withdraw from the Senior Notes Interest Reserve Account an amount
equal to such insufficiency (and, to the extent the amount in the Senior Notes Interest Reserve Account is insufficient, the Master Issuer (or the Manager on its behalf) shall instruct the Control Party to draw on the applicable Interest
Reserve Letter of Credit) and deposit such amount into the applicable Series Distribution Accounts, to be paid to the Senior Notes sequentially in order of alphanumeric designation and
pro rata
among each Class of Senior Notes of the
same alphanumerical designation based upon the Outstanding Principal Amount of the Senior Notes of each such Class.
(vi)
If
the Master Issuer (or the Manager on its behalf) determines, with respect to any Series of Senior Subordinated Notes, that the amount to be deposited in any Series Distribution Account in accordance with this
Section 5.13
on any Series
Legal Final Maturity Date related to such Series of Senior Subordinated Notes is less than the Outstanding Principal Amount of such Series of Senior Subordinated Notes, on the Quarterly Calculation Date immediately preceding such Series Legal
Final Maturity Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee thereof in writing, and the Trustee shall, in accordance with such instruction on such Series Legal Final Maturity Date, withdraw from the Senior
Subordinated Notes Interest Reserve Account an amount equal to such insufficiency (and, to the extent the amount in the Senior Subordinated Notes Interest Reserve Account is insufficient, the Master Issuer (or the Manager on its behalf) shall
instruct the Control Party to make a draw on the applicable Interest Reserve Letter of Credit) and deposit such amount into the applicable Series Distribution Accounts, to be paid to the Senior Subordinated Notes sequentially in order of
alphanumeric designation and
pro rata
among each Class of Senior Subordinated Notes of the same alphanumerical designation based upon the Outstanding Principal Amount of the Senior Subordinated Notes of each such Class.
(vii)
On any date on which no Senior Notes are Outstanding, the Master Issuer (or the Manager on its behalf) shall instruct the
Trustee in writing to withdraw on such date any funds then on deposit in the Senior Notes Interest Reserve Account and to deposit all remaining funds into the Collection Account and/or to return any outstanding Interest Reserve Letter of Credit
maintained with respect to the Senior Notes Interest Reserve Account to the issuer thereof for cancellation.
(viii)
On any date on which no Senior Subordinated Notes are Outstanding, the Master Issuer (or the Manager on its behalf) shall
instruct the Trustee in writing to withdraw on such date any funds then on deposit in the Senior Subordinated Notes Interest Reserve Account and to deposit all remaining funds into the Collection Account and/or to return any outstanding Interest
Reserve Letter of Credit maintained with respect to the Senior Subordinated Notes Interest Reserve Account to the issuer thereof for cancellation.
(ix)
Upon the occurrence of any Interest Reserve Release Event, the Master Issuer (or the Manager on its behalf) shall instruct the
Trustee in writing to (i) withdraw the aggregate amounts on deposit in the Senior Notes Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account, as applicable, and deposit such amount into the Collection Account for
distribution in accordance with the Priority of Payments or (ii) replace any Interest Reserve Letter of Credit, and the Trustee or the Control Party on its behalf shall deliver to the Master Issuer any such replaced Interest Reserve Letter of
Credit simultaneously with the receipt of any Interest Reserve Letter of Credit in replacement thereof, whether by way of escrow or otherwise, in each case to the extent that no Senior Notes Interest Reserve Account Deficiency Amount or Senior
Subordinated Notes Interest Reserve Account Deficiency Amount, as applicable, will be outstanding on the immediately following Weekly Allocation Date.
(l)
Principal Release Amount
.
(i)
If a Rapid Amortization Period or Event of Default is continuing, each Principal Release Amount shall be applied in the order
set forth in
Section 5.13(d)(i)
,
Section 5.13(e)(i)
or
Section 5.13(g)(i)
, as applicable, notwithstanding the exclusion of Principal Release Amounts therein.
(ii)
So long as no Rapid Amortization Period, Event of Default or Class A-1 Notes Amortization Event is continuing, on each
Quarterly Calculation Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date any Principal Release Amount from the Senior Notes Principal Payment Account,
Senior Subordinated Notes Principal Payment Account or Subordinated Notes Principal Payment Account, as applicable, and apply such funds on such Quarterly Payment Date to the extent necessary to pay, in the following order of priority,
(A) unreimbursed Advances of the Trustee (with interest thereon at the Advance Interest Rate), (B) unreimbursed Advances of the Servicer (with interest thereon at the Advance Interest Rate), (C) unreimbursed Manager Advances (with interest
thereon at the Advance Interest Rate), (D)
pro rata
, Senior Notes Quarterly Interest Amounts, Class A-1 Quarterly Commitment Fee Amounts, and Series Hedge Payment Amounts, and (E) Senior Subordinated Notes Quarterly Interest Amounts, in
each case, after giving effect to other amounts available for payment thereof as described in this
Section 5.13
. The Master Issuer (or the Manager on its behalf) shall instruct the Trustee in writing to distribute the remainder of such
Principal Release Amount, if any, in the priority set forth in the Priority of Payments, beginning at
priority (xi)
, but excluding (i)
priority (xv)
in the case of a Principal Release Amount with respect to any Series of Senior
Subordinated Notes or (ii)
priority (xx)
in the case of a Principal Release Amount with respect to any Series of Subordinated Notes.
(iii)
If no Rapid Amortization Period or Event of Default is continuing, but a Class A-1 Notes Amortization Event is continuing, on
each Quarterly Calculation Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee in writing to withdraw on the related Quarterly Payment Date any Principal Release Amount from the Senior Notes Principal Payment
Account, Senior Subordinated Notes Principal Payment Account or Subordinated Notes Principal Payment Account, as applicable, to the extent necessary to pay the Outstanding Principal Amount of the applicable Class A-1 Notes, and deposit such funds
into the applicable Series Distribution Account for distribution to the Holders of the applicable Class A-1 Notes,
pro rata
, after giving effect to other amounts available for payment thereof. The Master Issuer (or the Manager on its
behalf) shall instruct the Trustee in writing to distribute the remainder of the Principal Release Amount, if any, in the priority set forth in the Priority of Payments, beginning at
priority (xi)
, but excluding (i)
priority (xv)
in the case of a Principal Release Amount with respect to any Series of Senior Subordinated Notes or (ii)
priority (xx)
in the case of a Principal Release Amount with respect to any Series of Subordinated Notes.
(m)
Securitization Operating Expense Account
.
On or prior
to the time specified in
Section 4.01(a)
hereof for the delivery of an Weekly Manager’s Certificate with respect to an Weekly Allocation Date,
the Master Issuer shall instruct the Trustee in writing to
withdraw on the related Weekly Allocation Date an amount equal to the lesser of (i) the sum of all Securitization Operating Expenses then due and payable and (ii) the amount on deposit in the Securitization Operating Expense Account after
giving effect to any deposits thereto pursuant to the Priority of Payments on such date and apply such funds to pay any Securitization Operating Expenses then due and payable.
(n)
Hedge Payment Account
.
(i)
On each Quarterly Calculation Date, the Master Issuer (or the Manager on its behalf) shall instruct the Trustee in
writing to withdraw on the related Quarterly Payment Date the funds allocated to the Hedge Payment Account on each Weekly Allocation Date with respect to the immediately preceding Quarterly Collection Period and, if applicable, funds allocated to
the Hedge Payment Account pursuant to
subclause (ii)
below, up to the accrued and unpaid amount of Series Hedge Payment Amount, and distribute such funds among each Hedge Counterparty,
pro rata
based upon the Series Hedge Payment
Amount payable to each Hedge Counterparty.
(ii)
if the amount of funds allocated to the Hedge Payment Account on each Weekly Allocation Date with respect to the immediately
preceding Quarterly Collection Period is insufficient to pay the aggregate accrued and unpaid Series Hedge Payment Amount due and payable since the prior Quarterly Payment Date, then a Quarterly Reallocation Event pursuant to
Section 5.13(p)
shall be triggered and any funds reallocated as a result thereof into the Hedge Payment Account shall be distributed in accordance with
subclause (i)
above.
(o)
Optional Prepayments
. The Master Issuer shall have the right to optionally prepay the Outstanding Principal Amount of
any Series, Class, Subclass or Tranche of Notes, in whole or in part in accordance with the Series Supplement for such Series or, to the extent applicable, the Variable Funding Note Purchase Agreement (such prepayment, an “
Optional Prepayment
”);
provided
that following a Series Anticipated Repayment Date for any Series of Notes that remains Outstanding, all optional prepayments must be applied
first
,
pro
rata
among each Class in order of priority, to Senior
Notes,
second
,
pro
rata
among each Class in order of priority, to Senior Subordinated Notes and
third
,
pro
rata
among each Class in order of priority to Subordinated Notes. Following a Rapid
Amortization Event as a result of the event described in
clause (b)
of the definition of such term, the Master Issuer may make an Optional Prepayment during the Post-ARD Rapid Amortization Cure Period with respect to such Series of Notes
(or Class or Tranche thereunder) for purposes of curing such Rapid Amortization Event;
provided
that as a condition to making such Optional Prepayment, following such Optional Prepayment, there will be no Rapid Amortization Event or
Potential Rapid Amortization Event with respect to any Series of Notes (or Class or Tranche thereunder). The Master Issuer shall instruct the Trustee in writing to withdraw on each applicable optional prepayment date, including such prepayment
dates that do not occur on Quarterly Payment Dates, the prepayment amounts on deposit in the applicable Series Distribution Account in accordance with the Series Supplement for such Series or, to the extent applicable, the Variable Funding Note
Purchase Agreement, and as set forth in the Quarterly Noteholders’ Report.
(p)
Quarterly Reallocation Events
. In the event that there exists any shortfall with respect to amounts payable under any subsection of this
Section 5.13
that
specifically refers to this
clause (p)
(a “
Quarterly Reallocation Event
”), then the Master Issuer (or the Manager on its behalf) shall instruct the Trustee to reallocate on the relevant Quarterly Calculation Date (subject to
Section
5.13(k)(ii)
) the aggregate funds on deposit in the Specified Indenture Trust Accounts that were allocated during the immediately preceding Quarterly Collection Period to the Specified Indenture Trust Accounts in sequential order in the
aggregate amounts due under
priorities (vi)
,
(viii)
,
(x)
,
(xii)
,
(xiii)
,
(xiv)
,
(xv)
,
(xix)
,
(xx)
,
(xxi)
,
(xxii)
,
(xxiii)
,
(xxiv)
, (
xxvi)
,
(xxvii)
,
(xxviii
) and (xxix) of the Priority of Payments for such Quarterly Collection Period.
Section 5.14
Determination of Quarterly Interest
. Quarterly payments of interest and fees on each Series of Notes shall be determined, allocated and distributed in accordance with the procedures set forth in the Series
Supplement for such Series and, to the extent applicable, the Variable Funding Note Purchase Agreement, and as set forth in the Quarterly Noteholders’ Report.
Section 5.15
Determination of Quarterly Principal
. Quarterly payments of principal, if any, of each Series of Notes shall be determined, allocated and distributed in accordance with the procedures set forth in the
Series Supplement for such Series and, to the extent applicable, the Variable Funding Note Purchase Agreement, and as set forth in the Quarterly Noteholders’ Report.
Section 5.16
Prepayment of Principal
. Mandatory prepayments of principal, if any, of each Series of Notes shall be determined, allocated and distributed in accordance with the procedures set forth in the Series
Supplement for such Series, and to the extent applicable, the Variable Funding Note Purchase Agreement, in each case, if not otherwise described herein, and as set forth in the Quarterly Noteholders’ Report.
Section 5.17
Retained Collections Contributions
. With respect to any Quarterly Collection Period, the Master Issuer may designate Retained Collections Contributions made to the Master Issuer during such period to be
included in Net Cash Flow, but not more than $7,500,000 in any Quarterly Collection Period or more than $15,000,000 during any period of four (4) consecutive Quarterly Collection Periods or more than $30,000,000 from the Closing Date to the
latest Series Legal Final Maturity Date for any Notes Outstanding;
provided
that any Retained Collections Contribution made shall be excluded from the Net Cash Flow for purposes of calculations undertaken in the following circumstances:
(a) to determine compliance with any Series Non-Amortization Test and (b) to determine the New Series Pro Forma DSCR. The amount of any Retained Collections Contribution included in Net Cash Flow for the purpose of calculating the DSCR shall be
retained in the Collection Account until the Weekly Allocation Date on which either (i) the DSCR for the period of four (4) Quarterly Collection Periods ended immediately prior to such Weekly Allocation Date is at least 1.75x without giving
effect to the inclusion of such Retained Collections Contribution or (ii) such Retained Collections Contribution is required to pay any shortfall in the amounts payable under
priorities (ii)
through
(xxix)
of the Priority of
Payments, to the extent of any shortfall on such Weekly Allocation Date.
Section 5.18
Interest Reserve Letters of Credit
. The Master Issuer may, in lieu of funding (or as partial replacement for funding) the Senior Notes Interest Reserve Account and/or the Senior Subordinated Notes Interest
Reserve Account in the amounts required hereunder, maintain one or more
Interest Reserve Letters of Credit issued under a Variable Funding Note Purchase Agreement for the benefit of the Trustee and the
Senior Noteholders or the Senior Subordinated Noteholders, as applicable, each in a face amount equal to the amounts required to be funded in respect of such account(s) had such Interest Reserve Letter of Credit not been issued. Where on any
Quarterly Calculation Date the Master Issuer (or the Manager on its behalf) instructs the Trustee to withdraw funds from the Senior Notes Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account, as applicable, for
allocation or payment on the following Quarterly Payment Date, such funds shall be drawn,
first
, from amounts on deposit in the Senior Notes Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account, as
applicable, on such Quarterly Calculation Date and
second
, from amounts available to be drawn under the applicable Interest Reserve Letter of Credit.
Each such Interest Reserve Letter of Credit (a) shall name each of the Trustee, for the benefit of the Senior Noteholders or the
Senior Subordinated Noteholders, as applicable, and the Control Party as the beneficiary thereof; (b) shall allow the Trustee (or the Control Party on the Trustee’s behalf) to submit a notice of drawing in respect of such Interest Reserve Letter of
Credit whenever amounts would otherwise be required to be withdrawn from the Senior Notes Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account, as applicable, pursuant to
Section 5.13
; (c) shall have an
expiration date of no later than ten (10) Business Days prior to the Class A-1 Notes Renewal Date specified in the related Variable Funding Note Purchase Agreement pursuant to which such Interest Reserve Letter of Credit was issued; and (d) shall
indicate by its terms that the proceeds in respect of drawings under such Interest Reserve Letter of Credit shall be paid directly into the Senior Notes Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account, as
applicable.
If, on the date that is five (5) Business Days prior to the expiration of any such Interest Reserve Letter of Credit, such Interest
Reserve Letter of Credit has not been replaced or renewed and the Master Issuer has not otherwise deposited funds into the Senior Notes Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account, as applicable, in the
amounts that would otherwise be required had such Interest Reserve Letter of Credit not been issued, the Control Party (on behalf of the Trustee) shall submit a notice of drawing under such Interest Reserve Letter of Credit and use the proceeds
thereof to fund a deposit into the Senior Notes Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account (as directed in writing by the Manager), as applicable, in an amount equal to the Senior Notes Interest Reserve
Account Deficiency Amount or the Senior Subordinated Notes Interest Reserve Account Deficiency Amount on such date, as applicable, in each case calculated as if such Interest Reserve Letter of Credit had not been issued.
If, on any day an Interest Reserve Letter of Credit is outstanding, such Interest Reserve Letter of Credit becomes an Ineligible
Interest Reserve Letter of Credit, then (a) on the fifth (5
th
) Business Day after such day, either (i) the Master Issuer shall fund a deposit into the Senior Notes
Interest Reserve Account or the Senior Subordinated Notes Interest Reserve Account, as applicable, or (ii) the Trustee (at the direction of the Master Issuer) or the Control Party (on the Master Issuer’s behalf) shall submit a notice of drawing
under such Interest Reserve Letter(s) of Credit and apply the proceeds of such drawing to fund such account, in either case in an amount equal to the Senior Notes Interest Reserve Account Deficiency Amount or the Senior Subordinated Notes Interest
Reserve Account Deficiency Amount on such date, in each case calculated as if such Interest Reserve Letter(s) of Credit had not been issued or (b) prior to the fifth (5
th
)
Business Day after such day, the Master Issuer shall obtain one or more replacement Interest Reserve Letters of Credit on substantially the same terms as each such Interest Reserve Letter of Credit being replaced.
The (i) Trustee (at the direction of the Master Issuer) shall or (ii) the Control Party (at the Master Issuer’s request and on the
Master Issuer’s behalf) may submit a notice of drawing under such Interest Reserve Letter of Credit issued by such L/C Provider and the proceeds of any such draw shall be deposited into the Senior Notes Interest Reserve Account or the Senior
Subordinated Notes Interest Reserve Account, as applicable.
Upon the occurrence of any Interest Reserve Release Event, the Master Issuer (or the Manager on its behalf) shall instruct the
Trustee in writing to either (i) replace any Interest Reserve Letter of Credit, and the Trustee or the Control Party on its behalf shall deliver to the Master Issuer any such replaced Interest Reserve Letter of Credit simultaneously with the
receipt of any Interest Reserve Letter of Credit in replacement thereof, whether by way of escrow or otherwise, or (ii) reduce the face amount of any Interest Reserve Letter of Credit in accordance with the relevant terms thereof, and the Trustee
or the Control Party on its behalf shall deliver to the relevant issuing bank a letter instructing the issuing bank to reduce the face amount of such Interest Reserve Letter of Credit, in each case, to the extent that no Senior Notes Interest
Reserve Account Deficiency Amount or Senior Subordinated Notes Interest Reserve Account Deficiency Amount, as applicable, will be outstanding on the immediately following Weekly Allocation Date, as set forth in an Officer’s Certificate of the
Master Issuer (or the Manager on its behalf) delivered to the Trustee, the Control Party and the applicable issuing bank in connection with such written instructions of the Master Issuer (or the Manager on its behalf).
Section 5.19
Replacement of Ineligible Accounts
. If, at any time, any Management Account or any of the Senior Notes Interest Reserve Account, the Senior Subordinated Notes Interest Reserve Account, the Cash Trap
Reserve Account, the Collection Account or any Collection Account Administrative Account shall cease to be an Eligible Account (each, an “
Ineligible Account
”), the Master Issuer shall (i) within five (5) Business Days of obtaining
knowledge thereof, notify the Control Party thereof and (ii) within sixty (60) days of obtaining knowledge thereof, (A) establish, or cause to be established, a new account that is an Eligible Account in substitution for such Ineligible Account,
(B) with the exception of any Management Account, following the establishment of such new Eligible Account, transfer, or with respect to the Trustee Accounts maintained at the Trustee, instruct the Trustee in writing to transfer, all cash and
investments from such Ineligible Account into such new Eligible Account, (C) in the case of a Management Account, following the establishment of such new Eligible Account, transfer or cause to be transferred to such new Eligible Account, all cash
and investments from such Ineligible Account into such new Eligible Account, (D) in the case of a Management Account, transfer or cause to be transferred all items deposited in the lock-box related to such Ineligible Account to a new lock-box
related to such new Management Account, and (E) pledge, or cause to be pledged, such new Eligible Account to the Trustee for the benefit of the Secured Parties and, if such Ineligible Account is required to be subject to an Account Control
Agreement in accordance with the terms of the Indenture, cause such new Eligible Account to be subject to an Account Control Agreement in form and substance reasonably acceptable to the Control Party and the Trustee. In the event that any of the
Collection Account, any Management Account or any Collection Account Administrative Account becomes an Ineligible Account, the Manager shall, promptly following the establishment of such related new Eligible Account, notify each Franchisee of a
change in payment instructions, if any.
Section 5.20
Instructions and Directions
. Any instructions or directions to be provided by the Master Issuer referenced in this
Article V
may be given by the Manager on behalf of the Master Issuer and (a) with
respect to a Quarterly Calculation Date or Quarterly Payment Date, respectively, shall be contained in the applicable Quarterly Noteholders’ Report for such Quarterly Payment Date and (b) with respect to a Weekly Allocation Date shall be
contained in the Weekly Manager’s Certificate for such Weekly Allocation Date.
ARTICLE V
DISTRIBUTIONS
Section 6.01
Distributions
in General
. (a) Unless otherwise specified in the Series Supplement for such Series, on each Quarterly Payment Date, the Paying Agent shall pay to the Noteholders of each Series, Class, Subclass or Tranche, as applicable, of
record on the preceding Record Date (or in the case of optional prepayments made in accordance with a Series Supplement, the Noteholders of each Series, Class, Subclass or Tranche, as applicable, of record on the applicable prepayment date as
specified therein) the amounts payable thereto (i) by wire transfer in immediately available funds released by the Paying Agent from the applicable Series Distribution Account no later than 12:30 p.m. (Eastern time) if a Noteholder has provided
to the Paying Agent and the Trustee wiring instructions at least five (5) Business Days prior to the applicable Quarterly Payment Date or (ii) by check mailed first-class postage prepaid to such Noteholder at the address for such Noteholder
appearing in the Note Register if such Noteholder has not provided wire instructions pursuant to
clause (i)
above;
provided
,
however
, that the final principal payment due on a Note shall only be paid upon due presentment
and surrender of such Note for cancellation in accordance with the provisions of the Note at the applicable Corporate Trust Office.
(b)
Unless otherwise specified in the Series Supplement for such Series, in this Base Indenture or in any applicable Variable
Funding Note Purchase Agreement, all distributions to Noteholders of all Classes within a Series of Notes shall be made from amounts allocated in accordance with the Priority of Payments among each Class of Notes in alphanumerical order (i.e.,
A-1, A-2, B-1, B-2 and not A-1, B-1, A-2, B-2) and
pro rata
among Holders of Notes within each Class or Tranche of the same alphanumerical designation;
provided
,
however
, that any roman numeral denominated Tranche within
an alphanumerical Class of Notes shall be deemed to have the same alphanumerical priority, i.e. “Class A-2-I Notes” will be
pari
passu
and
pro
rata
in right of payment according to the amount then due and payable
with respect to “Class A-2-II Notes” except to the extent specified in this Base Indenture, the Series Supplement for such Series or the related Variable Funding Note Purchase Agreement;
provided
,
further
,
however
, that
unless otherwise specified in the Series Supplement, in this Base Indenture or in any applicable Variable Funding Note Purchase Agreement, all distributions to Noteholders of all Classes or Tranches within a Series of Notes having the same
alphabetical designation shall be
pari passu
with each other with respect to the distribution of Securitized Assets proceeds resulting from exercise of remedies upon an Event of Default. The use of Subclass designations or Tranche
designations or other designations to differentiate Note characteristics within a Class shall not alter priority or the requirement to pay among the Class
pro
rata
unless expressly provided for in the Series Supplement for the
Series that includes such Class.
(c)
Unless otherwise specified in the Series Supplement for such Series, the Trustee shall distribute all amounts owed to the
Noteholders of any Class of Notes pursuant to the instructions of the Master Issuer whether set forth in a Quarterly Noteholders’ Report, Company Order or otherwise.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Master Issuer hereby represents and warrants, for the benefit of the Trustee and the Noteholders, as follows as of the date hereof and as of each
Series Closing Date:
Section 7.01
Existence and Power
. Each Securitization Entity (a) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, (b) is duly qualified to do business as a
foreign entity and in good standing under the laws of each jurisdiction where the character of its property, the nature of its business or the performance of its obligations under the Related Documents make such qualification necessary, and
(c) has all limited liability company, corporate or other powers and all governmental licenses, authorizations, consents and approvals required (i) to carry on its business as now conducted and (ii) for consummation of the transactions
contemplated by the Indenture and the other Related Documents except, in the case of
clauses (b)
and
(c)(i)
, to the extent the failure to do so would not, individually or in the aggregate, be reasonably likely to result in a
Material Adverse Effect.
Section 7.02
Company and Governmental Authorization
. The execution, delivery and performance by the Master Issuer of this Base Indenture and any Series Supplement and by the Master Issuer and each other Securitization
Entity of the other Related Documents to which it is a party (a) is within such Securitization Entity’s limited liability company, corporate or other powers and has been duly authorized by all necessary limited liability company, corporate or
other action, (b) requires no action by or in respect of, or filing with, any Governmental Authority which has not been obtained (other than any actions or filings that may be undertaken after the Closing Date pursuant to the terms of this Base
Indenture or any other Related Document, including actions or filings with respect to the Mortgages) and (c) does not contravene, or constitute a default under, any Requirements of Law with respect to such Securitization Entity or any Contractual
Obligation with respect to such Securitization Entity or result in the creation or imposition of any Lien on any property of any Securitization Entity (other than Permitted Liens), except for Liens created by this Base Indenture or the other
Related Documents, except in the case of
clauses (b)
and
(c)
above, solely with respect to the Contribution Agreements, the violation of which would not reasonably be expected to result in a Material Adverse Effect. This Base
Indenture and each of the other Related Documents to which each Securitization Entity is a party has been executed and delivered by a duly Authorized Officer of such Securitization Entity.
Section 7.03
No Consent
. No consent, action by or in respect of, approval or other authorization of, or registration, declaration or filing with, any Governmental Authority or other Person is required for the valid
execution and delivery by the Master Issuer of this Base Indenture and any Series Supplement and by the Master Issuer and each other Securitization Entity of any Related Document to which it is a party or for the performance of any of the
Securitization Entities’ obligations hereunder or thereunder other than such consents, approvals, authorizations, registrations, declarations or filings (a) as shall have been obtained or made by such Securitization Entity prior to the Closing
Date as are permitted to be obtained subsequent to the Closing Date in accordance with
Section 7.13
,
Section 8.25
or
Section 8.37
or (b) relating to the performance of any Collateral Business Documents, the failure of
which to obtain would not reasonably be expected to result in a Material Adverse Effect.
Section 7.04
Binding Effect
. This Base Indenture and each other Related Document to which a Securitization Entity is a party is a legal, valid and binding obligation of each such Securitization Entity enforceable
against such Securitization Entity in accordance with its terms (except as may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws affecting creditors’ rights generally or by general
equitable principles, whether considered in a proceeding at law or in equity and by an implied covenant of good faith and fair dealing).
Section 7.05
Litigation
. There is no action, suit, proceeding or investigation pending against or, to the knowledge of the Master Issuer, threatened against or affecting any Securitization Entity or of which any
property or assets of such Securitization Entity is the subject before any court or arbitrator or any Governmental Authority that (a) would affect the validity or enforceability of this Base Indenture or any Series Supplement or (b) either
individually or in the aggregate would reasonably be expected to result in a Material Adverse Effect.
Section 7.06
ERISA
. During the five-year period prior to the date on which this representation is made or deemed made with respect to any Pension Plan, no ERISA Event has occurred which would reasonably be expected
to have a Material Adverse Effect. . No Securitization Entity has any contingent liability with respect to any post-retirement welfare benefits under a Welfare Plan, other than liability (i) for continuation coverage described in Part 6 of
Subtitle B of Title I of ERISA or other applicable continuation of coverage laws or (ii) that would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect. Each Employee Benefit Plan for which any
Securitization Entity has any liability (excluding a Multiemployer Plan) presently complies and has been maintained in compliance with its terms and with the requirements of all applicable statutes, rules and regulations, including ERISA and the
Code, except for such instances of noncompliance as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect. No “prohibited transaction” (within the meaning of Section 406 of ERISA or Section
4975 of the Code) has occurred with respect to any Employee Benefit Plan, other than transactions effected pursuant to a statutory or administrative exemption or such transactions as would not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect. Except as would not reasonably be expected to result in a Material Adverse Effect, each such Employee Benefit Plan for which any Securitization Entity has any liability that is intended to be
qualified under Section 401(a) of the Code is the subject of a current favorable determination or opinion letter from the IRS regarding such qualification (or an application for such a letter is currently pending) and nothing has occurred, to the
knowledge of the Master Issuer, whether by action or by failure to act, that would cause the loss of such qualification.
Section 7.07
Tax Filings and Expenses
. Each Securitization Entity has filed, or caused to be filed, all federal, state, local and foreign Tax returns required to be filed by such Securitization Entity, subject to
permitted extensions (except in any case in which the failure to so file would not, individually or in the aggregate, have a Material Adverse Effect), and has paid, or caused to be paid, all Taxes due pursuant to said returns, except such Taxes
(i) as are being contested in good faith and by appropriate proceedings and for which adequate reserves are being maintained in accordance with GAAP or (ii) as would not, individually or in the aggregate, have a Material Adverse Effect. As of
the Closing Date, the Master Issuer is not aware of any material Tax assessments proposed in writing against any Non-Securitization Entity. Except as would not reasonably be expected to result in a Material Adverse Effect, no Tax deficiency has
been determined adversely to any Securitization Entity, nor does any Securitization Entity have any knowledge of any Tax deficiencies. Each Securitization Entity has paid all fees and expenses required to be paid by it in connection with the
conduct of its business, the maintenance of its existence and its qualification as a foreign entity authorized to do business in each state and each foreign country in which it is required to so qualify, except to the extent that the failure to
pay such fees and expenses is not reasonably likely to result in a Material Adverse Effect.
Section 7.08
Disclosure
. No written report, financial statements, certificate or other information furnished in writing (other than projections, budgets, other estimates and general market, industry and economic data)
to the Trustee or the Holders by or on behalf of the Securitization Entities pursuant to any provision of the Indenture or any other Related Document, or in connection with or pursuant to any amendment or modification of, or waiver under, the
Indenture or any other Related Document (when taken together with all other information furnished by or on behalf of the Non-Securitization Entities to the Trustee or the Holders, as the case may be), contains any material misstatement of fact or
omits to state any material fact necessary to make the statements therein not materially misleading in each case when taken as a whole and in the light of the circumstances under which they were made, and the furnishing of the same to the Trustee
or the Holders, as the case may be, shall constitute a representation and warranty by the Master Issuer made on the date the same are furnished to the Trustee or the Holders, as the case may be, to the effect specified herein.
Section 7.09
1940 Act
. The Master Issuer is not, and no Securitization Entity is an “investment company” as defined in Section 3(a)(1) of the 1940 Act.
Section 7.10
Regulations T, U and X
. The proceeds of the Notes will not be used to purchase or carry any “margin stock” (as defined or used in the regulations of the Board of Governors of the Federal Reserve System,
including Regulations T, U and X thereof) in such a way that could cause the transactions contemplated by the Related Documents to fail to comply with the regulations of the Board of Governors of the Federal Reserve System, including Regulations
T, U and X thereof. No Securitization Entity owns or is engaged in the business of extending credit for the purpose of purchasing or carrying any margin stock.
Section 7.11
Solvency
. Both before and after giving effect to the transactions contemplated by the Indenture and the other Related Documents, (i) the fair value of the assets of the Securitization Entities, when taken
as a whole, will exceed their debts and liabilities, including contingent liabilities; (ii) the present fair saleable value of the property of the Securitization Entities, when taken as a whole, will be greater than the amount that will be
required to pay the probable liability of their debts and other liabilities as such debts and other liabilities become absolute and matured; (iii) the Securitization Entities, taken as a whole, do not intend to, and do not believe that they will,
incur debts or liabilities beyond their ability to pay such debts and liabilities as they mature; and (iv) the Securitization Entities, taken as a whole, will not have unreasonably small capital with which to conduct the business in which they
are engaged as such business is now conducted and is proposed to be conducted after the Closing Date, and no Event of Bankruptcy has occurred with respect to any Securitization Entity.
Section 7.12
Ownership
of Equity Interests; Subsidiaries
. (a) All of the issued and outstanding limited liability company interests of the Master Issuer are directly owned by the Holding Company Guarantor, have been duly authorized and validly issued,
are fully paid and non-assessable and are owned of record by Holding Company Guarantor free and clear of all Liens other than Permitted Liens.
(b)
All of the issued and outstanding limited liability company interests of the Franchisor are directly owned by the Master
Issuer, have been duly authorized and validly issued, are fully paid and non-assessable and are owned of record by the Master Issuer free and clear of all Liens other than Permitted Liens.
(c)
All of the issued and outstanding limited liability company interests of JIB Properties are directly owned by the Master
Issuer, have been duly authorized and validly issued, are fully paid and non-assessable and are owned of record by the Master Issuer free and clear of all Liens other than Permitted Liens.
(d)
As of the Closing Date, (i) the Holding Company Guarantor has no direct Subsidiaries and owns no Equity Interests in any other
Person, other than the Master Issuer, (ii) the Master Issuer has no direct Subsidiaries and owns no Equity Interests in any other Person, other than the Franchisor and JIB Properties, (iii) the Franchisor has no Subsidiaries and owns no Equity
Interests in any other Person, (iv) JIB Properties has no Subsidiaries and owns no Equity Interests in any other Person.
Section 7.13
Security
Interests
. (a) The Master Issuer and each Guarantor owns and has good title to its Securitized Assets, free and clear of all Liens other than Permitted Liens,
provided
,
however
, that this sentence shall not apply
to the Securitized Owned Real Property until six (6) months after the Closing Date. Other than the Accounts, the Real Estate Assets and Intellectual Property, the Indenture Collateral consists of securities, loans, investments, accounts,
commercial tort claims, inventory, equipment, fixtures, health care insurance receivables, chattel paper, money, deposit accounts, instruments, financial assets, documents, investment property, general intangibles, letter of credit rights, or
other supporting obligations (in each case, as defined in the UCC). Except in the case of the Securitized Owned Real Property, which is subject to
Section 8.37
or as described on
Schedule 7.13(a)
, this Base Indenture and the
Guarantee and Collateral Agreement constitute a valid and continuing Lien on the Collateral in favor of the Trustee on behalf of and for the benefit of the Secured Parties, which Lien on the Collateral has been perfected
(
or, (i) with respect to Collateral other than Accounts and Intellectual Property, will be perfected within the timeframe set forth in the final sentence of this
Section 7.13(a)
, (ii) with respect to Collateral
constituting Intellectual Property, will be perfected within the timeframe set forth in
Section 8.25
, and (iii) with respect to Collateral constituting Accounts, will be perfected within the timeframe set forth in
Article V
herein
)
, and is prior to all other Liens (other than Permitted Liens), and is enforceable as such as against creditors of and purchasers from the Master Issuer and each Guarantor in accordance with its terms, except as
such enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws affecting creditors’ rights generally or by general equitable principles, whether considered in a proceeding at
law or in equity, and by an implied covenant of good faith and fair dealing. Except as set forth in
Schedule 7.13(a)
, the Master Issuer and the Guarantors have received all consents and approvals required by the terms of the Collateral
to the pledge of the Collateral to the Trustee hereunder and under the Guarantee and Collateral Agreement. The Master Issuer and the Guarantors have caused, or shall have caused, the filing of all appropriate financing statements in the proper
filing office in the appropriate jurisdictions under applicable law in order to perfect the first-priority security interest (subject to Permitted Liens) in the Collateral (other than the Accounts and Intellectual Property) granted to the Trustee
hereunder or under the Guarantee and Collateral Agreement within ten (10) days of the date hereof.
(b)
Other than the security interest granted to the Trustee in the Collateral hereunder or pursuant to the other Related Documents
or any other Permitted Lien, the Master Issuer has not, and no Guarantor has, pledged, assigned, sold or granted a security interest in the Securitized Assets. All action necessary (including the filing of UCC-1 financing statements) to protect
and evidence the Trustee’s security interest in the Collateral (other than the Intellectual Property) in the United States has been duly and effectively taken. No security agreement, financing statement, equivalent security or lien instrument or
continuation statement authorized by the Master Issuer and any Guarantor and listing the Master Issuer or Guarantor as debtor covering all or any part of the Securitized Assets is on file or of record in any jurisdiction, except in respect of
Permitted Liens or such as may have been filed, recorded or made by the Master Issuer or such Guarantor in favor of the Trustee on behalf of the Secured Parties in connection with this Base Indenture and the Guarantee and Collateral Agreement,
and the Master Issuer has not, and no Guarantor has, authorized any such filing.
(c)
All authorizations in this Base Indenture and the Guarantee and Collateral Agreement for the Trustee to endorse checks,
instruments and securities and to execute financing statements, continuation statements, security agreements and other instruments with respect to the Collateral and to take such other actions with respect to the Collateral authorized by this
Base Indenture and the Guarantee and Collateral Agreement are powers coupled with an interest and are irrevocable.
Section 7.14
Related Documents
. The Indenture Documents, the Collateral Transaction Documents, the Account Agreements, the Depository Agreements, any Variable Funding Note Purchase Agreement, any Swap Contract, any
Series Hedge Agreement and any Enhancement Agreement with respect to each Series of Notes (other than the Mortgages) are in full force and effect. There are no outstanding defaults thereunder nor have events occurred which, with the giving of
notice, the passage of time or both, would constitute a default thereunder.
Section 7.15
Non-Existence
of Other Agreements
. Other than as permitted by
Section 8.22
, (a) no Securitization Entity is a party to any contract or agreement of any kind or nature and (b) no Securitization Entity is subject to any material
obligations or liabilities of any kind or nature in favor of any third party, including, without limitation, Contingent Obligations. No Securitization Entity has engaged in any activities since its formation (other than those incidental to its
formation, the authorization and the issuance of Series of Notes, the execution of the Related Documents to which such Securitization Entity is a party and the performance of the activities referred to in or contemplated by such agreements).
Section 7.16
Compliance with Contractual Obligations and Laws
. No Securitization Entity is in violation of (a) its Charter Documents, (b) any Requirement of Law with respect to such Securitization Entity or (c) any
Contractual Obligation with respect to such Securitization Entity except, solely with respect to
clauses (b)
and
(c)
, to the extent such violation would not, individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect.
Section 7.17
Other Representations
. All representations and warranties of each Securitization Entity made in each other Related Document to which a Securitization Entity is a party are true and correct (i) as of the
date hereof or (ii) if made on a future date (A) if qualified as to materiality, in all respects, and (B) if not qualified as to materiality, in all material respects (unless stated to relate solely to an earlier date, in which case such
representations and warranties were true and correct in all respects or in all material respects, as applicable, as of such earlier date), and in each case are repeated herein as though fully set forth herein.
Section 7.18
No Employees
. Notwithstanding any other provision of the Indenture or any Charter Documents of any Securitization Entity to the contrary, no Securitization Entity has any employees.
Section 7.19
Insurance
. The Securitization Entities shall maintain, or cause to be maintained, the insurance coverages (or self-insurance for such risks) described on
Schedule 7.19
hereto, in such amounts and
covering such risks as is adequate for the conduct of their respective businesses and the value of their respective properties and as is customary for companies engaged in similar businesses in similar industries. All policies of insurance of
the Securitization Entities are in full force and effect and the Securitization Entities are in compliance with the terms of such policies in all material respects. None of the Securitization Entities has any reason to believe that it will not
be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would not reasonably be expected to result in a
Material Adverse Effect. All such insurance is primary coverage, all premiums therefor due on or before the date hereof have been paid in full, and the terms and conditions thereof are no less favorable to the Securitization Entities than the
terms and conditions of insurance maintained by their Affiliates that are not Securitization Entities.
Section 7.20
Environmental
Matters
. (a) None of the Securitization Entities is subject to any liabilities pursuant to any Environmental Law or with respect to any Materials of Environmental Concern that could, individually or in the aggregate, reasonably
be expected to result in a Material Adverse Effect.
(b)
Other than exceptions to any of the following that could not, individually or in the aggregate, reasonably be expected to
result in a Material Adverse Effect:
(i)
The Securitization Entities: (x) are, and within the period of all applicable statutes of limitation have been, in
compliance with all applicable Environmental Laws, (y) hold all Environmental Permits (each of which is in full force and effect) required for their current operations and (z) are, and within the period of all applicable statutes of limitation
have been, in compliance with all of their Environmental Permits.
(ii)
Materials of Environmental Concern are not present at, on, under, in, or about any Contributed Securitized Owned Real
Property now or, to the knowledge of the Master Issuer, formerly owned, leased or operated by any Securitization Entity, or at any other location (including, without limitation, any location to which Materials of Environmental Concern have been
sent by the Master Issuer for re-use or recycling or for treatment, storage or disposal) in a condition or circumstance that would reasonably be expected to (x) give rise to liability of any Securitization Entity under any applicable
Environmental Law or otherwise result in costs to any Securitization Entity (y) interfere with any Securitization Entity’s continued operations or (z) impair the fair saleable value of any real property owned by any Securitization Entity.
(iii)
There is no judicial, administrative, or arbitral proceeding (including, without limitation, any notice of violation
or alleged violation) under or relating to any Environmental Law to which any Securitization Entity is, or to the knowledge of the Securitization Entities will be, named as a party that is pending or, to the knowledge of the Securitization
Entities, threatened.
(iv)
No Securitization Entity has received any written request for information, or been notified in writing that it is a
potentially responsible party under or relating to the federal Comprehensive Environmental Response, Compensation, and Liability Act, as amended, or that it is liable under any other Environmental Law, or in either case, with respect to the
release of any Materials of Environmental Concern to the environment.
(v)
No Securitization Entity has entered into or agreed to any consent decree, order, or settlement or other agreement,
or is subject to any judgment, decree, or order or other agreement, in any judicial, administrative, arbitral, or other forum for dispute resolution, relating to compliance with or liability under any Environmental Law that has not been fully and
finally resolved.
Section 7.21
Intellectual
Property
. (a) The Securitization IP comprises all the Intellectual Property used in or necessary for the Securitization Entities to conduct the business as now conducted and as proposed to be conducted after the Closing Date
except as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect and provided that the foregoing is not and shall not be deemed to be a representation or warranty of noninfringement. All of the
issuances, registrations and applications included in the Securitization IP are subsisting, unexpired and have not been abandoned or cancelled in any applicable jurisdiction except where such expiration, abandonment or cancellation would not,
individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(b)
(i) To the Master Issuer’s knowledge, the use of the Securitization IP and the operation of the Jack in the Box System
(including any products or services sold, marketed, offered for sale in connection therewith) did not and currently do not infringe, misappropriate, dilute or otherwise violate the Intellectual Property rights of any third party in a manner that
would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (ii) to the Master Issuer’s knowledge, the Securitization IP has not been in the past three (3) years and is not being infringed,
misappropriated, diluted or otherwise violated by any third party in a manner that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect and (iii) there is no action or proceeding pending or to the
Master Issuer’s knowledge, threatened, alleging the foregoing that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(c)
No action or proceeding is pending or, to the Master Issuer’s knowledge, threatened, that seeks to limit, cancel, or challenge
the validity or enforceability of, or the Securitization Entities’ rights in or to, any Securitization IP, or the use thereof, that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(d)
The Franchisor is the exclusive owner of all right, title, and interest in and to Owned Securitization IP and has a valid
right to use the Licensed Securitization IP, free and clear of all Liens, other than the Permitted Liens (including the IP License Agreements and licenses permitted pursuant to
Section 8.16
).
(e)
The Master Issuer has not made and will not hereafter make any assignment, pledge, mortgage, hypothecation or transfer of any of the Securitization IP other than Permitted
Liens and Permitted Asset Dispositions under
Section 8.16(d)
.
(f)
Except as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the Securitization Entities (i) have since their
inception maintained commercially reasonable policies, practices and procedures regarding the confidentiality, integrity and availability of its data (including Securitization IP) and information technology and (ii) are in material compliance
with all applicable data protection laws, regulations, contracts, policies, and guidance.
ARTICLE VII
COVENANTS
Section 8.01
Payment
of Notes
. (a) The Master Issuer shall pay or cause to be paid the principal of, and premium, if any, and interest, subject to
Section 2.15(d)
, on the Notes when due pursuant to the provisions of this Base Indenture, any
Series Supplement for such Series and, to the extent applicable, any Variable Funding Note Purchase Agreement. Principal, premium, if any, and interest shall be considered paid on the date due if the Paying Agent holds on that date money
designated for and sufficient to pay all principal, premium, if any, and interest then due. Except as otherwise provided pursuant to a Variable Funding Note Purchase Agreement or any other Related Document, amounts properly withheld under the
Code or any applicable state, local or foreign law by any Person from a payment to any Noteholder of interest or principal or premium, if any, shall be considered as having been paid by the Master Issuer to such Noteholder for all purposes of the
Indenture and the Notes.
(b)
By acceptance of its Notes, each Holder agrees that the failure to provide the Paying Agent with appropriate tax
certifications (which includes but is not limited to (i) an IRS Form W-9 for United States persons (as defined under Section 7701(a)(30) of the Code) or any applicable successor form or (ii) an applicable IRS Form W-8 and any required
attachments, for Persons other than United States persons, or applicable successor form) may result in amounts being withheld from payments to such Holder under this Base Indenture and any Series Supplement and that amounts withheld pursuant to
applicable laws shall be considered as having been paid by the Master Issuer as provided in
clause (a)
above.
Section 8.02
Maintenance
of Office or Agency
. (a) The Master Issuer shall maintain an office or agency (which, with respect to the surrender for registration of, or transfer or exchange or the payment of principal and premium, may be an office of the
Trustee, the Registrar or co-registrar or Paying Agent) where Notes may be surrendered for registration of transfer or exchange, where notices and demands to or upon the Master Issuer in respect of the Notes and the Indenture may be served, and
where, at any time when the Master Issuer is obligated to make a payment of principal of, and premium, if any, on the Notes, the Notes may be surrendered for payment. The Master Issuer shall give prompt written notice to the Trustee and the
Servicer of the location, and any change in the location, of such office or agency. If at any time the Master Issuer shall fail to maintain any such required office or agency or shall fail to furnish the Trustee and the Servicer with the address
thereof, such presentations and surrenders may be made or served at the Corporate Trust Office and notices and demands may be made at the address set forth in
Section 14.01
hereof.
(b)
The Master Issuer may also from time to time designate one or more other offices or agencies where the Notes may be presented
or surrendered for any or all such purposes and may, from time to time, rescind such designations. The Master Issuer shall give prompt written notice to the Trustee and the Servicer of any such designation or rescission and of any change in the
location of any such other office or agency. The Master Issuer hereby designates the applicable Corporate Trust Office as one such office or agency of the Master Issuer.
Section 8.03
Payment and Performance of Obligations
. The Master Issuer shall, and shall cause each other Securitization Entity to, pay and discharge and fully perform, at or before maturity, all of their respective
material obligations and liabilities, including, without limitation, Tax liabilities and other governmental claims levied or imposed upon each such Securitization Entity or upon the income, properties or operations of such Securitization Entity,
judgments, settlement agreements and all obligations of each Securitization Entity under the Collateral Transaction Documents, except where the same may be contested in good faith by appropriate proceedings (and without derogation from the
material obligations of the Master Issuer hereunder and the Guarantors under the Guarantee and Collateral Agreement regarding the protection of the Securitized Assets from Liens (other than Permitted Liens)), and shall maintain, in accordance
with GAAP, reserves as appropriate for the accrual of any of the same.
Section 8.04
Maintenance of Existence
. The Master Issuer shall, and shall cause each other Securitization Entity to, maintain its existence as a limited liability company or corporation validly existing and in good
standing under the laws of its state of organization and duly qualified as a foreign limited liability company or corporation licensed under the laws of each state in which the failure to so qualify would, individually or in the aggregate, be
reasonably likely to result in a Material Adverse Effect. The Master Issuer shall, and shall cause each other Securitization Entity (other than any Additional Securitization Entity that is a corporation for U.S. federal income tax purposes) to,
be treated as a disregarded entity within the meaning of U.S. Treasury regulations Section 301.7701-2(c)(2) and the Master Issuer shall not, and shall not permit any other Securitization Entity (other than any Additional Securitization Entity
that is a corporation for U.S. federal income tax purposes) to, be classified as an association taxable as a corporation or a publicly traded partnership taxable as a corporation for U.S. federal income tax purposes.
Section 8.05
Compliance with Laws
. The Master Issuer shall, and shall cause each other Securitization Entity to, comply in all respects with all Requirements of Law with respect to the Master Issuer or such other
Securitization Entity except where such noncompliance would not, individually or in the aggregate, be reasonably likely to result in a Material Adverse Effect;
provided
,
however
, such noncompliance will not result in a Lien (other
than a Permitted Lien) on any of the Securitized Assets or any criminal liability on the part of any Securitization Entity, the Manager or the Trustee.
Section 8.06
Inspection of Property; Books and Records
. The Master Issuer shall, and shall cause each other Securitization Entity to, keep proper books of record and accounts in which full, true and correct entries
in all material respects shall be made of all dealings and transactions, business and activities in accordance with GAAP. The Master Issuer shall, and shall cause each other Securitization Entity to, permit, at reasonable times upon reasonable
notice, the Servicer, the Controlling Class Representative and the Trustee or any Person appointed by any of them to act as its agent to inspect any of its properties (subject to the rights of tenants under applicable leases and subleases), to
examine and make abstracts from any of its books and records and to discuss its affairs, finances and accounts with its officers, directors, managers, employees and independent certified public accountants, and the reasonable costs and documented
out-of-pocket expenses of one such visit and inspection by each of the Servicer, the Controlling Class Representative and the Trustee, or any Person appointed by them, shall be reimbursable as a Securitization Operating Expense per calendar year,
with any additional visit or inspection by any such Person being at such Person’s sole cost and expense;
provided
,
however
, that during the continuance of a Warm Back-Up Management Trigger Event, an Advance Period that is longer
than sixty (60) consecutive days, a Rapid Amortization Event or an Event of Default, or to the extent expressly required without the instruction of any other party under the terms of any Related Documents, any such Person may visit and conduct
such activities at any time and all such visits and activities shall constitute a Securitization Operating Expense.
Section 8.07
Actions
under the Collateral Transaction Documents and Related Documents
. (a) Except as otherwise provided in
Section 8.07(d)
, the Master Issuer shall not, and will not permit any Securitization Entity to, take any action which
would permit any Non-Securitization Entity or any other Person party to a Collateral Transaction Document to have the right to refuse to perform any of its respective obligations under any of the Collateral Transaction Documents or that would
result in the amendment, waiver, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, any Collateral Transaction Document.
(b)
Except as otherwise provided in
Section 3.02(a)
or
Section 8.07(d)
, the Master Issuer shall not, and shall not permit any Securitization Entity to, take any
action which would permit any other Person party to a Collateral Business Document to have the right to refuse to perform any of its respective obligations under such Collateral Business Document or that would result in the amendment, waiver,
hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, such Collateral Business Document if such action when taken on behalf of any Securitization Entity by the Manager would constitute a breach by
the Manager of the Management Agreement.
(c)
Except as otherwise provided in
Section 3.02(a)
, the Master Issuer agrees that it shall not, and shall cause each Securitization Entity not to, without the prior
written consent of the Control Party, exercise any right, remedy, power or privilege available to it with respect to any obligor under a Collateral Transaction Document or under any instrument or agreement included in the Securitized Assets, take
any action to compel or secure performance or observance by any such obligor of its obligations to the Master Issuer or such other Securitization Entity or give any consent, request, notice, direction or approval with respect to any such obligor
if such action when taken on behalf of any Securitization Entity by the Manager would constitute a breach by the Manager of the Management Agreement.
(d)
The Master Issuer agrees that it shall not, and shall cause each Securitization Entity not to, without the prior written
consent of the Control Party, amend, modify, waive, supplement, terminate or surrender, or agree to any amendment, modification, supplement, termination, waiver or surrender of, the terms of any of the Related Documents;
provided
,
however
,
that the Securitization Entities may agree to any amendment, modification, supplement or waiver of any such term of any Related Document without any such consent (x) to the extent permitted under the terms of such other Related Documents, (y) as
contemplated by
Section 13.01
or
Section 13.08
hereof and (z) as follows:
(i)
to add to the covenants of any Securitization Entity for the benefit of the Secured Parties; or to add to the
covenants of any Non-Securitization Entity for the benefit of any Securitization Entity;
(ii)
to terminate any Related Document if any party thereto (other than a Securitization Entity) becomes, in the
reasonable judgment of the Master Issuer, unable to pay its debts as they become due, even if such party has not yet defaulted on its obligations under the Related Document, so long as the Master Issuer enters into a replacement agreement with a
new party within ninety (90) days of the termination of the Related Document;
(iii)
to make such other provisions in regard to matters or questions arising under the Related Documents as the parties
thereto may deem necessary or desirable, which are not inconsistent with the provisions thereof and which shall not materially and adversely affect the interests of any Holder or any other Secured Party;
provided
that an Opinion of
Counsel and an Officer’s Certificate shall be delivered to the Trustee, each Rating Agency and the Servicer to such effect; or
(iv)
in the case of this Base Indenture, any Series Supplement for such Series, and to the extent applicable, any Variable
Funding Note Purchase Agreement, to which the related Series, Class, Subclass or Tranche of Notes is issued or any Related Document for such Series, Class, Subclass or Tranche of Notes, to the extent that the consent of the Control Party is not
required, pursuant to the terms of such agreement, for such amendment, modification, supplement or waiver.
(e)
Upon the occurrence of a Manager Termination Event under the Management Agreement, (i) the Master Issuer shall not, and shall
cause each other Securitization Entity not to, without the prior written consent of the Control Party, terminate the Manager and appoint any Successor Manager in accordance with the Management Agreement and (ii) the Master Issuer shall, and shall
cause each other Securitization Entity to, terminate the Manager and appoint one or more Successor Managers in accordance with the Management Agreement if and when so directed by the Control Party.
Section 8.08
Notice of Defaults and Other Events
. The Master Issuer shall give the Trustee, the Servicer, the Manager, the Back-Up Manager, the Controlling Class Representative and each Rating Agency with respect to
each Series of Notes Outstanding notice within three (3) Business Days upon having Actual Knowledge of (i) any Potential Rapid Amortization Event, (ii) any Rapid Amortization Event, (iii) any Potential Manager Termination Event, (iv) any Manager
Termination Event, (v) any Default, (vi) any Event of Default or (vii) any default under any Collateral Transaction Document, together with an Officer’s Certificate setting forth the details thereof and any action with respect thereto taken or
contemplated to be taken by the Master Issuer. The Master Issuer shall, at its expense, promptly provide to the Servicer, the Manager, the Back-Up Manager, the Controlling Class Representative and the Trustee such additional information as the
Servicer, the Manager, the Back-Up Manager, the Controlling Class Representative or the Trustee may reasonably request from time to time in connection with the matters so reported, and the actions so taken or contemplated to be taken.
Section 8.09
Notice
of Material Proceedings
. Without limiting
Section 8.25(b)
or
Section 8.30
, promptly (and in any event within ten (10) days) of a determination by an Authorized Officer of the Securitization Entities that the
commencement or existence of any litigation, arbitration or other proceeding with respect to any Non-Securitization Entity would reasonably be expected to result in a Material Adverse Effect), the Master Issuer shall give written notice thereof
to the Trustee, the Servicer, the Manager, the Back-Up Manager, the Controlling Class Representative and each Rating Agency with respect to each Series of Notes Outstanding.
Section 8.10
Further Requests
. The Master Issuer shall, and shall cause each other Securitization Entity to, promptly furnish to the Trustee such other information as, and in such form as, the Trustee may reasonably
request in connection with the transactions contemplated hereby or by any Series Supplement.
Section 8.11
Further
Assurances
. (a) The Master Issuer shall, and shall cause each other Securitization Entity to, do such further acts and things, and execute and deliver to the Trustee and the Servicer such additional assignments, agreements,
powers of attorney and instruments, as are necessary or desirable to obtain or maintain the security interest of the Trustee in the Collateral or the Securitized Assets required to be part of the Collateral on behalf of the Secured Parties as a
perfected security interest subject to no prior Liens (other than Permitted Liens), to carry into effect the purposes of the Indenture or the other Related Documents or to better assure and confirm unto the Trustee, the Servicer, the Holders or
the other Secured Parties their rights, powers and remedies hereunder including, without limitation, the filing of any financing or continuation statements or amendments under the UCC in effect in any jurisdiction with respect to the liens and
security interests granted hereby and by the Guarantee and Collateral Agreement, in each case except as set forth on
Schedule 7.13(a)
and in accordance with
Section 8.25(c)
,
Section 8.25(d)
or
Section 8.37
. If the
Master Issuer fails to perform any of its agreements or obligations under this
Section 8.11(a)
, then the Servicer may perform such agreement or obligation, and the expenses of the Servicer incurred in connection therewith shall be payable
by the Master Issuer upon the Servicer‘s demand therefor. The Servicer is hereby authorized to execute and file any financing statements, continuation statements, amendments or other instruments necessary or appropriate to perfect or maintain
the perfection of the Trustee’s security interest in the Collateral (other than with regard to Excepted Securitization IP Assets) or the Securitized Assets required to be part of the Collateral.
(b)
If any amount payable under or in connection with any of the Securitized Assets shall be or become evidenced by any promissory
note, chattel paper or other instrument, such note, chattel paper or instrument shall be deemed to be held in trust and immediately pledged and within two (2) Business Days physically delivered to the Trustee hereunder, and shall, subject to the
rights of any Person in whose favor a prior Lien has been perfected, be duly endorsed in a manner satisfactory to the Trustee and delivered to the Trustee promptly;
provided
that no Securitization Entity shall be required to deliver any
Securitized Franchisee Note.
(c)
Notwithstanding the provisions set forth in
clauses (a)
and
(b)
above, the Master Issuer and the Guarantors
shall not be required to perfect any security interest in any fixtures (other than through a central filing of a UCC financing statement), any Securitized Franchisee Note or, except as provided in
Section 8.37
, any real property, leases
on real property owned or rents on real property owned.
(d)
If during any Quarterly Collection Period, the Master Issuer or any Guarantor shall obtain an interest in any commercial tort
claim or claims (as such term is defined in the New York UCC) and such commercial tort claim or claims (when added to any past commercial tort claim or claims that were obtained by any Securitization Entity prior to such Quarterly Collection
Period that are still outstanding) have an aggregate value equal to or greater than $2,000,000 as of the last day of such Quarterly Collection Period, the Master Issuer or such Guarantor shall notify the Servicer on or before the third Business
Day prior to the next succeeding Quarterly Payment Date that it has obtained such an interest and shall sign and deliver documentation reasonably acceptable to the Servicer granting a security interest under this Base Indenture or the Guarantee
and Collateral Agreement, as the case may be, in and to such commercial tort claim or claims whether obtained during such Quarterly Collection Period or prior to such Quarterly Collection Period.
(e)
The Master Issuer shall, and shall cause each other Securitization Entity to, warrant and defend the Trustee’s right, title
and interest in and to the Securitized Assets, including the right to cause the Securitized Assets to become Collateral, and the income, distributions and Proceeds thereof, for the benefit of the Trustee on behalf of the Secured Parties, against
the claims and demands of all Persons whomsoever.
(f)
On or before April 30 of each calendar year, commencing with April 30, 2020, the Master Issuer shall furnish to the Trustee,
each Rating Agency for each Series of Notes Outstanding and the Servicer (with a copy to the Back-Up Manager) an Opinion of Counsel either stating that, in the opinion of such counsel, such action has been taken with respect to the recording,
filing, re-recording and refiling of this Base Indenture, any indentures supplemental hereto, the Guarantee and Collateral Agreement and any other requisite documents and with respect to the execution and filing of any financing statements,
continuation statements and amendments to financing statements and such other documents as are, subject to
clause (c)
above, necessary to maintain the perfection of the Lien and security interest created by this Base Indenture and the
Guarantee and Collateral Agreement under Article 9 of the New York UCC in the United States and reciting the details of such action or stating that in the opinion of such counsel no such action is necessary to maintain the perfection of such Lien
and security interest. Each such Opinion of Counsel shall also describe the recording, filing, re-recording and refiling of this Base Indenture, any indentures supplemental hereto, the Guarantee and Collateral Agreement and any other requisite
documents and the execution and filing of any financing statements, continuation statements and amendments or other documents that will, in the opinion of such counsel, be required, subject to
clause (c)
above, to maintain the perfection
of the Lien and security interest of such security interest of this Base Indenture and the Guarantee and Collateral Agreement under Article 9 of the New York UCC in the Collateral in the United States until April 30 in the following calendar
year. For the avoidance of doubt, the Opinions of Counsel described in this
clause (f)
shall not be required to cover any matters related to the Real Estate Assets.
Section 8.12
Liens
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, create, incur, assume or permit to exist any Lien upon any of its property (including the Securitized Assets),
other than (i) Liens in favor of the Trustee for the benefit of the Secured Parties and (ii) other Permitted Liens.
Section 8.13
Other Indebtedness
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, create, assume, incur, suffer to exist or otherwise become or remain liable in respect of any
Indebtedness other than (i) Indebtedness hereunder or under the Guarantee and Collateral Agreement or any other Related Document, (ii) any Guarantee by any Securitization Entity of the obligations of any other Securitization Entity, (iii)
Indebtedness of a Securitization Entity owed to a Securitization Entity, (iv) any purchase money Indebtedness incurred in order to finance the acquisition, lease or improvement of equipment in the ordinary course of such Securitization Entity’s
business, (v) Indebtedness to a bank or other financial institution arising from cash management services provided by such bank or financial institution to one or more of the Securitization Entities in the ordinary course of business;
provided
that such Indebtedness is extinguished within ten (10) Business Days of notification to the applicable Securitization Entity of its incurrence; or (vi) guarantees for the benefit of Franchisees of Indebtedness in an aggregate principal amount at
any time outstanding of up to the greater of (x) $20,000,000 and (y) 5.0% of the Net Cash Flow for the preceding four (4) Quarterly Collection Periods most recently ended as of such date and for which financial statements have been prepared.
Section 8.14
Bankruptcy Proceedings
. The Master Issuer shall, and shall cause the other Securitization Entities to, promptly object to the institution of any bankruptcy proceeding against it and to take all necessary
or advisable steps to cause the dismissal of any such proceeding (including, without limiting the generality of the foregoing, to timely file an answer and any other appropriate pleading objecting to (i) the institution of any proceeding to have
any Securitization Entity, as the case may be, adjudicated as bankrupt or insolvent or (ii) the filing of any petition seeking relief, reorganization, arrangement, adjustment or composition or in respect of any Securitization Entity, as the case
may be, under applicable bankruptcy law or any other applicable law).
Section 8.15
Mergers
. On and after the Closing Date, the Master Issuer shall not, and shall not permit any other Securitization Entity to, merge or consolidate with or into any other Person (whether by means of a
single transaction or a series of related transactions) other than any merger or consolidation of any Securitization Entity with any other Securitization Entity or any merger or consolidation of any Securitization Entity with any other entity to
which the Control Party has given prior written consent.
Section 8.16
Asset Dispositions
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, sell, transfer, lease, license, liquidate or otherwise dispose of any of its property (whether by
means of a single transaction or a series of related transactions), including any Equity Interests of any other Securitization Entity, except in the case of the following (each, a “
Permitted Asset Disposition
”):
(a)
(i) any disposition of obsolete, surplus, damaged or worn out property or property that is no longer used or useful
in the business of the Securitization Entities, and (ii) any abandonment, cancellation, or lapse of Securitization IP (including any issuances, registrations or applications thereof) that is no longer used or useful in the business of the
Securitization Entities or in the reasonable good faith judgment of the Manager are no longer commercially reasonable to maintain;
(b)
any disposition of (i) Eligible Investments and (ii) inventory in the ordinary course of the Securitization Entity’s
business;
(c)
any disposition of equipment or real property to the extent that (x) such equipment or property is exchanged for
credit against the purchase price or other payment obligations in respect of similar replacement equipment, property or other Eligible Assets (including, without limitation, credit against rental obligations under a real estate lease) or (y) the
proceeds thereof are applied to the purchase price of such replacement equipment, property or other Eligible Assets in accordance with this Base Indenture;
(d)
(i) any licenses of Securitization IP under the IP License Agreements and to the Manager in connection with the
performance of its Services under the Management Agreement and (ii) other non-exclusive licenses of Securitization IP granted in the ordinary course of the Franchisor’s respective business that (x) when effected on behalf of any Securitization
Entity by the Manager would not constitute a breach by the Manager of the Management Agreement and (y) would not reasonably be expected to materially and adversely impact the Securitization IP (taken as a whole);
(e)
any dispositions of equipment leased to Franchisees or used in a Securitized Company Restaurant;
(f)
any dispositions of property of a Securitization Entity to any other Securitization Entity not otherwise prohibited
under the Related Documents;
(g)
any dispositions of property relating to repurchases of Contributed Assets in exchange for the payment of
Indemnification Amounts;
(h)
Investments permitted under
Section 8.21
, Liens permitted under
Section 8.12
and distributions permitted
under
Section 8.18
;
(i)
transfers of properties subject to condemnation or casualty events;
(j)
any disposition of Securitized Franchisee Notes or accounts receivable in connection with the collection or compromise
thereof;
(k)
any termination, non-renewal, expiration, amendment or other modification of any Collateral Business Document that when
effected on behalf of any Securitization Entity by the Manager would not constitute a breach by the Manager of the Management Agreement;
(l)
any decision to abandon, fail to pursue, settle, or otherwise resolve any claim, proceeding, investigation or cause of action
to enforce or seek remedy for the infringement, misappropriation, dilution or other violation of any Securitization IP, or other remedy against any third party where it is not commercially reasonable to pursue such claim or remedy in light of the
cost, potential remedy, or other factors;
provided
that such action (or failure to act) would not reasonably be expected to materially and adversely impact the Securitization IP (taken as whole);
(m)
any surrender or waiver of contractual rights or the settlement, release or surrender of contractual rights or other
litigation claims in the ordinary course of the Securitization Entity’s business, in each case that would not reasonably be expected to result in a Material Adverse Effect;
(n)
subleases and terminations of leases in the ordinary course of business and subleases that do not, individually or in the
aggregate, materially interfere with the business of the Securitization Entities and assignments that do not result in receipt of a cash payment to a Securitization Entity;
(o)
any Qualifying Real Estate Transaction;
(p)
any sale, transfer or other disposition of the operations and assets of a Securitized Company Restaurant to a Franchisee
which, upon such sale, transfer or other disposition becomes a Securitized Franchised Restaurant (a “
Refranchising Asset Disposition
”);
(q)
any dispositions pursuant to the sale or sale-leaseback of Securitized Owned Real Property;
(r)
any other sale, lease, license, transfer or other disposition of property to which the Control Party has given the relevant
Securitization Entity prior written consent; or
(s)
any other sale, lease, license, liquidation, transfer or other disposition of property not directly or indirectly constituting
any asset dispositions permitted by
clauses (a)
through
(q)
above and so long as such disposition when effected on behalf of any Securitization Entity by the Manager does not constitute a breach by the Manager of the Management
Agreement;
(t)
it being understood that any delivery to the Trustee of any Note, at any time and in any amount, by the Manager or any
Securitization Entity, together with any cancellation thereof pursuant to
Section 2.14
, shall be deemed to be a Permitted Asset Disposition.
All amounts received by any Securitization Entity upon a Permitted Asset Disposition pursuant to
clauses (a)
–
(o)
and any amounts of up to $5,000,000 in the aggregate during any fiscal year pursuant to
clauses (p)
,
(q)
,
(r)
and
(t)
of the
definition of “Permitted Asset Disposition” shall be treated as Collections and not as Asset Disposition Proceeds (collectively, “
Asset Disposition Collections
”) with respect
to the Quarterly Collection Period in which such amounts are received.
Notwithstanding the foregoing, the Master Issuer may, and may permit any Securitization Entity to, dispose the Equity Interests of any Additional
Securitization Entity so long as all assets (and any ancillary rights thereto) held by such Additional Securitization Entity are permitted to be disposed of pursuant to this
Section 8.16
.
All Asset Disposition Proceeds shall be deposited to the Asset Disposition Proceeds Account or, to the extent the applicable Securitization Entity elects
not to reinvest such amounts in Eligible Assets, shall be deposited to the Collection Account promptly following receipt thereof and applied in accordance with
priority (i)
of
the Priority of Payments.
Upon any sale, transfer, lease, license, liquidation or other disposition of any property by any Securitization Entity permitted by
this
Section 8.16
, all Liens with respect to such disposed property created in favor of the Trustee for the benefit of the Secured Parties under this Base Indenture and the other Related Documents shall be automatically released, and the
Trustee, upon written request of the Master Issuer, at the written direction of the Control Party, shall provide evidence of such release as set forth in
Section 14.17
.
Section 8.17
Acquisition of Assets
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, acquire, by long-term or operating lease or otherwise, any property (i) if such acquisition when
effected on behalf of any Securitization Entity by the Manager would constitute a breach by the Manager of the Management Agreement or (ii) that is a license (other than the IP License Agreements or permitted sublicenses thereunder, licenses for
Intellectual Property obtained in the ordinary course of business) or other contract (other than leases or subleases for real property) or permit, if the grant of a Lien or security interest in any of the Securitization Entities’ right, title and
interest in, to or under such lease, sublease, license, contract or permit in the manner contemplated by the Indenture and the Guarantee and Collateral Agreement (a) would be prohibited by the terms of such lease, sublease, license, contract or
permit, (b) would constitute or result in the abandonment, invalidation or unenforceability of any right, title or interest of the applicable Securitization Entity therein or (c) would otherwise result in a breach thereof or the termination or a
right of termination thereof, except to the extent that any such prohibition, breach, termination or right of termination is rendered ineffective pursuant to the UCC or any other applicable law. Unless prohibited by a Series Supplement, the
Master Issuer may purchase Notes on the open market or accept as a capital contribution from a direct or indirect parent of the Master Issuer one or more Notes, and such Notes may be cancelled in accordance with
Section 2.14
.
Section 8.18
Dividends, Officers’ Compensation, etc
. The Master Issuer will not declare or pay any distributions on any of its limited liability company interests;
provided
,
however
, that so long as no
Potential Rapid Amortization Event, Rapid Amortization Event, Default or Event of Default has occurred and is continuing with respect to any Series of Notes Outstanding or would result therefrom, the Master Issuer may declare and pay
distributions to the extent permitted under Section 18‑607 of the Delaware Limited Liability Company Act and the Master Issuer’s Charter Documents. The Master Issuer shall not, and shall not permit any other Securitization Entity to, redeem,
purchase, retire or otherwise acquire for value any Equity Interest in or issued by such Securitization Entity or set aside or otherwise segregate any amounts for any such purpose except as expressly permitted by the Indenture or as consented to
by the Control Party. The Master Issuer may draw on Commitments with respect to any Series of Class A-1 Notes for general corporate purposes of the Securitization Entities and the Non-Securitization Entities, including to fund any acquisition by
any Securitization Entity or Non-Securitization Entity or any dividend, distribution or share repurchase by any Securitization Entity or Non-Securitization Entity.
Section 8.19
Legal
Name, Location Under Section 9-301 or 9-307
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, change its location (within the meaning of Section 9-301 or 9-307 of the applicable UCC) or its
legal name without at least thirty (30) days’ prior written notice to the Trustee, the Servicer, the Manager, the Back-Up Manager and each Rating Agency with respect to each Series of Notes Outstanding. In the event that the Master Issuer or
other Securitization Entity desires to so change its location or change its legal name, the Master Issuer will, or will cause such other Securitization Entity to, make any required filings and prior to actually changing its location or its legal
name the Master Issuer will, or will cause such other Securitization Entity to, deliver to the Trustee and the Servicer (i) an Officer’s Certificate and an Opinion of Counsel confirming (a) that all required filings have been made, subject to
Section
8.11(c)
, to continue the perfected interest or to record evidence of such security interest, as applicable, of the Trustee on behalf of the Secured Parties in the Collateral under Article 9 of the applicable UCC in respect of the new
location or new legal name of the Master Issuer or other Securitization Entity and (b) such change in location or change in name will not adversely affect the Lien under any Mortgage required to be delivered pursuant to
Section 8.37
and
(ii) copies of all such required filings with the filing information duly noted thereon by the office in which such filings were made.
Section 8.20
Charter Documents
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, amend, or consent to the amendment of, any of its Charter Documents to which it is a party as a
member or shareholder unless, prior to such amendment, the Control Party shall have consented thereto and the Rating Agency Condition with respect to each Series of Notes Outstanding shall have been satisfied with respect to such amendment;
provided
,
however
, the Master Issuer and the other Securitization Entities shall be permitted to amend their Charter Documents without having to meet the Rating Agency Condition to cure any ambiguity, defect or inconsistency therein or if such
amendments would not reasonably be deemed to be disadvantageous to any Holder in the reasonable judgment of the Control Party. The Control Party may rely on an Officer’s Certificate to make such determination. The Master Issuer shall provide
written notice to each Rating Agency (with a copy to the Servicer) of any amendment of any Charter Document of any Securitization Entity.
Section 8.21
Investments
.
The Master Issuer shall not, and shall not permit any other Securitization Entity to, make, incur, or suffer to exist any loan, advance, extension of credit or other Investment if such Investment when made on behalf of any Securitization Entity
by the Manager would constitute a breach by the Manager of the Management Agreement, other than (a) Investments in the Accounts and Eligible Investments, (b) any Securitized Franchisee Note, (c) Investments in any other Securitization Entity, (d)
loans or advances by the Franchisor or any Additional Securitization Entity to any Non-Securitization Entity in accordance with
Section 8.24(a)(ii)
using funds on deposit in the Franchisor Capital Account (unless the Senior Notes Interest
Reserve Account is then designated as the Franchisor Capital Account and (i) a Senior Notes Interest Reserve Account Deficiency Amount would exist immediately after giving effect to such loan or advance or (ii) a Cash Trapping Period or Rapid
Amortization Period is then in effect or would take effect immediately after giving effect to such loan or advance), (e) the transactions described in the proviso to
Section 8.24(a)(vi)
, (f) guarantees with respect to operating leases and
product volumes and (g) guarantees for the benefit of Franchisees of Indebtedness in an aggregate principal amount at any time outstanding of up to the greater of (x) $20,000,000 and (y) 5.0% of the Net Cash Flow for the preceding four (4)
Quarterly Collection Periods most recently ended as of such date and for which financial statements have been prepared
Section 8.22
No
Other Agreements
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, enter into or be a party to any agreement or instrument (other than any Related Document, any Collateral Business Document,
any other document permitted by a Series Supplement, Variable Funding Note Purchase Agreement or the Related Documents, as the same may be amended, supplemented or otherwise modified from time to time, any documents related to any Enhancement
(subject to
Section 8.32
) or any Series Hedge Agreement (subject to
Section 8.33
), any documents relating to the transactions described in the proviso to
Section 8.24(a)(vi)
or any documents or agreements incidental
thereto) if such agreement when effected on behalf of any Securitization Entity by the Manager would constitute a breach by the Manager of the Management Agreement.
Section 8.23
Other
Business
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, engage in any business or enterprise or enter into any transaction other than the incurrence and payment of ordinary course operating
expenses, the issuing and selling of the Notes, entry into and performance of the Collateral Business Documents and other agreements permitted pursuant to
Section 8.22
and other activities related to or incidental to any of the foregoing
or any other transaction which when effected on behalf of any Securitization Entity by the Manager would not constitute a breach by the Manager of the Management Agreement.
Section 8.24
Maintenance
of Separate Existence
. (a) The Master Issuer shall, and shall cause each other Securitization Entity to, except as otherwise contemplated hereunder or under the other Related Documents:
(i)
maintain their own deposit and securities accounts, as applicable, separate from those of any of its Affiliates
(other than the other Securitization Entities), with commercial banking institutions and ensure that the funds of the Securitization Entities will not be diverted to any Person who is not a Securitization Entity or for other than the use of the
Securitization Entities, nor will such funds be commingled with the funds of any of its Affiliates (other than the other Securitization Entities), other than as provided in the Related Documents;
(ii)
ensure that all transactions between it and any of its Affiliates (other than the other Securitization Entities),
whether currently existing or hereafter entered into, shall be only on an arm’s length basis, it being understood and agreed that the transactions contemplated in the Related Documents and the transactions described in the proviso to
clause (vi)
meet the requirements of this
clause (ii)
;
(iii)
to the extent that it requires an office to conduct its business, conduct its business from an office at a separate
address from that of any of its Affiliates (other than the other Securitization Entities);
provided
that segregated offices in the same building shall constitute separate addresses for purposes of this
clause (iii)
. To the extent
that any Securitization Entity and any of its members or Affiliates (other than the other Securitization Entities) have offices in the same location, there shall be a fair and appropriate allocation of overhead costs among them, and each such
entity shall bear its fair share of such expenses;
(iv)
issue, as required, separate financial statements from any of its Affiliates (other than the other Securitization
Entities) prepared at least quarterly and prepared in accordance with GAAP;
(v)
conduct its affairs in its own name and in accordance with its Charter Documents and observe all necessary,
appropriate and customary limited liability company or corporate formalities (as applicable), including, but not limited to, holding all regular and special meetings appropriate to authorize all its actions, keeping separate and accurate minutes
of its meetings, passing all resolutions or consents necessary to authorize actions taken or to be taken, and maintaining accurate and separate books, records and accounts, including, but not limited to, payroll and intercompany transaction
accounts;
(vi)
not assume or guarantee any of the liabilities of any of its Affiliates (other than the other Securitization
Entities);
provided
that the Securitization Entities may, pursuant to a Letter of Credit Reimbursement Agreement, cause letters of credit to be issued pursuant to Variable Funding Note Purchase Agreements that are for the sole benefit of
one or more Non-Securitization Entities if the Master Issuer receives a fee from each Non-Securitization Entity whose obligations are secured by such letter of credit in an amount equal to the cost to the Master Issuer in connection with the
issuance and maintenance of such letter of credit
plus
25 basis points per annum, it being understood that such fee is an arm’s length fair market fee;
(vii)
take, or refrain from taking, as the case may be, all other actions that are necessary to be taken or not to be taken
in order to (x) ensure that the assumptions and factual recitations set forth in the Specified Bankruptcy Opinion Provisions remain true and correct in all material respects with respect to it and (y) comply in all material respects with those
procedures described in such provisions which are applicable to it;
(viii)
maintain at least two Independent Managers, on its board of managers or its Board of Directors, as the case may be;
(ix)
to the fullest extent permitted by law, so long as any Obligation remains outstanding, remove or replace any
Independent Manager only for Cause and only after providing the Trustee and the Control Party with no less than three (3) days’ prior written notice of (A) any proposed removal of such Independent Manager, and (B) the identity of the proposed
replacement Independent Manager, together with a certification that such replacement satisfies the requirements for an Independent Manager set forth in the Charter Documents of the applicable Securitization Entity; and
(x)
(A) provide, or cause the Manager to provide, to the Trustee and the Control Party, a copy of the executed agreement
with respect to the appointment of any replacement Independent Manager and (B) provide, or cause the Manager to provide, to the Trustee, the Control Party and each Holder, written notice of the identity and contact information for each
Independent Manager on an annual basis and at any time such information changes.
(b)
The Master Issuer, on behalf of itself and each of the other Securitization Entities, confirms that the statements relating to
the Master Issuer referenced in the opinion of White & Case LLP regarding substantive consolidation matters most recently delivered to the Trustee are true and correct with respect to itself and each other Securitization Entity, and that the
Master Issuer will, and will cause each other Securitization Entity to, comply with any covenants or obligations assumed to be complied with by it therein as if such covenants and obligations were set forth herein.
Section 8.25
Covenants
Regarding the Securitization IP
. (a) The Master Issuer shall not, and shall not permit any other Securitization Entity to, take or omit to take any action with respect to the maintenance, enforcement and defense of the
Franchisor’s rights in and to the applicable Securitization IP that would constitute a breach by the Manager of the Management Agreement if such action were taken or omitted by the Manager on behalf of any Securitization Entity.
(b)
The Master Issuer shall notify the Trustee, the Back-Up Manager and the Servicer in writing within fifteen (15) Business Days
of the Master Issuer first knowing or having reason to know that any application or registration relating to any material Securitization IP (now or hereafter existing) may become abandoned or dedicated to the public domain, or of any material
adverse determination or development (including the institution of, or any such determination or development in, any proceeding in the PTO, the United States Copyright Office or similar offices or agencies in the United States, or any court, but
excluding office actions in the course of prosecution and any non-final determinations (other than in an adversarial proceeding) of the PTO, the United States Copyright Office or any similar office or agency in the United States) regarding the
validity of any Securitization Entity’s ownership of any material Securitization IP, its right to register the same, or to keep and maintain the same.
(c)
With respect to the Securitization IP, the Master Issuer shall cause the Franchisor, as applicable to: execute, deliver and
file, within fifteen (15) Business Days of the Closing Date, to the PTO or the United States Copyright Office, as applicable, instruments substantially in the form attached as
Exhibit B-1
hereto with respect to Trademarks,
Exhibit B-2
hereto with respect to Patents and
Exhibit B-3
hereto with respect to Copyrights, or otherwise in form and substance satisfactory to the Control Party, and any other instruments or documents as may be reasonably necessary or, in the
Control Party’s opinion, desirable to perfect or protect the Trustee’s security interest granted under this Base Indenture and the Guarantee and Collateral Agreement in the Trademarks, Patents and Copyrights included in the Securitization IP in
the United States.
(d)
If the Master Issuer or any Guarantor, either itself or through any agent, licensee or designee, shall file or otherwise
acquire an application for the registration of any Patent, Trademark or Copyright with the PTO, the United States Copyright Office or any successor agency thereto, the Master Issuer shall, or shall cause such Guarantor to, in a reasonable time
after such filing or acquisition (and in any event within ninety (90) days), execute, deliver and file, to the PTO or the United States Copyright Office, as applicable, instruments substantially in the form attached as
Exhibit C-
1 hereto
with respect to Trademarks,
Exhibit C-2
hereto with respect to Patents and
Exhibit C-3
hereto with respect to Copyrights, or otherwise in form and substance satisfactory to the Control Party, and any other instruments or documents
as may be reasonably necessary or, in the Control Party’s opinion, desirable to perfect or protect the Trustee’s security interest granted under this Base Indenture and the Guarantee and Collateral Agreement in the Trademarks, Patents and
Copyrights included in the Securitization IP in the United States.
(e)
In the event that any Securitization IP is infringed upon, misappropriated or diluted by one or more third parties in a manner
that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the Master Issuer within a reasonable period of its becoming aware of such infringement, misappropriation or dilution shall promptly
notify the Trustee and the Control Party in writing. Except as provided below, the Master Issuer shall cause the Franchisor, as applicable, to take all reasonable and appropriate actions, at the expense of the Franchisor to protect or enforce
such Securitization IP, including, if reasonable, suing for infringement, misappropriation or dilution and seeking an injunction (including, if appropriate, temporary and/or preliminary injunctive relief) against such infringement,
misappropriation or dilution, unless the failure to take such actions on behalf of the Franchisor by the Manager would not constitute a breach by the Manager of the Management Agreement;
provided
that if the Franchisor decides not to take
any action with respect to an infringement, misappropriation or dilution that would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the Master Issuer shall deliver written notice to the Trustee,
the Manager, the Back-Up Manager and the Control Party setting forth in reasonable detail the basis for its decision not to act, and none of the Manager, the Trustee, the Back-Up Manager or the Control Party will be required to take any actions
on their behalf to protect or enforce the Securitization IP against such infringement, misappropriation or dilution;
provided
,
further
, that the Manager will be required to act if failure to do so would constitute a breach of the
Managing Standard.
(f)
With respect to any licenses of third-party Intellectual Property (other than “off-the-shelf” software or “click through”
third-party terms that are reasonably expected to be non-negotiable) entered into after the Closing Date by a Securitization Entity (including, for the avoidance of doubt, the Manager acting on behalf of the Securitization Entities, as
applicable) that is material to the business of such Securitization Entity, such Securitization Entity shall use commercially reasonable efforts to include terms permitting the grant by such Securitization Entity of a security interest therein to
the Trustee for the benefit of the Secured Parties and to allow the Manager (and any Successor Manager) the right to use such Intellectual Property in the performance of its duties under the Management Agreement.
Section 8.26
1940 Act
. The Master Issuer shall take or omit to take action as necessary in order to ensure the Master Issuer is not an “investment company” as set forth in Section 3(a)(1) of the 1940 Act, as such
section may be amended from time to time.
Section 8.27
Real Property
. The Master Issuer shall not, and shall not permit any other Securitization Entity to, (i) acquire any fee interest in real property unrelated to the ownership and operation of Branded
Restaurants or (ii) enter into any lease or invest in real property unrelated to the ownership and operation of Branded Restaurants.
Section 8.28
No Employees
. The Master Issuer and the other Securitization Entities shall have no employees.
Section 8.29
Insurance
. The Master Issuer shall cause the Manager to list each Securitization Entity as an “additional insured” or “loss payee” on any insurance maintained by the Manager for the benefit of each
such Securitization Entity pursuant to the Management Agreement.
Section 8.30
Litigation
. So long as Jack in the Box Inc. is not then subject to Section 13 or 15(d) of the 1934 Act, the Master Issuer shall, on each Quarterly Payment Date, provide a written report to the Servicer,
the Manager, the Back-Up Manager and each Rating Agency for each Series of Notes Outstanding that sets forth all outstanding litigation, arbitration or other proceedings against any Non-Securitization Entity that would have been required to be
disclosed in Jack in the Box Inc.’ annual reports, quarterly reports and other public filings which Jack in the Box Inc. would have been required to file with the SEC pursuant to Section 13 or 15(d) of the 1934 Act if Jack in the Box Inc. were
subject to such Sections.
Section 8.31
Environmental
. The Master Issuer shall, and shall cause each other Securitization Entity to, promptly notify the Servicer, the Manager, the Back-Up Manager, the Trustee and each Rating Agency for each
Series of Notes Outstanding, in writing, upon receipt of any written notice of which any Securitization Entity becomes aware from any source (including, but not limited to, a governmental entity) relating in any way to any possible material
liability of any Securitization Entity pursuant to any Environmental Law that could reasonably be expected to have a Material Adverse Effect. In addition, other than exceptions to any of the following that could not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect, the Master Issuer shall, and shall cause each other Securitization Entity to:
(a)
(i) comply with all applicable Environmental Laws, (ii) hold all Environmental Permits (each of which is in full
force and effect) required for any of their current operations or for any property owned, leased, or otherwise operated by any of them and obtain all Environmental Permits for any intended operations when such Environmental Permits are required
and (iii) comply with all of their Environmental Permits; and
(b)
undertake all investigative and remedial action required by Environmental Laws with respect to any Materials of
Environmental Concern present at, on, under, in, or about any Contributed Securitized Owned Real Property owned, subleased, leased or operated by the Master Issuer or any of its Affiliates, or at any other location (including, without limitation,
any location to which Materials of Environmental Concern have been sent for re-use or recycling or for treatment, storage or disposal), which would reasonably be expected to (i) give rise to liability of the Master Issuer or any of its Affiliates
under any applicable Environmental Law or otherwise result in costs to the Master Issuer or any of its Affiliates, (ii) interfere with the Master Issuer’s or any of its Affiliates’ continued operations or (iii) impair the fair saleable value of
any Contributed Securitized Owned Real Property owned by the Master Issuer or any of its Affiliates.
Section 8.32
Enhancements
. No Enhancement shall be provided in respect of any Series of Notes, nor will any Enhancement Provider have any rights hereunder, as third-party beneficiary or otherwise, unless the Control
Party has provided its prior written consent to such Enhancement, such consent not to be unreasonably withheld.
Section 8.33
Series
Hedge Agreements; Derivatives Generally
. (a) No Series Hedge Agreement shall be provided in respect of any Series of Notes, nor will any Hedge Counterparty have any rights hereunder, as third-party beneficiary or otherwise,
unless the Control Party has provided its prior written consent to such Series Hedge Agreement, such consent not to be unreasonably withheld, and the Master Issuer has delivered a copy of such prior written consent to each Rating Agency for each
Series of Notes Outstanding (with a copy to the Servicer).
(b)
Without the prior written consent of the Control Party, the Master Issuer shall not, and shall not permit any other
Securitization Entity to, enter into any derivative contract, swap, option, hedging contract, forward purchase contract or other similar agreement or instrument if any such contract, agreement or instrument requires the Master Issuer to expend
any financial resources to satisfy any payment obligations owed in connection therewith;
provided
that the Master Issuer shall deliver a copy of any such prior written consent to each Rating Agency for each Series of Notes Outstanding
(with a copy to the Servicer).
Section 8.34
Additional
Securitization Entity
. (a) The Master Issuer in accordance with and as permitted under the Related Documents, and upon written notice to each Rating Agency, may form or cause to be formed or accept as a capital contribution
Additional Securitization Entities without the consent of the Control Party;
provided
that such Additional Securitization Entity is a Delaware limited liability company or a Delaware corporation (so long as the use of such corporate form
is reasonably satisfactory to the Control Party) and has adopted Charter Documents substantially similar to the Charter Documents (including Specified Bankruptcy Opinion Provisions) of the Securitization Entities that are Delaware limited
liability companies as in existence on the Closing Date;
provided
,
further
, that such Additional Securitization Entity holds Securitized Assets or is being established in order to act as a franchisor with respect to future New
Securitized Franchise Agreements or hold such future assets.
(b)
If the Master Issuer desires to create, incorporate, form or otherwise organize or accept as a capital contribution an
Additional Securitization Entity that does not comply with the requirements of the proviso set forth in
clause (a)
above, the Master Issuer shall first obtain the prior written consent of the Control Party, such consent not to be
unreasonably withheld;
provided
that the Master Issuer shall deliver a copy of any such prior written consent to each Rating Agency for each Series of Notes Outstanding (with a copy to the Servicer).
(c)
In connection with the organization of any Additional Securitization Entity in conjunction with
clause (a)
or
(b)
above, the Master Issuer may (i) designate such Additional Securitization Entity as a “franchisor” or (ii) elect to apply the provisions hereunder and under the other Related Documents applicable to any then-existing Securitization Entity to such
Additional Securitization Entity;
(d)
The Master Issuer shall cause each Additional Securitization Entity to promptly execute an assumption agreement in form set
forth as Exhibit A to the Guarantee and Collateral Agreement (an “
Assumption Agreement
”) pursuant to which such Additional Securitization Entity shall become jointly and severally obligated under the Guarantee and Collateral Agreement with
the other Guarantors.
(e)
Upon the execution and delivery of an Assumption Agreement as required in
clause (d)
above, each Additional
Securitization Entity party thereto shall become a party to the Guarantee and Collateral Agreement with the same force and effect as if originally named therein as a Guarantor and, without limiting the generality of the Guarantee and Collateral
Agreement, will assume all Obligations and liabilities of a Guarantor thereunder.
(f)
If the Master Issuer desires to (i) dissolve or wind up an Additional Securitization Entity or (ii) transfer an Additional
Securitization Entity to either a Securitization Entity or a Non-Securitization Entity, the Master Issuer shall (x) first, obtain the prior written consent of the Control Party, such consent not to be unreasonably withheld, (y) second, in the
case of a dissolution or wind up of an Additional Securitization Entity or a transfer of an Additional Securitization Entity to a Non-Securitization Entity, transfer any Securitized Assets held in such Additional Securitization Entity to a
Securitization Entity and (z) third, provide notice of such dissolution, wind up or transfer to each Rating Agency for each Series of Notes Outstanding (with a copy to the Trustee, the Servicer and Back-Up Manager).
Section 8.35
Subordinated Notes Repayments
. The Master Issuer shall not repay any Subordinated Notes or Senior Subordinated Notes after the Series Anticipated Repayment Date with respect to any Series of Notes
Outstanding with amounts obtained by the Master Issuer from the Holding Company Guarantor, Jack in the Box Inc. or any other direct or indirect owner of Equity Interests of the Master Issuer in the form of any capital contributions or any portion
of any Residual Amounts distributed to the Master Issuer pursuant to the Priority of Payments unless and until all Senior Notes Outstanding have been paid in full and are no longer Outstanding.
Section 8.36
Tax Lien Reserve Amount
. If the Holding Company Guarantor notifies the Master Issuer that it has received any Tax Lien Reserve Amount, the Master
Issuer shall direct the Holding Company Guarantor to remit such amount to the Master Issuer to be held in a collateral deposit account established with and controlled by the Trustee, in which the Trustee shall have a security interest;
provided
that the Trustee will not release such Tax Lien Reserve Amount from such account unless: (a) the Servicer instructs the Trustee in writing to withdraw and pay all of such Tax Lien Reserve Amount in accordance with the written instructions of the
Master Issuer which may include returning such amounts to the Holding Company Guarantor for refund to the Manager or an Affiliate thereof upon receipt by the Trustee, the Servicer, the Manager, the Back-Up Manager and the Controlling Class
Representative of reasonably satisfactory evidence that the Lien for which such Tax Lien Reserve Amount was established has been released by the IRS; (b) the Master Issuer, or the Manager on behalf of the Master Issuer, delivers written
instructions to the Trustee to withdraw and pay all or a portion of such Tax Lien Reserve Amount to the IRS on behalf of the Securitization Entities;
provided
that the Master Issuer shall deliver, or cause to be delivered, prior written
notice of any such written instruction to the Servicer; or (c) the Control Party instructs the Trustee in writing to withdraw and pay all or a portion of such Tax Lien Reserve Amount to the IRS (i) upon the occurrence and during the continuation
of an Event of Default or (ii) upon receipt of written notice from any Securitization Entity stating that the IRS intends to execute on the Lien for which such Tax Lien Reserve Amount was established in respect of any assets of any Securitization
Entity;
provided
that the Control Party shall deliver a copy of any such written instruction to the Manager.
Section 8.37
Mortgages
.
Upon the occurrence of a Mortgage Preparation Event, the Master Issuer shall cause the preparation of fully executed Mortgages for recordation against the
Securitized Owned Real Property;
provided
that the Control Party shall have the right to waive, delay or modify such requirement to prepare fully executed Mortgages without the consent of any other party. Within ninety (90) days of such
Mortgage Preparation Event, the Master Issuer shall deliver such Mortgages to the Trustee, to be held for the benefit of the Secured Parties in the event a Mortgage Recordation Event occurs (subject to
Section 3.01(c)
). Upon the
occurrence of a Mortgage Recordation Event, the Trustee shall, at the direction of the Control Party, deliver the Mortgages within twenty (20) Business Days following receipt of the properly executed Mortgages to the applicable recording office
for recordation (unless such recordation requirement is waived by the Control Party, acting at the direction of the Controlling Class Representative);
provided
that the Trustee shall have no obligation to record a Mortgage until the later
of (i) twenty (20) Business Days following delivery of a properly executed Mortgage to the Trustee and (ii) the Trustee’s Actual Knowledge of a Rapid Amortization Event. The Trustee may engage a third-party service provider (which shall be
reasonably acceptable to the Control Party) to assist in delivering such Mortgages to the applicable Governmental Authority and the Trustee shall pay all Mortgage Recordation Fees in connection with such recordation. The Trustee shall be
reimbursed by the Master Issuer for any and all reasonable costs and expenses in connection with such Mortgage Recordation Event, including all Mortgage Recordation Fees pursuant to and in accordance with the Priority of Payments. For the
avoidance of doubt, JIB Properties shall not be required to, and the Trustee may not, record or cause to be recorded any Mortgage until the occurrence of a Mortgage Recordation Event that has not been waived by the Control Party (at the direction
of the Controlling Class Representative). Neither the Trustee nor any custodian on behalf of the Trustee shall be under any duty or obligation to inspect, review or examine any such Mortgages or to determine that the same are valid, binding,
legally effective, properly endorsed, genuine, enforceable or appropriate for the represented purpose or that they are in recordable form. Neither the Trustee nor any agent on its behalf shall in any way be liable in the absence of any gross
negligence, bad faith or willful misconduct on its part for any delays in the recordation of any Mortgage, for the rejection of a Mortgage by any recording office or for the failure of any Mortgage to create in favor of the Trustee, for the
benefit of the Secured Parties, legal, valid and enforceable first priority Liens on (subject to Permitted Liens), and security interests in, JIB Properties’ right, title and interest in and to each Securitized Owned Real Property and the
Proceeds thereof. Upon the request of JIB Properties, and at the direction of the Manager, the Trustee shall execute and deliver a release of mortgage to be held in escrow pending a closing of a sale of any Securitized Owned Real Property;
provided
that if such closing shall not occur, such release of mortgage shall be returned by the escrow agent directly to the Trustee.
Section 8.38
Required Balance
. For each Weekly Collection Period, the Master Issuer will specify to the Trustee the Weekly Allocation Percentage. If less than the Required Balance is on deposit in the Senior Notes
Interest Payment Account, the Senior Subordinated Notes Interest Payment Account, the Senior Notes Principal Payment Account, the Senior Subordinated Notes Principal Payment Account, the Subordinated Notes Interest Payment Account, the
Subordinated Notes Principal Payment Account and/or the Senior Notes Post-ARD Contingent Interest Account (as applicable) for any Weekly Collection Period within a Quarterly Fiscal Period, the Master Issuer shall direct any Residual Amount on the
following Weekly Allocation Date (and each subsequent Weekly Allocation Date as necessary) to be deposited to such Senior Notes Interest Payment Account, Senior Subordinated Notes Interest Payment Account, Senior Notes Principal Payment Account,
Senior Subordinated Notes Principal Payment Account, Subordinated Notes Interest Payment Account, Subordinated Notes Principal Payment Account and/or Senior Notes Post-ARD Contingent Interest Account, in that order, until at least the Required
Balance for such Weekly Collection Period is on deposit in in the Senior Notes Interest Payment Account, the Senior Subordinated Notes Interest Payment Account, the Senior Notes Principal Payment Account, the Senior Subordinated Notes Principal
Payment Account, the Subordinated Notes Interest Payment Account, the Subordinated Notes Principal Payment Account and/or the Senior Notes Post-ARD Contingent Interest Account (as applicable).
Section 8.39
Modification of Contributed Assets
. After the Closing Date and on a quarterly basis, if there are any additions or modifications to the Contributed Assets (excluding any lease for which a Securitization
Entity becomes the legal assignee and named lessee under such lease) that constitute accounts, chattel paper, instruments or general intangibles under the Delaware UCC, the Master Issuer (or the Manager on its behalf) shall deliver and shall
cause each applicable Securitization Entity to deliver to the Trustee an Officer’s Certificate with a revised list of the applicable Contributed Assets.
ARTICLE VIII
REMEDIES
Section 9.01
Rapid Amortization Events
. The Notes shall be subject to rapid amortization, in whole and not in part, following the occurrence of any of the following events as declared by the Control Party (at the
direction of the Controlling Class Representative) by written notice to the Master Issuer (with a copy to the Trustee) (each, a “
Rapid Amortization Event
”);
provided
that a Rapid Amortization Event described in
clause (b)
below will occur automatically without any declaration by the Control Party unless the Control Party and 100% of the Noteholders have agreed to waive such event in accordance with
Section 9.07
:
(a)
the failure to maintain a DSCR of at least 1.20x as calculated on any Quarterly Calculation Date;
(b)
the failure to repay or refinance a Series of Notes (or Class or Tranche thereunder) in full by the Series
Anticipated Repayment Date relating to such Series of Notes (or Class or Tranche thereunder);
provided
that, to the extent that the DSCR is greater than 2.00x as of such Series Anticipated Repayment Date, and such Series of Notes (or
Class or Tranche thereunder) is repaid or refinanced within one (1) calendar year from such Series Anticipated Repayment Date (such calendar year, the “
Post-ARD Rapid Amortization Cure Period
”), such Rapid Amortization Event will no longer
be in effect following such repayment or refinancing;
(c)
the occurrence of a Manager Termination Event;
(d)
the occurrence of an Event of Default; or
(e)
Systemwide Sales calculated on any Quarterly Payment Date are less than $1.25 billion.
For the avoidance of doubt, any Scheduled Principal Payments set forth in any Series Supplement shall continue to be made when due and
payable subsequent to the occurrence of a Rapid Amortization Event.
Section 9.02
Events of Default
. If any one of the following events shall occur (each an “
Event of Default
”):
(a)
the Master Issuer defaults in the payment of interest on any Series of Notes Outstanding when the same becomes due
and payable and such default continues for two (2) Business Days (or in the case of a failure to pay such interest when due resulting solely from an administrative error or omission by the Trustee, such default continues for a period of two (2)
Business Days after the earlier of the date on which the Trustee receives written notice or an Authorized Officer of the Trustee has Actual Knowledge of such error or omission);
provided
that failure to pay any contingent interest on any
Series of Notes (including, but not limited to, any Post-ARD Contingent Interest on any Quarterly Payment Date (including on any applicable Series Legal Final Maturity Date) in excess of available amounts in accordance with the Priority of
Payments will not be an Event of Default;
(b)
the Master Issuer (i) defaults in the payment of any principal of any Series of Notes on its Series Legal Final
Maturity Date or as and when due in connection with any mandatory or optional prepayment or (ii) fails to make any other principal payments or allocations due from funds available in the Collection Account in accordance with the Priority of
Payments and the Series Supplement for such Series on any Weekly Allocation Date;
provided
that in the case of a failure to pay or allocate principal resulting solely from an administrative error or omission by the Trustee, such default
continues for a period of two (2) Business Days after the earlier of the date on which the Trustee receives written notice or an Authorized Officer of the Trustee has Actual Knowledge of such error or omission;
provided
that the failure
to pay any prepayment premium on any prepayment of principal made during any Rapid Amortization Period occurring prior to the related Series Anticipated Repayment Date will not be an Event of Default;
(c)
any Securitization Entity fails to perform or comply with any of the covenants (other than those covered by
clause (a)
or
clause (b)
above) (including any covenant to pay any amount other than interest on or principal of the Notes when due in accordance with the Priority of Payments), or any of its representations or warranties contained in any Related
Document to which it is a party proves to be incorrect in any material respect as of the date made or deemed to be made, and such default, failure, breach or incorrect representation or warranty continues for a period of thirty (30) consecutive
days or, in the case of a failure to comply with any of the agreements, covenants or provisions of any IP License Agreements, such longer cure period as may be permitted under such IP License Agreement, or, solely with respect to a failure to
comply with (i) any obligation to deliver a notice, report or other communication within the specified time frame set forth in the applicable Related Document, such failure continues for a period of five (5) consecutive Business Days after the
specified time frame for delivery has elapsed or (ii)
Sections 8.7
,
8.12
,
8.13
,
8.14
,
8.15
,
8.17
,
8.18
,
8.19
,
8.20
,
8.21
,
8.22
,
8.23
,
8.24
,
8.25
,
8.27
and
8.28
such failure continues for a period of ten (10) consecutive Business Days, in each case, following the earlier to occur of the Actual Knowledge of an Authorized Officer of such Securitization Entity of such breach or
failure and the default caused thereby or written notice to such Securitization Entity by the Trustee, the Back-Up Manager or the Control Party (at the direction of the Controlling Class Representative) of such default, breach or failure;
provided
,
however
, that no Event of Default shall occur pursuant to this
clause (c)
if, with respect to any such representation deemed to have been false in any material respect when made which can be remedied by making a payment of an
Indemnification Amount, (i) the Indemnitor has paid the required Indemnification Amount in accordance with the terms of the Related Documents and (ii) such Indemnification Amount has been deposited into the Collection Account;
(d)
the occurrence of an Event of Bankruptcy with respect to any Securitization Entity;
(e)
the Interest-Only DSCR as calculated as of any Quarterly Calculation Date is less than 1.10x;
(f)
the SEC or other regulatory body having jurisdiction reaches a final determination that any Securitization Entity is
required to register as an “investment company” under the 1940 Act or is under the “control” of a Person that is required to register as an “investment company” under the 1940 Act;
(g)
any of the Related Documents or any material portion thereof ceases to be in full force and effect or enforceable in
accordance with its terms (other than (i) in accordance with the express termination provisions thereof, (ii) a termination in the ordinary course of business, which termination could not reasonably be expected to result in a Material Adverse
Effect or (iii) as a result of actions, omissions or breaches of representations or warranties by any party to such Related Document that is not a Securitization Entity or a Non-Securitization Entity so long as such Related Document, or any
material portion thereof, is reinstated or replaced with a substantially similar document, agreement or arrangement within thirty (30) Business Days after such Related Document ceases to be in full force and effect or enforceable in accordance
with its terms) or any Non-Securitization Entity or Securitization Entity so asserts in writing;
(h)
other than with respect to Collateral with an aggregate fair market value of less than the greater of $25,000,000 or
20% of Retained Collections for the preceding four (4) Quarterly Collection Periods most recently ended and for which financial statements have been prepared, the Trustee ceases to have for any reason a valid and perfected first-priority security
interest in the Collateral (subject to Permitted Liens), in which perfection can be achieved under the UCC or other applicable law in the United States to the extent required by the Related Documents or any Securitization Entity or any Affiliate
thereof so asserts in writing;
(i)
any Securitization Entity fails to perform or comply with any material provision of its organizational documents or any
provision of
Section 8.24
or the Guarantee and Collateral Agreement relating to legal separateness of the Securitization Entities, which failure is reasonably likely to cause the contribution of the Securitized Assets to such
Securitization Entity pursuant to the Contribution Agreements to fail to constitute a “true contribution” or other absolute transfer of such Securitized Assets pursuant to such Contribution Agreement or is reasonably likely to cause a court of
competent jurisdiction to disregard the separate existence of such Securitization Entity relative to any Person other than another Securitization Entity and, in each case, such failure continues for more than thirty (30) consecutive days
following the earlier to occur of the Actual Knowledge of an Authorized Officer of such Securitization Entity or written notice to such Securitization Entity from the Trustee, the Back-Up Manager or the Control Party (at the direction of the
Controlling Class Representative) of such failure;
(j)
a final non-appealable ruling has been made by a court of competent jurisdiction that the contribution of the Securitized
Assets (other than any immaterial Securitized Assets and any Securitized Assets that have been disposed of to the extent permitted or required under the Related Documents) pursuant to a Contribution Agreement does not constitute a “true
contribution” or other absolute transfer of such Securitized Assets pursuant to such agreement;
(k)
one or more outstanding final non-appealable judgments for the payment of money are rendered against any Securitization Entity
in an aggregate amount exceeding $25,000,000 (to the extent not covered by independent third-party insurance as to which the issuer is rated at least “A” by A.M. Best Company, has been notified of the potential claim and does not dispute
coverage), and either (i) enforcement proceedings are commenced by any creditor upon such judgment or order or (ii) there is any period of thirty (30) consecutive days during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, will not be in effect;
(l)
the failure of (i) Jack in the Box Inc. or any successor thereto to own (directly or indirectly) 100% of the Equity Interests
of the Holding Company Guarantor; (ii) the Holding Company Guarantor to own 100% of the Equity Interests of the Master Issuer; (iii) the Master Issuer to own (directly or indirectly) 100% of the Equity Interests of the Franchisor and JIB
Properties; or (iv) the Master Issuer or any Guarantor to own (directly or indirectly) 100% of the Equity Interests of any Additional Securitization Entity (except to the extent permitted under
Section 8.16
);
(m)
other than as permitted hereunder or the other Related Documents, the Securitization Entities collectively fail to have good
title or valid leasehold interest, as applicable, in or to any material portion of the Securitized Assets;
provided
,
however
, that this
clause (m)
will only begin to apply to the Real Estate Assets six (6) months after the
Closing Date;
(n)
any ERISA Event occurs that, would, individually or in the aggregate, reasonably be expected to result in a Material Adverse
Effect on any Securitization Entity;
(o)
the IRS files notice of a Lien pursuant to Section 6323 of the Code with regard to the assets of any Securitization Entity and
such Lien has not been released within sixty (60) days, unless (i) Jack in the Box Inc. or a Subsidiary thereof has provided evidence that payment to satisfy the full amount of the asserted liability has been provided to the IRS, and the IRS has
released such asserted Lien within sixty (60) days of such payment, or (ii) such Lien or the asserted liability is being contested in good faith and Jack in the Box Inc. or a Subsidiary thereof has contributed to the Holding Company Guarantor the
Tax Lien Reserve Amount, which such Tax Lien Reserve Amount is set aside and remitted to a collateral deposit account as provided in
Section 8.36
;
(p)
a final non-appealable non-monetary judgment has been made by a court of competent jurisdiction that materially impairs (i)
the Securitization Entities’ ability to conduct the Securitized Company Restaurant Business and the Securitized Franchised Restaurant Business as of such date, taken as a whole, or (ii) the exercise of the Securitization Entities’ or of the
Trustee’s rights with respect to the Securitized Assets; or
(q)
on the 90th day following the occurrence and continuation of an Advance Period;
then (i) in the case of any event described in each clause above (except for
clause (d)
thereof) that
is continuing the Trustee, at the direction of the Control Party (at the direction of the Controlling Class Representative) and on behalf of the Noteholders, by written notice to the Master Issuer, shall declare the Notes of all Series to be
immediately due and payable, and upon any such declaration the unpaid principal amount of the Notes of all Series, together with accrued and unpaid interest thereon through the date of acceleration, and all other amounts due to the Noteholders and
the other Secured Parties under the Indenture Documents shall become immediately due and payable or (ii) in the case of any event described in
clause (d)
above, the unpaid
principal amount of the Notes of all Series, together with interest accrued but unpaid thereon through the date of acceleration, and all other amounts due to the Noteholders and the other Secured Parties under the Indenture Documents, shall
immediately and without further act become due and payable. Promptly following the Trustee’s receipt of written notice hereunder of any Event of Default, the Trustee shall send a copy thereof to the Master Issuer, the Servicer, each Rating Agency
for each Series of Notes Outstanding, the Controlling Class Representative, the Manager, the Back-Up Manager, each Noteholder and each other Secured Party.
If the Master Issuer obtains Actual Knowledge that a Default or an Event of Default has occurred and is continuing, the Master Issuer shall promptly notify
the Trustee and the Servicer.
At any time after such a declaration of acceleration of maturity has been made relating to the Notes and before a judgment or
decree for payment of the money due has been obtained by the Trustee, as hereinafter provided in this
Article IX
, the Control Party (at the direction of the Controlling Class Representative), by written notice to the Master Issuer and to
the Trustee, may rescind and annul such declaration and its consequences, if (i) the Master Issuer has paid or deposited with the Trustee a sum sufficient to pay (a) all overdue installments of interest and principal on the Notes (excluding
principal amounts due solely as a result of the acceleration), and (b) all unpaid taxes, administrative expenses and other sums paid or advanced by the Trustee or Servicer under the Related Documents and the reasonable compensation, expenses,
disbursements and Advances of the Trustee and the Servicer, their agents and counsel, and any unreimbursed Advances (with interest thereon at the Advance Interest Rate), Servicing Fees, Liquidation Fees or Workout Fees and (ii) all existing Events
of Default, other than the non-payment of the principal of the Notes which has become due solely by such declaration of acceleration, have been cured or waived as provided in
Section 9.07
. No such rescission shall affect any subsequent
default or impair any right consequent thereon. Any acceleration resulting from any event described in
clause (d)
above may not be rescinded.
Section 9.03
Rights of the Control Party and Trustee upon Event of Default
.
(a)
Payment of Principal and Interest
. The Master Issuer covenants that if (i) default is made in the payment of any
interest on any Series of Notes Outstanding when the same becomes due and payable, (ii) the Notes are accelerated following the occurrence of an Event of Default or (iii) default is made in the payment of the principal of, or premium, if any, on
any Series of Notes Outstanding when due and payable, the Master Issuer shall, to the extent of funds available, upon demand of the Trustee, at the direction of the Control Party (subject to
Section 11.04(e)
, at the direction of the
Controlling Class Representative), pay to the Trustee, for the benefit of the Noteholders, the whole amount then due and payable on the Notes for principal, premium, if any, and interest, and, to the extent payment at such rate of interest shall
be legally enforceable, upon overdue installments of interest, at the applicable Note Rate and any default rate, as applicable, and in addition thereto such further amount as shall be sufficient to cover costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of the Trustee and its agents and counsel.
(b)
Proceedings To Collect Money
. In case the Master Issuer shall fail forthwith to pay such amounts upon such demand, the
Trustee at the direction of the Control Party (at the direction of the Controlling Class Representative), in its own name and as trustee of an express trust, may institute a Proceeding for the collection of the sums so due and unpaid, and may
prosecute such Proceeding to judgment or final decree, and may enforce the same against the Master Issuer and collect in the manner provided by law out of the property of the Master Issuer, wherever situated, the moneys adjudged or decreed to be
payable.
(c)
Other Proceedings
. If and when an Event of Default shall have occurred and is continuing, the Trustee, at the
direction of the Control Party (subject to
Section 11.04(e)
, at the direction of the Controlling Class Representative) pursuant to a Control Party request shall take one or more of the following actions:
(i)
proceed to protect and enforce its rights and the rights of the Noteholders and the other Secured Parties, by such
appropriate Proceedings as the Control Party (at the direction of the Controlling Class Representative) shall deem most effective to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in the
Indenture or any other Related Document or in aid of the exercise of any power granted therein, or to enforce any other proper remedy or legal or equitable right vested in the Trustee by the Indenture or any other Related Document or by law,
including any remedies of a secured party under applicable law;
(ii)
(A) direct the Master Issuer to exercise (and the Master Issuer agrees to exercise) all rights, remedies, powers,
privileges and claims of the Master Issuer or any Securitization Entity against any party to any Collateral Transaction Document arising as a result of the occurrence of such Event of Default or otherwise, including the right or power to take any
action to compel performance or observance by any such party of its obligations to the Master Issuer, and any right of the Master Issuer to take such action independent of such direction shall be suspended, and (B) if (x) the Master Issuer shall
have failed, within ten (10) Business Days of receiving the direction of the Trustee (given at the direction of the Control Party (at the direction of the Controlling Class Representative)), to take commercially reasonable action to accomplish
such directions of the Trustee, (y) the Master Issuer refuses to take such action or (z) the Control Party (at the direction of the Controlling Class Representative) reasonably determines that such action must be taken immediately, take (or the
Control Party on behalf of the Trustee shall take) such previously directed action (and any related action as permitted under the Indenture thereafter determined by the Trustee or the Control Party to be appropriate without the need under this
provision or any other provision under the Indenture to direct the Master Issuer to take such action);
(iii)
institute Proceedings from time to time for the complete or partial foreclosure of the Indenture or, to the extent
applicable, any other Related Document, with respect to the Collateral and, to the extent permitted by applicable law, any other Securitized Assets;
provided
that the Trustee will not be required to take title to any real property in
connection with any foreclosure or other exercise of remedies hereunder or under such Related Documents and title to such property will instead be acquired in an entity designated and (unless owned by a third party) controlled by the Control
Party; and/or
(iv)
sell all or a portion of the Collateral and, to the extent permitted by applicable law, any other Securitized Assets,
at one or more public or private sales called and conducted in any manner permitted by law;
provided
,
however
, that the Trustee shall not proceed with any such sale without the prior written consent of the Control Party (at the
direction of the Controlling Class Representative) and the Trustee will provide notice to the Master Issuer and each Holder of Subordinated Notes and Senior Subordinated Notes of a proposed sale of Collateral or Securitized Assets, to the extent
permitted by applicable law.
(d)
Sale of Securitized Assets
. In connection with any sale of the Collateral hereunder, under the Guarantee and
Collateral Agreement (which may proceed separately and independently from the exercise of remedies under the Indenture), Mortgage or under any judgment, order or decree in any judicial proceeding for the foreclosure or involving the enforcement
of the Indenture, the Guarantee and Collateral Agreement or any other Related Document, or any sale of Securitized Assets, to the extent permitted by applicable law:
(i)
any of the Trustee, any Noteholder, any Enhancement Provider, any Hedge Counterparty and/or any other Secured Party
may bid for and purchase the property being sold, and upon compliance with the terms of the sale may hold, retain, possess and dispose of such property in its own absolute right without further accountability;
(ii)
the Trustee (at the direction of the Control Party (at the direction of the Controlling Class Representative)) may
make and deliver to the purchaser or purchasers a good and sufficient deed, bill of sale and instrument of assignment and transfer of the property sold;
(iii)
all right, title, interest, claim and demand whatsoever, either at law or in equity or otherwise, of any
Securitization Entity of, in and to the property so sold shall be divested; and such sale shall be a perpetual bar both at law and in equity against such Securitization Entity, its successors and assigns, and against any and all Persons claiming
or who may claim the property sold or any part thereof from, through or under such Securitization Entity or its successors or assigns; and
(iv)
the receipt of the Trustee or of the officer thereof making such sale shall be a sufficient discharge to the
purchaser or purchasers at such sale for his or their purchase money, and such purchaser or purchasers, and his or their assigns or personal representatives, shall not, after paying such purchase money and receiving such receipt of the Trustee or
of such officer therefor, be obliged to see to the application of such purchase money or be in any way answerable for any loss, misapplication or non‑application thereof.
(e)
Application of Proceeds
.
Any amounts obtained by the Trustee on account of or as a result of the
exercise by the Trustee of any of its rights under the Base Indenture or under the Guarantee and Collateral Agreement (a) will be deposited into the Collection Account and, other than with respect to amounts owed to a depository bank or
securities intermediary under the related Account Control Agreement, will be held by the Trustee as additional collateral for the repayment of the Obligations and (b) will be applied first to pay a depository bank or securities intermediary in
respect of amounts owed to it under the related Account Control Agreement and then as provided in the priority set forth in the Priority of Payments;
provided
that, unless otherwise provided in this
Article IX
, with respect to any
distribution to any Class of Notes, such amounts will be distributed sequentially in order of alphabetical (as opposed to alphanumerical) designation and
pro rata
among each Class of Notes of the
same alphabetical designation based upon the Outstanding Principal Amount of the Notes of each such Class
.
(f)
Additional Remedies
. In addition to any rights and remedies now or hereafter granted hereunder or under applicable law (x) with respect to the Collateral, the
Trustee shall have all of the rights and remedies of a secured party under the UCC as enacted in any applicable jurisdiction and (y) with respect to the other Securitized Assets, the Trustee shall have all of the rights and remedies of an
unsecured creditor in any applicable jurisdiction.
(g)
Proceedings
. The Trustee may maintain a Proceeding even if it does not possess any of the Notes or does not produce any of them in the Proceeding, and any such
Proceeding instituted by the Trustee shall be in its own name as trustee. All remedies are cumulative to the extent permitted by law.
(h)
Power of Attorney
. The Master Issuer hereby grants to the Trustee an absolute and irrevocable power of attorney, with full power and authority in the place and stead
of the Master Issuer and in the name of the Master Issuer, upon the occurrence and during the continuance of an Event of Default, to take any action and to execute any instrument consistent with the terms of hereof and the other Related Documents
necessary or advisable to accomplish the purposes hereof, including, without limitation, to sign any document which may be required by the PTO, the United States Copyright Office, any similar office or agency in each foreign country in which any
Securitization IP is located, or any other Governmental Authority in order to effect an absolute assignment of all right, title and interest in or to any Securitization IP, and record the same. The foregoing grant of authority is a power of
attorney coupled with an interest. The Master Issuer hereby ratifies all that such attorney shall lawfully do or cause to be done by virtue hereof.
Section 9.04
Waiver of Appraisal, Valuation, Stay and Right to Marshaling
. To the extent it may lawfully do so, the Master Issuer for itself and for any Person who may claim through or under it hereby:
(a)
agrees that neither it nor any such Person will step up, plead, claim or in any manner whatsoever take advantage of
any appraisal, valuation, stay, extension or redemption laws, now or hereafter in force in any jurisdiction, which may delay, prevent or otherwise hinder (i) the performance, enforcement or foreclosure of the Indenture or the Guarantee and
Collateral Agreement, (ii) the sale of any of the Collateral or Securitized Assets, to the extent permitted by applicable law or (iii) the putting of the purchaser or purchasers thereof into possession of such property immediately after the sale
thereof;
(b)
waives all benefit or advantage of any such laws;
(c)
waives and releases all rights to have the Collateral and/or the Securitized Assets marshaled upon any foreclosure,
sale or other enforcement of the Indenture or the Guarantee and Collateral Agreement; and
(d)
consents and agrees that, subject to the terms of the Indenture and the Guarantee and Collateral Agreement, all the
Collateral and all of the Securitized Assets (to the extent permitted by applicable law) may at any such sale be sold by the Trustee as an entirety or in such portions as the Trustee may (upon direction by the Control Party (at the direction of
the Controlling Class Representative)) determine.
Section 9.05
Limited
Recourse
. Notwithstanding any other provision of the Indenture, the Notes or any other Related Document or otherwise, the liability of the Securitization Entities to the Noteholders and any other Secured Parties under or in
relation to the Indenture, the Notes or any other Related Document or otherwise, is limited in recourse to the assets of the Securitization Entities. Following the proceeds of such assets having been applied in accordance with the terms hereof,
none of the Noteholders or any other Secured Parties shall be entitled to take any further steps against any Securitization Entity to recover any sums due but still unpaid hereunder, under the Notes or under any of the other agreements or
documents described in this
Section 9.05
, all claims in respect of which shall be extinguished. The provisions of this
Section 9.05
shall survive the expiration or earlier termination of the Indenture.
Section 9.06
Optional
Preservation of the Securitized Assets
. If the maturity of the Outstanding Notes of each Series has been accelerated pursuant to
Section 9.02
following an Event of Default and such declaration and its consequences have not
been rescinded and annulled, the Trustee, at the direction of the Control Party (acting at the direction of the Controlling Class Representative), shall elect to maintain possession of such portion, if any, of the Collateral and/or Securitized
Assets (to the extent permitted by applicable law) as the Control Party (acting at the direction of the Controlling Class Representative) shall in its discretion determine.
Section 9.07
Waiver
of Past Events
. Prior to the declaration of the acceleration of the maturity of each Series of Notes Outstanding as provided in
Section 9.02
and subject to
Section 13.02
, the Control Party (at the direction of the
Controlling Class Representative) by notice to the Trustee, each Rating Agency and the Servicer, may waive any existing Default or Event of Default described in any clause of
Section 9.02
(except
clause (d)
thereof) and its
consequences;
provided
,
however
, that before any waiver may be effective, the Trustee and the Servicer must have received any reimbursement then due or payable in respect of unreimbursed Advances (including interest thereon) or
any other amounts then due to the Servicer or the Trustee hereunder or under the Related Documents;
provided
,
further
, that the Control Party shall provide written notice of any such waiver to each Rating Agency for each Series of
Notes Outstanding (with a copy to the Servicer). Upon any such waiver, such Default shall cease to exist and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of the Indenture, but no such waiver shall
extend to any subsequent or other Default or impair any right consequent thereon. A Default or an Event of Default described in
Section 9.02(d)
shall not be subject to waiver without the consent of the Control Party (acting at the
direction of the Controlling Class Representative) and each Noteholder. Subject to
Section 13.02
, the Control Party (at the direction of the Controlling Class Representative), by notice to the Trustee, each Rating Agency for each Series
of Notes Outstanding and the Servicer, may waive any existing Potential Rapid Amortization Event or any existing Rapid Amortization Event;
provided
however
, that a Rapid Amortization Event described in
Section 9.01(b)
relating to a particular Series, Class or Tranche of Notes shall not be permitted to be waived by any party unless 100% of the Noteholders have consented to such waiver in writing.]
Section 9.08
Control by the Control Party
. Notwithstanding any other provision hereof, the Control Party (subject to
Section 11.04(e)
, at the direction of the Controlling Class Representative) may cause the
institution of and direct the time, method and place of conducting any proceeding in respect of any enforcement of the Collateral (or, to the extent permitted by applicable law, other Securitized Assets) or conducting any proceeding in respect of
any enforcement of Liens on the Collateral and other rights and remedies against the other Securitized Assets (to the extent permitted by applicable law) or conducting any proceeding for any contractual or legal remedy available to the Trustee or
exercise any trust or power conferred on the Trustee;
provided
that:
(a)
such direction of time, method and place shall not be in conflict with any rule of law, the Servicing Standard or the
Indenture;
(b)
the Control Party (at the direction of the Controlling Class Representative) may take any other action deemed proper
by the Control Party (at the direction of the Controlling Class Representative) that is not inconsistent with such direction (as the same may be modified by the Control Party (with the consent of the Controlling Class Representative)); and
(c)
such direction shall be in writing;
provided
further
that, subject to
Section 10.01
, the Trustee need not take any action that it determines might involve it in
liability unless it has received an indemnity for such liability as provided herein. The Trustee shall take no action referred to in this
Section 9.08
unless instructed to do so by the Control Party (at the direction of the Controlling
Class Representative).
Section 9.09
Limitation on Suits
. Any other provision of the Indenture to the contrary notwithstanding, a Holder may pursue a remedy with respect to the Indenture or any other Related Document only if:
(a)
the Holder gives to the Trustee, the Control Party and the Controlling Class Representative written notice of a
continuing Event of Default;
(b)
the Holders of at least 25% of the Aggregate Outstanding Principal Amount make a written request to the Trustee, the
Control Party and the Controlling Class Representative to pursue the remedy;
(c)
such Holder or Holders offer and, if requested, provide to the Trustee, the Control Party and the Controlling Class
Representative indemnification satisfactory to the Trustee, the Control Party and the Controlling Class Representative against any loss, liability or expense;
(d)
the Trustee does not comply with the request within sixty (60) days after receipt of the request and the offer and,
if requested, the provision of indemnity reasonably satisfactory to it;
(e)
during such sixty (60) day period, the Majority of Senior Noteholders do not give the Trustee a direction
inconsistent with the request; and
(f)
the Control Party (at the direction of the Controlling Class Representative) has consented to the pursuit of such
remedy.
A Holder may not use the Indenture or any other Related Document to prejudice the rights of another Holder or to obtain a preference or priority over another Holder.
Section 9.10
Unconditional Rights of Holders to Receive Payment
. Notwithstanding any other provision of the Indenture, the right of any Holder of a Note to receive payment of principal of, and premium, if any, and
interest on the Note, on or after the respective Series Legal Final Maturity Date expressed in the Note, or to bring suit for the enforcement of any such payment on or after such respective dates, is absolute and unconditional and shall not be
impaired or affected without the consent of the Holder of the Note.
Section 9.11
The
Trustee May File Proofs of Claim
. The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel), the Holders and any other Secured Party (as applicable) allowed in any judicial proceedings relative to the Master Issuer (or any other obligor
upon the Notes), its creditors or its property, and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claim and any custodian in any such judicial proceeding is
hereby authorized by each Holder and each other Secured Party to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders or any other Secured Party, to pay the
Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 10.05
. To the extent that the payment of any
such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 10.05
out of the estate in any such proceeding, shall be denied for any reason, payment of
the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money and other properties which any of the Holders or any other Secured Party may be entitled to receive in such proceeding whether in
liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder or any other Secured Party any
plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Holder or any other Secured Party, or to authorize the Trustee to vote in respect of the claim of any Holder or any other Secured Party
in any such proceeding.
Section 9.12
Undertaking
for Costs
. In any suit for the enforcement of any right or remedy under the Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any
party litigant in the suit of any undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in the suit, having due regard to the merits
and good faith of the claims or defenses made by the party litigant. This
Section 9.12
does not apply to a suit by the Trustee (or by the Control Party for any contractual or legal remedy available to the Trustee), a suit by a Holder
pursuant to
Section 9.09
or a suit by Holders of more than 10% of the Aggregate Outstanding Principal Amount of all Series of Notes.
Section 9.13
Restoration of Rights and Remedies
. If the Trustee, any Holder or any other Secured Party has instituted any Proceeding to enforce any right or remedy under the Indenture or any other Related Document and
such Proceeding has been discontinued or abandoned for any reason or has been determined adversely to the Trustee or to such Holder or other Secured Party, then and in every such case the Trustee and the Holders and any such other Secured Party
shall, subject to any determination in such proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all rights and remedies of the Trustee, the Holders and the other Secured Parties shall continue as
though no such Proceeding had been instituted.
Section 9.14
Rights and Remedies Cumulative
. No right or remedy herein conferred upon or reserved to the Trustee or to the Holders or any other Secured Party is intended to be exclusive of any other right or
remedy, and every right or remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given under the Indenture or any other Related Document or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy under the Indenture or any other Related Document, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.
Section 9.15
Delay
or Omission Not Waiver
. No delay or omission of the Trustee, the Control Party, the Controlling Class Representative, any Holder or any other Secured Party to exercise any right or remedy accruing upon any Potential Rapid
Amortization Event, Rapid Amortization Event, Default or Event of Default shall impair any such right or remedy or constitute a waiver of any such Potential Rapid Amortization Event, Rapid Amortization Event, Default or Event of Default or an
acquiescence therein. Every right and remedy given by this
Article IX
or by law to the Trustee, the Control Party, the Controlling Class Representative, the Holders or any other Secured Party may be exercised from time to time to the
extent not inconsistent with the Indenture, and as often as may be deemed expedient, by the Trustee, the Control Party, the Controlling Class Representative, the Holders or any other Secured Party, as the case may be.
Section 9.16
Waiver of Stay or Extension Laws
. The Master Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of the Indenture or any other Related Document; and the Master Issuer (to the extent that
it may lawfully do so) hereby expressly waives all benefit or advantages of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, the Control Party or the Controlling Class
Representative, but will suffer and permit the execution of every such power as though no such law had been enacted.
ARTICLE IX
THE TRUSTEE
Section 10.01
Duties
of the Trustee
. (a) If an Event of Default or Rapid Amortization Event actually known to a Trust Officer has occurred and is continuing, the Trustee shall (except in the case of the receipt of directions with respect to such
matter from the Control Party in accordance with the terms of this Base Indenture or another Related Document in which event the Trustee’s sole obligation will be to await such direction and act or refrain from acting in accordance therewith)
exercise such of the rights and powers vested in it by the Indenture and the other Related Documents, and use the same degree of care and skill in their exercise, as a prudent Person would exercise or use under the circumstances in the conduct of
such Person’s own affairs;
provided
,
however
, that the Trustee shall have no liability in connection with any action or inaction taken, or not taken, by it upon the deemed occurrence of an Event of Default, a Rapid Amortization
Event, a Manager Termination Event or a Servicer Termination Event of which a Trust Officer has not received written notice;
provided
,
further
, that the Trustee shall have no liability in connection with any action or inaction due
to the acts or failure to act of the Control Party or the Controlling Class Representative in connection with any Event of Default, Rapid Amortization Event, a Manager Termination Event or a Servicer Termination Event or for acting or failing to
act due to any direction or lack of direction from the Control Party or the Controlling Class Representative. The preceding sentence shall not have the effect of insulating the Trustee from liability arising out of the Trustee’s negligence, bad
faith or willful misconduct except as provided in
Section 10.01(c)
. The Trustee, upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to the Trustee which are
specifically required to be furnished pursuant to any provision of the Indenture, shall examine them to determine whether they conform to the requirements of this Indenture;
provided
,
however
, that the Trustee shall not be
responsible for the accuracy or content of any resolution, certificate, statement opinion, report, document, order or other instrument furnished by the Master Issuer under the Indenture.
(b)
Except during the occurrence and continuance of an Event of Default, Rapid Amortization Event, Manager Termination Event or
Servicer Termination Event of which a Trust Officer shall have Actual Knowledge:
(i)
The Trustee undertakes to perform only those duties that are specifically set forth in the Indenture or any other
Related Document to which it is a party and no others, the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be
read into the Indenture or any other Related Document against the Trustee; and
(ii)
In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of the Indenture and any other applicable Related Document;
provided
,
however
, in the case of
any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine such certificates or opinions to determine whether or not they conform to the
requirements of the Indenture and shall promptly notify the party of any non-conformity.
(c)
The Trustee may not be relieved from liability for its own negligent action, bad faith or willful misconduct, except that:
(i)
This
clause (c)
does not limit the effect of
clause (b)
of this
Section 10.01
.
(ii)
The Trustee shall not be liable in its individual capacity for any error of judgment made in good faith by a Trust Officer,
unless it is proven that the Trustee was grossly negligent, acted in bad faith or engaged in willful misconduct in ascertaining the pertinent facts.
(iii)
The Trustee shall not be liable in its individual capacity with respect to any action taken or omitted to be taken by it in
good faith at the direction of the Manager, the Master Issuer, the Control Party and/or a Holder under circumstances in which such direction is required or permitted by the terms of this Base Indenture or applicable law.
(iv)
The Trustee shall not be charged with knowledge of any Mortgage Preparation Event, Mortgage Recordation Event, Default, Event
of Default, Potential Rapid Amortization Event, Rapid Amortization Event, Manager Termination Event, Potential Manager Termination Event or Servicer Termination Event or the commencement and continuation of a Cash Trapping Period until such time
as a Trust Officer shall have Actual Knowledge or have received written notice thereof. In the absence of such Actual Knowledge or receipt of such notice, the Trustee may conclusively assume that no such event has occurred or is continuing.
(d)
Notwithstanding anything to the contrary contained in the Indenture or any of the other Related Documents, no provision of the
Indenture or the other Related Documents shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties or exercises of its rights or powers hereunder, if it has
reasonable grounds for believing that the repayment of such funds or adequate security or indemnity against such risk or liability is not reasonably assured to it by the terms of the Indenture or the Guarantee and Collateral Agreement. The
Trustee may refuse to perform any duty or exercise any right or power unless it receives indemnity satisfactory to it against any risk, loss, liability or expense.
(e)
In the event that the Paying Agent or the Registrar shall fail to perform any obligation, duty or agreement in the manner or
on the day required to be performed by the Paying Agent or the Registrar, as the case may be, under the Indenture, the Trustee shall be obligated as soon as practicable upon Actual Knowledge of a Trust Officer thereof and receipt of appropriate
records and information, if any, to perform such obligation, duty or agreement in the manner so required.
(f)
Subject to
Section 10.03
, all moneys received by the Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were
received, but need not be segregated from other funds except to the extent required by law or the Indenture or any of the other Related Documents.
(g)
Whether or not therein expressly so provided, every provision of the Indenture and the other Related Documents relating to the conduct of, affecting the liability of, or
affording protection to, the Trustee shall be subject to the provisions of this
Section 10.01
.
(h)
The Trustee shall not be responsible for the existence, genuineness or value of any of the Securitized Assets or for the validity, perfection, priority or enforceability of
the Liens in any of the Collateral, whether impaired by operation of law or by reason of any action or omission to act on its part hereunder, except to the extent such action or omission constitutes negligence, bad faith or willful misconduct on
the part of the Trustee, for the validity or sufficiency of the Securitized Assets or any agreement or assignment contained therein, for the validity of the title of the Securitization Entities to the Securitized Assets, for insuring the
Securitized Assets or for the payment of Taxes, charges, assessments or Liens upon the Securitized Assets or otherwise as to the maintenance of the Securitized Assets. Except as otherwise provided herein, the Trustee shall have no duty to
inquire as to the performance or observance of any of the terms of the Indenture or the other Related Documents by the Securitization Entities.
(i)
The Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the Indenture or at the direction of
the Servicer, the Control Party, the Controlling Class Representative or the Holders of the requisite percentage of Notes, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under the Indenture, any other circumstances in which direction is required or permitted by the terms of the Indenture or applicable law.
(j)
The Trustee shall have no duty (i) to see to any recording, filing or depositing of this Base Indenture or any agreement referred to herein or any financing statement or
continuation statement evidencing a security interest, or to see to the maintenance of any such recordings or filing or depositing or to any rerecording, refiling or redepositing of any thereof (other than with respect to filings of the Mortgages
as and to the extent provided in
Section 3.01(c)
); (ii) to see to any insurance, (iii) except as otherwise provided by
Section 10.01(e)
, to see to the payment or discharge of any Tax, assessment or other governmental charge or any
Lien or encumbrance of any kind or (iv) to confirm or verify the contents of any reports or certificates of the Manager, the Control Party, the Back-Up Manager or the Servicer delivered to the Trustee pursuant to this Base Indenture or any other
Related Document believed by the Trustee to be genuine and to have been signed or presented by the proper party or parties.
(k)
The Trustee shall not be personally liable for special, indirect, consequential or punitive damages arising out of, in connection with or as a result of the performance of
its duties under the Indenture.
(i)
Notwithstanding anything to the contrary in this
Section 10.01
, the Trustee shall make Debt Service Advances to the
extent and in the manner set forth in
Section 5.13(a)(iii)
hereof;
provided
,
however
, that notwithstanding anything herein or in any other Related Document to the contrary, the Trustee will not be responsible for advancing
any principal on the Senior Notes, any make-whole prepayment premiums, any Series Hedge Payment Amounts, any Class A-1 Notes Administrative Expenses, any Class A-1 Quarterly Commitment Fee Amounts, any Post-ARD Contingent Interest or any reserve
amounts or any interest or principal payable on, or any other amount due with respect to, the Senior Subordinated Notes or the Subordinated Notes.
(ii)
Notwithstanding anything herein to the contrary, no Debt Service Advance shall be required to be made hereunder by the Trustee
if the Trustee determines such Debt Service Advance (including interest thereon) would, if made, constitute a Nonrecoverable Advance. The determination by the Trustee that it has made a Nonrecoverable Advance or that any proposed Debt Service
Advance, if made, would constitute a Nonrecoverable Advance, shall be made by the Trustee in its reasonable good faith judgment. The Trustee is entitled to conclusively rely on the determination of the Servicer that an Advance is or would be a
Nonrecoverable Advance. Any such determination will be conclusive and binding on the Holders. The Trustee may update or change its nonrecoverability determination at any time, and may decide that a requested Debt Service Advance or Collateral
Protection Advance that was previously deemed to be a Nonrecoverable Advance shall have become recoverable. Notwithstanding the foregoing, all outstanding Debt Service Advances and Collateral Protection Advances made by the Trustee and any
accrued interest thereon will be paid strictly in accordance with the Priority of Payments, even if the Trustee determines that any such advance is a Nonrecoverable Advance after such Advance has been made.
(iii)
The Trustee shall be entitled to receive interest at the Advance Interest Rate accrued on the amount of each
Debt Service Advance made thereby (with its own funds) for so long as such Debt Service Advance is outstanding. Such interest with respect to any Debt Service Advance made pursuant to this
Section
10.01(k)
shall
be calculated on the basis of a 360-day year of twelve 30-day months (which will be compounded monthly) and shall be payable out of
Collections in accordance with the Priority of Payments pursuant to
Section 5.12
hereof and the other applicable provisions of the Related Documents.
Section 10.02
Rights of the Trustee
. Except as otherwise provided by
Section 10.01
:
(a)
The Trustee may conclusively rely and shall be fully protected in acting or refraining from acting based upon any
resolution, Officer’s Certificate, Opinion of Counsel, certificate, instrument, report, consent, order, document or other paper reasonably believed by it to be genuine and to have been signed by or presented by the proper Person.
(b)
The Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.
(c)
The Trustee may act through agents, custodians and nominees and shall not be liable for any negligence, bad faith or
willful misconduct on the part of, or for the supervision of, any such non-affiliated agent, custodian or nominee so long as such agent, custodian or nominee is appointed with due care;
provided
,
however
, the Trustee shall have
received the consent of the Servicer prior to the appointment of any agent, custodian or nominee performing any material obligation of the Trustee hereunder.
(d)
The Trustee shall not be liable for any action it takes, suffers or omits to take in the absence of gross negligence,
bad faith or willful misconduct which it believes to be authorized or within the discretion or rights or powers conferred upon it by the Indenture or the applicable Related Documents.
(e)
The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Base Indenture,
any Series Supplement or any other Related Document, or to institute, conduct or defend any litigation hereunder or thereunder or in relation hereto or thereto, at the request, order or direction of the Servicer, the Control Party, the
Controlling Class Representative, any of the Holders or any other Secured Party, pursuant to the provisions of this Base Indenture or any Series Supplement, unless the Trustee shall have been offered security or indemnity reasonably satisfactory
to the Trustee against the costs, expenses and liabilities which may be incurred therein or thereby.
(f)
Prior to the occurrence of an Event of Default or Rapid Amortization Event, the Trustee shall not be bound to make
any investigation into the facts of matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond or other paper or document, unless requested in writing so to do by the
Noteholders of at least 25% of the Aggregate Outstanding Principal Amount of all then Outstanding Notes. If the Trustee is so requested or determines in its own discretion to make such further inquiry or investigation into such facts or matters
as it sees fit, the Trustee shall be entitled to examine the books, records and premises of the Securitization Entities, personally or by agent or attorney, at the sole cost of the Master Issuer and the Trustee shall incur no liability by reason
of such inquiry or investigation.
(g)
The right of the Trustee to perform any discretionary act enumerated in this Base Indenture shall not be construed as
a duty, and the Trustee shall be not be liable in the absence of negligence, bad faith or willful misconduct for the performance of such act.
(h)
In accordance with Section 326 of the U.S.A. Patriot Act, to help fight the funding of terrorism and money laundering
activities, the Trustee will obtain, verify, and record information that identifies individuals or entities that establish a relationship or open an account with the Trustee. The Trustee will ask for the name, address, tax identification number
and other information that will allow the Trustee to identify the individual or entity who is establishing the relationship or opening the account. The Trustee may also ask for formation documents such as articles of incorporation, an offering
memorandum, or other identifying documents to be provided.
(i)
Notwithstanding anything to the contrary herein, any and all communications (both text and attachments) by or from
the Trustee that the Trustee in its sole discretion deems to contain confidential, proprietary or sensitive information and sent by electronic mail will be encrypted. The recipient of the email communication will be required to complete a
one-time registration process.
(j)
The Trustee shall not be responsible or liable for any failure or delay in the performance of its obligations under
this Indenture arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including without limitation, acts of God; earthquakes; fires; floods; wars; civil or military disturbances; sabotage; epidemics;
riots; interruptions, loss or malfunctions of utilities, computer (hardware or software) or communications service, accidents; labor disputes; acts of civil or military authority or governmental actions (it being understood that the Trustee shall
use commercially reasonable efforts to resume performance as soon as practicable under the circumstances).
(k)
The Trustee shall not be required to give any bond or surety in respect of the execution of the trust created hereby
or the powers granted hereunder.
(l)
All rights of action and claims under this Base Indenture may be prosecuted and enforced by the Trustee without the possession
of any of the Notes or the production thereof in any proceeding relating thereto, any such proceeding instituted by the Trustee shall be brought in its own name or in its capacity as Trustee. Any recovery of judgment shall, after provision for
the payments to the Trustee provided for in
Section 10.05
, be distributed in accordance with the Priority of Payments.
(m)
The Trustee may request written direction from any applicable party any time the Indenture provides that the Trustee may be
directed to act.
(n)
Any request or direction of the Master Issuer mentioned herein shall be sufficiently evidenced by a Company Order.
(o)
Whenever in the administration of the Indenture the Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the Trustee may, in the absence of bad faith, gross negligence or willful misconduct on its part, rely upon an Officer’s Certificate of the Master Issuer, the Manager or the Servicer
and shall incur no liability for its reliance thereon.
(p)
The Trustee shall not be responsible for the accuracy of the books or records of, or for any acts or omissions of, DTC, any
transfer agent (other than the Trustee itself acting in that capacity), Clearstream, Euroclear, any calculation agent (other than the Trustee itself acting in that capacity), or any agent appointed by it with due care or any Paying Agent (other
than the Trustee itself acting in that capacity).
(q)
The Trustee or its Affiliates are permitted to receive additional compensation that could be deemed to be in the Trustee’s
economic self-interest for (i) serving as an investment advisor, administrator, shareholder servicing agent, custodian or sub-custodian with respect to certain Eligible Investments, (ii) using Affiliates to effect transactions in certain Eligible
Investments and (iii) effecting transactions in certain Eligible Investments. The Trustee does not guarantee the performance of any Eligible Investments.
(r)
The Trustee shall have no obligation to invest and reinvest any cash held in the absence of timely and specific written
investment direction from the Servicer or the Master Issuer. In no event shall the Trustee be liable for the selection of investments or for investment losses incurred thereon. The Trustee shall have no liability in respect of losses incurred
as a result of the liquidation of any investment prior to its stated maturity or the failure of the Servicer or the Master Issuer to provide timely written investment direction.
(s)
The Trustee shall have no obligation to calculate nor shall it be responsible or liable for any calculation of the DSCR, New
Series Pro Forma DSCR or the Interest-Only DSCR.
(t)
The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to
be indemnified, are extended to, and shall be enforceable by, the Trustee, in each case, with respect to its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.
(u)
The Trustee shall be afforded, in each Related Document, all of the rights, powers, immunities and indemnities granted to it
in this Base Indenture as if such rights, powers, immunities and indemnities were specifically set out in each such Related Document.
(v)
For any purpose under the Related Documents, the Trustee may conclusively assume without incurring liability therefor that no
Notes are held by any of the Securitization Entities, any other obligator upon the Notes, the Manager or any Affiliate of them unless a Trust Officer has received written notice at the Corporate Trust Office that any Notes are so held by any of
the Securitization Entities, any other obligator upon the Notes, the Manager or any Affiliate of them.
(w)
The Trustee shall not have any responsibility to make any inquiry or investigation as to, and shall have no obligation in
respect of, the terms of an engagement of Independent Auditors by the Master Issuer (or the Manager on behalf of the Master Issuer) or the terms of any agreed upon procedures in respect of such engagement;
provided
,
however
, that
the Trustee shall be authorized, upon receipt of a Company Order directing the same, to execute any acknowledgment or other agreement with the Independent Auditors required for the Trustee to receive any of the reports or instructions provided
herein, which acknowledgment or agreement may include, among other things, (i) acknowledgment that the Master Issuer had agreed that the procedures to be performed by the Independent Auditors are sufficient for the Master Issuer’s purposes, (ii)
releases by the Trustee (on behalf of itself and the Holders) of claims against the Independent Auditors, and (iii) restrictions or prohibitions on the disclosure of information or documents provided to it by such firm of Independent Auditors
(including to the Holders). Notwithstanding the foregoing, in no event shall the Trustee be required to execute any agreement in respect of the Independent Auditors that the Trustee reasonably determines adversely affects it.
Section 10.03
Individual Rights of the Trustee
. The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Securitization Entities or an Affiliate of the
Securitization Entities with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights.
Section 10.04
Notice of Events of Default and Defaults
. If an Event of Default, a Default, a Rapid Amortization Event or a Potential Rapid Amortization Event occurs and is continuing and if a Trust Officer has Actual
Knowledge, or written notice of the existence thereof has been delivered to a Trust Officer, the Trustee shall promptly provide the Noteholders, the Servicer, the Manager, the Back-Up Manager, the Master Issuer, any Class A-1 Administrative Agent
and each Rating Agency for each Series of Notes Outstanding with notice of such Event of Default, Default, Rapid Amortization Event or Potential Rapid Amortization Event, to the extent that the Notes of such Series are Book-Entry Notes, by email,
telephone and facsimile and otherwise by first class mail.
Section 10.05
Compensation
and Indemnity
. (a) The Master Issuer shall promptly pay to the Trustee from time to time compensation for its acceptance of the Indenture and services hereunder and under the other Related Documents to which the Trustee is a
party as the Trustee and the Master Issuer shall from time to time agree in writing. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Master Issuer shall reimburse the Trustee
promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services in accordance with the provisions of the Indenture (including, without limitation, the Priority
of Payments). Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee’s agents and outside counsel. The Master Issuer shall not be required to reimburse any expense incurred by the Trustee through the
Trustee’s own willful misconduct, bad faith or negligence. When the Trustee incurs expenses or renders services after an Event of Default or Rapid Amortization Event occurs, the expenses and the compensation for the services are intended to
constitute expenses of administration under the Bankruptcy Code.
(b)
The Master Issuer shall indemnify and hold harmless the Trustee or any predecessor Trustee and their respective directors, officers, agents and employees from and against
any loss, liability, claim, expense (including Taxes, other than Taxes based upon, measured by or determined by the income of the Trustee or such predecessor Trustee), damage or injury suffered or sustained by reason of any acts, omissions or
alleged acts or omissions arising out of or in connection with (i) the activities of the Trustee or such predecessor Trustee pursuant to this Base Indenture, any Series Supplement or any other Related Documents to which the Trustee is a party and
(ii) the security interest granted hereby, whether arising by virtue of any act or omission on the part of the Master Issuer or otherwise, including but not limited to any judgment, award, settlement, reasonable attorneys’ fees and other costs or
expenses reasonably incurred in connection with the defense of any actual or threatened action, proceeding, claim (whether asserted by the Master Issuer, the Servicer, the Control Party or any Noteholder or any other Person), liability in
connection with the exercise or performance of any of its powers or duties hereunder or under any Related Document, the preservation of any of its rights to, or the realization upon, any of the Collateral, or the Securitized Assets, to the extent
permitted by applicable law, or in connection with enforcing the provisions of this
Section 10.05(b)
;
provided
,
however
, that the Master Issuer shall not indemnify the Trustee, any predecessor Trustee or their respective
directors, officers, employees or agents if such acts, omissions or alleged acts or omissions constitute willful misconduct, bad faith or negligence by the Trustee or such predecessor Trustee, as the case may be.
(c)
The provisions of this
Section 10.05
shall survive the termination of the Indenture and the resignation and removal of the Trustee.
Section 10.06
Replacement
of the Trustee
. (a) A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this
Section 10.06
.
(b)
The Trustee may, after giving thirty (30) days prior written notice to the Master Issuer, the Noteholders, the Servicer, the
Manager, the Back-Up Manager, the Controlling Class Representative, each Class A-1 Administrative Agent and each Rating Agency for each Series of Notes Outstanding, resign at any time from its office and be discharged from the trust hereby
created;
provided
,
however
, that no such resignation of the Trustee shall be effective until a successor trustee has assumed the obligations of the Trustee hereunder. The Control Party or the Master Issuer may remove the Trustee,
or any Noteholder may, on behalf of itself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee, if at any time:
(i)
the Trustee fails to comply with
Section 10.08
;
(ii)
the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under the
Bankruptcy Code;
(iii)
the Trustee fails generally to pay its debts as such debts become due; or
(iv)
the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of the Trustee for any reason, the Master Issuer shall promptly, with the prior written consent of
the Control Party, appoint a successor Trustee. Within one (1) year after the successor Trustee takes office, the Majority of Controlling Class Members (with the prior written consent of the Control Party) may appoint a successor Trustee to
replace the successor Trustee appointed by the Master Issuer.
(c)
If a successor Trustee is not appointed and an instrument of acceptance by a successor Trustee is not delivered to the Trustee
within thirty (30) days after the retiring Trustee resigns or is removed, at the direction of the Control Party, the retiring Trustee, at the expense of the Master Issuer, may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
(d)
If the Trustee after written request by the Servicer or any Noteholder fails to comply with
Section 10.08
, the Servicer or such Noteholder may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
(e)
A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee or removed Trustee and to the Servicer and the Master Issuer. Thereupon
the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Base Indenture, any Series Supplement and any other Related Document to
which the Trustee is a party. The successor Trustee shall mail a notice of its succession to the Noteholders and each Class A-1 Administrative Agent. The retiring Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee;
provided
,
however
, that all sums owing to the retiring Trustee hereunder have been paid. Notwithstanding replacement of the Trustee pursuant to this
Section 10.06
, the Master Issuer’s obligations under
Section 10.05
shall continue for the benefit of the retiring Trustee.
(f)
No successor Trustee may accept its appointment unless at the time of such acceptance such successor is qualified and eligible under this Base Indenture and a Rating Agency
Notification has been provided and the Control Party has provided its consent with respect to such appointment.
Section 10.07
Successor
Trustee by Merger, etc
. Subject to
Section 10.08
, if the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor
corporation without any further act shall be the successor Trustee;
provided
that written notice of such consolidation, merger or conversion shall be provided to the Master Issuer, the Servicer, the Noteholders and each Class A-1
Administrative Agent;
provided
,
further
, that the resulting or successor corporation is eligible to be a Trustee under
Section 10.08
.
Section 10.08
Eligibility
Disqualification
. (a) There shall at all times be a Trustee hereunder which shall (i) be a bank or trust company organized and doing business under the laws of the United States of America or of any state thereof authorized under
such laws to exercise corporate trustee power, (ii) be subject to supervision or examination by federal or state authority, (iii) have a combined capital and surplus of at least $250,000,000 as set forth in its most recent published annual report
of condition, (iv) be reasonably acceptable to the Servicer and (v) have a long-term unsecured debt rating of at least “BBB” by S&P, if it has a rating by S&P, if it has a rating by KBRA, “BBB” by KBRA, and if it does not have a rating by
S&P or KBRA, then a rating of at least “BBB” (or an equivalent) by another nationally recognized statistical rating organization.
(b)
At any time the Trustee shall cease to satisfy the eligibility requirements of
Section 10.08(a)
, the Trustee shall resign after written request that it do so by the
Master Issuer, or by the Control Party at the direction of the Controlling Class Representative, in the manner and with the effect specified in
Section 10.06
.
Section 10.09
Appointment
of Co-Trustee or Separate Trustee
. (a) Notwithstanding any other provisions of this Base Indenture, any Series Supplement or any other Related Document, at any time, for the purpose of meeting any legal requirements of any
jurisdiction in which any part of the
Securitized Assets
may at the time be located, the Trustee shall have the power upon notice to the Control Party, the Master Issuer and each Class A-1
Administrative Agent and may execute and deliver all instruments to appoint one or more Persons to act as a co-trustee or co-trustees, or separate trustee or separate trustees, of all or any part of the
Securitized
Assets
, and to vest in such Person or Persons, in such capacity and for the benefit of the Noteholders and the other Secured Parties, such title to the Collateral (or other rights in and to the Securitized Assets), or any part thereof,
and, subject to the other provisions of this
Section 10.09
, such powers, duties, obligations, rights and trusts as the Trustee may consider necessary or desirable. Any co-trustee or separate trustee hereunder shall be required to meet
the terms of eligibility as a successor trustee under
Section 10.08
or shall be otherwise acceptable to the Servicer. No notice to Noteholders of the appointment of any co-trustee or separate trustee shall be required under
Section
10.06
. No co-trustee shall be appointed without the consent of the Servicer and the Master Issuer unless such appointment is required as a matter of state law or to enable the Trustee to perform its functions hereunder.
(b)
Every separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i)
the Notes of each Series shall be authenticated and delivered solely by the Trustee or an authenticating agent
appointed by the Trustee;
(ii)
all rights, powers, duties and obligations conferred or imposed upon the Trustee shall be conferred or imposed upon
and exercised or performed by the Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co-trustee is not authorized to act separately without the Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular act or acts are to be performed, the Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Collateral (or other rights in and to the Securitized Assets) or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee, but solely at
the direction of the Trustee;
(iii)
no trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder and
such appointment shall not, and shall not be deemed to, constitute any such trustee or co-trustee as an agent of the Trustee; and
(iv)
the Trustee may at any time accept the resignation of or remove any separate trustee or co-trustee.
(c)
Any notice, request or other writing given to the Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if
given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Base Indenture and the conditions of this
Article X
. Each separate trustee and co-trustee, upon its acceptance of the trusts
conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Trustee or separately, as may be provided therein, subject to all the provisions of this Base Indenture, any Series
Supplement and any other Related Documents to which the Trustee is a party, specifically including every provision of this Base Indenture, any Series Supplement, or any other Related Document which the Trustee is a party relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every such instrument shall be filed with the Trustee and a copy thereof given to the Servicer and the Master Issuer.
(d)
Any separate trustee or co-trustee may at any time constitute the Trustee, its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law,
to do any lawful act under or in respect to this Base Indenture, any Series Supplement or any other Related Document on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Trustee, to the extent permitted by law, without the appointment of a new or successor trustee.
Section 10.10
Representations and Warranties of Trustee
. The Trustee represents and warrants to the Master Issuer and the Holders that:
(a)
the Trustee is a national banking association, organized, existing and in good standing under the laws of the United
States;
(b)
the Trustee has full power, authority and right to execute, deliver and perform this Base Indenture, any Series
Supplement issued concurrently with this Base Indenture and each other Related Document to which it is a party and to authenticate the Notes, and has taken all necessary action to authorize the execution, delivery and performance by it of this
Base Indenture, any Series Supplement issued concurrently with this Base Indenture and any such other Related Document and to authenticate the Notes;
(c)
this Base Indenture and each other Related Document to which it is a party has been duly executed and delivered by
the Trustee; and
(d)
the Trustee meets the requirements of eligibility as a trustee hereunder set forth in
Section 10.08(a)
.
ARTICLE X
CONTROLLING CLASS REPRESENTATIVE AND CONTROL PARTY
Section 11.01
Controlling Class Representative
.
(a)
On the Closing Date and at any time when no Person is serving as the Controlling Class Representative in accordance with this
Article XI
, (i) the Control Party shall
exercise the rights of the Controlling Class Representative in accordance with the Servicing Standard;
provided
that the Control Party shall have no obligations to interact with any Holders (including providing any notices or
deliverables) and (ii) any deliverable or notice that is required to be provided to the Controlling Class Representative under a Related Document shall be delivered to the Control Party.
(b)
Within thirty (30) days after the Closing Date or any CCR Re-election Event, the Trustee shall send via email to the Class A-1 Administrative Agent and via the Applicable Procedures of the
Clearing Agency with respect to the Controlling Class Members holding Book-Entry Notes a written notice (with copies to the Manager and the Master Issuer) in the form attached as
Exhibit E
hereto, announcing an election and soliciting
nominations for a Controlling Class Representative (a “
CCR Election Notice
”). Each Controlling Class Member will be allowed to nominate itself as a CCR Candidate (and will not be permitted to nominate any other Person or entity as a CCR
Candidate) by submitting a nomination to the Trustee in the form attached as
Exhibit F
hereto (a “
CCR Nomination
”) certifying that, as of a date not more than ten (10) Business Days prior to the date of the CCR Election Notice,
such Controlling Class Member was the Holder of the Outstanding Principal Amount of Notes of the Controlling Class specified in its CCR Nomination and that it is not a Competitor;
provided
that for purposes of such nomination and
determining the CCR Candidates pursuant to
Section 11.01(c)
, with respect to any Series of Class A-1 Notes Outstanding, the Class A-1 Notes Voting Amount shall be used in place of the Outstanding Principal Amount of such Series. For any
nomination to be valid, the CCR Nomination shall be delivered to the Trustee within thirty (30) calendar days of the date of the CCR Election Notice (such period, the “
CCR Nomination Period
”).
(c)
Based upon the CCR Nominations that are received by the Trustee, within three (3) Business Days following the end of the CCR Nomination Period, (i) if no nomination has been received and there
is no Controlling Class Representative, the Trustee shall notify the Manager, the Master Issuer, the Servicer and the Controlling Class Members that no nominations have been received and that no election will occur, (ii) if one or more
nominations have been received, the Trustee shall prepare and send to each applicable Controlling Class Member a ballot in the form of
Exhibit G
attached hereto (the “
CCR Ballot
”) naming the top three candidates based upon the
highest aggregate Outstanding Principal Amount of Notes of Controlling Class Members nominating such candidate (or, if fewer than three (3) candidates are nominated, the CCR Ballot will list all candidates) or (iii) if a Controlling Class
Representative currently exists and no CCR Nominations are received prior to the end of the CCR Nomination Period, then the Person serving as the current Controlling Class Representative will be deemed reelected and will remain the Controlling
Class Representative. Each Controlling Class Member may, in its sole discretion, indicate its vote for Controlling Class Representative by returning a completed CCR Ballot directly to the Trustee certifying that, as of the date of the CCR Ballot
(the “
CCR Voting Record Date
”), such Controlling Class Member was the owner or beneficial owner of the Outstanding Principal Amount of Notes of the Controlling Class specified by such Controlling Class Member in the CCR Ballot;
provided
that for the purposes of such certification and the tabulation of votes pursuant to
Section 11.01(d)
, with respect to any Series of Class A-1 Notes Outstanding, the Class A-1 Notes Voting Amount shall be used in place of the Outstanding
Principal Amount of such Series. For any vote delivered on a CCR Ballot to be valid, such CCR Ballot must be delivered to the Trustee within thirty (30) calendar days of the date of such CCR Ballot (such period a “
CCR Election Period
”)
.
(d)
If a CCR Candidate receives votes from Controlling Class Members holding interests in excess of 50% of the sum of (i) the Class A-1 Notes Voting Amount with
respect to each Series of Class A-1 Notes of the Controlling Class and (ii) the Outstanding Principal Amount of each Series of Notes of the Controlling Class (other than Class A-1 Notes), in each case, that are Outstanding as of the CCR Voting
Record Date and with respect to which votes were submitted (which may be less than the Outstanding Principal Amount of Notes of the Controlling Class as of the CCR Voting Record Date), such CCR Candidate shall be appointed the Controlling Class
Representative. Notes of the Controlling Class held by the Master Issuer or any Affiliate of the Master Issuer will not be considered Outstanding for such voting purposes. If two CCR Candidates both receive votes from Controlling Class
Members holding beneficial interests in exactly 50% of the Aggregate Outstanding Principal Amount of Notes of the Controlling Class with respect to which votes were submitted, the Controlling Class Representative shall be the CCR Candidate
chosen by the Master Issuer (or the Manager on its behalf pursuant to the Management Agreement). In the event that there is no current Controlling Class Representative and no CCR Candidate receives 50% of the Aggregate Outstanding Principal
Amount of Notes of the Controlling Class with respect to which votes were submitted, the Trustee will notify the Manager, the Securitization Entities, the Servicer, the Back-Up Manager, each Rating Agency and the Controlling Class Members that
no Controlling Class Representative has been appointed, and
until a CCR Re-election Event occurs and a new Controlling Class Representative is elected then (i) the Control Party shall exercise the rights of the Controlling Class
Representative in accordance with the Servicing Standard and (ii) any deliverable or notice that is required to be provided to the Controlling Class Representative under a Related Document shall be delivered to the Control Party.
(e)
In the event that a Controlling Class Representative is elected, deemed elected or chosen pursuant to
Section 11.01(d)
or
Section 11.01(j)
, the Trustee shall forward an
acceptance letter in the form of
Exhibit H
attached hereto (a “
CCR Acceptance Letter
”) to such Controlling Class Representative. No Person shall be appointed Controlling Class Representative unless such Person delivers to the
Trustee an executed CCR Acceptance Letter within fifteen (15) Business Days of receipt thereof. In the CCR Acceptance Letter, the Person accepting the role of Controlling Class Representative shall (i) agree to act as the Controlling Class
Representative, (ii) provide its name and contact information and permit such information to be shared with the Manager, the Securitization Entities, the Servicer, the Back-Up Manager, each Rating Agency and the Controlling Class Members,
(iii) represent and warrant that it is a Controlling Class Member and not a Competitor and (iv) in the event that such Person subsequently ceases to be a Controlling Class Member, covenant to provide written notice thereof to the Trustee within
one (1) Business Day of ceasing to be a Controlling Class Member. Within two (2) Business Days of receipt of the executed CCR Acceptance Letter, the Trustee shall promptly forward copies thereof, or provide the new Controlling Class
Representative’s identity and contact information to the Manager, the Securitization Entities, the Servicer, the Back-Up Manager, each Rating Agency and the Controlling Class Members.
(f)
Within two (2) Business Days of any other change in the name or address of the Controlling Class Representative of which the Trustee has received notice from the Controlling Class
Representative, the Trustee shall deliver to the Noteholder via the Applicable Procedures of the Clearing Agency, the Class A-1 Administrative Agent, the Master Issuer, the Manager, the Back-Up Manager and the Servicer a notice setting forth the
name and address of the new Controlling Class Representative.
(g)
The Trustee shall be entitled to conclusively rely on, and will be fully protected in all actions taken or not taken by it with respect to, (i) the email information provided by the Class A-1
Administrative Agent and the Applicable Procedures of the Clearing Agency for delivery of the CCR Election Notices and CCR Ballots to Holders and beneficial owners of the Controlling Class and (ii) with respect to all CCR Re-election Events, the
representations and warranties of the Persons submitting CCR Nominations, CCR Ballots and CCR Acceptance Letters.
(h)
The Servicer (in its capacity as Servicer and Control Party) shall be entitled to rely on the identity of the Controlling Class Representative provided by the Trustee with respect to any
obligation or right hereunder or under the other Related Documents that the Servicer (in its capacity as Servicer and Control Party) may have to deliver information or otherwise communicate with the Controlling Class Representative or any of the
Noteholders of the Controlling Class, with no liability to it for such reliance.
(i)
The Controlling Class Representative shall be entitled to receive from the Trustee, upon request, any memoranda delivered to the Trustee by the Back-Up Manager pursuant to the Back-Up Management
Agreement;
provided
that it shall have first executed a confidentiality agreement, in form and substance satisfactory to the Manager, and such confidentiality agreement remains in effect. Any such memoranda shall be deemed to contain
confidential information.
(j)
If no Controlling Class Representative has been elected, deemed elected or chosen pursuant to
Section 11.01(d)
or this
Section 11.01(j)
, and a Rapid
Amortization Event, a Potential Rapid Amortization Event, a Manager Termination Event, a Potential Manager Termination Event, an Event of Default and/or a Default has occurred and is continuing, the Controlling Class Representative may be
appointed by a Majority of Controlling Class Members without complying with the requirements set forth in
clauses (b)
through
(d)
of this
Section 11.01
by delivery of an ad hoc ballot to the Trustee and the Control Party,
which shall be in the form of
Exhibit K
attached hereto.
Section 11.02
Resignation
or Removal of the Controlling Class Representative
. The Controlling Class Representative may at any time resign as such by giving written notice to the Trustee, the Servicer and to each Noteholder of the Controlling Class. The
Controlling Class Representative will resign immediately if such Controlling Class Representative no longer holds any Notes of the Controlling Class. As of any Record Date, a Majority of Controlling Class Members shall be entitled to remove any
existing Controlling Class Representative by giving written notice to the Trustee, the Servicer and such existing Controlling Class Representative. No resignation or removal of the Controlling Class Representative shall be effective until a
successor Controlling Class Representative has been appointed pursuant to
Section 11.01
or until the end of the CCR Election Period (or, if no CCR Election Period has occurred after a CCR Nomination Period, until the end of the related
CCR Nomination Period) following such resignation or removal;
provided
that any Controlling Class Representative that has been removed pursuant to this
Section 11.02
may subsequently be nominated as a CCR Candidate pursuant to
Section
11.01
(provided that such Controlling Class Representative candidate satisfies the requirements of this Base Indenture) and appointed as Controlling Class Representative;
provided
,
further
, that an existing Controlling Class
Representative shall cease to be the Controlling Class Representative at the end of a CCR Election Period, even if no successor is re-elected pursuant to
Section 11.01
, unless such Controlling Class Representative is elected during such
CCR Election Period (except that, in the event of a CCR Re-election Event or upon the occurrence of an Annual Election Date, if no CCR Nominations are received prior to the end of the CCR Nomination Period, the current Controlling Class
Representative will remain the Controlling Class Representative and no further action will be taken with respect to such CCR Re-election Event or Annual Election Date). In addition to the foregoing, within two (2) Business Days of the selection,
resignation or removal of the Controlling Class Representative, the Trustee shall notify the Servicer and the parties to this Base Indenture of such event.
If no Controlling Class Representative has been elected or if the Controlling Class Representative does not respond to a Consent Request within the time
period specified in Section 2.4 of the Servicing Agreement, the Control Party will be entitled (but not required) to exercise the rights of the Controlling Class Representative with respect to such Consent Request other than with respect to
Servicer Termination Events. .
Section 11.03
Expenses
and Liabilities of the Controlling Class Representative
. (a) The Controlling Class Representative shall have no liability to the Holders for any action taken, or for refraining from the taking of any action, in good faith
pursuant to the Indenture or for errors in judgment;
provided
,
however
, that the Controlling Class Representative shall not be protected against any liability that would otherwise be imposed by reason of gross negligence, bad
faith or willful misconduct committed with respect to its obligations or duties under the Indenture. Each Holder acknowledges and agrees, by its acceptance of its Notes or interests therein, that (i) the Controlling Class Representative may have
special relationships and interests that conflict with those of Note Owners of one or more Classes of Notes, or that conflict with other Holders, (ii) the Controlling Class Representative may act solely in the interests of the Controlling Class
Members or in its own interest, (iii) the Controlling Class Representative does not have any duties to Holders other than the Controlling Class Members, (iv) the Controlling Class Representative may take actions that favor the interests of the
Controlling Class Members over the interests of Holders of one or more other Classes of Notes, or that favor its own interests over those of other Holders or other Controlling Class Members, (v) the Controlling Class Representative shall not be
deemed to have been grossly negligent or reckless, or to have acted in bad faith or engaged in willful misfeasance, by reason of its having acted solely in the interests of the Controlling Class Members or in its own interests, and (vi) the
Controlling Class Representative shall have no liability whatsoever for having so acted pursuant to
clauses (i)
through
(v)
, and no Holder may take any action whatsoever against the Controlling Class Representative for having so
acted or against any director, officer, employee, agent or principal thereof for having so acted.
(b)
Any and all expenses of the Controlling Class Representative for acting in its capacity as Controlling Class Representative
shall constitute Securitization Operating Expenses and shall be paid to the extent funds are available therefor in accordance with
clauses (v)
and
(xvi)
of the Priority of Payments. Notwithstanding the foregoing, if a claim is
made against the Controlling Class Representative and the Servicer or the Trustee are also named parties to the same action and, in the sole judgment of the Servicer, the Controlling Class Representative had acted in good faith, without gross
negligence or willful misconduct, with regard to the particular matter at issue, and there is no potential for the Servicer or the Trustee to be an adverse party in such action as regards the Controlling Class Representative, the Servicer on
behalf of the Trustee shall be required to assume the defense (with any costs incurred in connection therewith being deemed to be reimbursable as a Collateral Protection Advance) of any such claim against the Controlling Class Representative.
Section 11.04
Control Party
. (a) Pursuant to the Indenture and the other Related Documents, the Control Party is authorized to consent to and implement, subject to the
Servicing Standard, Consent Requests that do not require the consent of any Noteholder or the Controlling Class Representative.
(b)
For any Consent Request that requires, pursuant to the terms of the Indenture or any other Related Document, the consent or
direction of the Controlling Class Representative, or the consent of the affected Noteholders or 100% of the Noteholders, the Control Party and the Trustee shall follow the procedures set forth in
Section 2.4
of the Servicing Agreement.
(c)
[Reserved].
(d)
The Control Party shall promptly notify the Trustee, the Manager, the Back-Up Manager, the Master Issuer and the Controlling Class Representative
if the Control Party determines, in accordance with the Servicing Standard, not to implement a Consent Request or has not received the requisite consent of the Controlling Class Representative or the Noteholders, if applicable, to implement a
Consent Request. The Trustee shall promptly notify the Control Party, the Manager, the Back-Up Manager, the Master Issuer and the Controlling Class Representative if the Trustee has not received the requisite consent of the required percentage
of Noteholders to implement a Consent Request.
(e)
Notwithstanding anything herein to the contrary, no advice, direction or objection from or by the Controlling
Class Representative may (i) require or cause the Trustee or the Control Party to violate applicable law, the terms of this Indenture, the Notes, the Servicing Agreement or the other Related Documents, including, without limitation with respect
to the Control Party, the Control Party’s obligation to act in accordance with the Servicing Standard, (ii) expose the Control Party or the Trustee, or any of their respective Affiliates, officers, directors, members, managers, employees,
agents or partners, to any material claim, suit or liability, or (iii) materially expand the scope of the Control Party’s responsibilities under the Servicing Agreement or the Trustee’s responsibilities under this Indenture, the Notes and the
other Related Documents. The Trustee and the
Control Party will not be required to follow any such advice, direction, or objection.
In addition, notwithstanding anything herein or in the other
Related Documents to the contrary, the Controlling Class Representative shall not be able to prevent the Control Party from transferring the ownership of all or any portion of the Securitized Assets (including by way of foreclosure on the
Equity Interests of the Master Issuer) if any Advance by the Servicer has been outstanding for twelve (12) months (or longer) and the Control Party determines in accordance with the Servicing Standard that such transfer of ownership would be in
the best interests of the Noteholders (taken as a whole).
Section 11.05
Note
Owner List
. (a) To facilitate communication among Note Owners, the Manager, the Trustee, the Control Party and the Controlling Class Representative, a Note Owner may elect, but is not required, to notify the Trustee of its name,
address and other contact information, which will be kept in a register maintained by the Trustee. The Trustee will be required to furnish the Manager, the Control Party and the Controlling Class Representative upon request with the information
maintained in such register as of the most recent date of determination. Every Note Owner, by receiving and holding a beneficial interest in a Note, will agree that none of the Trustee, the Master Issuer, the Servicer, the Controlling Class
Representative nor any of their respective agents will be held accountable by reason of any disclosure of any such information as to the names and addresses of the Note Owners in the register maintained by the Trustee.
(b)
Noteholders under any Variable Funding Note Purchase Agreement (“
VFN Noteholders
”) having interests of not less than
25% of the aggregate principal amount of the Class A-1 Notes (including any unfunded commitments of any VFN Noteholder under any Variable Funding Note Purchase Agreement) or Note Owners of Notes other than the Class A-1 Notes having beneficial
interests of not less than 10% of the aggregate principal amount of Notes that wish to communicate with the other Note Owners and VFN Noteholders with respect to their rights under the Indenture or under the Notes may request in writing that the
Trustee deliver a notice or communication to the other Note Owners through the Applicable Procedures of each Clearing Agency, and to the VFN Noteholders through the applicable Class A‑1 Administrative Agent, with respect to all Series of Notes
Outstanding. If such request states that such Note Owners or VFN Noteholders desire to communicate with other Note Owners and VFN Noteholders with respect to their rights under the Indenture or under the Notes and is accompanied by (i) a
certificate substantially in the form of
Exhibit I
certifying that such VFN Noteholders hold interests of not less than 25% of the aggregate principal amount of the Class A-1 Notes (including any unfunded commitments of such VFN
Noteholders under any Variable Funding Note Purchase Agreement) or that such Note Owners of Notes other than the Class A-1 Notes hold beneficial interests of not less than 10% of the aggregate principal amount of Notes (each, a “
Note Owner
Certificate
”) (upon which the Trustee may conclusively rely) and (ii) a copy of the communication which such Note Owners or VFN Noteholders propose to transmit, then the Trustee, after having been adequately indemnified by such Note Owners
or VFN Noteholders, as applicable, for its costs and expenses, shall transmit the requested communication to all other Note Owners through the Applicable Procedures of each Clearing Agency and to all other VFN Noteholders through the applicable
Class A-1 Administrative Agent, with respect to all Series of Notes Outstanding, and shall give the Master Issuer, the Servicer and the Controlling Class Representative notice that such request has been made, within five (5) Business Days after
receipt of the request. The Trustee shall have no obligation of any nature whatsoever with respect to any requested communication other than to transmit it in accordance with and subject to the terms hereof and to give notice of such request and
transmission to the Master Issuer, the Servicer and the Controlling Class Representative.
ARTICLE XI
DISCHARGE OF INDENTURE
Section 12.01
Termination of the Master Issuer’s and Guarantors’ Obligations
.
(a)
Satisfaction and Discharge
. The Indenture and the Guarantee and Collateral Agreement shall be discharged and cease to be of further effect when all Outstanding Notes
theretofore authenticated and issued (other than destroyed, lost or stolen Notes that have been replaced or repaid) have been delivered to the Trustee for cancellation, the Master Issuer has paid all sums payable hereunder and under each other
Related Document, all commitments to extend credit under all Variable Funding Note Purchase Agreements have been terminated and all Series Hedge Agreements have been terminated and all payments by the Master Issuer thereunder have been paid or
otherwise provided for; except that (i) the Master Issuer’s obligations under
Section 10.05
and the Guarantors’ guaranty thereof, (ii) the Trustee’s and the Paying Agent’s obligations under
Section 12.02
and
Section 12.03
and (iii) the Noteholders’ and the Trustee’s obligations under
Section 14.03
shall survive. The Trustee, on demand of the Securitization Entities, will execute proper instruments acknowledging confirmation of, and discharge under, the
Indenture and the Guarantee and Collateral Agreement.
(b)
Indenture Defeasance
. The Master Issuer may terminate all of its obligations under the Indenture and all obligations
of the Guarantors under the Guarantee and Collateral Agreement in respect thereof and release all Collateral if:
(i)
the Master Issuer irrevocably deposits in trust with the Trustee or with a trustee reasonably satisfactory to the
Control Party, the Trustee and the Master Issuer, U.S. Dollars and/or Government Securities in an amount sufficient (after giving effect to the application of funds on deposit in the Collection Account in accordance with the Priority of
Payments), in the opinion of a nationally recognized firm of independent certified public accountants expressed in a written certification thereof delivered to the Trustee, to pay all principal, premiums (including make-whole prepayment
premiums), if any, and interest on the Outstanding Notes (including additional interest that accrues after an anticipated repayment date or renewal date, if applicable) to the applicable prepayment date, redemption date or maturity date, as the
case may be, and to pay other sums payable by them hereunder, under the Servicing Agreement and under each other Related Document and each Series Hedge Agreement;
provided
that any Government Securities must provide for the scheduled
payment of all principal and interest thereon not later than the Business Day prior to the applicable prepayment date, redemption date or maturity date, as the case may be, and the Trustee must have been irrevocably instructed to apply such funds
to the payment of principal, premiums, make-whole prepayment premiums and interest with respect to the Notes and such other sums;
(ii)
all commitments under all Variable Funding Note Purchase Agreements and all Series Hedge Agreements are terminated on
or before the date of deposit;
(iii)
the Master Issuer delivers notice of prepayment, redemption or maturity of the Notes in full to the Noteholders of
Outstanding Notes, the Manager, the Trustee, the Control Party, the Controlling Class Representative, the Back-Up Manager, each Rating Agency and the Servicer, which notice is expressly stated to be, or has become as of the prepayment date,
redemption date or maturity date, as applicable, irrevocable (
provided
that such notice may be conditioned upon the contemporaneous closing of a financing the proceeds of which will be used to fund all or a portion of such deposit), and
the date of prepayment, redemption or maturity as specified in such notice when delivered was not longer than twenty (20) Business Days after the date of such notice;
(iv)
the Master Issuer delivers notice of such deposit to the Control Party, the Manager, the Back-Up Manager and each
Rating Agency, on or before the date of the deposit; and
(v)
the Master Issuer delivers to the Trustee and the Servicer an Opinion of Counsel to the effect that all conditions
precedent to such termination have been satisfied.
Upon satisfaction of such conditions, the Indenture and the Guarantee and Collateral Agreement shall cease to be of further effect; except that
(i) the rights and obligations of the Trustee hereunder, including, without limitation, the Trustee’s rights to compensation and indemnity under
Section 10.05
, and the Guarantor’s guaranty thereof, (ii) the Trustee’s and the Paying Agent’s
obligations under
Section 12.02
and
Section 12.03
, (iii) the Noteholders’ and the Trustee’s obligations under
Section 14.13
, (iv) this
Section 12.01(b)
and (v) the Noteholders’ rights to registration of transfer and
exchange under
Section 2.08
and to replacement or substitution of mutilated, destroyed, lost or stolen Notes under
Section 2.10(a)
shall survive. The Trustee, on demand of the Securitization Entities, shall execute proper
instruments acknowledging confirmation of and discharge under the Indenture and the Guarantee and Collateral Agreement.
(c)
Series Defeasance
. Except as may be provided to the contrary in any Series Supplement, the Master Issuer, solely in
connection with an optional prepayment in full, a mandatory prepayment in full or a redemption in full of all Outstanding Notes of a particular Series or in connection with the Series Legal Final Maturity Date of such Series of Notes, may
terminate all of its Obligations under the Indenture and all Obligations of the Guarantors under the Guarantee and Collateral Agreement in respect of such Series of Notes (the “
Defeased Series
”) on and as of any Business Day (the “
Series
Defeasance Date
”), provided:
(i)
the Master Issuer irrevocably deposits in trust with the Trustee, or with a trustee reasonably satisfactory to the
Control Party, the Trustee and the Master Issuer, U.S. Dollars and/or Government Securities sufficient (after giving effect to the application of funds on deposit in the applicable Series Distribution Account), in the opinion of a nationally
recognized firm of independent certified public accountants expressed in a written certification thereof delivered to the Trustee, to pay, without duplication:
(A)
all principal, premiums, if any, make-whole prepayment premiums, if any, Series Hedge Payment Amounts, commitment
fees, administration expenses, Class A-1 Notes Other Amounts for the Defeased Series, interest on the Outstanding Notes of such Defeased Series (including additional interest that accrues after the anticipated repayment date or renewal date, if
applicable) and any other amounts that will be due and payable by the Master Issuer solely with respect to the Defeased Series to the applicable prepayment date, redemption date or maturity date, as the case may be, and to pay other sums payable
by them under the Base Indenture, each other Related Document and each Series Hedge Agreement with respect to such Defeased Series;
(B)
all Weekly Management Fees, Supplemental Management Fees, unreimbursed Advances (and outstanding interest thereon)
and Manager Advances (and outstanding interest thereon), all fees, indemnities, reimbursements and expenses due to the Trustee, the Manager, the Servicer and the Back-Up Manager, and all Successor Manager Transition Expenses and Successor
Servicer Transition Expenses, in each case that will be due and payable as of the following Quarterly Calculation Date; and
(C)
all Securitization Operating Expenses, all Class A-1 Notes Administrative Expenses for the Defeased Series, all Class
A-1 Interest Adjustment Amounts for the Defeased Series and all Class A-1 Notes Other Amounts for the Defeased Series, in each case, that are due and unpaid as of the Series Defeasance Date to the Actual Knowledge of the Manager;
provided, any Government Securities must provide for the scheduled payment of all principal and interest thereon not later than the Business Day prior to
the applicable prepayment date, redemption date or maturity date, as the case may be, and the Trustee must have been irrevocably instructed to apply such funds to the payment of principal, premiums, make-whole prepayment premiums and interest with
respect to the Notes of such Series and such other sums;
(ii)
all commitments under all Variable Funding Note Purchase Agreements and Series Hedge Agreements with respect to such
Defeased Series are terminated on or before the Series Defeasance Date;
(iii)
the Master Issuer delivers notice of prepayment, redemption or maturity of such Series of Notes to the Noteholders of
the Defeased Series, the Manager, the Trustee, the Control Party, the Controlling Class Representative, the Back-Up Manager and each Rating Agency not more than twenty (20) Business Days prior to the Series Defeasance Date, and such notice is
expressly stated to be, or as of the date of the deposit has become, irrevocable;
provided
that such notice may be conditioned upon the contemporaneous closing of a financing the proceeds of which will be used to fund all or a portion of
such deposit;
(iv)
after giving effect to the deposit, if any other Series of Notes is Outstanding, the Master Issuer delivers to the
Trustee an Officer’s Certificate of the Master Issuer stating that no Potential Rapid Amortization Event, Rapid Amortization Event, Class A-1 Notes Amortization Event, Default or Event of Default has occurred and will be continuing;
(v)
the Master Issuer delivers to the Trustee an Officer’s Certificate stating that the defeasance was not made by the
Master Issuer with the intent of preferring the Holders of the Defeased Series over other creditors of the Master Issuer or with the intent of defeating, hindering, delaying or defrauding other creditors;
(vi)
the Master Issuer delivers notice of such deposit to the Control Party, the Manager, the Back-Up Manager and each
Rating Agency on or before the date of the deposit;
(vii)
such defeasance will not result in a breach or violation of, or constitute a default under, the Indenture or any
Indenture Documents; and
(viii)
the Master Issuer delivers to the Trustee an Opinion of Counsel to the effect that all conditions precedent to such
termination have been satisfied other than those conditions precedent which individually or in the aggregate do not adversely affect any Secured Party.
Upon satisfaction of such conditions, the Indenture and the Guarantee and Collateral Agreement shall cease to be of further effect with respect to
such Defeased Series, the Master Issuer and the Guarantors shall be deemed to have paid and been discharged from their Series Obligations with respect to such Defeased Series and thereafter such Defeased Series shall be deemed to be “Outstanding”
only for purposes of (1) the Trustee’s and the Paying Agent’s obligations under
Section 12.02
and
Section 12.03
, (2) the Holders’ and the Trustee’s obligations under
Section 14.13
and (3) the Noteholders’ rights to
registration of transfer and exchange under
Section 2.08
and to replacement or substitution of mutilated, destroyed, lost or stolen Notes under
Section 2.10(a)
. The Trustee, on demand of the Securitization Entities, shall execute
proper instruments acknowledging confirmation of and discharge under the Indenture and the Guarantee and Collateral Agreement of such Series Obligations.
(d)
After the conditions set forth in
Section 12.01(a)
have been met, or after the irrevocable deposit is made pursuant to
Section 12.01(b)
and satisfaction of
the other conditions set forth therein have been met, the Trustee upon request of the Securitization Entities shall reassign (without recourse upon, or any warranty whatsoever by, the Trustee) and deliver all Securitized Assets and documents then
in the custody or possession of the Trustee promptly to the applicable Securitization Entities.
Section 12.02
Application
of Trust Money
. The Trustee or a trustee satisfactory to the Servicer, the Trustee and the Master Issuer shall hold in trust money or Government Securities deposited with it pursuant to
Section 12.01
. The Trustee shall
apply the deposited money and the money from Government Securities through the Paying Agent in accordance with this Base Indenture and the other Related Documents to the payment of principal, premium, if any, and interest on the Notes and the
other sums referred to above. The provisions of this
Section 12.02
shall survive the expiration or earlier termination of the Indenture.
Section 12.03
Repayment
to the Master Issuer
. (a) The Trustee and the Paying Agent shall promptly pay to the Master Issuer upon written request any excess money or, pursuant to
Section 2.10
and
Section 2.14
, return any cancelled Notes
held by them at any time.
(b)
Subject to
Section 2.06(c)
, the Trustee and the Paying Agent shall pay to the Master Issuer upon written request any money held by them for the payment of principal,
premium or interest that remains unclaimed for two (2) years after the date upon which such payment shall have become due.
(c)
The provisions of this
Section 12.03
shall survive the expiration or earlier termination of the Indenture.
Section 12.04
Reinstatement
.
If the Trustee is unable to apply any funds received under this
Article XII
by reason of any proceeding, order or judgment of any court or Governmental Authority enjoining, restraining or otherwise prohibiting such application, the Master
Issuer’s obligations under the Indenture or the other Indenture Documents and in respect of the Notes and the Guarantors’ obligations under the Guarantee and Collateral Agreement shall be revived and reinstated as though no deposit had occurred,
until such time as the Trustee is permitted to apply all such funds or property in accordance with this
Article XII
. If the Master Issuer or Guarantors make any payment of principal, premium or interest on any Notes or any other sums
under the Indenture Documents while such obligations have been reinstated, the Master Issuer and the Guarantors shall be subrogated to the rights of the Holders or other Secured Parties who received such funds or property from the Trustee to
receive such payment in respect of the Notes. The provisions of this
Section 12.04
shall survive the expiration or earlier termination of the Indenture.
ARTICLE XII
AMENDMENTS
Section 13.01
Without
Consent of the Control Party, the Controlling Class Representative or the Noteholders
. (a) Without the consent of any Noteholder, the Control Party, the Controlling Class Representative or any other Secured Party, the Master
Issuer and the Trustee, at any time and from time to time, may enter into one or more Supplements or waivers to either this Base Indenture or any Series Supplement, in form satisfactory to the Trustee, for any of the following purposes:
(i)
to create a new Series of Notes (except that the consent of the Control Party is necessary to the extent required by
Section
2.02
);
(ii)
to add to the covenants of the Securitization Entities for the benefit of any Noteholders or any other Secured Parties (and if
such covenants are to be for the benefit of less than all Series of Notes, stating that such covenants are expressly being included solely for the benefit of such Series) or to surrender for the benefit of the Noteholders and the other Secured
Parties any right or power herein conferred upon the Securitization Entities;
provided
,
however
, that the Master Issuer will not pursuant to this
Section 13.01(a)(ii)
surrender any right or power it has under the Related
Documents;
(iii)
to mortgage, pledge, convey, assign and transfer to the Trustee any property or assets as security for the Obligations and to
specify the terms and conditions upon which such property or assets are to be held and dealt with by the Trustee and to set forth such other provisions in respect thereof as may be required by the Indenture or as may, consistent with the
provisions of the Indenture, be deemed appropriate by the Master Issuer, the Servicer and the Trustee, or to correct or amplify the description of any such property or assets at any time so mortgaged, pledged, conveyed and transferred to the
Trustee;
(iv)
to correct any manifest error or defect or to cure any ambiguity, defect or inconsistency or to correct or supplement any
provisions herein or in any Series Supplement which may be inconsistent with any other provision herein or therein or with any related offering memorandum in the case of a Series Supplement and each related offering memorandum in the case of this
Base Indenture;
(v)
to provide for uncertificated Notes in addition to or in place of certificated Notes
(
provided
that the uncertificated Notes are issued in registered form for purposes of Section 163(f) of the Code)
;
(vi)
to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Notes of one or
more Series and to add to or change any of the provisions of the Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder or thereunder by more than one Trustee;
(vii)
to comply with Requirements of Law (as evidenced by an Opinion of Counsel);
(viii)
to facilitate the transfer of Notes in accordance with applicable Requirements of Law (as evidenced by an Opinion of Counsel);
(ix)
to take any action necessary or helpful to avoid the imposition, under and in accordance with applicable law, of any Tax, including withholding Tax;
(x)
to take any action necessary and appropriate to facilitate the origination of Collateral Business Documents or the management and preservation of the Collateral Business Documents, in each case, in accordance with
the Managing Standard;
(xi)
to allow any additional assets (and related cash flows thereon) similar to the Securitized Assets (including any assets used in connection with the future operation of Branded Restaurants or franchises
internationally (including international Intellectual Property), Real Estate Assets, Franchise Agreements and Development Agreements to be contributed to, or acquired by, the Securitization Entities;
(xii)
to allow any real property, lease, franchise agreement, development agreement, equipment or other assets related to the
operation of international Branded Restaurants to be contributed to, or acquired by, the Securitization Entities;
(xiii)
at the direction of the Master Issuer, correct or supplement any provision in the Base Indenture or any Series Supplement that
may be inconsistent with any other provision or to make consistent any other provisions with respect to matters or questions arising under the Base Indenture, in any Supplement, in the Guarantee and Collateral Agreement or any other Indenture
Document;
(xiv)
to allow any Future Brand to be contributed to, or acquired by, the Securitization Entities in a manner that does not violate
the Managing Standard;
provided
that any amendment, modification or supplement that alters the manner in which Net Cash Flow or DSCR is calculated (including by any amendment, modification or supplement of any defined terms contained
therein) may not be effected unless the Rating Agency Condition is satisfied with respect thereto;
(xv)
if any additional changes to the Base Indenture or any Series Supplement are required or desirable to in order to facilitate
any Senior Notes Interest Reserve Account and/or Senior Subordinated Notes Interest Reserve Account being held in the name of a Securitization Entity that is not the Master Issuer, then to make such changes to the Base Indenture and/or any Series
Supplement to facilitate the holding of such Senior Notes Interest Reserve Account and/or Senior Subordinated Notes Interest Reserve Account in the name of a Securitization Entity that is not the Master Issuer, in each case so long as the Trustee
maintains a perfected security interest in such account;
(xvi)
to make such other provisions in regard to matters or questions arising under the Base Indenture, any Series Supplement and/or
any Supplement as the parties thereto may deem necessary or desirable, which are not inconsistent with the provisions thereof and which shall not materially and adversely affect the interests of any Holder or any other Secured Party;
provided
that an Opinion of Counsel and an Officer’s Certificate shall be delivered to the Trustee, each Rating Agency and the Servicer to such effect; or
(xvii)
to amend this Base Indenture or any Series Supplement in order to accommodate a replacement Management Agreement, Back-Up
Management Agreement or Servicing Agreement if at any time (x) such agreement is terminated or (y) the Manager, the Back-Up Manager or the Servicer is either unwilling or unable to perform its obligations under the Management Agreement, the
Back-Up Management Agreement or the Servicing Agreement, as applicable;
provided
that Rating Agency Confirmation shall be required for each Series of Notes that will remain Outstanding after the effective date of such Supplement;
provided
,
however
, that in
the case of any Supplement pursuant to any of
clauses (iii)
,
(iv)
,
(ix
), (
x
), (
xi
),
(xii)
,
(xiii)
,
(xiv)
or
(xv)
above, the Trustee and the Servicer shall have received an Officer’s Certificate certifying that such action could not reasonably be expected to adversely affect in any material respect the interests of any
Holder, the Servicer, the Trustee or any other Secured Party.
(b)
Upon the request of the Master Issuer and receipt by the Servicer and the Trustee of the documents described in
Section 2.02
and delivery by the Servicer of its
consent thereto to the extent required by
Section 2.02
, the Trustee shall join with the Master Issuer in the execution of any Series Supplement authorized or permitted by the terms of this Base Indenture and shall make any further
appropriate agreements and stipulations which may be therein contained, but the Trustee shall not be obligated to enter into such Series Supplement which affects its own rights, duties or immunities under this Base Indenture or otherwise.
Section 13.02
With
Consent of the Controlling Class Representative or the Noteholders
. (a) Except as provided in
Section 13.01
, the provisions of this Base Indenture and any Series Supplement (unless otherwise provided in such Series
Supplement) may, from time to time, be amended, modified or waived, if such amendment, modification or waiver is in writing in a Supplement and consented to in writing by the Control Party (at the direction of the Controlling Class
Representative). Notwithstanding the foregoing:
(i)
any amendment, waiver or other modification that would reduce the percentage of the Aggregate Outstanding Principal Amount or
the Outstanding Principal Amount of any Series of Notes, the consent of the Noteholders of which is required for any Supplement under this
Section 13.02
or the consent of the Noteholders of which is required for any waiver of compliance
with the provisions of the Indenture or defaults hereunder and their consequences provided for herein or for any other action hereunder shall require the consent of each affected Noteholder;
(ii)
any amendment, waiver or other modification that would permit the creation of any Lien ranking prior to or on a parity with
the Lien created by the Indenture, the Guarantee and Collateral Agreement or any other Related Documents with respect to any material part of the Collateral or except as otherwise permitted by the Related Documents, terminate the Lien created by
the Indenture, the Guarantee and Collateral Agreement or any other Related Documents on any material portion of the Collateral at any time subject thereto or deprive any Secured Party of any material portion of the security provided by the Lien
created by the Indenture, the Guarantee and Collateral Agreement or any other Related Documents shall require the consent of each affected Noteholder and each other affected Secured Party.
(iii)
any amendment, waiver or other modification that would (A) extend the due date for, or reduce the amount of any scheduled
repayment or prepayment of principal of, premium, if any, or interest on any Note and any other Obligations (or reduce the principal amount of, premium, if any, or rate of interest on any Note and any other Obligations); (B) affect adversely the
interests, rights or obligations of any Noteholder individually in comparison to any other Noteholder; (C) change the provisions of the Priority of Payments or
Section 5.13
(for the avoidance of doubt, amendments that affect amounts
payable under the Priority of Payments do not change the provisions of the Priority of Payments for purposes of this
clause (C)
); (D) change any place of payment where, or the coin or currency in which, any Notes and the other Obligations
or the interest thereon is payable; (E) impair the right to institute suit for the enforcement of the provisions of the Indenture requiring the application of funds available therefor, as provided in
Article V
, to the payment of any such
amount due on the Notes and the other Obligations on or after the respective due dates thereof, (F) subject to the ability of the Control Party (acting at the direction of the Controlling Class Representative) to waive certain events as set forth
in
Section 9.07
, amend or otherwise modify any of the specific language of the following definitions: “
Default
,” “
Event of Default
,” “
Outstanding
,” “
Potential Rapid Amortization Event
” or “
Rapid
Amortization Event
” (as defined herein or in any Series Supplement for such Series); or (G) amend, waive or otherwise modify this
Section 13.02
, shall require the consent of each Holder and/or Secured Party whose consent is required
to amend any such provision; and
(iv)
any amendment, waiver or other modification that would change the time periods with respect to any requirement to deliver to
any specific Noteholders notice with respect to any repayment, prepayment, redemption or election of any Extension Period shall require the consent of each affected Noteholder.
(b)
Notwithstanding anything to the contrary herein, in addition to any amendment, modification or waiver effected in accordance
with the provisions of
Section 13.01
or
Section 13.02(a)
, (i) the provisions of any Series Supplement under which Class A-1 Notes have been issued may be amended, modified or waived in writing by the Master Issuer and the Trustee
with the consent of the Noteholders required therefor pursuant to the related Variable Funding Note Purchase Agreement(s) (but without the consent of any other Person), if such amendment, modification or waiver is with respect to any of the terms
hereof relating to the amounts of interest, fees or other related amounts allocable to any Series of Class A-1 Notes (regardless of whether such amendment, modification or waiver would have the effect of modifying amounts available for allocation
to any Series of Notes (it being understood that the respective order of priorities set forth in the Priority of Payments will remain unaffected as a result of any such amendment, modification or waiver));
provided
,
however
, no
such amendment may (1) adversely affect (x) the Trustee without the Trustee’s prior consent or (y) the Servicer without the Servicer’s prior consent or (2) increase the aggregate principal amount of Notes without satisfaction of the Rating Agency
Condition with respect to each Series of Notes Outstanding and (ii) if at any time any change in GAAP (including a conversion of Jack in the Box Inc.’s financial reporting to IFRS) would affect the computation of any covenant, incurrence test or
other restriction affecting any Securitization Entity or Non-Securitization Entity that is set forth in the Base Indenture or any Series Supplement (including the calculation of Adjusted EBITDA), the Base Indenture or such Series Supplement may
be amended with the consent of the Control Party to amend the provisions of this Base Indenture or such Series Supplement, as the case may be, related to such covenant, incurrence test or other restriction to preserve the original intent thereof
in light of such change in GAAP.
(c)
No failure or delay on the part of any Noteholder, the Trustee or any other Secured Party in exercising any power or right
under the Base Indenture or any Series Supplement shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right.
(d)
The express requirement, in any provision hereof, that the Rating Agency Condition be satisfied as a condition to the taking
of a specified action, shall not be amended, modified or waived by the parties hereto without satisfying the Rating Agency Condition for the applicable Rating Agencies that are rating the Outstanding Notes.
(e)
The Securitization Entities and the Trustee agree not to amend this Base Indenture or any Series Supplement without the
Servicer’s consent if such amendment would materially increase the Servicer’s obligations or liabilities or materially decrease the Servicer’s rights or remedies under the Servicing Agreement, this Base Indenture or any other Related Document.
Section 13.03
Supplements
. Each amendment or other modification to this Base Indenture, any Series Supplement or the Notes shall be set forth in a Supplement, a copy of which shall be delivered to each Rating Agency,
the Servicer, the Controlling Class Representative, the Manager, the Back-Up Manager and the Master Issuer. The Master Issuer shall provide written notice to each Rating Agency of any amendment or modification to this Base Indenture, any Series
Supplement or the Notes no less than ten (10) days prior to the effectiveness of the related Supplement;
provided
that such Supplement need not be in final form at the time such notice is given. The initial effectiveness of each
Supplement shall be subject to the delivery to the Servicer and the Trustee of an Opinion of Counsel that such Supplement is authorized or permitted by this Base Indenture and the conditions precedent set forth herein with respect thereto have
been satisfied. Any Series Supplement (or if a Supplement to the Base Indenture) may be amended in accordance with the manner described above and any such amendment may be subject to additional requirements as set forth in such Series
Supplement.
Section 13.04
Revocation and Effect of Consents
. Until an amendment or waiver becomes effective, a consent to it by a Holder of a Note is a continuing consent by the Holder and every subsequent Holder of a Note or
portion of a Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent is not made on any Note. Any such Holder or subsequent Holder, however, may revoke the consent as to his Note or portion of a Note if
the Trustee receives written notice of revocation before the date the amendment or waiver becomes effective. An amendment or waiver becomes effective in accordance with its terms and thereafter binds every Holder. The Master Issuer may fix a
record date for determining which Holders must consent to such amendment or waiver.
Section 13.05
Notation on or Exchange of Notes
. The Trustee may place an appropriate notation about an amendment or waiver on any Note thereafter authenticated. The Master Issuer, in exchange for all Notes, may
issue and the Trustee shall authenticate new Notes that reflect the amendment or waiver. Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment or waiver.
Section 13.06
The
Trustee to Sign Amendments, etc
. The Trustee shall sign any Supplement authorized pursuant to this
Article XIII
if the Supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If
such Supplement adversely affects the rights, duties, liabilities or immunities of the Trustee, the Trustee may, but need not, sign it. In signing such Supplement, the Trustee shall be entitled to receive, if requested, an indemnity reasonably
satisfactory to it and to receive and, subject to
Section 10.01
, shall be fully protected in relying upon, an Officer’s Certificate of the Master Issuer and an Opinion of Counsel as conclusive evidence that such Supplement is authorized
or permitted by this Base Indenture and that all conditions precedent have been satisfied, and that it will be valid and binding upon the Master Issuer and the Guarantors in accordance with its terms;
provided
,
however
, that such
opinion may indicate that any conditions precedent, which, individually or in the aggregate, do not adversely affect any Noteholder, have been satisfied.
Section 13.07
Amendments and Fees
. The Master Issuer, the Control Party and the Controlling Class Representative shall negotiate any amendments, waivers or modifications to the Indenture or the other Related Documents
that require the consent of the Control Party or the Controlling Class Representative in good faith, and any consent required to be given by the Control Party or the Controlling Class Representative shall not be unreasonably denied or delayed.
The Control Party and the Controlling Class Representative shall be entitled to be reimbursed by the Master Issuer only for the reasonable counsel fees incurred by the Control Party or the Controlling Class Representative in reviewing and
approving any amendment or in providing any consents, and except as provided in the Servicing Agreement, neither the Control Party nor the Controlling Class Representative shall be entitled to any additional compensation in connection with any
amendments or consents to this Base Indenture or to any Related Document.
Section 13.08
Amendments to Certain Related Documents
. Each Related Document (other than the Base Indenture, any Series Supplement and any Supplement) may be amended or modified without consent in accordance with the
terms of such document;
provided
that the Master Issuer shall not be permitted to consent to any such amendment or modification unless either (x) the Control Party has consented to such amendment or modification or (y) such amendment or
modification is consistent with the following paragraphs of this
Section 13.08
.
(a)
Related Documents other than the Base Indenture and any Series Supplement
.
(i)
Without the consent of any Noteholder, the Control Party, the Controlling Class Representative or any other Secured
Party, the Master Issuer may enter into one or more amendments or waivers to each Related Document (other than the Base Indenture and any Series Supplement), in form satisfactory to the Trustee, for any of the following purposes:
(A)
to correct any manifest error or defect or to cure any ambiguity, defect or inconsistency or to correct or supplement
any provisions in the Related Documents (other than the Base Indenture and any Series Supplement) which may be inconsistent with any provision therein or any other Indenture Document or the related offering memorandum;
(B)
to evidence and provide for the acceptance of appointment hereunder and thereunder by a successor Trustee with
respect to the Notes of one or more Series and to add to or change any of the provisions of the Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder or thereunder by more than one Trustee;
(C)
to comply with Requirements of Law (as evidenced by an Opinion of Counsel);
(D)
to take any action necessary or helpful to avoid the imposition, under and in accordance with applicable law, of any
Tax, including withholding Tax;
(E)
to take any action necessary and appropriate to facilitate the origination of Collateral Business Documents or the
management and preservation of the Collateral Business Documents, in each case, in accordance with the Managing Standard;
(F)
to allow any additional assets (and related cash flows thereon) similar to the Securitized Assets (including any
assets used in connection with the future operation of Branded Restaurants or franchises internationally (including international Intellectual Property), Real Estate Assets, Franchise Agreements and Development Agreements to be contributed to, or
acquired by, the Securitization Entities;
(G)
to allow any real property, lease, franchise agreement, development agreement, equipment or other assets related to
the operation of international Branded Restaurants to be contributed to, or acquired by, the Securitization Entities;
(H)
at the direction of the Master Issuer, correct or supplement any provision in the Related Documents (other than the
Base Indenture and any Series Supplement) that may be inconsistent with any other provision or to make consistent any other provisions with respect to matters or questions arising under the Base Indenture, in any Series Supplement, in any
Supplement, in the Guarantee and Collateral Agreement or any other Indenture Document;
(I)
allow any Future Brand to be contributed to, or acquired by, the Securitization Entities in a manner that does not
violate the Managing Standard;
provided
that any amendment, modification or supplement that alters the manner in which Net Cash Flow or DSCR is calculated (including by any amendment, modification or supplement of any defined terms
contained therein) may not be effected unless the Rating Agency Condition is satisfied with respect thereto;
(J)
if any additional changes to the Related Documents (other than the Base Indenture and any Series Supplement) are
required or desirable to in order to facilitate any Senior Notes Interest Reserve Account and/or Senior Subordinated Notes Interest Reserve Account being held in the name of a Securitization Entity that is not the Master Issuer, then to make such
changes to the Related Documents (other than the Base Indenture and any Series Supplement) to facilitate the holding of such Senior Notes Interest Reserve Account and/or Senior Subordinated Notes Interest Reserve Account in the name of a
Securitization Entity that is not the Master Issuer, in each case so long as the Trustee maintains a perfected security interest in such account;
(K)
to make such other provisions in regard to matters or questions arising under the Related Documents (other than the
Base Indenture and any Series Supplement) as the parties thereto may deem necessary or desirable, which are not inconsistent with the provisions thereof and which shall not materially and adversely affect the interests of any Holder or any other
Secured Party;
provided
that an Opinion of Counsel and an Officer’s Certificate shall be delivered to the Trustee, each Rating Agency and the Servicer to such effect;
(L)
to add to the covenants of any (I) Securitization Entity for the benefit of the Secured Parties or (II)
Non-Securitization Entity for the benefit of any Securitization Entity; or
(M)
to amend any Related Document in order to accommodate a replacement Management Agreement, Back-Up Management
Agreement or Servicing Agreement if at any time (x) such agreement is terminated or (y) the Manager, the Back-Up Manager or the Servicer is either unwilling or unable to perform its obligations under the Management Agreement, the Back-Up
Management Agreement or the Servicing Agreement, as applicable;
provided
that Rating Agency Confirmation shall be required for each Series of Notes that will remain Outstanding after the effective date of such Supplement.
(ii)
In addition to
Section 13.08(a)(i)
, the Master Issuer may otherwise consent to an amendment, modification or waiver of
the provisions of any Related Document, from time to time, if such amendment, modification or waiver is in writing and consented to in writing by the Control Party (at the direction of the Controlling Class Representative). Notwithstanding the
foregoing, any amendment, waiver or other modification that would permit the creation of any Lien ranking prior to or on a parity with the Lien created by the Indenture, the Guarantee and Collateral Agreement or any other Related Documents with
respect to any material part of the Collateral or except as otherwise permitted by the Related Documents, terminate the Lien created by the Indenture, the Guarantee and Collateral Agreement or any other Related Documents on any material portion
of the Collateral at any time subject thereto or deprive any Secured Party of any material portion of the security provided by the Lien created by the Indenture, the Guarantee and Collateral Agreement or any other Related Documents shall require
the consent of each affected Noteholder and each other affected Secured Party.
(iii)
Notwithstanding anything to the contrary herein, in addition to any amendment, modification or waiver effected in accordance
with the provisions of this
Section 13.08
, (i) the provisions of any Variable Funding Note Purchase Agreement may be amended, modified or waived in writing by the Master Issuer and the Trustee with the consent of the Noteholders required
therefor pursuant to the related Variable Funding Note Purchase Agreement(s) (but without the consent of any other Person), if such amendment, modification or waiver is with respect to any of the terms hereof relating to the amounts of interest,
fees or other related amounts allocable to any Series of Class A-1 Notes (regardless of whether such amendment, modification or waiver would have the effect of modifying amounts available for allocation to any Series of Notes (it being understood
that the respective order of priorities set forth in the Priority of Payments will remain unaffected as a result of any such amendment, modification or waiver));
provided
,
however
, no such amendment may (1) adversely affect (x)
the Trustee without the Trustee’s prior consent or (y) the Servicer without the Servicer’s prior consent or (2) increase the aggregate principal amount of Notes without satisfaction of the Rating Agency Condition with respect to each Series of
Notes Outstanding and (ii) if at any time any change in GAAP (including a conversion of Jack in the Box Inc.’s financial reporting to IFRS) would affect the computation of any covenant, incurrence test or other restriction affecting any
Securitization Entity or Non-Securitization Entity that is set forth in any Related Document (other than the Base Indenture and any Series Supplement) (including the calculation of Adjusted EBITDA), such Related Document may be amended with the
consent of the Control Party to amend the provisions of such Related Document, as the case may be, related to such covenant, incurrence test or other restriction to preserve the original intent thereof in light of such change in GAAP.
(b)
Management Agreement
. Subject to the conditions precedent for certain amendments and modifications under this
Section
13.08
, the Master Issuer may enter into an amendment of the Management Agreement from time to time, in writing, with the written consent of the Trustee (acting at the direction of the Control Party, which direction shall not be unreasonably
withheld or delayed), the Securitization Entities and the Manager;
provided
, that no consent of the Trustee or the Control Party shall be required (and the Trustee shall execute an amendment at the direction of the Master Issuer) in
connection with any amendment to accomplish any of the following:
(A)
to correct or amplify the description of any required activities of the Manager;
(B)
to add to the duties or covenants of the Manager for the benefit of any Noteholders or any other Secured Parties, or
to add provisions to the Management Agreement so long as such action does not modify the Managing Standard, materially adversely affect the enforceability of the Securitization IP or materially adversely affect the interests of the Noteholders;
(C)
to evidence the succession of another Person to any party to the Management Agreement;
(D)
to take any action necessary and appropriate to facilitate the origination of new Managed Documents, the acquisition,
disposition and management of Securitized Assets in a manner consistent with the Base Indenture, or the management and preservation of the Managed Documents, in each case, in accordance with the Managing Standard; or
(E)
to provide for additional Services related to any Securitized Company Restaurants;
provided
that, promptly after the execution of any such amendment, the Manager shall
send to the Trustee, the Servicer, the Back-Up Manager and each Rating Agency a conformed copy of such amendment, but the failure to do so shall not impair or affect its validity.
(c)
Back-Up Management Agreement
. Subject to any conditions precedent for certain amendment or modification under this
Article
13.08
, the Master Issuer may enter into an amendment or modification of the Back-Up Management Agreement from time to time, in writing, with the consent of the parties thereto. The Back-Up Management Agreement may be amended or modified
with the consent of the parties thereto and such parties may waive any right under the Back-Up Management Agreement, which waiver shall be effective only in the specific instance and for the specific purpose for which it is given unless otherwise
specified in such waiver. The following shall not operate as a waiver of any right under the Back-Up Management Agreement or applicable law: (i) any election not to exercise, (ii) any failure to exercise or delay in exercising any right, or
(iii) any course of dealing or performance. The single or partial exercise of any right under the Back-Up Management Agreement shall not preclude any further exercise of such right thereof or the exercise of any other right under the Back-Up
Management Agreement or applicable law.
(d)
Servicing Agreement
.
(i)
Subject to any conditions precedent for certain amendment or modification under this
Article 13.08
and upon
satisfaction of the Rating Agency Condition with respect to an amendment or modification, the Master Issuer may enter into an amendment or modification of the Servicing Agreement from time to time, in writing, with the consent of the parties
thereto;
provided
that the satisfaction of the Rating Agency Condition shall not be required in connection with an amendment to (a) cure any ambiguity or correct or supplement any provisions in the Servicing Agreement that are defective
or inconsistent with any other provisions in the Servicing Agreement, any other Related Document or each final offering memoranda or private placement memoranda prepared in connection with the then-current Outstanding Notes or (b) reduce the
Servicing Fee.
(ii)
The Master Issuer may not consent to any amendment to the Servicing Agreement that (a) adversely affects, in any
material respect, the interest of the holders of any Class of Notes in any manner, without the consent of the Majority of Noteholders of such Class (or, with respect to the Controlling Class, the Controlling Class Representative) or (b) has an
effect comparable to any of those set forth in
Section 13.02(a)
that requires the consent of each Noteholder or each affected Noteholder, without the consent of each Noteholder or each affected Noteholder, as applicable;
provided
that any amendment to reduce the Servicing Fee may be agreed by the Servicer without the consent of the Master Issuer, the Noteholders or any other party.
(iii)
The parties thereto may waive any right under the Servicing Agreement, which waiver will be effective only in the
specific instance and for the specific purpose for which it is given unless otherwise specified in such waiver. The following will not operate as a waiver of any right under the Servicing Agreement or applicable law: (a) any election not to
exercise, (b) any failure to exercise or delay in exercising any right, or (c) any course of dealing or performance. The single or partial exercise of any right under the Servicing Agreement will not preclude any further exercise of such right
thereof or the exercise of any other right under the Servicing Agreement or applicable law.
(iv)
The Securitization Entities and the Trustee agree not to amend the Related Documents (other than the Base Indenture
and any Series Supplement) without the Servicer’s consent if such amendment would materially increase the Servicer’s obligations or liabilities or materially decrease the Servicer’s rights or remedies under the Servicing Agreement, this Base
Indenture or any other Related Document.
(e)
The express requirement, in any provision hereof, that the Rating Agency Condition be satisfied as a condition to the taking
of a specified action, shall not be amended, modified or waived by the parties hereto without satisfying the Rating Agency Condition for the applicable Rating Agencies that are rating the Outstanding Notes.
(f)
No failure or delay on the part of any Noteholder, the Trustee or any other Secured Party in exercising any power or right
under any Related Document (other than the Base Indenture and any Series Supplement) shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right.
(g)
To the extent that the Trustee and/or Control Party is party to a Related Document (other than the Base Indenture and any
Series Supplement) to be amended or modified pursuant to this
Section 13.08
, the Trustee and/or Control Party shall sign such amendment or modification, so long as such amendment or modification does not adversely affect the rights,
duties, liabilities or immunities of the Trustee and/or Control Party. If such amendment or modification does adversely affect the rights, duties, liabilities or immunities of the Trustee and/or Control Party, the Trustee and/or Control Party
may, but need not, sign it.
ARTICLE XIII
MISCELLANEOUS
Section 14.01
Notices
.
(a) Any notice or communication by the Master Issuer, the Manager or the Trustee to any other party hereto shall be in writing and delivered in person, delivered by email (
provided
that such email may contain a link to a
password-protected website containing such notice for which the recipient has granted access;
provided
,
further
, that any email notice to the Trustee other than an email containing a link to a password-protected website shall be
in the form of an attachment of a .pdf or similar file) or mailed by first-class mail (registered or certified, return receipt requested), facsimile or overnight air courier guaranteeing next day delivery, to such other party’s address:
If to the Master Issuer
:
Jack in the Box Funding, LLC
9330 Balboa Avenue
San Diego, CA 92123
Attention: General Counsel
If to the Manager
:
Jack in the Box Inc.
9330 Balboa Avenue
San Diego, CA 92123
Attention: General Counsel
If to the Master Issuer with a copy to (which shall not constitute notice)
:
White & Case LLP
1221 Avenue of the Americas
New York, NY 10020
Attention: David Thatch
Facsimile: 212-354-8113
Email: dthatch@whitecase.com
If to the Manager with a copy to (which shall not constitute notice)
:
White & Case LLP
1221 Avenue of the Americas
New York, New York 10020
Attention: David Thatch
Facsimile: 212-354-8113
Email: dthatch@whitecase.com
If to the Back-Up Manager
:
FTI Consulting, Inc.
3 Times Square, 9
th
Floor
New York, New York 10036
Attention: Robert J. Darefsky
Facsimile: 212-841-9350
If to the Servicer
:
Midland Loan Services, a division of PNC Bank, National Association
10851 Mastin Street Building 82, Suite 700
Overland Park, Kansas 66210
Attention: President
Facsimile: 913-253-9709
If to the Trustee
:
Citibank, N.A.
388 Greenwich Street
New York, New York 10013
Attention: Citibank Agency & Trust – Jack in the Box Funding, LLC
Email: jacqueline.suarez@citi.com or contact Citibank, N.A.’s customer service desk at (888) 855-9695
If to any Rating Agency
: At the notice address set forth in the applicable Series
Supplement.
If to an Enhancement Provider or an Hedge Counterparty
: At the address provided in
the applicable Enhancement Agreement or the applicable Series Hedge Agreement.
(b)
The Master Issuer or the Trustee by notice to each other party may designate additional or different addresses for subsequent
notices or communications;
provided
,
however
, the Master Issuer may not at any time designate more than a total of three (3) addresses to which notices must be sent in order to be effective.
(c)
Any notice (i) given in person shall be deemed delivered on the date of delivery of such notice, (ii) given by first class
mail shall be deemed given five (5) days after the date that such notice is mailed, (iii) delivered by facsimile shall be deemed given on the date of delivery of such notice, (iv) delivered by overnight air courier shall be deemed delivered one
(1) Business Day after the date that such notice is delivered to such overnight courier, (v) when posted on a password-protected website shall be deemed delivered after notice of such posting has been provided to the recipient and (vi) delivered
by email shall be deemed delivered on the date of delivery of such notice.
(d)
Notwithstanding any provisions of the Indenture to the contrary, the Trustee shall have no liability based upon or arising
from the failure to receive any notice required by or relating to the Indenture, the Notes or any other Related Document.
(e)
If the Master Issuer delivers a notice or communication to Noteholders, it shall deliver a copy to the Back-Up Manager, the
Servicer, the Controlling Class Representative and the Trustee at the same time.
(f)
Where the Indenture provides for notice to Noteholders of any event, such notice shall be sufficiently given (unless otherwise
herein expressly provided) if sent in writing and mailed, first-class postage prepaid, to each Noteholder affected by such event, at its address as it appears in the Note Register, not later than the latest date, and not earlier than the earliest
date, prescribed (if any) for the giving of such notice. In any case where notice to a Noteholder is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Noteholder shall affect the
sufficiency of such notice with respect to other Noteholders, and any notice which is mailed in the manner herein provided shall be conclusively presumed to have been duly given. Where the Indenture provides for notice in any manner, such notice
may be waived in writing by any Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Noteholders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. In the case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made that is satisfactory to the Trustee shall constitute a sufficient notification for every purpose hereunder.
(g)
Notwithstanding any other provision herein, for so long as Jack in the Box Inc. is the Manager, any notice, communication, certificate, report, statement or other
information required to be delivered by the Manager to the Master Issuer, or by the Master Issuer to the Manager, shall be deemed to have been delivered to both the Master Issuer and the Manager if the Manager has prepared or is otherwise in
possession of such notice, communication, certificate, report, statement or other information, and in no event shall the Manager or the Master Issuer be in breach of any delivery requirements hereunder for constructive delivery pursuant to this
Section
14.01(g)
.
(h)
The Trustee (in each of its capacities) agrees to accept and act upon instructions or directions pursuant to this Base Indenture or any documents executed in connection
herewith sent by unsecured email or other similar unsecured electronic methods,
provided
,
however
, that any person providing such instructions or directions shall provide to the Trustee an incumbency certificate listing persons
designated to provide such instructions or directions (including the email addresses of such persons), which incumbency certificate shall be amended whenever a person is added or deleted from the listing. If such person elects to give the Trustee
email (of .pdf or similar files) (or instructions by a similar electronic method) and the Trustee in its discretion elects to act upon such instructions, the Trustee’s reasonable understanding of such instructions shall be deemed controlling. The
Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such instructions notwithstanding such instructions conflicting with or being inconsistent with a
subsequent written instruction. Any person providing such instructions or directions agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including without limitation
the risk of the Trustee acting on unauthorized instructions, and the risk of interception and misuse by third parties.
Section 14.02
Communication by Holders With Other Holders
. Holders may communicate with other Holders with respect to their rights under the Indenture or the Notes.
Section 14.03
Officer’s
Certificate as to Conditions Precedent
. Upon any request or application by the Master Issuer to the Controlling Class Representative, the Servicer or the Trustee to take any action under the Indenture or any other Related
Document, the Master Issuer to the extent requested by the Controlling Class Representative, the Servicer or the Trustee shall furnish to the Controlling Class Representative, the Servicer and the Trustee (a) an Officer’s Certificate of the
Master Issuer in form and substance reasonably satisfactory to the Controlling Class Representative, the Servicer or the Trustee, as applicable (which shall include the statements set forth in
Section 14.04
), stating that all conditions
precedent and covenants, if any, provided for in the Indenture or such other Related Documents relating to the proposed action have been complied with and (b) an Opinion of Counsel confirming the same. Such Opinion of Counsel shall be at the
expense of the Master Issuer.
Section 14.04
Statements Required in Certificate
. Each certificate with respect to compliance with a condition or covenant provided for in the Indenture or any other Related Document shall include:
(a)
a statement that the Person giving such certificate has read such covenant or condition;
(b)
a brief statement as to the nature and scope of the examination or investigation upon which the statements contained
in such certificate are based;
(c)
a statement that, in the opinion of such Person, he has made such examination or investigation as is necessary to
enable him to reach an informed opinion as to whether or not such covenant or condition has been complied with; and
(d)
a statement as to whether or not such condition or covenant has been complied with.
Section 14.05
Rules by the Trustee
. The Trustee may make reasonable rules for action by or at a meeting of Holders.
Section 14.06
Benefits of Indenture
. Except as set forth in a Series Supplement, nothing in this Base Indenture or in the Notes, expressed or implied, shall give to any Person, other than the parties hereto and their
successors hereunder and the Holders and the other Secured Parties, any benefit or any legal or equitable right, remedy or claim under the Indenture.
Section 14.07
Payment on Business Day
. In any case where any Quarterly Payment Date, redemption date or maturity date of any Note shall not be a Business Day, then (notwithstanding any other provision of the Indenture)
payment of interest or principal (and premium, if any), as the case may be, need not be made on such date but may be made on the next succeeding Business Day with the same force and effect as if made on the Quarterly Payment Date, redemption date
or maturity date;
provided
,
however
, that no interest shall accrue for the period from and after such Quarterly Payment Date, redemption date or maturity date, as the case may be.
Section 14.08
Governing Law
.
THIS BASE INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAW PRINCIPLES.
Section 14.09
Successors
. All agreements of the Master Issuer in the Indenture, the Notes and each other Related Document to which it is a party shall bind its successors and assigns;
provided
,
however
,
the Master Issuer must not assign its obligations or rights under the Indenture or any other Related Document, except with the written consent of the Servicer. All agreements of the Trustee in the Indenture shall bind its successors.
Section 14.10
Severability
. In case any provision in the Indenture, the Notes or any other Related Document shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 14.11
Counterpart Originals
. This Base Indenture may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single agreement.
Section 14.12
Table of Contents, Headings, etc
. The Table of Contents and headings of the Articles and Sections of the Indenture have been inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions hereof.
Section 14.13
No
Bankruptcy Petition Against the Securitization Entities
. Each of the Holders, the Trustee and the other Secured Parties hereby covenants and agrees that, prior to the date which is one (1) year and one (1) day after the payment in
full of the latest maturing Note, it will not institute against, or join with any other Person in instituting against, any Securitization Entity any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings, under any federal or state bankruptcy or similar law;
provided
,
however
, that nothing in this
Section 14.13
shall constitute a waiver of any right to indemnification, reimbursement or other payment from the
Securitization Entities pursuant to the Indenture or any other Related Document. In the event that any such Holder or other Secured Party or the Trustee takes action in violation of this
Section 14.13
, each affected Securitization Entity
shall file or cause to be filed an answer with the bankruptcy court or otherwise properly contesting the filing of such a petition by any such Holder or Secured Party or the Trustee against such Securitization Entity or the commencement of such
action and raising the defense that such Holder or other Secured Party or the Trustee has agreed in writing not to take such action and should be estopped and precluded therefrom and such other defenses, if any, as its counsel advises that it may
assert. The provisions of this
Section 14.13
shall survive the termination of the Indenture and the resignation or removal of the Trustee. Nothing contained herein shall preclude participation by any Holder or any other Secured Party or
the Trustee in the assertion or defense of its claims in any such proceeding involving any Securitization Entity.
Section 14.14
Recording of Indenture
. If the Indenture is subject to recording in any appropriate public recording offices, such recording is to be effected by the Master Issuer and at its expense.
Section 14.15
Waiver of Jury Trial
. EACH OF THE MASTER ISSUER AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS BASE INDENTURE, THE NOTES, THE OTHER RELATED DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY.
Section 14.16
Submission to Jurisdiction; Waivers
. Each of the Master Issuer and the Trustee hereby irrevocably and unconditionally:
(a)
submits for itself and its property in any legal action or proceeding relating to the Indenture and the other Related
Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of the State of New York sitting in New York County, the courts of the United States
for the Southern District of New York, and appellate courts from any thereof;
(b)
consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;
(c)
agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage prepaid, to the Master Issuer or the Trustee, as the case may be, at its address set forth in
Section 14.01
or at such other address of which the Trustee shall have been
notified pursuant thereto;
(d)
agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall
limit the right to sue in any other jurisdiction; and
(e)
waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or
proceeding referred to in this
Section 14.16
any special, exemplary, punitive or consequential damages.
Section 14.17
Permitted Asset Dispositions; Release of Collateral
. Upon consummation of a Permitted Asset Disposition, all Liens with respect to the disposed property created in favor of the Trustee for the benefit of
the Secured Parties under this Base Indenture and the other Related Documents shall be automatically released, and upon request of the Master Issuer, the Trustee, at the written direction of the Control Party, shall execute and deliver to the
Master Issuer any and all documentation reasonably requested and prepared by the Master Issuer at the Master Issuer’s expense to effect or evidence the release by the Trustee of the Secured Parties’ security interest in the property disposed of
in connection with such Permitted Asset Disposition.
Section 14.18
Calculation of Holdco Leverage Ratio and Senior ABS Leverage Ratio
.
(a)
Holdco Leverage Ratio
. For purposes of making the computation of the Holdco Leverage Ratio (including, without limitation the calculation of Adjusted EBITDA used
therein), investments, acquisitions, dispositions, mergers, amalgamations, consolidations and discontinued operations, in each case with respect to an operating unit of a business, and any restructurings or reorganizations, that any of the
Non-Securitization Entities has either determined to make or made during the preceding four Quarterly Collection Periods or subsequent to such preceding four Quarterly Collection Periods and on or prior to or simultaneously with the date as of
which such computation is made (each, for purposes of the calculations described in this
Section 14.18
, a “
pro forma event
”) shall, at the discretion of the Manager, be calculated on a pro forma basis assuming that all such
investments, acquisitions, dispositions, mergers, amalgamations, consolidations, discontinued operations, restructurings and reorganizations (and the change in Adjusted EBITDA resulting therefrom) had occurred on the first day of such preceding
four Quarterly Collection Periods. If since the beginning of such period any Person that subsequently became a Non-Securitization Entity since the beginning of such preceding four Quarterly Collection Periods shall have made any investment,
acquisition, disposition, merger, consolidation, discontinued operation, restructurings or reorganizations, in each case with respect to an operating unit of a business, that would have been subject to adjustment pursuant to this
Section
14.18
, then the Holdco Leverage Ratio shall, at the discretion of the Manager, be calculated giving
pro
forma
effect thereto for such period as if such investment, acquisition, disposition, discontinued operation, merger,
consolidation, restructuring or reorganization had occurred at the beginning of the applicable preceding four Quarterly Collection Periods.
(b)
Senior ABS Leverage Ratio
. For purposes of making the computation of the Senior ABS Leverage Ratio (including, without limitation the calculation of Net Cash Flow
used therein), any pro forma event shall, at the discretion of the Manager, be calculated on a pro forma basis assuming that all such investments, acquisitions, dispositions, mergers, amalgamations, consolidations, discontinued operations,
restructurings and reorganizations (and the change in Net Cash Flow resulting therefrom) had occurred on the first day of such preceding four Quarterly Collection Periods. If since the beginning of such period any Person that subsequently became
a Securitization Entity since the beginning of such preceding four Quarterly Collection Periods shall have made any investment, acquisition, disposition, merger, consolidation, discontinued operation, restructurings or reorganizations in each
case with respect to an operating unit of a business, that would have been subject to adjustment pursuant to this
Section 14.18
, then the Senior ABS Leverage Ratio shall, at the discretion of the Manager, be calculated giving pro forma
effect for any related thereto for such period as if such investment, acquisition, disposition, discontinued operation, merger, consolidation, restructurings or reorganizations had occurred at the beginning of the applicable preceding four
Quarterly Collection Periods.
(c)
Calculations to be Made in Good Faith
. For purposes of the calculations described in this
Section 14.18
, whenever pro forma effect is to be given to any
pro forma event, the pro forma calculations shall be made in good faith by a responsible financial or accounting officer of the Manager. Any such pro forma calculation may include adjustments appropriate, in the reasonable good faith
determination of the Manager as set forth in an Officer’s Certificate delivered to the Trustee (with respect to which the Trustee shall have no obligation of any nature whatsoever) to reflect (1) operating expense reductions and other operating
improvements or synergies reasonably expected to result from the applicable pro forma event, and (2) all adjustments of the nature used in connection with the calculation of “Adjusted EBITDA” or “Net Cash Flow” as set forth in the definition
thereof, to the extent such adjustments, without duplication, continue to be applicable to such preceding four Quarterly Collection Periods.
(d)
Changes in GAAP
. If at any time any change in GAAP (including a conversion of Jack in the Box Inc.’s financial reporting to IFRS) would affect the computation of any
covenant, incurrence test or other restriction affecting any Securitization Entity or Non-Securitization Entity that is set forth in this Base Indenture or any Related Document (including the calculation of Adjusted EBITDA), and the Manager shall
so request, the Control Party and the Manager shall negotiate in good faith to amend the provisions of the Related Documents related to such covenant, incurrence test or other restriction to preserve the original intent thereof in light of such
change in GAAP;
provided
that, until so amended, such covenant, incurrence test or other restriction shall continue to be computed in accordance with GAAP or the application thereof prior to such change therein. If the Manager notifies
the Control Party that Jack in the Box Inc. is required to report under IFRS or has elected to do so through an early adoption policy, “GAAP” shall mean international financial reporting standards pursuant to IFRS (
provided
that after such
conversion, Jack in the Box Inc. cannot elect to report under U.S. generally accepted accounting principles).
Section 14.19
Instructions and Directions on Behalf of the Master Issuer
. Instructions, directions, notices or reports to be provided by the Master Issuer or any other Securitization Entity hereunder, may be provided
by the Manager on behalf of the Master Issuer or such other Securitization Entity.
Signature Pages Follow
* * *
IN WITNESS WHEREOF, the Master Issuer, the Trustee and the
Securities Intermediary have caused this Base Indenture to be duly executed by its respective duly Authorized Officer as of the day and year first written above.
JACK IN THE BOX FUNDING, LLC
,
a Delaware limited liability company, as Master Issuer
By:
/s/Michael J. Snider
Name: Michael J. Snider
Title: Assistant Secretary
Signature Page to Indenture
CITIBANK, N.A.
, in its capacity as Trustee
and as Securities Intermediary
By:
/s/Jacqueline Suarez
Name: Jacqueline Suarez
Title: Senior Trust Officer
Signature Page to Indenture
ANNEX A
BASE INDENTURE DEFINITIONS LIST
“
1933 Act
” means the Securities Act of 1933, as amended.
“
1934 Act
” means the Securities Exchange Act of 1934, as amended.
“
1940 Act
” means the Investment Company Act of 1940, as amended.
“
Account Agreement
” means each agreement governing the establishment and
maintenance of any Management Account or any other Base Indenture Account or Series Account to the extent that any such account is not held at the Trustee.
“
Account Control Agreement
” means each control agreement, in form and substance
reasonably satisfactory to the Servicer and the Trustee, pursuant to which the Trustee is granted the right to control deposits and withdrawals from, or otherwise give instructions or entitlement orders in respect of, a deposit and/or securities
account and any lock-box related thereto.
“
Accounts
” means, collectively, the Indenture Trust Accounts, the Management
Accounts and any other account either held by the Trustee for the benefit of the Secured Parties or subject to an Account Control Agreement.
“
Actual Knowledge
” means the actual knowledge of (i) in the case of Jack in the Box
Inc., in its individual capacity or in its capacity as Manager, the Chief Executive Officer, the President, the Chief Financial Officer, the General Counsel or any Senior Vice President of Jack in the Box Inc., (ii) in the case of any
Securitization Entity, any manager or director (as applicable) or officer of such Securitization Entity who is also an officer of Jack in the Box Inc. described in
clause (i)
above, (iii) in the case of the Manager or any Securitization Entity, with respect to a relevant matter or event, an Authorized Officer of the Manager or such Securitization Entity, as applicable, directly responsible for managing the relevant
asset or for administering the transactions relevant to such matter or event, (iv) with respect to the Trustee, an Authorized Officer of the Trustee responsible for administering the transactions relevant to the applicable matter or event or
(v) with respect to any other Person, any member of senior management of such Person.
“
Additional Management Account
” has the meaning set forth in
Section 5.02(a)(vi)
of this Base Indenture.
“
Additional Notes
” means any Series, Class, Subclass and Tranche of Notes and additional Notes of an existing Series, Class,
Subclass or Tranche of Notes, in each case, issued by the Master Issuer after the Closing Date.
“
Additional Securitization Entity
” means any entity that becomes a direct or indirect wholly-owned Subsidiary of the Master
Issuer or any other Securitization Entity after the Closing Date in accordance with and as permitted under the Related Documents and is designated by the Master Issuer as an “Additional Securitization Entity” pursuant to
Section 8.34
of
this Base Indenture.
“
Adjusted EBITDA
” means, with respect to any Person for any period, the Consolidated Net Income of such Person and its
Subsidiaries for such period (a) plus, without duplication, the following to the extent deducted in calculating such Consolidated Net Income: (i) Consolidated Interest Expense, Net; (ii) provision for federal, state, local and foreign income taxes;
(iii) depreciation and amortization expense; (iv) stock-based compensation; (v) impairment and other charges, net (i.e., restructuring costs, cost of closed restaurants and losses on disposition of property and equipment, accelerated depreciation
and operating restaurant impairment); and (vi) franchise tenant improvement allowance amortization; and (b) minus, without duplication, to the extent added in calculating such Consolidated Net Income, gains (losses), net attributable to sales of
Company Restaurants;
provided
,
however
, that, with respect to the Securitization Entities, items that would have been accounted for as operating leases under GAAP as in effect on the Closing Date may be treated as operating leases
for purposes of this definition irrespective of any change in GAAP subsequent to the Closing Date at the discretion of the Manager in accordance with the Managing Standard;
provided
,
further
, that, with respect to the Securitization
Entities, the Manager, in accordance with the Managing Standard, may amend the definition of “Adjusted EBITDA” after the Closing Date with the consent of the Control Party.
“
Advance
” means a Collateral Protection Advance and/or a Debt Service Advance.
“
Advance Interest Rate
” means a rate equal to the Prime Rate
plus
3.0% per annum.
“
Advance Period
” has the meaning set forth in the Servicing Agreement.
“
Affiliate
” means, with respect to any specified Person, any other Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control with, such specified Person;
provided
,
however
, that no equity holder of Jack in the Box Inc. or any Affiliate of such equity holder shall be deemed to be an
Affiliate of any Non-Securitization Entity. 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 or other ownership or beneficial interests, by contract or otherwise; and the terms “controlling” and “controlled” have the meanings correlative to the meaning of “control.”
“
After-Acquired Securitization IP
” means all Intellectual Property (other than Excluded IP) throughout the United States
created, developed, authored or acquired by or on behalf of, or licensed to or on behalf of, the Franchisor or any additional Securitization Entities after the Closing Date pursuant to the IP License Agreements or otherwise, including, without
limitation, all Manager-Developed IP and all Licensee-Developed IP.
“
Agent
” means any Registrar or Paying Agent.
“
Aggregate Outstanding Principal Amount
” means the sum of the Outstanding Principal Amounts with respect to all Series of
Notes.
“
Allocated Note Amount
” means, as of any date of determination, an amount equal to the greater of (x) zero and (y) with
respect to any Contributed Asset in existence on the Closing Date, the
pro
rata
portion of $1,300,000,000 allocated to such asset on the Closing Date based on such asset’s expected contribution to Retained Collections as estimated by
the calculation of Transaction-adjusted Securitized Net Cash Flow (as such term is used in the Offering Memorandum dated June 28, 2019 for the Notes issued on the Closing Date) and (ii) any Securitized Asset arising or entered into after the
Closing Date that is contributed by a Non-Securitization Entity, the Outstanding Principal Amount of the Notes allocated to such asset, on the date such asset was included in the Securitized Assets, based on such asset’s contribution to Retained
Collections during the then-most recently ended four Quarterly Collection Periods (or in the case of the first four Quarterly Collection Periods, the estimated Retained Collections). With respect to any Securitized Asset that does not have a four
Quarterly Collection Period operating period as of the date such asset was included in the Securitized Assets, such asset’s contribution to Retained Collections will equal, as applicable, either (a) in the case of any Franchise Document, the
average of all payments or fees collected under the related agreements during the four Quarterly Collection Periods ending as of the date such agreement was included in the Securitized Assets, (b) in the case of any Franchisee Note, the aggregate
scheduled payments due thereunder during the twelve-month period after such inclusion, (c) in the case of any Securitized Lease, the aggregate scheduled lease payments due to the applicable Securitization Entity in respect thereof during the
twelve-month period after such inclusion (if applicable, net of the aggregate scheduled lease payments payable by such Securitization Entity in respect thereof during such period) or (d) in the case of a Securitized Company Restaurant, the average
of the sum of (A) the Four-Week Fiscal Period Securitized Company Restaurant Accrual Profits Amount
plus
(B) the Company Restaurant IP License Fees
plus
(C) any Company Synthetic Lease Payments, in each case, with respect to such
Securitized Company Restaurant during the twelve-month period after such inclusion.
“
alphanumerical
” means, with respect to distributions in respect of all Notes, an order of priority that is first by
alphabetical designation (i.e.,
letter) and then by numerical order for the same letter (
i.e.
, A-1, A-2, B-1, B-2 and not A-1, B-1, A-2, B-2) as set forth in herein,
and
pro
rata
among holders of Notes within each Class of the same alphanumerical designation, as set forth in the Series Supplement for such Series (unless specified otherwise in the Series Supplement for such Series or, with respect
to any Series of Class A-1 Notes, in the applicable Variable Funding Note Purchase Agreement);
provided
,
however
, that except as otherwise set forth in a Series Supplement for a Tranche of Notes, a designation beyond a letter and an
Arabic number (i.e., the addition of a roman numeral) will not affect the priority of distributions and distributions to such Notes will be
pari
passu
and
pro
rata
.
“
Annual Election Date
” means June 1
st
of every calendar year beginning on June 1, 2019, unless a Controlling Class Representative has been elected or re-elected on or after January 1
st
of that same calendar year, in which case the Annual Election Date will be deemed to not occur during such calendar year.
“
Applicable Procedures
” means the provisions of the rules and procedures of DTC,
the “Operating Procedures of the Euroclear System” and “Terms and Conditions Governing Use of Euroclear” and the “General Terms and Conditions of Clearstream Banking” and “Customer Handbook” of Clearstream, as in effect from time to time.
“
Applicants
” has the meaning set forth in
Section 2.07(a)
of this Base Indenture.
“
Asset Disposition Collections
” has the meaning set forth in
Section 8.16
of this Base Indenture.
“
Asset Disposition Proceeds
” means, with respect to any disposition of property by a Securitization Entity, other than
dispositions resulting in Asset Disposition Collections, the excess, if any, of (i) the sum of cash and cash equivalents received in connection with such disposition (including any cash or cash equivalents received by way of deferred payment
pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received) over (ii) the sum of (A) the principal amount of any Indebtedness that is secured by the applicable property and that is required to be repaid in
connection with such disposition (other than Indebtedness under the Notes) to the extent such principal amount is actually repaid, (B) the reasonable and customary out-of-pocket expenses incurred by the Securitization Entities in connection with
such disposition and (C) income Taxes reasonably estimated to be actually payable within two (2) years of such disposition as a result of any gain recognized in connection therewith.
“
Asset Disposition Proceeds Account
” has the meaning set forth in
Section 5.02(a)(iv)
of this Base Indenture.
“
Asset Disposition Reinvestment Period
” has the meaning set forth in
Section 5.11(a)(v)
of this Base Indenture.
“
Assumption Agreement
” has the meaning set forth in
Section 8.34(d)
of this Base Indenture.
“
Authorized Officer
” means, with respect to (i) any Securitization Entity, any officer who is authorized to act for such
Securitization Entity in matters relating to such Securitization Entity, including an Authorized Officer of the Manager authorized to act on behalf of such Securitization Entity; (ii) Jack in the Box Inc., in its individual capacity and in its
capacity as the Manager, the Chief Executive Officer, the President, the Chief Financial Officer, the General Counsel, the Treasurer or any Senior Vice President of Jack in the Box Inc. or any other officer of Jack in the Box Inc. who is directly
responsible for managing the Securitized Restaurant Business or otherwise authorized to act for the Manager in matters relating to, and binding upon, the Manager with respect to the subject matter of the request, certificate or order in question;
(iii) the Trustee or any other bank or trust company acting as trustee of an express trust or as custodian, a Trust Officer; (iv) the Servicer, any officer of the Servicer who is duly authorized to act for the Servicer with respect to the relevant
matter; or (v) the Control Party, any officer of the Control Party who is duly authorized to act for the Control Party with respect to the relevant matter. Each party may receive and accept a certification of the authority of any other party as
conclusive evidence of the authority of any Person to act, and such certification may be considered as in full force and effect until receipt by such other party of written notice to the contrary.
“
Back-Up Management Agreement
” means the Back-Up Management and Consulting Agreement, dated as of the Closing Date, by and
among the Master Issuer, the other Securitization Entities party thereto, the Manager, the Trustee and the Back-Up Manager, as amended, supplemented or otherwise modified from time to time.
“
Back-Up Manager
” means FTI Consulting, Inc., a Maryland corporation, in its capacity as Back-Up Manager pursuant to the
Back-Up Management Agreement, and any successor Back-Up Manager.
“
Back-Up Manager Fees
” means amounts paid to the Back-Up Manager to (i) reimburse for reasonable out-of-pocket expenses and
(ii) pay a fee as agreed upon under a separate fee letter among the Manager, the Securitization Entities and the Back-Up Manager, in each case incurred by the Back-Up Manager in performing services under the Back-Up Management Agreement.
“
Bankruptcy Code
” means the provisions of Title 11 of the United States Code, 11 U.S.C. Section 101 et seq.
“
Base Indenture
” means the Base Indenture, dated as of the Closing Date, by and among the Master Issuer and the Trustee, as
amended, supplemented or otherwise modified from time to time, exclusive of any Series Supplement.
“
Base Indenture Account
” means any account or accounts authorized and established pursuant to the Base Indenture for the
benefit of the Secured Parties, including, without limitation, each account established pursuant to
Article V
of this Base Indenture.
“
Base Indenture Definitions List
” has the meaning set forth in
Section 1.01(a)
of this Base Indenture.
“
Board of Directors
” means the Board of Directors of any corporation or any unlimited company, or any authorized committee
of such Board of Directors.
“
Book-Entry Notes
” means beneficial interests in the Notes of any Series, ownership and transfers of which will be evidenced
or made through book entries by a Clearing Agency as described in
Section 2.12
of this Base Indenture;
provided
that, after the occurrence of a condition whereupon book-entry registration and transfer are no longer permitted and
Definitive Notes are issued to the Note Owners, such Definitive Notes will replace Book-Entry Notes.
“
Branded Restaurants
” means, as of any date of determination, all restaurants, whether or not such restaurants offer
sit-down dining, operated in the United States under the Jack in the Box Brand.
“
Business Day
” means any day other than Saturday or Sunday or any other day on which commercial banks are authorized to
close under the laws of, or are in fact closed in, New York, New York, San Diego, California or the city in which the Corporate Trust Office of any successor Trustee is located if so required by such successor.
“
Capitalized Lease Obligations
” means the obligations of a Person to pay rent or other amounts under any lease of (or other
arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP and, for the purposes of
the Indenture, the amount of such obligations will be the capitalized amount thereof determined in accordance with GAAP.
“
Capped Class A‑1 Notes Administrative Expenses Amount
” means, for each Weekly Allocation Date with respect to any Quarterly
Collection Period, an amount equal to the lesser of (a) the Class A-1 Notes Administrative Expenses that have become due and payable prior to such Weekly Allocation Date and have not been previously paid and (b) the amount by which (i) $100,000
exceeds (ii) the aggregate amount of Class A-1 Notes Administrative Expenses previously paid on each preceding Weekly Allocation Date that occurred (x) in the case of a Weekly Allocation Date occurring during the period beginning on the Closing
Date and ending on the date on which 52 full and consecutive Weekly Collection Periods have occurred, since the Closing Date and (y) in the case of a Weekly Allocation Date occurring during any successive period of 52 consecutive Weekly Collection
Periods after the period in
clause (x)
, since the beginning of such period.
“
Capped Securitization Operating Expense Amount
” means, for any Weekly Allocation Date that occurs during each fiscal year
of the Securitization Entities, the amount by which $500,000 exceeds the aggregate Securitization Operating Expenses already paid during such period;
provided
,
however
, that during any period that the Back-Up Manager is required to
provide Warm Back-Up Management Duties or Hot Back-Up Management Duties pursuant to the Back-Up Management Agreement, such amount shall automatically be increased by an additional $500,000 solely in order to provide for the reimbursement of any
increased fees and expenses incurred by the Back-Up Manager associated with the provision of such services and the Control Party, acting at the direction of the Controlling Class Representative, may further increase the Capped Securitization
Operating Expense Amount as calculated above in order to take account of any increased fees associated with the provision of such services.
“
Cash Collateral
” has the meaning set forth in
Section 5.13(d)(iii)
of this Base Indenture.
“
Cash Trapping Amount
” means, for any Weekly Allocation Date during a Cash Trapping Period, an amount equal to the product
of (i) the applicable Cash Trapping Percentage and (ii) the amount of funds available in the Collection Account on such Weekly Allocation Date after payment of
priorities (i)
through
(xii)
of the Priority of Payments (but with
respect to the first Weekly Allocation Date on or after a Cash Trapping Release Date, net of the Cash Trapping Release Amount released on such Cash Trapping Release Date);
provided
that, for any Weekly Allocation Date following the
occurrence and during the continuation of a Rapid Amortization Event, or an Event of Default, the Cash Trapping Amount will be zero.
“
Cash Trapping DSCR Threshold
” means a DSCR equal to 1.75x.
“
Cash Trapping Event
” means, as of any Quarterly Payment Date, that the DSCR calculated as of the immediately preceding
Quarterly Calculation Date is less than the Cash Trapping DSCR Threshold.
“
Cash Trapping Percentage
” means, with respect to any Weekly Allocation Date during a Cash Trapping Period, a percentage
equal to (i) 50%, if the DSCR as calculated as of the immediately preceding Quarterly Calculation Date is less than 1.75x but equal to or greater than 1.50x and (ii) 100%, if the DSCR as calculated as of the immediately preceding Quarterly
Calculation Date is less than 1.50x.
“
Cash Trapping Period
” means any period that begins at the close of business on any Quarterly Payment Date on which the DSCR
as calculated as of the immediately preceding Quarterly Calculation Date is less than the Cash Trapping DSCR Threshold and will end on the first Quarterly Payment Date on which the DSCR as calculated as of the immediately preceding Quarterly
Calculation Date is equal to or exceeds the Cash Trapping DSCR Threshold.
“
Cash Trapping Release Amount
” means, (i) with respect to any Cash Trapping Release Date on which a Cash Trapping Period is
no longer in effect, the full amount on deposit in the Cash Trap Reserve Account, and (ii) with respect to any other Cash Trapping Release Date, 50% of the aggregate amount deposited to the Cash Trap Reserve Account during the most recent period in
which the applicable Cash Trapping Percentage was equal to 100%, after having been reduced ratably for any withdrawals made from the Cash Trap Reserve Account during such period for any other purpose.
“
Cash Trapping Release Date
” means any Quarterly Payment Date (i) on which a Cash Trapping Period is no longer continuing or
(ii) on which the Cash Trapping Percentage is equal to 50% and on the prior Quarterly Payment Date, the applicable Cash Trapping Percentage was equal to 100%.
“
Cash Trap Reserve Account
” means the reserve account no. 12206100 entitled “Citibank, N.A. f/b/o Jack in the Box Funding,
LLC, Cash Trap Reserve Account”, which account is maintained by the Trustee for the purpose of trapping cash upon the occurrence of a Cash Trapping Event, or any successor securities account established pursuant to the Base Indenture.
“
Casualty Reinvestment Period
” has the meaning set forth in
Section 5.11(a)(vi)
of this Base Indenture.
“
Cause
” means, with respect to an Independent Manager, (i) acts or omissions by such Independent Manager constituting fraud,
dishonesty, negligence, misconduct or other deliberate action which causes injury to any Securitization Entity or an act by such Independent Manager involving moral turpitude or a serious crime, (ii) that such Independent Manager no longer meets
the definition of “Independent Manager” as set forth in the applicable Securitization Entity’s Charter Documents or (iii) a material increase in fees charged by such Independent Manager;
provided
, that the Independent Manager may only be
removed for Cause pursuant to this
clause (iii)
with the consent of the Control Party.
“
CCR Acceptance Letter
” has the meaning set forth in
Section 11.01(e)
of this Base Indenture.
“
CCR Ballot
” has the meaning set forth in
Section 11.01(c)
of this Base Indenture.
“
CCR Candidate
” means any nominee submitted to the Trustee on a CCR Nomination pursuant to
Section 11.01(b)
of this
Base Indenture.
“
CCR Election
” means an election of a Controlling Class Representative as set forth in
Section
11.01(a)
and
(b)
of this Base Indenture.
“
CCR Election Notice
” has the meaning set forth in
Section 11.01(b)
of this Base Indenture.
“
CCR Election Period
” has the meaning set forth in
Section 11.01(c)
of this Base Indenture.
“
CCR Nomination
” has the meaning set forth in
Section 11.01(b)
of this Base Indenture.
“
CCR Nomination Period
” has the meaning set forth in
Section 11.01(b)
of this Base Indenture.
“
CCR Re-election Event
” means any of the following events: (i) an additional Series of Notes of the Controlling Class is
issued, (ii) the Controlling Class changes, (iii) the Trustee receives written notice of the resignation or removal of any acting Controlling Class Representative, (iv) the Trustee receives a written request for an election for a Controlling Class
Representative from a Controlling Class Member and such election has been consented to by the Control Party in its sole discretion, which election will be at the expense of such Controlling Class Members (including Trustee expenses), (v) the
Trustee receives written notice that an Event of Bankruptcy has occurred with respect to the acting Controlling Class Representative, (vi) there is no Controlling Class Representative and the Control Party requests an election be held or (vii) an
Annual Election Date occurs;
provided
that with respect to a CCR Re-election Event that occurs as a result of
clauses (iv)
,
(vi)
and
(vii)
, no CCR Re-election Event will be deemed to have occurred if it would result
in more than two (2) CCR Re-election Events occurring in a single calendar year.
“
CCR Voting Record Date
” has the meaning set forth in
Section 11.01(c)
of this Base Indenture.
“
Charter Documents
” means, with respect to any entity and at any time, the certificate of incorporation, certificate of
formation, operating agreement, by-laws, memorandum of association, articles of association, or such other similar document, as applicable to such entity in effect at such time.
“
Class
” means, with respect to any Series of Notes, any one of the classes of Notes of such Series as specified in the
Series Supplement for such Series, which may include Subclasses or Tranches.
“
Class A‑1 Administrative Agent
” means, with respect to any Series of Class A‑1 Notes, the Person identified as the
“Class A‑1 Administrative Agent” in the Series Supplement for such Series or Variable Funding Note Purchase Agreement.
“
Class A-1 Commitment Fee Adjustment Amount
” means, for any Series of Class A‑1 Notes for any Interest Accrual Period, the
aggregate amount, if any, for such Interest Accrual Period that is identified as the “Class A-1 Commitment Fee Adjustment Amount” in the Series Supplement for such Series or Variable Funding Note Purchase Agreement.
“
Class A‑1 Interest Adjustment Amount
” means, for any Series of Class A‑1 Notes for any Interest Accrual Period, the
aggregate amount, if any, for such Interest Accrual Period that is identified as a “Class A‑1 Interest Adjustment Amount” in the Series Supplement for such Series or Variable Funding Note Purchase Agreement.
“
Class A-1 Notes
” means any Notes alphanumerically designated as “Class A-1” pursuant to the Series Supplement applicable to
such Class of Notes.
“
Class A-1 Notes Accrued Quarterly Commitment Fee Amount
” means, for each Weekly Allocation Date with respect to a Quarterly
Collection Period and the Interest Accrual Period beginning during such Quarterly Collection Period, and with respect to any Series of Class A-1 Notes Outstanding, the aggregate amount of commitment fees due and payable, with respect to such Weekly
Allocation Date on such Series of Class A‑1 Notes that is identified as “Class A-1 Notes Accrued Quarterly Commitment Fee Amount” in the Series Supplement for such Series or Variable Funding Note Purchase Agreement.
“
Class A‑1 Notes Administrative Expenses
” means all amounts due and payable pursuant to any Variable Funding Note Purchase
Agreement that are identified as “Class A‑1 Notes Administrative Expenses” in each Series Supplement for such Series or Variable Funding Note Purchase Agreement.
“
Class A‑1 Notes Amortization Event
” means any event designated as a “Class A‑1 Notes Amortization Event” in any Series
Supplement or Variable Funding Note Purchase Agreement.
“
Class A‑1 Notes Commitment Fees Account
” has the meaning set forth in
Section 5.07(a)(iv)
of this Base Indenture.
“
Class A‑1 Notes Maximum Principal Amount
” means, with respect to all Series of Class A‑1 Notes Outstanding, the aggregate
maximum principal amount of such Series of Class A‑1 Notes as identified in the Series Supplement for such Series or Variable Funding Note Purchase Agreement as reduced by any permanent reductions of commitments with respect to such Series of
Class A‑1 Notes and any cancellations of repurchased Class A‑1 Notes thereunder.
“
Class A‑1 Notes Other Amounts
” means all amounts due and payable pursuant to any Variable Funding Note Purchase Agreement
that are identified as “Class A-1 Notes Other Amounts” in such Variable Funding Note Purchase Agreement.
“
Class A‑1 Notes Renewal Date
” means, with respect to any Series of Class A‑1 Notes, the date identified as the “Class A‑1
Notes Renewal Date” in the Series Supplement for such Series or Variable Funding Note Purchase Agreement.
“
Class A‑1 Notes Voting Amount
” has the meaning set forth in
Section 2.01(b)(i)
of this Base Indenture or Variable
Funding Note Purchase Agreement.
“
Class A-1 Quarterly Commitment Fee Amounts
” means, for any Interest Accrual Period, with respect to each Series of
Class A‑1 Notes Outstanding, the aggregate amount of commitment fees due and payable, with respect to such Interest Accrual Period, on such Series of Class A‑1 Notes that is identified as “Class A-1 Quarterly Commitment Fee Amounts” in the Series
Supplement for such Series or Variable Funding Note Purchase Agreement.
“
Class A-1 Quarterly Commitment Fees Shortfall Amount
” has the meaning set forth in
Section 5.13(b)(iii)
of this
Base Indenture.
“
Class A-2 Notes
” means any Notes alphanumerically designated as “Class A-2” pursuant to the Series Supplement applicable to
such Class of Notes.
“
Clearing Agency
” means an organization registered as a “clearing agency” pursuant to Section 17A of the 1934 Act or any
successor provision thereto or Euroclear or Clearstream.
“
Clearing Agency Participant
” means a broker, dealer, bank, other financial institution or other Person for whom from time
to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the Clearing Agency.
“
Clearstream
” means Clearstream Banking,
societe anonyme
and any successor entity.
“
Closing Date
” means July 8, 2019.
“
Closing Date Securitization IP
” means all Intellectual Property (other than the Excluded IP) throughout the United States
created, developed, authored, acquired or owned by or on behalf of, or licensed to or on behalf of, Jack in the Box Inc., Jack in the Box Eastern Division L.P., the Holding Company Guarantor, the Master Issuer, JIB Properties, the Franchisor, Jack
in the Box Foundation or JIB Stored Value Cards, LLC as of the Closing Date covering, reading on, embodied in or otherwise relating to (i) the Jack in the Box System and Jack in the Box Brand, (ii) products or services sold or distributed via the
Jack in the Box System under the Jack in the Box Brand, (iii) the Branded Restaurants, (iv) the Securitized Franchised Restaurant Business or (v) the Securitized Company Restaurant Business, and also including the JIB Mobile Apps.
“
Code
” means the U.S. Internal Revenue Code of 1986, as amended, reformed or otherwise modified from time to time, and any
successor statute of similar import, in each case as in effect from time to time.
“
Collateral
” means, collectively, the Indenture Collateral, the “Collateral” as defined in the Guarantee and Collateral
Agreement and any property subject to any other Indenture Document that grants a Lien to secure any Obligations.
“
Collateral Business Documents
” means, collectively, the Securitized Franchise Documents, the Securitized Franchisee Notes,
the Securitized Owned-Property Franchisee Leases and the Securitized Franchisee Back-to-Back Subleases.
“
Collateral Exclusions
” has the meaning set forth in
Section 3.01(b)
of this Base Indenture.
“
Collateralized Letters of Credit
” has the meaning set forth in
Section 5.13(d)(iii)
of this Base Indenture.
“
Collateral Protection Advance
” means any advance of (a) payment of Taxes, rent, assessments, insurance premiums and other
related or similar costs and expenses necessary to protect, preserve or restore the Securitized Assets and (b) payments of any Securitization Operating Expenses (excluding (i) any indemnification obligations, (ii) business and/or asset related
operating expenses, (iii) fees and expenses of external legal counsel that are not directly related to the maintenance or preservation of the Collateral, (iv) fees and expenses of any entity other than a Securitization Entity and (v) damages,
costs, or expenses relating to fraud, bad faith, willful misconduct, violations of law, bodily injury, property damage or misappropriation of funds), to the extent not previously paid pursuant to a Manager Advance, in each case made by the Servicer
pursuant to the Servicing Agreement in accordance with the Servicing Standard, or by the Trustee pursuant to the Indenture.
“
Collateral Transaction Documents
” means the Contribution Agreements, the Charter Documents of each Securitization Entity,
the IP License Agreements, the Servicing Agreement, the Account Control Agreements, the Management Agreement and the Back-Up Management Agreement.
“
Collection Account
” means account no. 12205400 entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Collection
Account”, which account is maintained by the Trustee pursuant to
Section 5.06
of this Base Indenture or any successor securities account maintained pursuant to
Section 5.06
of this Base Indenture.
“
Collection Account Administrative Accounts
” has the meaning set forth in
Section 5.07
of this Base Indenture.
“
Collections
” means, with respect to each Weekly Collection Period, all amounts
received by or for the account of the Securitization Entities during such Weekly Collection Period, including (without duplication):
(i)
Securitized Franchisee Payments, Securitized Franchisee Note Payments, Securitized Owned-Property Franchisee Lease Payments, Franchisee
Back-to-Back Sublease Payments, Non-Branded Restaurant Lease Payments and any Non-Securitization Entity Lease Payments deposited into any Concentration Account;
(ii)
all amounts received under the IP License Agreements and all other license fees, including the Company Restaurant IP License Fees and other amounts
received in respect of the Securitization IP, including recoveries from the enforcement of the Securitization IP;
(iii)
all Securitized Company Restaurant Collections; including amounts in respect of sales Taxes and other comparable Taxes, payroll Taxes, wage
garnishments and other amounts received by Securitized Company Restaurants that are due and payable to a Governmental Authority or other unaffiliated third party (“
Pass-Through Amounts
”);
(iv)
Indemnification Amounts, Insurance/Condemnation Proceeds, Asset Disposition Proceeds and (without duplication) all other amounts received upon the
disposition of the Securitized Assets, including proceeds received upon the disposition of property expressly excluded from the definition of Asset Disposition Proceeds, in each case that are required to be deposited into any Concentration
Account or the Collection Account;
(v)
the Series Hedge Receipts, if any, received by the Securitization Entities in respect of any Series Hedge Agreements entered into by the
Securitization Entities in connection with the issuance of Additional Notes following the Closing Date;
(vi)
Investment Income earned on amounts on deposit in the Accounts;
provided
that Investment Income will only be considered “Collections” if it
is greater than or equal to $100 per Account with respect to such Weekly Collection Period;
(vii)
equity contributions made to the Master Issuer directed to be deposited to any Concentration Account;
(viii)
to the extent not otherwise included above, payments from Franchisees or any other Person in respect of Excluded Amounts deposited in any
Concentration Account;
(ix)
any payments received under the Letter of Credit Reimbursement Agreement from any Non-Securitization Entity; and
(x)
any other payments or proceeds received with respect to the Securitized Assets.
“
Commitment
” has the meaning set forth in the Series Supplement for such Series.
“
Company Order
” means a written order or request signed in the name of the Master
Issuer by any Authorized Officer of the Master Issuer and delivered to the Trustee, the Control Party or the Paying Agent.
“
Company Restaurant IP License Fees
” means the licensing fees payable by JIB
Properties, Jack in the Box Inc. or Jack in the Box Eastern Division L.P. under the applicable Company Restaurant IP License, at a rate equal to five percent (5%) of the Gross Sales of each Company Restaurant, owned and operated by JIB Properties,
Jack in the Box Inc. or Jack in the Box Eastern Division L.P., as applicable (paid weekly).
“
Company Restaurant IP Licenses
” means collectively, the Jack in the Box Inc.
Company Restaurant IP License, the Jack in the Box Eastern Division Company Restaurant IP License and the JIB Properties Company Restaurant IP License.
“
Company Restaurants
” means Branded Restaurants owned and operated by any
Securitization Entity or Non-Securitization Entity.
“
Company Synthetic Lease Payment
” has the meaning set forth in
Section 5.11(a)(ii)
of this Base Indenture.
“
Competitor
” means any Person that is a direct or indirect franchisor, franchisee,
owner or operator of a large regional or national quick service restaurant concept (including a Franchisee);
provided
,
however
, that (i) a Person will not be a “Competitor” solely by virtue of its direct or indirect ownership of less than 5.0% of the Equity Interests in a “Competitor” and (ii) a franchisee shall only be a
“Competitor” if it, or its Affiliates, directly or indirectly, owns, franchises or licenses, in the aggregate, ten or more individual locations of a particular concept; and provided, further, that (iii) a Person will not be a “Competitor” solely by
virtue of its direct or indirect ownership of between 5.0% and 15% of the Equity Interests in a “Competitor” so long as (a) such Person has policies and procedures that prohibit such Person from disclosing or making available any confidential
information that such Person may receive as a Holder or prospective investor in the Notes, to individuals involved in the business of buying, selling, holding or analyzing the Equity Interests of a “Competitor” or in the business of being a
franchisor, franchisee, owner or operator of a large regional or national quick service restaurant concept and (b) such Person is a passive investor in a “Competitor” as described in Rule 13d-1(b)(1) of the 1934 Act (or would be described as a
passive investor under such rule if the “Competitor” were a publicly-traded company and the securities held were publicly-traded equity securities) and is not a franchisor, franchisee, owner (other than in its capacity as a passive investor as
described in Rule 13d-1(b)(1) of the 1934 Act) or operator of a large regional or national quick service restaurant concept (including a Franchisee).
“
Concentration Accounts
” has the meaning set forth in
Section 5.02(a)(iii)
of this Base Indenture.
“
Consent Request
” means any request for a direction, waiver, amendment, consent or
certain other action under the Related Documents.
“
Consolidated Interest Expense, Net
” means, with respect to any Person for any
period, consolidated net interest expense, whether paid or accrued, of such Person and its Subsidiaries for such period determined in accordance with GAAP.
“
Consolidated Net Income
” means, with respect to any Person for any period, the
consolidated net income of such Person and its Subsidiaries (whether positive or negative), determined in accordance with GAAP, for such period.
“
Contingent Obligation
” means, as applied to any Person, any direct or indirect
liability, contingent or otherwise, of that Person (a) with respect to any indebtedness, lease, declared but unpaid dividends, letter of credit or other obligation of another if the primary purpose or intent thereof by the Person incurring the
Contingent Obligation is to provide assurance to the obligee of such obligation of another that such obligation of another will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such
obligation will be protected (in whole or in part) against loss in respect thereof or (b) under any letter of credit issued for the account of that Person or for which that Person is otherwise liable for reimbursement thereof. Contingent
Obligation will include (x) the direct or indirect guarantee, endorsement (otherwise than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of
another and (y) any liability of such Person for the obligations of another through any agreement (contingent or otherwise) (i) to purchase, repurchase or otherwise acquire such obligation- or any security therefor, or to provide funds for the
payment or discharge of such obligation (whether in the form of loans, advances, stock purchases, capital contributions or otherwise), (ii) to maintain the solvency of any balance sheet item, level of income or financial condition of another or
(iii) to make take-or-pay or similar payments if required regardless of non-performance by any other party or parties to an agreement, if in the case of any agreement described under
subclause (i)
or
(ii)
of this
clause (y)
the primary purpose or intent thereof is as described in the preceding
sentence. The amount of any Contingent Obligation will be equal to the amount of the obligation so guaranteed or otherwise supported.
“
Contractual Obligation
” means, with respect to any Person, any provision of any
security issued by that Person or of any indenture, mortgage, deed of trust, contract, undertaking, agreement or other instrument to which that Person is a party or by which it or any of its properties is bound or to which it or any of its
properties is subject.
“
Contributed Assets
” means all assets contributed under the Contribution
Agreements.
“
Contributed Real Estate Assets
” means (i) the Contributed Securitized Owned Real
Property and (ii) the Contributed Securitized Leases.
“
Contributed Securitized Back-to-Back Franchisee Lease Arrangements
” means lease
arrangements for certain Franchised Restaurants comprised of (i) Contributed Securitized JIB Back-to-Back Leases and (ii) Contributed Securitized Franchisee Back-to-Back Subleases which are collectively contributed to JIB Properties on the Closing
Date pursuant to the applicable Contribution Agreement.
“
Contributed Securitized Company Restaurants
” means Company Restaurants existing on
the Closing Date that are contributed to JIB Properties on the Closing Date pursuant to the applicable Contribution Agreement.
“
Contributed Securitized Company Restaurant Third-Party Leases
” means leases for
certain Securitized Company Restaurants under which JIB Properties will act as lessee under leases with third-party landlords, which are contributed to JIB Properties on the Closing Date pursuant to the applicable Contribution Agreement.
“
Contributed Securitized Development Agreements
” means all Development Agreements
and related guaranty agreements existing as of the Closing Date that are contributed to any Securitization Entity on the Closing Date pursuant to the applicable Contribution Agreements.
“
Contributed Securitized Franchise Agreements
” means all Franchise Agreements and
related guaranty agreements existing as of the Closing Date that are contributed to the Franchisor on the Closing Date pursuant to the applicable Contribution Agreements.
“
Contributed Securitized Franchised Restaurants
” means Franchised Restaurants
existing as of the Closing Date that are franchised pursuant to Franchise Agreements contributed to the Franchisor on the Closing Date pursuant to the applicable Contribution Agreement.
“
Contributed Securitized Franchisee Back-to-Back Subleases
” means for certain
Franchised Restaurants, leases under which JIB Properties acquires rights to a property as lessee from a third-party landlord (or a landlord that is a Non-Securitization Entity, if such lease is on arm’s length terms) and in turn leases that
property to a Franchisee that are contributed to JIB Properties on the Closing Date pursuant to the applicable Contribution Agreements.
“
Contributed Securitized Franchisee Notes
” means all Franchisee Notes and related
guaranty and collateral agreements existing as of the Closing Date that are contributed to the Franchisor on the Closing Date, if any.
“
Contributed Securitized JIB Back-to-Back Lease
” means for certain Franchised
Restaurants, leases under which (a) JIB Properties acts as lessee to a third-party landlord (or a landlord that is a Non-Securitization Entity, if such lease is on arm’s length terms) and (b) JIB Properties subleases such lease to a Franchisee,
that are contributed to JIB Properties on the Closing Date pursuant to the applicable Contribution Agreements.
“
Contributed Securitized Leases
” means Securitized Leases existing as of the
Closing Date that are contributed to JIB Properties on the Closing Date.
“
Contributed Securitized Owned Real Property
” means the real property (including
the land, buildings and fixtures) owned in fee by Jack in the Box Inc. or its Subsidiaries that are contributed to JIB Properties on the Closing Date pursuant to the applicable Contribution Agreements.
“
Contributed Securitized Owned-Property Franchisee Leases
” means leases for certain
Franchised Restaurants under which the real property is owned by JIB Properties, a Franchisee will act as lessee and JIB Properties will act as lessor, which are contributed to JIB Properties on the Closing Date pursuant to the applicable
Contribution Agreement.
“
Contribution Agreements
” means the following agreements:
(a)
Properties 1 Contribution Agreement, dated as of the Closing Date, by and between Jack in the Box Eastern Division
L.P. and JIB Properties;
(b)
Eastern Distribution Agreement, dated as of the Closing Date, by and between Jack in the Box Eastern Division L.P.
and JBX General Partner LLC;
(c)
Eastern Distribution Agreement, dated as of the Closing Date, by and between Jack in the Box Eastern Division L.P.
and JBX Limited Partner LLC;
(d)
JBX GP Distribution Agreement, dated as of the Closing Date, by and between JBX General Partner LLC and Jack in the
Box Inc.;
(e)
JBX LP Distribution Agreement, dated as of the Closing Date, by and between JBX Limited Partner LLC and Jack in the
Box Inc.;
(f)
Properties 2 Contribution Agreement, dated as of the Closing Date, by and between Jack in the Box Inc. and JIB
Properties;
(g)
Franchisor Contribution Agreement, dated as of the Closing Date, by and between Jack in the Box Inc. and the
Franchisor;
(h)
Holding Company Guarantor Contribution Agreement, dated as of the Closing Date, by and between Jack in the Box Inc.
and the Holding Company Guarantor;
(i)
Master Issuer Contribution Agreement, dated as of the Closing Date, by and between the Holding Company Guarantor and
the Master Issuer.
“
Control Party
” means, at any time, the Servicer, who will direct the Trustee to
act (or refrain from acting) or will act on behalf of the Trustee in connection with Consent Requests.
“
Controlled Foreign Corporation
” has the meaning given to such term in Section 957 of the Code.
“
Controlled Group
” means any trade or businesses (whether or not incorporated) that, together with any Securitization
Entity, is treated as a single employer under Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).
“
Controlling Class
” means the most senior Class of Notes (by alphabetical designation (as opposed to alphanumerical
designation)) then Outstanding among all Series of Notes then Outstanding.
“
Controlling Class Member
” means, with respect to a Book-Entry Note of the Controlling Class, a Note Owner of such Note, and
with respect to a Definitive Note of the Controlling Class, a Noteholder of such Definitive Note (excluding, in each case, any Securitization Entity or Affiliate thereof).
“
Controlling Class Representative
” means, at any time during which one or more Series of Notes is outstanding, the
representative, if any, that has been elected pursuant to
Section 11.01
of this Base Indenture by the Majority of Controlling Class Members. The Controlling Class Representative may not be a Competitor.
“
Copyrights
” has the meaning set forth in the definition of “Intellectual Property.”
“
Corporate Trust Office
” means the corporate trust office of the Trustee at (a) for Note transfer purposes and presentment
of the Notes for final payment thereon, Citibank, N.A., 480 Washington Boulevard, 30th Floor, Jersey City, New Jersey 07310, Attention: Securities Window - Jack in the Box Funding, LLC and (b) for all other purposes, Citibank, N.A., 388 Greenwich
Street, New York, New York 10013, Attention: Citibank Agency & Trust - Jack in the Box Funding, LLC, email: jacqueline.suarez@citi.com or call (888) 855-9695 to obtain Citibank, N.A. account manager’s email address, or such other address as
the Trustee may designate from time to time by notice to the holders, each Rating Agency and the Master Issuer or the principal corporate trust office of any successor Trustee.
“
Cut-Off Date
” means July 8, 2019.
“
Debt Service
” means, with respect to any Quarterly Payment Date, the sum of (i) the Senior Notes Quarterly Interest Amount
plus
(ii) the Senior Subordinated Notes Quarterly Interest Amount
plus
(iii) the Class A-1 Quarterly Commitment Fee Amount
plus
(iv) with respect to any Class of Senior Notes and Senior Subordinated Notes Outstanding, the
aggregate amount of Scheduled Principal Payments (including, for the avoidance of doubt, the Senior Notes Quarterly Scheduled Principal Amount) due and payable on such Quarterly Payment Date, as such Scheduled Principal Payments may be ratably
reduced by the aggregate amount of any (A) payments of Indemnification Amounts, Asset Disposition Proceeds or Insurance/Condemnation Proceeds, (B) repurchases and cancellations of such Class of Notes or (C) optional prepayments of principal of such
Class of Notes, but without giving effect to any reductions of Scheduled Principal Payments available due to the satisfaction of the applicable Series Non-Amortization Test.
“
Debt Service Advance
” means an advance made by the Servicer (or, if the Servicer fails to do so, the Trustee) on a
Quarterly Payment Date in respect of the Senior Notes Quarterly Interest Shortfall Amount on any Quarterly Payment Date.
“
Default
” means any Event of Default or any occurrence that with notice or the lapse of time or both would become an Event
of Default.
“
Defeased Series
” has the meaning set forth in
Section 12.01(c)
of this Base Indenture.
“
Definitive Notes
” has the meaning set forth in
Section 2.12(a)
of this Base Indenture.
“
Depository Agreement
” means, with respect to a Series or Class of a Series of Notes having Book-Entry Notes, the agreement
among the Master Issuer, the Trustee and the Clearing Agency governing the deposit of such Notes with the Clearing Agency, or as otherwise provided in the Series Supplement for such Series.
“
Development Agreements
” means all development agreements for Branded Restaurants pursuant to which a Franchisee, developer
or other Person obtains the rights to develop (in order to operate as a Franchisee) one or more Branded Restaurants within a designated geographical area.
“
DSCR
” means, as of any Quarterly Payment Date, equals (i) the Net Cash Flow over the four (4) immediately preceding
Quarterly Collection Periods,
divided by
(ii) the Debt Service with respect to such four (4) Quarterly Collection Periods;
provided
that, for purposes of calculating the DSCR as of the first
three (3) Quarterly Calculation Dates, (a) “Net Cash Flow” for the Quarterly Collection Period ended January 20, 2019 will be deemed to be $73,100,108, “Net Cash Flow” for the Quarterly Collection Period ended April 14, 2019 will be deemed to be
$67,308,345 and “Net Cash Flow” for the Quarterly Collection Period ended July 7, 2019 will be calculated by the Manager at the time of the first Quarterly Calculation Date and will be based on the financial results of Jack in the Box for the
fiscal quarter ended July 7, 2019 and (b)
clause (ii)
of such DSCR calculation will be deemed to equal the Debt Service measured for the most recently ended Quarterly Collection Period times four (4) (and for the first four Quarterly
Payment Dates, the Debt Service for the first Quarterly Collection Period will be adjusted to account for the irregular number of days in such Quarterly Collection Period). For the purposes of calculating the DSCR as of the first four (4)
Quarterly Payment Dates, the Debt Service for the first Quarterly Collection Period will be deemed to be the sum of (A) the product of (x) the sum of the amounts referred to in
clauses (i)
,
(ii)
and
(iii)
of the definition
of “Debt Service”
multiplied by
(y) a fraction the numerator of which is ninety (90) and the denominator of which is the actual number of days elapsed during the period commencing on and including the Closing Date and ending on but
excluding the first Quarterly Payment Date
plus
(B) the amount referred to in
clause (iv)
of the definition of “Debt Service”. “
Interest-Only DSCR
” means the calculation of DSCR without any application of
clause (iv)
of the definition of “Debt Service.”
“
DTC
” means The Depository Trust Company and any successor thereto.
“
Eligible Account
” means (a) a segregated identifiable trust account established in the trust department of a Qualified
Trust Institution or (b) a separately identifiable deposit or securities account established at a Qualified Institution.
“
Eligible Assets
” means any real or personal property or other asset useful to a Securitization Entity in the operation of
its business or of its other assets, including, without limitation, (i) capital assets, capital expenditures, renovations and improvements and (ii) assets intended to generate revenue for a Securitization Entity.
“
Eligible Investments
” means (a) time deposits with, or insured certificates of deposit or bankers’ acceptances of, any
commercial bank or trust company that (i) is organized under the laws of the United States or is the principal banking subsidiary of a bank holding company organized under the laws of the United States and is a member of the Federal Reserve System,
(ii) whose short-term debt is rated at least “P-1” (or then equivalent grade) by Moody’s and at least “A‑1+” (or then equivalent grade) by S&P and, if it has a short-term rating by KBRA, at least “K2” by KBRA and (iii) has combined capital and
surplus of at least $1,000,000,000, in each case with maturities of not more than one (1) year from the date of acquisition thereof; (b) readily marketable obligations issued or directly and fully guaranteed or insured by the United States or any
agency or instrumentality thereof having maturities of not more than one (1) year from the date of acquisition thereof;
provided
that the full faith and credit of the United States is pledged in support thereof; (c) commercial paper issued
by any Person organized under the laws of any state of the United States and rated at least “P-1” (or then equivalent grade) by Moody’s and at least “A‑1+” (or the then equivalent grade) by S&P and, if it has a short-term rating by KBRA, at
least “K2” by KBRA, with maturities of not more than one hundred eighty (180) days from the date of acquisition thereof; (d) repurchase obligations with a term of not more than thirty (30) days for underlying securities of the type described in
clauses (a)
and
(b)
above entered into with any financial institution meeting the qualifications specified in
clause (a)
above and (e) investments, classified in accordance with GAAP as current assets of the relevant Person making such
investment, in money market investment programs registered under the 1940 Act, which have the highest rating obtainable from Moody’s S&P and, if it has a short-term rating by KBRA, at least “K2” by KBRA, and the portfolios of which are invested
primarily in investments of the character, quality and maturity described in
clauses (a)
though
(d)
of this definition. Notwithstanding the foregoing, all Eligible Investments must either (A) be at all times available for
withdrawal or liquidation at par (or for commercial paper issued at a discount, at the applicable purchase price) or (B) mature on or prior to the Business Day prior to the immediately succeeding Weekly Allocation Date.
“
Employee Benefit Plan
” means any “employee benefit plan”, as such term is defined in Section 3(3) of ERISA, established,
maintained or contributed to by a Securitization Entity or with respect to which any Securitization Entity has any liability.
“
Enhancement
” means, with respect to any Series of Notes, the rights and benefits provided to the Holders of such Series of
Notes pursuant to any letter of credit, surety bond, cash collateral account, spread account, guaranteed rate agreement, maturity guaranty facility, tax protection agreement, interest rate swap or any other similar arrangement entered into by the
Master Issuer in connection with the issuance of such Series of Notes as provided for in the Series Supplement for such Series in accordance with the terms of this Base Indenture or Variable Funding Note Purchase Agreement.
“
Enhancement Agreement
” means any contract, agreement, instrument or document governing the terms of any Enhancement or
pursuant to which any Enhancement is issued or outstanding.
“
Enhancement Provider
” means the Person providing any Enhancement as designated in the Series Supplement for such Series or
Variable Funding Note Purchase Agreement.
“
Environmental Law
” means any and all applicable laws, rules, orders, regulations, statutes, ordinances, binding guidelines,
codes, decrees, agreements or other legally enforceable requirements (including common law) of any international authority, foreign government, the United States, or any state, local, municipal or other Governmental Authority, regulating, relating
to or imposing liability or standards of conduct concerning protection of the environment or of human health (as it relates to exposure to Materials of Environmental Concern), or employee health and safety (as it relates to exposure to Materials of
Environmental Concern), as has been, is now, or may at any time hereafter be, in effect.
“
Environmental Permits
” means any and all permits, licenses, approvals, registrations, notifications, exemptions and other
authorizations required under any Environmental Law.
“
Equity Interest
” means any (a) membership or limited liability company interest in any limited liability company,
(b) general or limited partnership interest in any partnership, (c) common, preferred or other stock interest in any corporation, (d) share, participation, unit or other interest in the property or enterprise of an issuer that evidences ownership
rights therein, (e) ownership or beneficial interest in any trust or (f) option, warrant or other right to convert any interest into or otherwise receive any of the foregoing.
“
ERISA
” means the U.S. Employee Retirement Income Security Act of 1974, as amended, and any successor statute of similar
import, in each case as in effect from time to time. References to sections of ERISA also refer to any successor sections.
“
ERISA Event
” means (a) Reportable Event; (b) the failure to meet the minimum funding standard of Section 412 of the Code or
Section 302 of ERISA with respect to any Single Employer Plan (whether or not waived in accordance with Section 412(c) of the Code) or the failure to make by its due date a required installment under Section 430 of the Code and Section 303(j) of
ERISA with respect to any Single Employer Plan; (c) the provision by the administrator of any Single Employer Plan pursuant to Section 4041(a)(2) of ERISA of a written notice of intent to terminate such Single Employer Plan in a standard
termination described in Section 4041(b) of ERISA or a distress termination described in Section 4041(c) of ERISA; (d) the complete or partial withdrawal by the Manager, or any company in the Controlled Group of the Manager, from any Single
Employer Plan with two or more contributing sponsors or the termination of any such Single Employer Plan, in each case, which results in liability pursuant to Section 4063 or 4064 of ERISA; (e) formal written notice from the PBGC of its intent to
commence proceedings to terminate any Single Employer Plan; (f) the imposition of liability on the Manager, or any company in the Controlled Group of the Manager, pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (g) receipt from the Internal Revenue Service of notice of the failure of any Single Employer Plan to qualify under Section 401(a) of the Code or the failure of any trust forming part of any Single Employer Plan to qualify
for exemption from taxation under Section 501(a) of the Code; (h) the imposition of a lien in favor of the PBGC or a Plan pursuant to Section 430(k) of the Code or pursuant to Section 303(k) of ERISA with respect to any Single Employer Plan or (i)
the complete or partial withdrawal by the Manager or any member of its Controlled Group from any Multiemployer Plan that has resulted or could reasonably be expected to result in a material liability to the Manager under ERISA.
“
Euroclear
” means Euroclear Bank, S.A./N.V., or any successor thereto, as operator of the Euroclear System.
“
Event of Bankruptcy
” will be deemed to have occurred with respect to a Person if:
(a)
a case or other proceeding is commenced, without the application or consent of such Person, in any court, seeking the liquidation, reorganization, debt arrangement, dissolution, winding up, or
composition or readjustment of debts of such Person, the appointment of a trustee, receiver, custodian, liquidator, assignee, sequestrator or the like for such Person or all or any substantial part of its assets, or any similar action with
respect to such Person under any law relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts, and such case or proceeding continues undismissed, or unstayed and in effect, for a period of sixty
(60) consecutive days; or an order for relief in respect of such Person is entered in an involuntary case under the federal bankruptcy laws or other similar laws now or hereafter in effect; or
(b)
such Person commences a voluntary case or other proceeding under any applicable bankruptcy, insolvency, reorganization, debt arrangement, dissolution or other similar law now or hereafter in
effect, or consents to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) for such Person or for any substantial part of its property, or makes any general
assignment for the benefit of creditors; or
(c)
the Board of Directors or board of managers (or similar body) of such Person votes to implement any of the actions set forth in
clause (b)
above.
“
Event of Default
” means any of the events set forth in
Section 9.02
of this Base Indenture.
“
Excepted Securitization IP Assets
” means (i) any right to use third-party Intellectual Property pursuant to a license to
the extent such rights are not able or permitted to be pledged; and (ii) any application for registration of a Trademark that would be invalidated, canceled, voided or abandoned due to the grant and/or enforcement of an assignment or security
interest, including intent-to-use applications filed with the PTO pursuant to 15 U.S.C. Section 1051(b) prior to the filing of a statement of use or amendment to allege use pursuant to 15 U.S.C. Section 1051(c) or (d);
provided
that at such
time as the grant and/or enforcement of the assignment or security interest would not cause such application to be invalidated, canceled, voided or abandoned, such Trademark application will cease to be considered an Excepted Securitization IP
Asset.
“
Excess Class A‑1 Notes Administrative Expenses Amount
” means, for each Weekly Allocation Date, an amount equal to the
amount by which (a) the Class A‑1 Notes Administrative Expenses that have become due and payable prior to such Weekly Allocation Date and have not been previously paid exceed (b) the Capped Class A‑1 Notes Administrative Expenses Amount for such
Weekly Allocation Date.
“
Excluded Amounts
” means, among other things, (i) fees and expenses paid by or on behalf of any Securitization Entity in
connection with registering, maintaining and enforcing the Securitization IP and paying third-party licensing fees, (ii) account expenses and fees paid to the banks at which the Management Accounts are held, (iii) insurance and condemnation
proceeds payable by the Securitization Entities to Franchisees, (iv) amounts in respect of sales Taxes and other comparable Taxes and other amounts received from Franchised Restaurants that are due and payable to a Governmental Authority or other
unaffiliated third party, (v) any statutory Taxes payable by a Securitization Entity, but required to be remitted to a Governmental Authority, (vi) amounts paid by Franchisees in respect of fees or expenses payable to unaffiliated third parties for
services provided to Franchisees, (vii) amounts paid by Franchisees relating to corporate services provided by the Manager to the Franchisees, including marking and administration fees, repairs and maintenance, value card administration, employee
training, point-of-sale system maintenance and support, upfront onboarding fees and maintenance of other information technology systems, (viii) tenant improvement allowances and similar amounts received from landlords, (ix) any amounts that cannot
be transferred to a Concentration Account due to applicable law and (x) any other amounts deposited into any Concentration Account or otherwise included in Collections that are not required to be deposited into the Collection Account.
“
Excluded IP
” means (i) any commercially available, off-the-shelf, uncustomized Software or information technology systems,
in each case, licensed on standard terms and conditions to or on behalf of any Non-Securitization Entity, (ii) any proprietary software or information technology systems that are readily replaceable with Software or information technology systems
described in subpart (i), and (iii) any Intellectual Property existing in any country other than the United States, unless the Manager, in its sole discretion, causes such Intellectual Property to be created, developed, authored or acquired by or
on behalf of, or licensed to or on behalf of, the Franchisor or another Securitization Entity.
“
Extension Period
” means, with respect to any Series or any Class of any Series of Notes, the period from the Series
Anticipated Repayment Date (or any previously extended Series Anticipated Repayment Date) with respect to such Series or Class to the Series Anticipated Repayment Date with respect to such Series or Class as extended in connection with the
provisions of the Series Supplement for such Series or, to the extent applicable, Variable Funding Note Purchase Agreement.
“
FDIC
” means the U.S. Federal Deposit Insurance Corporation.
“
Financial Assets
” has the meaning set forth in
Section 5.09(b)(i)
of this Base Indenture.
“
Foreign Subsidiary Holding Company
” has the meaning set forth in Section 3.01 of this Base Indenture.
“
Four-Week Fiscal Period
” means the following monthly fiscal periods of the Securitization Entities: (a) thirteen 4-week
fiscal periods of the Securitization Entities in connection with their 52-week fiscal years and (b) twelve 4-week fiscal periods and one 5-week fiscal period of the Securitization Entities in connection with their 53-week fiscal years, whereby the
5-week period is the last fiscal period in such fiscal year.
“
Four-Week Fiscal Period Estimated Securitized Company Restaurant Profits Amount
” means, with respect to each Four-Week
Fiscal Period of the Securitization Entities, the lesser of (or, at the option of the Master Issuer, the greater of) (x) an estimate of the Four-Week Fiscal Period Securitized Company Restaurant Accrual Profits Amount for such period and (y) an
estimate of the Four-Week Fiscal Period Securitized Company Restaurant Cash Profits Amount for such period, in each case, as set forth in the relevant Weekly Manager’s Certificate.
“
Four-Week Fiscal Period Securitized Company Restaurant Accrual Profits Amount
”
means, with respect to each Four-Week Fiscal Period of the Securitization Entities, the amount (not less than zero) equal to (a) all revenue accrued in respect of all Securitized Company Restaurants (excluding Pass-Through Amounts) for such
Four-Week Fiscal Period;
minus
(b) all Restaurant Operating Expenses (excluding Pass-Through Amounts) accrued over such period in connection with the operation of the
Securitized Company Restaurants for such Four-Week Fiscal Period;
minus
(c) all Company Synthetic Lease Payments and JIB Properties Company Restaurant IP License Fees accrued
over such period in connection with the operation of the Securitized Company Restaurants for such Four-Week Fiscal Period.
“
Four-Week Fiscal Period Securitized Company Restaurant Cash Profits Amount
” means,
with respect to each Four-Week Fiscal Period of the Securitization Entities, the amount (not less than zero) equal to (a) Securitized Company Restaurant Collections (excluding Pass-Through Amounts) for such Four-Week Fiscal Period;
minus
(b) all Restaurant Operating Expenses (excluding Pass-Through Amounts) paid in cash out of funds in deposit in the Securitized Company Restaurant Accounts; minus (c) all
Company Synthetic Lease Payments and JIB Properties Company Restaurant IP License Fees in connection with the operation of the Securitized Company Restaurants for such Four-Week Fiscal Period.
“
Four-Week Fiscal Period Securitized Company Restaurant Profits True-up Amount
”
means, with respect to each Four-Week Fiscal Period of the Securitization Entities, the sum of (a) the amount (whether positive or negative) equal to (i) the Four-Week Fiscal Period Securitized Company Restaurant Accrual Profits Amount for such
Four-Week Fiscal Period
minus
(ii) the Four-Week Fiscal Period Estimated Securitized Company Restaurant Profits Amount for such Four-Week Fiscal Period
plus
(b) the unpaid amount of all Four-Week Fiscal Period Securitized Company Restaurant Profits True-up Amounts for all prior Four-Week Fiscal Periods.
“
Franchise Agreement
” means a franchise agreement (including any related service or
license agreement) whereby a Franchisee agrees to operate a Branded Restaurant.
“
Franchise Documents
” means all Franchise Agreements (including master franchise
agreements and related service or license agreements), Development Agreements and agreements related thereto, together with any modifications, amendments, extensions or replacements of the foregoing.
“
Franchised Restaurants
” means, collectively, all Branded Restaurants that are
owned and operated by Franchisees that are unaffiliated with Jack in the Box Inc. and its Affiliates pursuant to a Franchise Agreement.
“
Franchisee
” means any Person that is a franchisee under a Franchise Agreement.
“
Franchisee Back-to-Back Sublease Payments
” means sublease payments payable by
Franchisees to JIB Properties under Securitized Franchisee Back-to-Back Subleases.
“
Franchisee Note
” means any franchisee note or other franchisee financing agreement
entered into in order to finance the payment of franchisee fees, amounts payable by Franchisees in connection with Refranchising Asset Dispositions or other amounts owing by a Franchisee.
“
Franchisor
” means Different Rules, LLC, a Delaware limited liability company.
“
Franchisor Capital Accounts
” has the meaning set forth in
Section 5.02(a)(ii)
of this Base Indenture.
“
Future Brand
” means any name or Trademark (including any Trademarks related to,
based on or derivative thereof, but excluding the Jack in the Box Brand or any Trademark owned by the Securitization Entities as of the Closing Date) that (i) is acquired or developed by Jack in the Box Inc. or any of its Subsidiaries and
subsequently contributed to one or more Securitization Entities in a manner consistent with the terms of the Related Documents or (ii) that is acquired or developed by the Master Issuer or any one or more Securitization Entities in a manner
consistent with the terms of the Related Documents.
“
GAAP
” means the generally accepted accounting principles in the United States
promulgated or adopted by the Financial Accounting Standards Board and its predecessors and successors in effect from time to time.
“
Government Securities
” means readily marketable obligations issued or directly and
fully guaranteed or insured by the United States of America or any agency or instrumentality thereof and as to which obligations the full faith and credit of the United States of America is pledged in support thereof.
“
Governmental Authority
” means the government of the United States or any other
nation or any political subdivision of the foregoing, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
“
Gross Sales
” means, with respect to a restaurant, the total amount of revenue
received from the sale of all food, products, merchandise and performance of all services and all other income of every kind and nature (including gift certificates when redeemed but not when purchased), whether for cash or credit and regardless of
collection in the case of credit;
provided
,
however
, that Gross Sales shall not include (i) refunds
and allowances; (ii) any sales Taxes or other Taxes, in each case collected from customers for transmittal to the appropriate taxing authority or (iii) revenues that are not subject to royalties in accordance with the related Securitized Franchise
Agreement, applicable IP License Agreement or other applicable agreement.
“
Guarantee
” means, as to any Person, any (a) obligation, contingent or otherwise,
of such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the “
Primary Obligor
”)
in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to
purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working
capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the Primary Obligor so as to enable the Primary Obligor to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) Lien on any
assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to
obtain any such Lien). The amount of any Guarantee shall be deemed to be (i) with respect to a Guarantee pursuant to
clause (a)
above, an amount equal to the stated or
determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith or (ii) with respect to a Guarantee pursuant to
clause (b)
above, the fair market value of the assets subject to (or that could be subject
to) the related Lien. The term “Guarantee” as a verb has a corresponding meaning.
“
Guarantee and Collateral Agreement
” means the Guarantee and Collateral Agreement,
dated as of the Closing Date, by and among the Guarantors in favor of the Trustee for the benefit of the Secured Parties, as amended, supplemented or otherwise modified from time to time.
“
Guarantors
” means the Subsidiary Guarantors and the Holding Company Guarantor.
“
Hague Securities Convention
” means the Hague Convention on the Law Applicable to
Certain Rights in Respect of Securities Held with an Intermediary, concluded 5 July 2006.
“
Hedge Counterparty
” means an institution that enters into a Swap Contract with one
or more Securitization Entities to provide certain financial protections with respect to changes in interest rates applicable to a Series of Notes if and as specified in the Series Supplement for such Series.
“
Hedge Payment Account
” means an account entitled “Citibank, N.A. f/b/o Jack in the Box Funding, LLC, Hedge Payment
Account”, which account is maintained by the Trustee pursuant to
Section 5.08
of this Base Indenture or any successor securities account maintained pursuant to
Section 5.08
of this Base Indenture.
“
Holdco Leverage Ratio
” means, As of any date of determination, the ratio of (a)(i) Indebtedness of the Non-Securitization
Entities and the Securitization Entities (assuming that amounts available under each Class A-1 Note at such time (after giving effect to any commitment reductions on such date) are fully drawn) as of the end of the most recently ended Quarterly
Fiscal Period less (ii) the sum of (v) the cash and Eligible Investments of the Securitization Entities credited to the Senior Notes Interest Reserve Account, the Senior Subordinated Notes Interest Reserve Account, the Cash Trap Reserve Account and
the Franchisor Capital Accounts as of the end of the most recently ended Quarterly Fiscal Period, (w) the cash and Eligible Investments of the Securitization Entities maintained in the Management Accounts as of the end of the most recently ended
Quarterly Fiscal Period that the Manager reasonably anticipates, pursuant to a Weekly Manager’s Certificate delivered on or prior to such date, will be paid to the Manager or constitute the Residual Amount on the next succeeding Weekly Allocation
Date, (x) the Unrestricted Cash and Eligible Investments of the Non-Securitization Entities as of the end of the most recently ended Quarterly Fiscal Period, (y) without duplication, the amount available under any Cash Collateralized Letters of
Credit and (z) without duplication, the available amount of each Interest Reserve Letter of Credit as of the end of the most recently ended Quarterly Fiscal Period to (b) the sum of the Adjusted EBITDA of the Non-Securitization Entities and the
Securitization Entities, for the immediately preceding four (4) Quarterly Fiscal Periods most recently ended as of such date and for which financial statements have been finalized. The Holdco Leverage Ratio shall be calculated in accordance with
Section
14.18(a)
of this Base Indenture.
“
Holder
” means each Noteholder and, to the extent Notes are held through a Clearing Agency, each Note Owner.
“
Holding Company Guarantor
” means Jack in the Box SPV Guarantor, LLC, a Delaware limited liability company, and its
successors and assigns.
“
Hot Back-Up Management Duties
” has the meaning set forth in the Back-Up Management Agreement.
“
IFRS
” means international accounting standards within the meaning of the IAS Regulation 1606/2002 to the extent applicable
to the relevant financial statements.
“
Improvements
” means, with respect to Intellectual Property, proprietary rights in any additions, modifications,
derivatives, developments, variations, refinements, enhancements or improvements that are derivative works as defined and recognized by applicable Requirements of Law or, with respect to real estate, the buildings, structures, fixtures, additions,
enlargements, extensions, modifications, repairs, replacements and improvements now or hereafter erected or located on the real property constituting a part of each property.
“
Indebtedness
” means, as to any Person as of any date, without duplication, (a) all obligations of such Person for borrowed
money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments, (b) the net obligations of such Person under any swap contract (other than any swap contracts not to exceed $30,000,000 in
aggregate termination value in existence on the Closing Date), (c) all obligations of such Person to pay the deferred purchase price of property or services (other than (i) trade accounts payable in the ordinary course of business, (ii) any
earn-out obligation until such obligation appears in the liabilities section of the balance sheet of such Person, and (iii) liabilities associated with customer prepayments and deposits); and (d) the maximum amount of all direct or contingent
obligations of such Person arising under letters of credit, in the case of the foregoing
clauses (a)
,
(b)
and
(c)
, to the extent such item would be classified as a liability on a consolidated balance sheet of such Person as
of such date;
provided
,
however
, that guarantees by Securitization Entities for the benefit of Franchisees in an aggregate principal amount at any time outstanding of up to the greater of (x) $20,000,000 and (y) 5.0% of the Net Cash
Flow for the preceding four (4) Quarterly Collection Periods most recently ended as of such date and for which financial statements have been prepared shall not be considered Indebtedness. For purposes of the foregoing
clause (b)
, the
amount of any net obligation under any swap contract on any date shall be deemed to the swap termination value thereof.
“
Indemnification Amount
” means, with respect to any Securitized Franchise Assets, Securitized Company Restaurants (and the
related Securitized Company Restaurant Assets), Securitized Owned-Property Franchisee Leases, and Securitized Franchisee Back-to-Back Subleases, an amount equal to the Allocated Note Amount for such asset.
“
Indemnitor
” means Jack in the Box Inc., as the Manager in its individual capacity, or any other Non-Securitization Entity.
“
Indenture
” means the Base Indenture, together with all Series Supplements, as amended, supplemented or otherwise modified
from time to time by Supplements thereto in accordance with its terms.
“
Indenture Collateral
” has the meaning set forth in
Section 3.01
of this Base Indenture.
“
Indenture Documents
” means, collectively, with respect to any Series of Notes, the Base Indenture (including any
Supplements thereto), the Series Supplement for such Series (including any Supplements thereto), the Notes of such Series, the Guarantee and Collateral Agreement, the related Account Control Agreements, any related Variable Funding Note Purchase
Agreement and any other agreements relating to the issuance or the purchase of the Notes of such Series or the pledge of Collateral under any of the foregoing.
“
Indenture Trust Accounts
” means each of the Collection Account, the Collection Account Administrative Accounts, the Senior
Notes Interest Reserve Account (which may also, at the election of the Manager, serve as a Franchisor Capital Account), the Senior Subordinated Notes Interest Reserve Account, the Cash Trap Reserve Account, the Hedge Payment Account, the Series
Distribution Accounts and such other accounts as the Master Issuer may establish with the Trustee or the Trustee may establish from time to time pursuant to its authority to establish additional accounts pursuant to the Indenture.
“
Independent
” means, as to any Person, any other Person (including, in the case of an accountant, or lawyer, a firm of
accountants or lawyers and any member thereof or an investment bank and any member thereof) who (i) does not have and is not committed to acquire any material direct or any material indirect financial interest in such Person or in any Affiliate of
such Person and (ii) is not connected with such Person or an Affiliate of such Person as an officer, employee, promoter, underwriter, voting trustee, partner, director or Person performing similar functions. “Independent” when used with respect to
any accountant may include an accountant who audits the books of such Person if, in addition to satisfying the criteria set forth above, the accountant is independent with respect to such Person within the meaning of Rule 101 of the Code of Ethics
of the American Institute of Certified Public Accountants. Whenever any Independent Person’s opinion or certificate is to be furnished to the Trustee, such opinion or certificate shall state that the signer has read this definition and that the
signer is Independent within the meaning hereof.
“
Independent Auditors
” means the firm of Independent accountants appointed pursuant to the Management Agreement or any
successor Independent accountant.
“
Independent Manager
” means, with respect to any corporation, partnership, limited liability company, association or other
business entity, an individual who has prior experience as an independent director, independent manager or independent member with at least three (3) years of employment experience and who is provided by Maples Fiduciary Services (Delaware) Inc.,
Corporation Service Company, CT Corporation, Global Securitization Services, LLC, Lord Securities Corporation, National Registered Agents, Inc., Stewart Management Company, Wilmington Trust Company, or any successor therto, or, if none of those
companies is then providing professional independent managers, another nationally recognized company reasonably approved by the Trustee, in each case that is not an Affiliate of the company and that provides professional independent managers and
other corporate services in the ordinary course of its business, and which individual is duly appointed as an Independent Manager and is not, and has never been, and will not while serving as Independent Manager be, any of the following:
(i)
a member, partner, equityholder, manager, director, officer or employee of the company, the member thereof, or any of their respective equityholders or Affiliates (other than as an Independent
Manager of the company or an Affiliate of the company that is not in the direct chain of ownership of the company and that is required by a creditor to be a single purpose bankruptcy remote entity,
provided
that such Independent Manager
is employed by a company that routinely provides professional independent managers in the ordinary course of its business);
(ii)
a creditor, supplier or service provider (including provider of professional services) to the company, or any of its equityholders or Affiliates (other than a nationally recognized company that
routinely provides professional independent managers and other corporate services to the company or any of its equityholders or Affiliates in the ordinary course of its business);
(iii)
a family member of any such member, partner, equityholder, manager, director, officer, employee, creditor, supplier or service provider; or
(iv)
a Person that controls (whether directly, indirectly or otherwise) any of (i), (ii) or (iii) above.
A natural Person who otherwise satisfies the foregoing definition and satisfies subparagraph (i) by reason of being the Independent Manager (or independent
manager or director) of a “special purpose entity” which is an Affiliate of the company shall be qualified to serve as an Independent Manager of the company,
provided
that the
fees that such individual earns from serving as Independent Manager (or independent manager or director) of any Affiliate of the company in any given year constitute in the aggregate less than five percent (5%) of such individual’s annual income
for that year.
“
Ineligible Account
” has the meaning set forth in
Section 5.19
of this Base Indenture.
“
Ineligible Interest Reserve Letter of Credit
” means an Interest Reserve Letter of Credit with respect to which (i) the
short-term debt credit rating of the L/C Provider with respect to such Interest Reserve Letter of Credit is withdrawn or downgraded by S&P to below “A-2” and, if it has a rating by KBRA, is withdrawn or downgraded by KBRA below “K2” or is
withdrawn by Moody’s or downgraded by Moody’s below “P-2” or (ii) the long-term debt credit rating of such L/C Provider is withdrawn by S&P or downgraded by S&P below “BBB” and, if it has a rating by KBRA, is withdrawn or downgraded by KBRA
below “BBB” or is withdrawn by Moody’s or downgraded by Moody’s below “Baa2”;
provided
that for determining whether an Interest Reserve Letter of Credit is eligible under this definition, an L/C Provider will be deemed to have the
short-term debt credit rating or the long-term debt credit rating, as applicable, of such L/C Provider or any guarantor of (or confirming bank for) such L/C Provider.
“
Initial Principal Amount
” means, with respect to any Series or Class (or Subclass) of Notes, the aggregate initial
principal amount of such Series or Class (or Subclass) of Notes specified in the Series Supplement for such Series.
“
Initial Senior Notes Interest Reserve Amount
” means, with respect to the Notes issued on the Closing Date, an amount equal
to $15,885,875 to be deposited
into the Senior Notes Interest Reserve Account and/or arranged for issuance as an Interest Reserve Letter of Credit by the Master Issuer.
“
Insurance Proceeds Account
” has the meaning set forth in
Section 5.02(a)(v)
of this Base Indenture.
“
Insurance/Condemnation Proceeds
” means an amount equal to: (i) any cash payments or proceeds received by the Securitization
Entities (a) by reason of theft, physical destruction or damage or any other similar event with respect to any properties or assets of the Securitization Entities under any policy of insurance (other than liability insurance) in respect of a
covered loss thereunder or (b) as a result of any non-temporary condemnation, taking, seizing or similar event with respect to any properties or assets of the Securitization Entities by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a purchaser with such power under threat of such a taking
minus
(ii)(a) any actual and reasonable costs incurred by the Securitization Entities in connection with the
adjustment or settlement of any claims of the Securitization Entities in respect thereof and (b) any
bona fide
direct costs incurred in connection with any disposition of such assets as referred to in
clause (i)(b)
of this
definition, including Taxes (or distributions to a direct or indirect parent for Taxes) paid or reasonably expected to be actually payable with respect to the Securitization Entities’ consolidated group as a result of any gain recognized in
connection therewith. For the avoidance of doubt, “Insurance/Condemnation Proceeds” shall not include any proceeds of policies of insurance not described above, such as business interruption insurance, food safety insurance coverage and other
insurance procured in the ordinary course of business, which shall be treated as Collections.
“
Intellectual Property
” or “
IP
” means all rights, title and interests in or to intellectual property of any type,
including: (i) Trademarks; (ii) Patents; (iii) rights in computer programs and mobile apps, including in both source code and object code, together with related documentation and explanatory materials, whether machine readable or otherwise, and
databases, including any Copyrights (as defined below), Patents and Trade Secrets (as defined below) therein (“
Software
”); (iv) copyrights (whether registered or unregistered) in unpublished and published works, works of authorship (whether
or not copyrightable), database or design rights, and all registrations and recordations thereof and all applications in connection therewith, along with all reversions, extensions and renewals thereof (“
Copyrights
”); (v) trade secrets and
other confidential or proprietary information, including with respect to recipes, unpatented inventions, operating procedures, know how, procedures and formulas for preparing food and beverage products, specifications for certain food and beverage
products, inventory methods, customer service methods, financial control methods, algorithm and training techniques (“
Trade Secrets
”); (vi) all Improvements of or to any of the foregoing; (vii) all social media account names or identifiers (
e.g.
, Twitter® handle or Facebook® account name); (viii) all registrations, applications for registration or issuances, recordings, renewals and extensions relating to any of the foregoing; and (ix) for the
avoidance of doubt, the sole and exclusive rights to prosecute and maintain any of the foregoing, to enforce any past, present or future infringement, dilution misappropriation or other violation of any of the foregoing, and to defend any pending
or future challenges to any of the foregoing.
“
Interest Accrual Period
” means (a) solely with respect to any Series of Class A‑1 Notes of any Series of Notes, a period
commencing on and including the day that is two (2) Business Days prior to a Quarterly Calculation Date and ending on but excluding the day that is two (2) Business Days prior to the next succeeding Quarterly Calculation Date and (b) with respect
to any other Class of Notes of any Series of Notes, the period from and including the 25th day of the calendar month in which the immediately preceding Quarterly Payment Date occurred to but excluding the 25th day of the calendar month which
includes the then-current Quarterly Payment Date;
provided
,
however
, that the initial Interest Accrual Period for any Series will commence on and include the Series Closing Date and end on the date specified above, unless otherwise
specified in the Series Supplement for such Series;
provided
,
further
, that the Interest Accrual Period, with respect to each Series of Notes Outstanding, immediately preceding the Quarterly Payment Date on which the last payment on
the Notes of such Series is to be made will end on such Quarterly Payment Date.
“
Interest Reserve Letter of Credit
” means any letter of credit issued for the benefit of the Trustee and the Senior
Noteholders or the Senior Subordinated Noteholders, as applicable.
“
Interest Reserve Release Event
” means, as of any date of determination, and with respect to each Series of Senior Notes or
Senior Subordinated Notes Outstanding, as applicable, any reduction in (i) the Class A‑1 Notes Maximum Principal Amount or (ii) the Outstanding Principal Amount of such Series of Notes that are not a Series of Class A-1 Notes.
“
Interest-Only DSCR
” has the meaning assigned to such term under the definition of “DSCR.”
“
Investment Income
” means the investment income earned on a specified account during a specified period, in each case net of
all losses and expenses allocable thereto.
“
Investments
” means, with respect to any Person(s), all investments by such Person(s) in other Persons in the form of loans
(including guarantees), advances or capital contributions (excluding accounts receivable, trade credit and advances to customers and commission, travel, moving and other similar advances to officers, directors, employees and consultants of such
Person(s) (including Affiliates) made in the ordinary course of business) and purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities issued by any other Person.
“
IP License Agreements
” means, collectively, Manager IP License, the Company
Restaurant IP Licenses, the Jack in the Box Foundation IP License and the JIB Stored Value Cards IP License.
“
IRS
” means the U.S. Internal Revenue Service.
“
Investor Request Certification
” has the meaning set forth in
Section 4.03
of this Base Indenture.
“
Jack in the Box Brand
” means the Jack in the Box
®
name and Trademarks, whether alone or in combination with other words or symbols, and any variations or derivatives of any of the foregoing.
“
Jack in the Box Eastern Division Company Restaurant IP License
” means the IP
License Agreement, dated as of the Closing Date, by and between the Franchisor, as licensor, and Jack in the Box Eastern Division L.P., as licensee, as amended, supplemented or otherwise modified from time to time.
“
Jack in the Box Foundation IP License
” means the IP License Agreement, dated as of
the Closing Date, by and between the Franchisor, as licensor, and Jack in the Box Foundation, as licensee, as amended, supplemented or otherwise modified from time to time.
“
Jack in the Box Inc.
” means Jack in the Box Inc., a Delaware corporation, and its
successors and assigns.
“
Jack in the Box Inc. Company Restaurant IP License
” means the IP License
Agreement, dated as of the Closing Date, by and between the Franchisor, as licensor, and Jack in the Box Inc., as licensee, as amended, supplemented or otherwise modified from time to time.
“
Jack in the Box System
” means the system of restaurants operating under the Jack
in the Box Brand.
“
JIB Back-to-Back Lease Obligations
” means amounts payable by JIB Properties to
third-party landlords under Securitized JIB Back-to-Back Leases.
“
JIB Back-to-Back Lease Obligations Advance
” means an advance to fund any JIB
Back-to-Back Lease Obligations, in the event sufficient funds are not available in the applicable Concentration Account, to the extent that the Manager reasonably expects to be reimbursed for such advances from the proceeds of future Franchisee
Back-to-Back Sublease Payments, it being agreed that any such advances will not constitute Manager Advances.
“
JIB Mobile Apps
” means all consumer-facing Jack in the Box Brand mobile
applications, whether the rights thereunder are contributed to the Franchisor on the Closing Date or acquired by the Franchisor following the Closing Date.
“
JIB Properties
” means Jack in the Box Properties, LLC, a Delaware limited
liability company.
“
JIB Properties Company Restaurant IP License
” means the IP License Agreement,
dated as of the Closing Date, by and between the Franchisor, as licensor, and JIB Properties, as licensee, as amended, supplemented or otherwise modified from time to time.
“
JIB Properties Company Restaurant IP License Fee
” means the licensing fees payable
by JIB Properties under the JIB Properties Company Restaurant IP License.
“
JIB Stored Value Cards IP License
” means the IP License Agreement, dated as of the
Closing Date, by and between the Franchisor, as licensor, and JIB Stored Value Cards, LLC, as licensee, as amended, supplemented or otherwise modified from time to time.
“
KBRA
” means Kroll Bond Rating Agency, Inc. (and any successor or successors
thereto).
“
L/C Provider
” means, with respect to any Series of Class A-1 Notes, the party
identified as the “L/C Provider” or the “L/C Issuing Bank”, as the context requires, in the applicable Variable Funding Note Purchase Agreement.
“
Lease Reserve Amount
” has the meaning set forth in
Section 5.11(a)(iv)(E)
of this Base Indenture.
“
Legacy Account
” means, on or after the date that any Class or Series of Notes
issued pursuant to the Base Indenture is no longer Outstanding, any account maintained by the Trustee to which funds have been allocated in accordance with the Priority of Payments for the payment of interest, fees or other amounts in respect of
such Class or Series of Notes.
“
Letter of Credit Reimbursement Agreement
” means (i) the Series 2019-1 Class A-1
Note Letter of Credit Reimbursement Agreement, dated as of the Closing Date, by and among Jack in the Box Inc., the Manager and the Master Issuer, as amended, supplemented or otherwise modified from time to time and (ii) any additional or
replacement letter of credit reimbursement agreement entered into on substantially the same terms or otherwise with the consent of the Control Party.
“
Licensed Securitization IP
” means (a) the portion of the Closing Date
Securitization IP that is held or used by Jack in the Box Inc., Jack in the Box Eastern Division L.P., the Holding Company Guarantor, the Master Issuer, JIB Properties, Jack in the Box Foundation or JIB Stored Value Cards, LLC as of the Closing
Date pursuant to license or similar arrangement; and (b) the portion of After-Acquired Securitization IP that, after the Closing Date, will be held or used by such parties pursuant to a license or similar arrangement.
“
Licensee-Developed IP
” means all Intellectual Property (other than Excluded IP)
created, developed, authored, acquired or owned by or on behalf of any licensee under any IP License Agreement or Franchise Agreement related to (i) the Jack in the Box Brand, (ii) products or services sold or distributed under the Jack in the Box
Brand, (iii) Branded Restaurants, (iv) the Jack in the Box System, (v) the Securitized Franchised Restaurant Business or (vi) the Securitized Company Restaurant Business, and all goodwill appurtenant thereto, including, without limitation, all
Improvements to any Securitization IP.
“
Lien
” means, when used with respect to any Person, any interest in any real or
personal property, asset or other right held, owned or being purchased or acquired by such Person which secures payment or performance of any obligation, and will include any mortgage, lien, pledge, encumbrance, charge, retained security title of a
conditional vendor or lessor, or other security interest of any kind, whether arising under a security agreement, mortgage, lease, deed of trust, chattel mortgage, assignment, pledge, retention or security title, financing or similar statement, or
arising as a matter of law, judicial process or otherwise.
“
Liquidation Fees
” has the meaning set forth in the Servicing Agreement.
“
Majority of Controlling Class Members
” means, (x) except as set forth in
clause (y)
, with respect to the Controlling Class Members (or, if specified, any subset thereof) and as of any day of determination, Controlling Class Members that hold in excess
of 50% of the sum of (i) the Class A-1 Notes Voting Amount with respect to each Series of Class A‑1 Notes of the Controlling Class and (ii) the Outstanding Principal Amount of each Series of Notes of the Controlling Class (other than Class A-1
Notes) or any beneficial interest therein as of such day of determination (excluding any Notes or beneficial interests in Notes held by any Securitization Entity or any Affiliate of any Securitization Entity) and (y) with respect to the election of
a Controlling Class Representative, Controlling Class Members that hold beneficial interests in excess of 50% of the sum of (i) the Class A-1 Notes Voting Amount with respect to each Series of Class A-1 Notes of the Controlling Class and (ii) the
Outstanding Principal Amount of each Series of Notes of the Controlling Class (other than Class A-1 Notes) or any beneficial interest therein, in each case, that are Outstanding as of the CCR Voting Record Date and with respect to which votes were
submitted by the applicable deadline for voting (which may be less than the Outstanding Principal Amount of Notes of the Controlling Class as of the CCR Voting Record Date).
“
Majority of Senior Noteholders
” means Senior Noteholders holding in excess of 50%
of the sum of (i) the Class A‑1 Notes Voting Amount with respect to each Series of Class A‑1 Notes Outstanding and (ii) the Outstanding Principal Amount of each Series of Senior Notes other than Class A‑1 Notes (excluding any Senior Notes or
beneficial interests in Senior Notes held by any Securitization Entity or any Affiliate of any Securitization Entity).
“
Managed Document
” means any contract, agreement, arrangement or undertaking
relating to any of the Securitized Assets, including, but not limited to, the Contribution Agreements, the Securitized Franchise Agreements, the Securitized Development Agreements, the Securitized Franchisee Notes, the Securitized Leases and the IP
License Agreements.
“
Management Accounts
” has the meaning set forth in
Section 5.02(a)
of this Base Indenture.
“
Management Agreement
” means the Management Agreement, dated as of the Closing
Date, by and among the Securitization Entities, the Trustee and the Manager, as amended, supplemented or otherwise modified from time to time.
“
Management Fee
” has the meaning set forth in the Management Agreement.
“
Manager
” means Jack in the Box Inc., as Manager, under the Management Agreement or
any successor thereto.
“
Manager Advances
” has the meaning set forth in the Management Agreement.
“
Manager IP License
” license of Intellectual Property granted by the Franchisor to
the Manager pursuant to the Management Agreement.
“
Manager Termination Event
” means the occurrence of an event specified in
Section 6.1 of the Management Agreement.
“
Manager-Developed IP
” means all Intellectual Property (other than Excluded IP)
created, developed, authored, acquired or owned by or on behalf of the Manager related to or intended to be used by (i) the Jack in the Box Brand, (ii) products or services sold or distributed under the Jack in the Box Brand, (iii) Branded
Restaurants, (iv) the Jack in the Box System, (v) the Securitized Franchised Restaurant Business or (vi) the Securitized Company Restaurant Business, including without limitation all Improvements to any Securitization IP.
“
Managing Standard
” has the meaning set forth in the Management Agreement.
“
Master Issuer
” means Jack in the Box Funding, LLC, a Delaware limited liability
company, and its successors and assigns.
“
Material Adverse Effect
” means
(a)
with respect to the Manager, a material adverse effect on (i) its results of operations, business, properties or financial condition, taken as a
whole, (ii) its ability to conduct its business or to perform in any material respect its obligations under the Management Agreement or any other Related Document, (iii) the Collateral, taken as a whole, or (iv) the ability of the Securitization
Entities to perform in any material respect their obligations under the Related Documents;
(b)
with respect to the Collateral, a material adverse effect with respect to the Collateral taken as a whole, the enforceability of the terms thereof,
the likelihood of the payment of the amounts required with respect thereto in accordance with the terms thereof, the value thereof, the ownership thereof by the Securitization Entities (as applicable) or the Lien of the Trustee thereon;
(c)
with respect to the Securitization Entities, a materially adverse effect on the results of operations, business, properties or financial condition
of the Securitization Entities, taken as a whole, or the ability of the Securitization Entities, taken as a whole, to conduct their business or to perform in any material respect their obligations under the Related Documents; or
(d)
with respect to any Person or matter, a material impairment to the rights of or benefits available to, taken as a whole, the Securitization
Entities, the Trustee, or the Holders under any Related Document or the enforceability of any material provision of any Related Document;
provided
that where “Material Adverse Effect” is used without specific reference, such term will have
the meaning set forth in
clauses (a)
through
(d)
, as the context may require.
“
Materials of Environmental Concern
” means any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products (virgin or unused), polychlorinated biphenyls, urea-formaldehyde insulation, asbestos, pollutants, contaminants, radioactivity and any other materials or substances of any kind, whether or
not any such material or substance is defined as hazardous or toxic under any Environmental Law, that is regulated pursuant to or could reasonably be expected to give rise to liability under any Environmental Law.
“
Moody’s
” means Moody’s Investors Service, Inc. or any successor thereto.
“
Mortgage Preparation Event
” means the earlier to occur of (i) the failure of the
Master Issuer to maintain a DSCR of at least 1.75x as calculated on any Quarterly Calculation Date or (ii) a Rapid Amortization Event that has not been waived.
“
Mortgage Preparation Fees
” means any reasonable expenses incurred by the Master
Issuer, the Manager or the Servicer, in connection with the preparation of any Mortgages as required by the Base Indenture.
“
Mortgage Recordation Event
” means the occurrence of the first Business Day in a
Rapid Amortization Period that is at least sixty (60) days following a Mortgage Preparation Event.
“
Mortgage Recordation Fees
” means any fees, taxes or other amounts required to be
paid to any applicable Governmental Authority, or any reasonable expenses incurred by the Trustee, in connection with the recording of any Mortgages as required by the Base Indenture.
“
Mortgages
” means the mortgages (including assignments of leases and rents for any
lease, in each case, in connection with such mortgages), substantially in the form of
Exhibit J
to the Base Indenture (or otherwise in form reasonably acceptable to the
Control Party and the Trustee and in recordable form).
“
Multiemployer Plan
” means any Pension Plan that is a “multiemployer plan” as
defined in Section 3(37) or 4001(a)(3) of ERISA.
“
Net Back-to-Back Franchisee Lease Payments
” means net profit from the Securitized
Back-to-Back Franchisee Lease Arrangements (if any) which equals to the amount of Franchisee Back-to-Back Sublease Payments
minus
the amount of the JIB Back-to-Back Lease
Obligations.
“
Net Cash Flow
” means, except as described in the definition of “DSCR” for the
first four (4) Quarterly Calculation Dates, with respect to any Quarterly Payment Date and the immediately preceding Quarterly Collection Period, the positive difference, if any, of:
(a)
the Retained Collections for such Quarterly Collection Period;
minus
(b)
the amount (without duplication) equal to the sum of (i) the Securitization Operating Expenses paid on each Weekly Allocation Date with respect to
such Quarterly Collection Period pursuant to
priority (v)
of the Priority of Payments, (ii) the Weekly Management Fees and Supplemental Management Fees paid on each Weekly Allocation Date to the Manager with respect to such Quarterly
Collection Period, (iii) the Servicing Fees, Liquidation Fees, and Workout Fees paid to the Servicer on each Weekly Allocation Date with respect to such Quarterly Collection Period; and (iv) the amount of Class A‑1 Notes Administrative Expenses
paid on each Weekly Allocation Date with respect to such Quarterly Collection Period;
minus
(c)
the amount, if any, by which equity contributions included in such Retained Collections exceeds the relevant amount of Retained Collections Contributions permitted to be included in Net Cash
Flow pursuant to
Section 5.17
of this Base Indenture;
provided
that funds released from the Cash Trap Reserve Account, the Senior Notes Interest Reserve
Account or the Senior Subordinated Notes Interest Reserve Account shall not constitute Retained Collections for purposes of this definition.
“
New Asset
” means a New Securitized Company Restaurant, New Securitized Franchise
Agreement, a New Securitized Development Agreement, New Real Estate Asset or New Securitized Franchisee Note or any other Securitized Asset contributed to, or otherwise entered into, acquired or created by, the Securitization Entities after the
Closing Date or any other asset(s) reasonably related to, incidental to, or useful in the judgment of the Manager in accordance with the Managing Standard, in connection with any of the foregoing.
“
New Real Estate Assets
” means, collectively, (i) the New Securitized Owned Real
Property and (ii) the New Securitized Leases.
“
New Securitized Back-to-Back Franchisee Lease Arrangements
” means lease
arrangements for certain Franchised Restaurants comprised of (i) New Securitized JIB Back-to-Back Leases and (ii) New Securitized Franchisee Back-to-Back Subleases which are collectively contributed to, or otherwise entered into or acquired by, a
Securitization Entity following the Closing Date.
“
New Securitized Company Restaurant Third-Party Leases
” means leases for certain
Securitized Company Restaurants under which JIB Properties will act as lessee under leases with third-party landlords, which are contributed to, or otherwise entered into or acquired by, a Securitization Entity following the Closing Date.
“
New Securitized Company Restaurants
” means a Company Restaurant acquired or opened
by a Securitization Entity after the Closing Date.
“
New Securitized Development Agreements
” means all Development Agreements and
related guaranty agreements contributed to, or otherwise entered into or acquired by, a Securitization Entity following the Closing Date.
“
New Securitized Franchise Agreements
” means all Franchise Agreements and related
guaranty agreements contributed to, or otherwise entered into or acquired by, a Securitization Entity following the Closing Date, in its capacity as franchisor for Branded Restaurants (including all renewals for Contributed Securitized Franchised
Restaurants).
“
New Securitized Franchised Restaurants
” means Franchised Restaurants that are
franchised pursuant to Franchise Agreements contributed to a Securitization Entity after the Closing Date.
“
New Securitized Franchisee Back-to-Back Subleases
” means for certain Franchised
Restaurants, leases under which JIB Properties (or another Securitization Entity) leases to a Franchisee a property in which JIB Properties (or such Securitization Entity) acquires rights to such property as lessee through a lease with a
third-party landlord (or a landlord that is a Non-Securitization Entity, if such lease is on arm’s length terms) that are contributed to, or otherwise entered into or acquired by, a Securitization Entity after the Closing Date.
“
New Securitized Franchisee Notes
” means all Franchisee Notes and related guaranty
and collateral agreements contributed to, or otherwise entered into or acquired by, a Securitization Entity following the Closing Date.
“
New Securitized JIB Back-to-Back Lease
” means for certain Franchised Restaurants,
leases under which JIB Properties acquires rights to a property as lessee from a third-party landlord (or a landlord that is a Non-Securitization Entity, if such lease is on arm’s length terms) and in turn leases that property to a Franchisee that
are contributed to, or otherwise entered into or acquired by, a Securitization Entity after the Closing Date.
“
New Securitized Leases
” means Securitized Leases, contributed to, or otherwise
entered into or acquired by, a Securitization Entity following the Closing Date.
“
New Securitized Owned Real Property
” means real property (including the land,
buildings and fixtures) that is (i) acquired in fee after the Closing Date by a Securitization Entity or (ii) acquired in fee after the Closing Date by a Non-Securitization Entity and contributed to, or otherwise acquired by, a Securitization
Entity pursuant to a contribution agreement in form and substance reasonably acceptable to the Trustee.
“
New Securitized Owned-Property Franchisee Leases
” means leases for certain
Franchised Restaurants under which the real property is owned by JIB Properties, a Franchisee will act as lessee and JIB Properties will act as lessor, which are , contributed to, or otherwise entered into or acquired by, a Securitization Entity
following the Closing Date.
“
New Series Pro Forma DSCR
” means, at any time of determination and with respect to
the issuance of any Additional Notes, the ratio calculated by dividing (i) the Net Cash Flow over the four immediately preceding Quarterly Collection Periods most recently ended by (ii) the Debt Service due during such period, in each case on a
pro forma basis, calculated as if (a) such Additional Notes had been outstanding and any assets acquired with the proceeds of such Additional Notes had been acquired at the commencement of such period, and (b) any Notes that have been paid, prepaid
or repurchased and cancelled during such period, or any Notes that will be paid, prepaid or repurchased and cancelled using the proceeds of such issuance, were so paid, prepaid or repurchased and cancelled as of the commencement of such period.
“
New York UCC
” has the meaning set forth in
Section 5.09(b)
of this Base Indenture.
“
Non-Branded Restaurant Lease Payments
” means lease payments payable by a third party (that does not operate a Branded
Restaurant) to JIB Properties under Non-Branded Restaurant Leases.
“
Non-Branded Restaurant Leases
” means leases for properties that are not operated as Branded Restaurants where (a) the real
property is owned by JIB Properties, a third party (that does not operate a Branded Restaurant) is the lessee and JIB Properties is the lessor or (b) JIB Properties (or another Securitization Entity) leases to a third-party (that does not operate a
Branded Restaurant) a property in which JIB Properties (or such Securitization Entity) acquires rights to such property as lessee through a lease with a third-party landlord (or a landlord that is a Non-Securitization Entity, if such lease is on
arm’s length terms).
“
Nonrecoverable Advance
” means any portion of an Advance previously made and not previously reimbursed, or proposed to be
made, which, together with any then-outstanding Advances, and the interest accrued or that would reasonably be expected to accrue thereon, in the reasonable and good faith judgment of the Servicer or the Trustee, as applicable, would not be
ultimately recoverable from subsequent payments or collections from any funds on deposit in the Collection Account or funds reasonably expected to be deposited in the Collection Account following such date of determination, giving due consideration
to allocations and disbursements of funds in such accounts and the limited assets of the Securitization Entities.
“
Non-Securitization Entity
” means Jack in the Box Inc. and each of its Affiliates
(including each of their Subsidiaries, but excluding any Securitization Entity) now existing or hereafter created.
“
Non-Securitization Entity Company Restaurants
” means Branded Restaurants owned and
operated by Non-Securitization Entities that either (1) cannot be contributed on the Closing Date due to contractual restrictions, legal requirements or other unforeseen circumstances or (2) may be temporarily held by Non-Securitization Entities in
order to refranchise them.
“
Non-Securitization Entity Lease Payments
” means lease payments payable by
Non-Securitization Entities to JIB Properties under Non-Securitization Entity Leases.
“
Non-Securitization Entity Leases
” means leases for certain Non-Securitization
Entity Company Restaurants where the real property is owned or leased by JIB Properties, a Non-Securitization Entity is the lessee and JIB Properties is the lessor.
“
Note Owner
” means, with respect to a Book-Entry Note, the Person who is the
beneficial owner of such Book-Entry Note, as reflected on the books of the Clearing Agency that holds such Book-Entry Note, or on the books of a Person maintaining an account with such Clearing Agency (directly or as an indirect participant, in
accordance with the rules of such Clearing Agency).
“
Note Owner Certificate
” has the meaning set forth in
Section 11.05(b)
of this Base Indenture.
“
Note Rate
” means, with respect to any Series or any Class, Subclass or Tranche of any Series of Notes, the annual rate at
which interest (other than contingent additional interest) accrues on the Notes of such Series or such Class, Subclass or Tranche of such Series of Notes (or the formula on the basis of which such rate will be determined) as stated in the Series
Supplement for such Series.
“
Note Register
” means the register maintained pursuant to
Section 2.05(a)
of this Base Indenture, providing for the
registration of the Notes and transfers and exchanges thereof, subject to such reasonable regulations as the Master Issuer may prescribe.
“
Noteholder
” means the Person in whose name a Note is registered in the Note Register.
“
Noteholder Materials
” has the meaning set forth in
Section 4.03
of this Base Indenture.
“
Notes
” has the meaning set forth in the recitals to the Base Indenture.
“
Notes Discharge Date
” means, with respect to any Class or Series of Notes, the first date on which such Class or Series of
Notes is no longer Outstanding.
“
Obligations
” means (a) all principal, interest and premium, if any, at any time and from time to time, owing by the Master
Issuer on the Notes or owing by the Guarantors pursuant to the Guarantee and Collateral Agreement, (b) the payment and performance of all other obligations, covenants and liabilities of the Master Issuer or the Guarantors arising under the
Indenture, the Notes, any other Indenture Document or the Servicing Agreement or of the Guarantors under the Guarantee and Collateral Agreement and (c) the obligation of the Master Issuer to pay to the Trustee all fees and expenses payable to the
Trustee under the Indenture and the other Related Documents to which it is a party when due and payable as provided in the Indenture and all Mortgage Preparation Fees and Mortgage Recordation Fees when due and payable as provided in the Indenture.
“
Officer’s Certificate
” means a certificate signed by an Authorized Officer of the party delivering such certificate.
“
Opinion of Counsel
” means a written opinion from legal counsel who is reasonably acceptable to the Trustee and the Control
Party, which may include one or more reliance letters. The counsel may be an employee of, or counsel to, the Securitization Entities, Jack in the Box Inc., the Manager (if not Jack in the Box Inc.) or the Back-Up Manager, as the case may be.
“
Optional Prepayment
” has the meaning set forth in
Section 5.13(o)
of this Base Indenture.
“
Outstanding
” means, with respect to the Notes, as of any time, all of the Notes of any one or more Series, as the case may
be, theretofore authenticated and delivered under the Indenture except:
(i)
Notes theretofore canceled by the Registrar or delivered to the Registrar for cancellation;
(ii)
Notes, or portions thereof, for whose payment or redemption funds in the necessary amount have been theretofore irrevocably deposited with the
Trustee in trust for the Noteholders of such Notes pursuant to the Indenture;
provided
that, if such Notes or portions thereof are to be redeemed, notice of such redemption has been duly given pursuant to the Indenture or provision
therefore reasonably satisfactory to the Trustee has been made;
(iii)
each Tranche of Notes that have been defeased in accordance with the Base Indenture;
(iv)
Notes in exchange for, or in lieu of which other Notes have been authenticated and delivered pursuant to the Indenture, unless proof reasonably
satisfactory to the Trustee is presented that any such Notes are held by a Holder in due course or protected purchaser; and
(v)
Notes alleged to have been mutilated, destroyed, lost or stolen for which replacement Notes have been issued as provided in the Indenture;
provided
that, (A) in determining whether the Noteholders of the requisite
Outstanding Principal Amount have given any request, demand, authorization, direction, notice, consent, waiver or vote under the Indenture, the following Notes shall be disregarded and deemed not to be Outstanding: (x) Notes owned by the
Securitization Entities or any other obligor upon the Notes or any Affiliate of any of them and (y) Notes held in any accounts with respect to which the Manager or any Affiliate thereof exercises discretionary voting authority;
provided
,
further
, that in determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent, waiver or vote, only Notes as described under
clause (x)
or
(y)
above that a Trust Officer actually knows to be so owned shall be so disregarded; and (B) Notes owned in the manner indicated in
clause (x)
or
(y)
above that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act
with respect to such Notes and that the pledgee is not a Securitization Entity or any other obligor or the Manager, an Affiliate thereof, or an account for which the Manager or an Affiliate of the Manager exercises discretionary voting authority.
“
Outstanding Principal Amount
” means, with respect to each Series, Class and
Tranche of Notes Outstanding, the amount calculated in accordance with the Series Supplement for such Series, Class, Tranche or Variable Funding Note Purchase Agreement, which amount with respect to any Series of Class A-1 Notes may include
outstanding amounts under swingline or letter of credit subfacilities thereunder.
“
Owned Securitization IP
” means (a) the portion of the Closing Date Securitization
IP that is owned by any Non-Securitization Entity as of the Closing Date immediately prior to giving effect to the Contribution Agreements; and (b) the portion of the After-Acquired Securitization IP that, after the Closing Date, will be owned by
the Franchisor.
“
Pass-Through Amounts
” has the meaning set forth in the definition of “
Collateral
”.
“
Patents
” means all patents (including, during the term of the patent, the
inventions claimed thereunder), patent disclosures, industrial designs, inventions (whether or not patentable or reduced to practice), invention disclosures, and applications, divisions, continuations, continuations-in-part, provisionals,
reexaminations and reissues for any of the foregoing.
“
Paying Agent
” has the meaning set forth in
Section 2.05(a)
of this Base Indenture.
“
PBGC
” means the Pension Benefit Guaranty Corporation established under Section 4002 of ERISA.
“
Pension Plan
” means any “employee pension benefit plan”, as such term is defined in Section 3(2) of ERISA, which is subject
to Title IV of ERISA and to which any company in the same Controlled Group as the Master Issuer has liability, including any liability by reason of having been a substantial employer within the meaning of Section 4063 of ERISA for any time within
the preceding five years or by reason of being deemed to be a contributing sponsor under Section 4069 of ERISA.
“
Permitted Asset Dispositions
” has the meaning set forth in
Section 8.16
of this Base Indenture.
“
Permitted Lien
” means (a) Liens for (i) Taxes, assessments or other governmental charges not delinquent or (ii) Taxes,
assessments or other charges being contested in good faith and by appropriate proceedings and with respect to which adequate reserves have been established, and are being maintained, in accordance with GAAP, (b) all Liens created or permitted under
the Related Documents in favor of the Trustee for the benefit of the Secured Parties, (c) Liens existing on the Closing Date, which shall be released on such date,
provided
that Intellectual Property recordations of Liens need not have been
terminated of record on the Closing Date so long as such Intellectual Property recordations of Liens are terminated of record within sixty (60) days of the Closing Date, (d) encumbrances in the nature of (i) a lessor’s fee interest, (ii) zoning,
building code and similar laws or rights reserved or vested in any Governmental Authority to control or regulate the use of any real property, (iii) easements, rights-of-way, covenants, restrictions, leases, subleases and other title matters
whether or not shown by the public records, (iv) overlaps, encroachments and any matters not of record which would be disclosed by an accurate survey or a personal inspection of the property, (v) conditions, encroachments, protrusions and other
similar charges and encumbrances and minor defects in title and survey affecting real property which, in each case (as described in
clauses (d)(i)
through
(v)
above), individually or in the aggregate, do not have a Material Adverse
Effect and (vi) the interest of a lessee or sublessee in property leased or subleased to a Franchisee or other third party under a Non-Branded Restaurant Lease, (e) in the case of any interest in real estate consisting of a Securitized Company
Restaurant Third-Party Lease, (i) the terms of the applicable Securitized Company Restaurant Third-Party Lease, (ii) Liens affecting the underlying fee interest in the real estate and/or any of the property of the lessor grantor under the
applicable lease (including, without limitation, any mortgages on the landlord’s fee interest in the leased real estate) and (iii) Liens with respect to which the Securitized Company Restaurant Third-Party Lease has priority, (f) deposits or
pledges made (i) in connection with casualty insurance maintained in accordance with the Related Documents, (ii) to secure the performance of bids, tenders, contracts or leases (iii) to secure statutory obligations or surety or appeal bonds or
(iv) to secure indemnity, performance or other similar bonds in the ordinary course of business of any Securitization Entity, (g) statutory or common law Liens of landlords, lessors, carriers, warehousemen, mechanics, materialmen, repairmen,
construction contractors or other like Liens arising in the ordinary course of business, in each case securing obligations (i) that are not yet due and payable or not overdue for more than forty-five (45) days from the date of creation thereof or
(ii) being contested in good faith by any Securitization Entity in appropriate proceedings (so long as such Securitization Entity shall, in accordance with GAAP, have set aside on its books adequate reserves with respect thereto), (h) restrictions
under federal, state or foreign securities laws on the transfer of securities, (i) any Liens arising under law or pursuant to documentation governing permitted accounts in connection with the Securitization Entities’ cash management system
(including credit card and processing arrangements), (j) defects of title, survey defects, easements, rights-of-way, covenants, restrictions and other similar charges or encumbrances with respect to each real property, which (1) do not constitute
Permitted Liens under any other clause of this definition and (2) neither have nor would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, (k) Liens arising from judgment, decrees or attachments in
circumstances not constituting an Event of Default, (l) Liens arising in connection with any Capitalized Lease Obligations, sale-leaseback transaction or in connection with any Indebtedness, in each case that is permitted under the Indenture,
(m) Liens not securing Indebtedness that attach to any Collateral in an aggregate outstanding amount not exceeding $20,000,000 at any time, (n) Liens on Collateral that has been pledged pursuant to a Variable Funding Note Purchase Agreement with
respect to letters of credit issued thereunder, and (o) any encumbrance on Securitization IP created by entering into (i) any non-exclusive licenses of Securitization IP under the IP License Agreements (including to the Manager in connection with
the performance of its Services under the Management Agreement) and (ii) non-exclusive licenses of Securitization IP granted in the ordinary course of business that (A) when effected on behalf of any Securitization Entity by the Manager would not
constitute a breach by the Manager of the Management Agreement and (B) would not reasonably be expected to materially and adversely impact the Securitization IP (taken as a whole).
“
Person
” means an individual, corporation (including a business trust), partnership, limited liability partnership, limited
liability company, joint venture, association, joint stock company, trust (including any beneficiary thereof), unincorporated association or government or any agency or political subdivision thereof.
“
Post-ARD Contingent Interest
” means any Senior Notes Quarterly Post-ARD Contingent Interest Amount, Senior Subordinated
Notes Quarterly Post-ARD Contingent Interest Amount and Subordinated Notes Quarterly Post-ARD Contingent Interest Amount.
“
Post-ARD Rapid Amortization Cure Period
” has the meaning set forth in
Section 9.01(b)
of this Base Indenture.
“
Post-Default Capped Trustee Expenses
” has the meaning set forth in the definition
of “Post-Default Capped Trustee Expenses Amount.”
“
Post-Default Capped Trustee Expenses Amount
” means an amount equal to the lesser
of (a) all reasonable expenses payable by the Master Issuer to the Trustee pursuant to the Indenture (excluding Mortgage Recordation Fees) after the occurrence and during the continuation of an Event of Default in connection with any obligations of
the Trustee in connection with such Event of Default that are in excess of the Capped Securitization Operating Expense Amount (“
Post-Default Capped Trustee Expenses
”) and
(b) the amount by which (i) $100,000 exceeds (ii) the aggregate amount of Post-Default Capped Trustee Expenses previously paid on each Weekly Allocation Date that occurred in the annual period (measured from the Closing Date to the anniversary
thereof and from each anniversary thereof to the next succeeding anniversary thereof) in which such Weekly Allocation Date occurs. For the avoidance of doubt, Mortgage Recordation Fees will not be considered Trustee expenses for purposes of
determining the Post-Default Capped Trustee Expenses Amount.
“
Potential Manager Termination Event
” means any occurrence or event which, with the
giving of notice, the passage of time or both, would constitute a Manager Termination Event.
“
Potential Rapid Amortization Event
” means any occurrence or event which, with the
giving of notice, the passage of time or both, would constitute a Rapid Amortization Event;
provided
that any occurrence or event which, with the giving of notice, the passage of time or both, would constitute a Rapid Amortization Event as described in
clause (b)
of the definition of Rapid Amortization Event, shall not constitute a Potential Rapid Amortization Event.
“
Prime Rate
” means the rate of interest publicly announced from time to time by a
commercial bank mutually agreed upon by the Manager and the Servicer as its reference rate, base rate or prime rate.
“
Principal Release Amount
” means, with respect to any Series and any Quarterly
Payment Date on which the related Series Non-Amortization Test is satisfied in accordance with the Series Supplement for such Series, all or part of the amounts allocated with respect to such Scheduled Principal Payment to the applicable Collection
Account Administrative Account pursuant to the Priority of Payments during the immediately preceding Quarterly Collection Period which the Master Issuer does not elect to make as a Scheduled Principal Payment with respect to such Series on such
Quarterly Payment Date.
“
Principal Terms
” has the meaning set forth in
Section 2.03(s)
of this Base Indenture.
“
Priority of Payments
” means the allocation and payment obligations described in
Section 5.12
and
Section 5.13
of this Base Indenture as supplemented by the allocation and payment obligations with respect to each Series of Notes described in each Series Supplement.
“
pro forma event
” has the meaning set forth in
Section 14.18(a)
of this Base Indenture.
“
Proceeding
” means any suit in equity, action at law or other judicial or administrative proceeding.
“
Proceeds
” has the meaning specified in Section 9-102(a)(64) of the applicable UCC.
“
PTO
” means the U.S. Patent and Trademark Office and any successor U.S. federal office.
“
Qualified Institution
” means a depository institution organized under the laws of the United States of America or any state
thereof or incorporated under the laws of a foreign jurisdiction with a branch or agency located in the United States of America or any state thereof and subject to supervision and examination by federal or state banking authorities that at all
times has the Required Rating and, in the case of any such institution organized under the laws of the United States of America, whose deposits are insured by the FDIC.
“
Qualified Trust Institution
” means an institution organized under the laws of the United States of America or any state
thereof or incorporated under the laws of a foreign jurisdiction with a branch or agency located in the United States of America or any state thereof and subject to supervision and examination by federal or state banking authorities that at all
times (i) is authorized under such laws to act as a trustee or in any other fiduciary capacity, (ii) has capital, surplus and undivided profits of not less than $250,000,000 as set forth in its most recent published annual report of condition and
(iii) has a long term deposits rating of not less than “Baa1” by Moody’s and “BBB+” by S&P.
“
Qualifying Real Estate Transaction
” means a transaction involving an acquisition of a real property (i) on which a Branded
Restaurant is located, (ii) which was not purported to be owned by or transferred to JIB Properties (or any other Securitization Entity) on or prior to the Closing Date and (iii) that is disposed of within fifteen (15) months of acquiring such real
property.
“
Quarterly Calculation Date
” means the date two (2) Business Days prior to each Quarterly Payment Date. Any reference to a
Quarterly Calculation Date relating to a Quarterly Payment Date means the Quarterly Calculation Date occurring in the same calendar month as the Quarterly Payment Date and any reference to a Quarterly Calculation Date relating to a Quarterly
Collection Period means the Quarterly Collection Period most recently ended on or prior to the related Quarterly Payment Date.
“
Quarterly Collection Period
” means (i) in the case of the initial Quarterly Collection Period, the period from the Cut-Off
Date to and including September 29, 2019 and (ii) for each Quarterly Collection Period thereafter, the period commencing on and including the first day of a Quarterly Fiscal Period and ending on but excluding the first day of the immediately
following Quarterly Fiscal Period.
“
Quarterly Compliance Certificate
” has the meaning set forth in
Section 4.01(c)
of this Base Indenture.
“
Quarterly Fiscal Period
” means the following quarterly fiscal periods of the Securitization Entities: (a) with respect to
each of the Securitization Entities’ 52-week fiscal years, one 16-week quarter followed by three 12-week quarters of the Securitization Entities and (b) with respect to each of the Securitization Entities’ 53-week fiscal years, one 16-week quarter
followed by two 12‑week quarters followed by one 13-week quarter. The last day of the fourth Quarterly Fiscal Period of each fiscal year of the Securitization Entities is the Sunday that is closest to September 30. References to “weeks” mean the
Securitization Entities’ fiscal weeks, which commence on and include each Monday of a week and end on but exclude Monday of the following week.
“
Quarterly Noteholders’ Report
” means, with respect to any Series of Notes, a statement substantially in the form of an
Exhibit C to the Series Supplement for such Series, including the Manager’s statement specified in such exhibit.
“
Quarterly Payment Date
” means, unless otherwise specified in any Series Supplement for the related Series of Notes, the
twenty-fifth (25
th
) day of each of February, May, August and November, or if such date is not a Business Day, the next succeeding Business Day, commencing on the
Payment Date in November 2019. Any reference to a Quarterly Collection Period relating to a Quarterly Payment Date means the Quarterly Collection Period most recently ended prior to such Quarterly Payment Date, and any reference to an Interest
Accrual Period relating to a Quarterly Payment Date means the Interest Accrual Period most recently ended prior to such Quarterly Payment Date.
“
Quarterly Reallocation Event
” has the meaning set forth in
Section 5.13(p)
of this Base Indenture.
“
Rapid Amortization Event
” has the meaning set forth in
Section 9.01
of this Base Indenture.
“
Rapid Amortization Period
” means the period commencing on the date on which a Rapid Amortization Event occurs and ending on
the earlier to occur of the waiver of the occurrence of such Rapid Amortization Event in accordance with
Section 9.07
of this Base Indenture and the date on which there are no Notes Outstanding.
“
Rating Agency
” means each rating agency identified in the applicable Series Supplement.
“
Rating Agency Condition
” means, with respect to any Outstanding Series of Notes
and any event or action to be taken or proposed to be taken requiring satisfaction of the Rating Agency Condition in the Indenture or in any other Related Document, a condition that is satisfied if the Manager has notified the Master Issuer, the
Servicer and the Trustee in writing that the Manager has provided each Rating Agency and the Servicer with a written notification setting forth in reasonable detail such event or action and has actively solicited (by written request and by request
via email and telephone) a Rating Agency Confirmation from each Rating Agency, and each Rating Agency has either provided the Manager with a Rating Agency Confirmation with respect to such event or action or informed the Manager that it declines to
review such event or action;
provided
that:
(i)
except in connection with the issuance of Additional Notes, as to which the conditions of
clause (ii)
below will apply in all cases, the
Rating Agency Condition in respect of any Rating Agency will be required to be satisfied in connection with any such event or action only if the Manager determines in its sole discretion that the policies of such Rating Agency permit it to
deliver such Rating Agency Confirmation; and
(ii)
the Rating Agency Condition will not be required to be satisfied in respect of any Rating Agency if the Manager provides an Officer’s Certificate
(along with copies of all written requests for such Rating Agency Confirmation and copies of all related email correspondence) to the Master Issuer, the Servicer and the Trustee certifying that:
(a)
the Manager has not received any response from such Rating Agency after the Manager has repeated such active solicitation (by request via telephone
and by email) on or about the tenth (10
th
) Business Day and the fifteenth (15
th
)
Business Day following the date of delivery of the initial solicitation;
(b)
the Manager has no reason to believe that such event or action would result in such Rating Agency withdrawing its credit ratings on such
Outstanding Series of Notes or assigning credit ratings on such Outstanding Series of Notes below the lower of (1) the then-current credit ratings on such Outstanding Series of Notes or (2) the initial credit ratings assigned to such Outstanding
Series of Notes by such Rating Agency (in each case, without negative implications); and
(c)
solely in connection with any issuance of Additional Notes, either:
(1)
at least one (1) Rating Agency has provided a Rating Agency Confirmation; or
(2)
each Rating Agency has rated the Additional Notes no lower than the lower of (x) the then-current credit rating assigned by such Rating Agency or
(y) the initial credit rating assigned by such Rating Agency (in each case, without negative implications) to each Outstanding Series of Notes ranking on the same priority as the Additional Notes, or, if no Outstanding Series of Notes ranks on
the same priority as such Additional Notes, the Control Party shall have provided its written consent to the issuance of such Additional Notes;
provided
, that in the case of
clause (c)
,
a Rating Agency Confirmation of S&P will be required for each Series of Notes then rated by S&P at the time of such issuance of Additional Notes (other than any Series of Notes that will be repaid in full from the proceeds of issuance of
the Additional Notes or otherwise on the applicable Series Closing Date for such Additional Notes).
“
Rating Agency Confirmation
” means, with respect to any Outstanding Series of
Notes, a confirmation from each Rating Agency that a proposed event or action will not result in (i) a withdrawal of its credit ratings on such Outstanding Series of Notes or (ii) the assignment of credit ratings on such Outstanding Series of Notes
below the lower of (A) the then-current credit ratings on such Outstanding Series of Notes or (B) the initial credit ratings assigned to such Outstanding Series of Notes by such Rating Agency (in each case, without negative implications).
“
Rating Agency Notification
” means, with respect to any prospective action or
occurrence, a written notification to each Rating Agency for each Series of Notes Outstanding setting forth in reasonable detail such action or occurrence.
“
Real Estate Assets
” means the Contributed Real Estate Assets and the New Real
Estate Assets.
“
Record Date
” means, with respect to any Quarterly Payment Date the close of
business on the last Business Day of the calendar month immediately preceding the calendar month in which such Quarterly Payment Date occurs.
“
Refranchising Asset Disposition
” has the meaning set forth in
Section 8.16(p)
of this Base Indenture.
“
Registrar
” has the meaning set forth in
Section 2.05(a)
of this Base Indenture.
“
Related Documents
” means the Indenture, the Notes, the Guarantee and Collateral Agreement, each Account Control Agreement,
any Mortgages, the Management Agreement, the Servicing Agreement, the Back-Up Management Agreement, any Series Hedge Agreement, the Contribution Agreements, any agreement pursuant to which New Assets are contributed to the Securitization Entities,
any Variable Funding Note Purchase Agreement, each other note purchase agreement pursuant to which Notes are purchased, the IP License Agreements, any Enhancement Agreement, the Charter Documents, each Letter of Credit Reimbursement Agreement and
any additional document identified as a “Related Document” in the Series Supplement for any Series of Notes Outstanding and any other material agreements entered into, pursuant to the foregoing documents.
“
Reportable Event
” means any “reportable event” as defined in Section 4043 of ERISA or the regulations issued thereunder
with respect to a Single Employer Plan (other than an event for which the 30-day notice period is waived).
“
Required Balance
” means, with respect to any Weekly Collection Period, the product
of (1) the percentage set forth in the table below for each Weekly Collection Period for the specific length of the Fiscal Quarter and (2) with respect to (a) the Senior Notes Interest Payment Account, the sum, for each Interest Accrual Period, of
(x) the Class A-1 Quarterly Commitment Fee Amounts and (y) the Senior Notes Quarterly Interest Amount, (b) the Senior Subordinated Notes Interest Payment Account, the Senior Subordinated Notes Accrued Quarterly Interest Amount, (c) the Subordinated
Notes Interest Payment Account, the Subordinated Notes Accrued Quarterly Interest Amount, (d) the Senior Notes Principal Payment Account, the Senior Notes Quarterly Scheduled Principal Amounts, (e) the Senior Subordinated Notes Principal Payment
Account, the Senior Subordinated Quarterly Scheduled Principal Amounts, (f) the Subordinated Notes Principal Payment Account, the Subordinated Quarterly Scheduled Principal Amounts and (g) the Senior Notes Post-ARD Contingent Interest Account, the
Senior Notes Accrued Quarterly Post-ARD Contingent Interest Amount.
|
Week
|
12-week quarter
|
13-week quarter
|
16-week quarter
|
|
1
|
–
|
–
|
–
|
|
2
|
–
|
–
|
–
|
|
3
|
–
|
–
|
–
|
|
4
|
45%
|
45%
|
–
|
|
5
|
45%
|
45%
|
–
|
|
6
|
45%
|
45%
|
45%
|
|
7
|
80%
|
80%
|
45%
|
|
8
|
80%
|
80%
|
45%
|
|
9
|
100%
|
100%
|
45%
|
|
10
|
100%
|
100%
|
80%
|
|
11
|
100%
|
100%
|
80%
|
|
12
|
100%
|
100%
|
80%
|
|
13
|
N/A
|
100%
|
100%
|
|
14
|
N/A
|
N/A
|
100%
|
|
15
|
N/A
|
N/A
|
100%
|
|
16
|
N/A
|
N/A
|
100%
|
“
Required Rating
” means (i) a short-term certificate of deposit rating from S&P
of at least “A-2” and (ii) a long-term unsecured debt rating of not less than “BBB-” by S&P.
“
Requirements of Law
” means, with respect to any Person or any of its property, the certificate of
incorporation or articles of association and by-laws, limited liability company agreement, partnership agreement or other organizational or governing documents of such Person or any of its property, and any law, treaty, rule or regulation, or
determination of any arbitrator or Governmental Authority, in each case applicable to, or binding upon, such Person or any of its property or to which such Person or any of its property is subject, whether federal, state, local or foreign
(including, without limitation, usury laws, the Federal Truth in Lending Act, state franchise laws and retail installment sales acts).
“
Residual Amount
” means for any Weekly Allocation Date with respect to any Quarterly Collection Period
the amount, if any, by which the amount allocated to the Collection Account on such Weekly Allocation Date exceeds the sum of the amounts to be paid and/or allocated on such Weekly Allocation Date pursuant to
priorities (i)
through
(xxix)
of the Priority of Payments.
“
Restaurant Operating Expenses
” means, collectively, (i) operating expenses that
are incurred by or allocated, in accordance with the Managing Standard, to Securitized Company Restaurants in the ordinary course of business relating to the operation of Securitized Company Restaurants, such as the cost of goods sold (including
vendor rebates), labor (including wages, incentive compensation, workers’ compensation-related expenses and other labor-related expenses for employees in respect of Securitized Company Restaurants), repair and maintenance expenses to the extent not
capitalized, insurance (including self-insurance), marketing, administration, information technology fees and similar fees allocable to such Securitized Company Restaurants (including, without limitation, fees for services that are similarly
charged to Franchisees), litigation and settlement costs relating to the Securitized Assets and other restaurant operating costs included in cost of sales, (ii) payments pursuant to Securitized Company Restaurant Third-Party Leases and (iii)
Pass-Through Amounts.
“
Retained Collections
” means, with respect to any specified period of time, the
amount equal to (A) the sum of (i) Collections (other than Securitized Company Restaurant Collections and Franchisee Back-to-Back Sublease Payments) received over such period
plus
,
without duplication, (ii) Four-Week Fiscal Period Estimated Securitized Company Restaurant Profits Amounts
plus
, without duplication, (iii) Four-Week Fiscal Period Securitized
Company Restaurant Profits True-up Amounts
plus
, without duplication (iv) Net Back-to-Back Franchisee Lease Payments and Company Synthetic Lease Payments for the Four-Week
Fiscal Period most recently ended
minus
(B) without duplication, the Excluded Amounts (to
the extent such amounts are included in
clauses (i)
through
(iii)
) over such period. Funds released
from the Cash Trap Reserve Account shall not constitute Retained Collections for purposes of this definition.
“
Retained Collections Contribution
” means, with respect to any Quarterly Collection Period, an equity contribution made to
the Master Issuer, at any time prior to the Series Legal Final Maturity Date with respect the last Series of Notes Outstanding, to be included in Net Cash Flow in accordance with
Section 5.17
of this Base Indenture, which for all purposes
of the Related Documents, except as otherwise specified therein, will be treated as Retained Collections received during such Quarterly Collection Period;
provided
that any Retained Collections Contribution made will be excluded from Net
Cash Flow for purposes of calculations undertaken in the following circumstances: (i) the New Series Pro Forma DSCR or (ii) compliance with the applicable Series Non-Amortization Test.
“
Rule 144A
” means Rule 144A under the 1933 Act.
“
S&P
” means S&P Global Ratings (and any successor or successors thereto).
“
Scheduled Principal Payments
” means, with respect to each Series or any Class of any Series of Notes, each payment
scheduled to be made pursuant to the Series Supplement for such Series that reduces the amount of principal Outstanding with respect to such Series or Class on a periodic basis that is identified as “Scheduled Principal Payments” in the Series
Supplement for such Series.
“
Scheduled Principal Payments Deficiency Event
” means, with respect to any Quarterly Collection Period, as of the last
Weekly Allocation Date with respect to such Quarterly Collection Period, the occurrence of the following event: the amount of funds on deposit in the Senior Notes Principal Payment Account after the last Weekly Allocation Date with respect to such
Quarterly Collection Period is less than the aggregate amount of Senior Notes Quarterly Scheduled Principal Amounts due and payable on all such Senior Notes for the next succeeding Quarterly Payment Date.
“
Scheduled Principal Payments Deficiency Notice
” has the meaning set forth in
Section 4.01(d)
of this Base
Indenture.
“
SEC
” means the United States Securities and Exchange Commission.
“
Secured Parties
” means the Trustee, for the benefit of (i) itself, (ii) the Noteholders, (iii) the Servicer, (iv) the
Control Party, (v) the Manager, (vi) the Back-Up Manager, (vii) each Hedge Counterparty, if any, and (viii) the Enhancement Provider, if any, together with their respective successors and assigns.
“
Securities Intermediary
” has the meaning set forth in
Section 5.09(a)
of this Base Indenture.
“
Securitization Entities
” means, collectively, the Master Issuer and the Guarantors, and each Subsidiary thereof (including
any Additional Securitization Entity).
“
Securitization IP
” means, collectively, the Owned Securitization IP and the
Licensed Securitization IP; except that (i) “Securitization IP” will not include, solely for purposes of the licenses granted under the IP License Agreements, any rights to use licensed third-party Intellectual Property to the extent that such
rights are not sublicensable without the consent of or any payment to such third party, or any other action by the licensee thereof, unless such consent has been obtained or payment has been made; and (ii) as used in the Related Documents, the
terms “owns,” “holds,” and similar terms mean, with regard to Owned Securitization IP, the holding of legal title, and with regard to Licensed Securitization IP, the holding of valid rights to use under a license or similar arrangement.
“
Securitization Operating Expense Account
” has the meaning set forth in
Section 5.07(a)(xi)
of this Base Indenture.
“
Securitization Operating Expenses
” means all expenses incurred by the
Securitization Entities and payable to third parties in connection with the maintenance and operation of the Securitization Entities and the transactions contemplated by the Related Documents to which they are a party (other than those paid for
from the Concentration Accounts or Securitized Company Restaurant Accounts), including (i) accrued and unpaid Taxes (other than federal, state, local and foreign Taxes based on income, profits or capital, including franchise, excise, withholding or
similar Taxes), filing fees and registration fees payable by and attributable to the Securitization Entities to any federal, state, local or foreign Governmental Authority; (ii) fees and expenses payable to (A) the Trustee under the Indenture or
the other Related Documents to which it is a party
(excluding Mortgage Recordation Fees)
, (B) the Back-Up Manager as Back-Up Manager Fees, (C) each Rating
Agency, (D) independent certified public accountants (including, for the avoidance of doubt, any incremental auditor costs) or external legal counsel, (E) any stock exchange on which the Notes may be listed and (F) the Controlling Class
Representative for out-of-pocket expenses incurred acting in such capacity; (iii) the indemnification obligations of the Securitization Entities under the Related Documents to which they are a party (including any interest thereon at the Advance
Interest Rate, if applicable); and (iv) independent director and independent manager fees. Mortgage Preparation Fees and Mortgage Recordation Fees shall not be Securitization Operating Expenses.
“
Securitized Assets
” means all assets owned by the Securitization Entities,
including but not limited to the Collateral and the Real Estate Assets.
“
Securitized Back-to-Back Franchisee Lease Arrangements
” means, collectively, the
Contributed Securitized Back-to-Back Franchisee Lease Arrangements and the New Securitized Back-to-Back Franchisee Lease Arrangements.
“
Securitized Company Restaurant Accounts
” has the meaning set forth in
Section 5.02(a)(i)
of this Base Indenture.
“
Securitized Company Restaurant Assets
” means the supplies, furniture and equipment
associated with owning and operating the Securitized Company Restaurants, such as furnishings, cooking equipment, cooking supplies and computer equipment.
“
Securitized Company Restaurant Business
” means the business of owning and
operating the Securitized Company Restaurants and the provision of ancillary goods and services in connection therewith.
“
Securitized Company Restaurant Collections
” means cash revenues, credit card and
debit card proceeds (including value card redemption amounts, but excluding proceeds of the initial sale of value cards) generated by Securitized Company Restaurants.
“
Securitized Company Restaurant Third-Party Leases
” means, collectively, the
Contributed Securitized Company Restaurant Third-Party Leases and the New Securitized Company Restaurant Third-Party Leases.
“
Securitized Company Restaurant Working Capital Reserve Amount
” means, as of any
date of determination, an amount determined by the Manager to be retained in a Securitized Company Restaurant Account for working capital expenses not to exceed in the aggregate for all Securitized Company Restaurant Accounts the greater of (i)
$5,000,000 and (ii) 10% of the aggregate Retained Collections for the preceding four (4) Quarterly Collection Periods;
provided
that amounts transferred by the Master Issuer to a Securitized Company Restaurant Account from the Residual Amount will not be included in such calculation.
“
Securitized Company Restaurants
” means, collectively, the Contributed Securitized
Company Restaurants and the New Securitized Company Restaurants.
“
Securitized Development Agreements
” means, collectively, the Contributed
Securitized Development Agreements and the New Securitized Development Agreements.
“
Securitized Franchise Agreements
” means, collectively, the Contributed Securitized
Franchise Agreements and the New Securitized Franchise Agreements.
“
Securitized Franchise Assets
” means, with respect to the Franchisor, (A) the
Securitized Franchisee Notes and all Securitized Franchisee Note Payments thereon and (B)(i) the Contributed Securitized Franchise Agreements and all Securitized Franchisee Payments thereon; (ii) the Contributed Securitized Development Agreements
and all Securitized Franchisee Payments thereon; (iii) the New Securitized Franchise Agreements and all Securitized Franchisee Payments thereon; (iv) the New Securitized Development Agreements and all Securitized Franchisee Payments thereon; (v)
all rights to enter into New Securitized Franchise Agreements and New Securitized Development Agreements; (vi) any and all other property of every nature, now or hereafter transferred, mortgaged, pledged, or assigned as security for payment or
performance of any obligation of the Franchisees or other Persons, as applicable, to the Franchisor under the Securitized Franchise Agreements or the Securitized Development Agreements and all guarantees of such obligations and the rights evidenced
by or reflected in the Securitized Franchise Agreements or the Securitized Development Agreements; and (vii) all payments, proceeds and accrued and future rights to payment on the items described in
clauses (i)
through
(vi)
of this definition.
“
Securitized Franchise Documents
” means all Securitized Franchise Agreements
(including master franchise agreements and related service or license agreements), Securitized Development Agreements and agreements related thereto, together with any modifications, amendments, extensions or replacements of the foregoing.
“
Securitized Franchised Restaurant Business
” means the business of franchising or
licensing Branded Restaurants located in the United States.
“
Securitized Franchised Restaurants
” means, collectively, the Contributed
Securitized Franchised Restaurants and the New Securitized Franchised Restaurants.
“
Securitized Franchisee Back-to-Back Subleases
” means, collectively, the
Contributed Securitized Franchisee Back-to-Back Subleases and the New Securitized Franchisee Back-to-Back Subleases.
“
Securitized Franchisee Note Payments
” means all amounts payable to a
Securitization Entity by a Franchisee pursuant to a Securitized Franchisee Note.
“
Securitized Franchisee Notes
” means, collectively, the Contributed Securitized
Franchisee Notes and the New Securitized Franchisee Notes.
“
Securitized Franchisee Payments
” means all amounts payable to a Securitization
Entity by Franchisees pursuant to the Franchise Documents other than Excluded Amounts, which may be excluded from the term at the option of the Manager.
“
Securitized JIB Back-to-Back Leases
” means, collectively, the Contributed
Securitized JIB Back-to-Back Leases and the New Securitized JIB Back-to-Back Leases.
“
Securitized Leases
” means, collectively, the Securitized Company Restaurant
Third-Party Leases, the Securitized JIB Back-to-Back Leases, the Securitized Franchisee Back-to-Back Subleases, the Securitized Owned-Property Franchisee Leases, the Non-Branded Restaurant Leases and the Non-Securitization Entity Leases.
“
Securitized Owned Real Property
” means collectively, the Contributed Securitized
Owned Real Property and the New Securitized Owned Real Property.
“
Securitized Owned-Property Franchisee Lease Payments
” means lease payments payable
by Franchisees to JIB Properties under Securitized Owned-Property Franchisee Leases.
“
Securitized Owned-Property Franchisee Leases
” means, collectively, the Contributed
Securitized Owned-Property Franchisee Leases and the New Securitized Owned-Property Franchisee Leases.
“
Securitized Restaurant Business
” means, collectively, the Securitized Company
Restaurant Business and the Securitized Franchised Restaurant Business.
“
Securitized Restaurants
” means, collectively, the Securitized Company Restaurants
and the Securitized Franchised Restaurants.
“
Senior ABS Leverage Ratio
” means, as of any date of determination, the ratio of (a)(i) the aggregate Outstanding Principal
Amount of each Series of Senior Notes Outstanding assuming the amounts available under each Class A-1 Note at such time (after giving effect to any commitment reductions on such date) are fully drawn) as of the end of the most recently ended
Quarterly Fiscal Period less (ii) the sum of (x) the cash and Eligible Investments of the Securitization Entities credited to the Senior Notes Interest Reserve Account, the Cash Trap Reserve Account and the Franchisor Capital Accounts as of the end
of the most recently ended Quarterly Fiscal Period, and (y) the available amount of the Interest Reserve Letter of Credit with respect to the Senior Notes as of the end of the most recently ended Quarterly Collection Period to (b) the sum of the
Net Cash Flow for the preceding four (4) Quarterly Collection Periods most recently ended as of such date and for which financial statements have been prepared. The Senior ABS Leverage Ratio shall be calculated in accordance with
Section
14.18(b)
of this Base Indenture.
“
Senior Noteholder
” means any Holder of Senior Notes of any Series.
“
Senior Notes
” or “
Class A Notes
” means the issuance of Notes under the Indenture by the Master Issuer that by its
terms (through its alphabetical designation as “Class A” pursuant to the Series Supplement applicable to such Indebtedness) is senior in the right to receive interest and principal on such Notes to the right to receive interest and principal on any
Subordinated Notes.
“
Senior Notes Accrued Quarterly Interest Amount
” means, for each Weekly Allocation Date with respect to a Quarterly
Collection Period, and with respect to any Senior Notes Outstanding, the amount identified as “Senior Notes Accrued Quarterly Interest Amount” in the Series Supplement for such Series.
“
Senior Notes Accrued Quarterly Post-ARD Contingent Interest Amount
” means, for each Weekly Allocation Date with respect to
a Quarterly Collection Period, and with respect to any Senior Notes Outstanding, the amount identified as “Senior Notes Accrued Quarterly Post-ARD Contingent Interest Amount” in the Series Supplement for such Series.
“
Senior Notes Accrued Quarterly Scheduled Principal Amount
” means with respect to each Weekly Allocation Date, and with
respect to all Senior Notes Outstanding, the aggregate amounts identified as the “Senior Notes Accrued Quarterly Scheduled Principal Amount” in each Series Supplement for such Series.
“
Senior Notes Interest Payment Account
” has the meaning set forth in
Section 5.07(a)(i)
of this Base Indenture.
“
Senior Notes Interest Reserve Account
” means account no. 1220600 entitled “Citibank, N.A. f/b/o Different Rules, LLC,
Senior Notes Interest Reserve Account”, which account is maintained by the Trustee pursuant to
Section 5.03
of this Base Indenture or any successor securities account maintained pursuant to
Section 5.03
of this Base Indenture.
“
Senior Notes Interest Reserve Account Deficiency Amount
” means, as of any date of determination the excess, if any, of the
Senior Notes Interest Reserve Amount over the sum of (a) the amount on deposit in the Senior Notes Interest Reserve Account and (b) the amount available under any Interest Reserve Letter of Credit relating to the Senior Notes.
“
Senior Notes Interest Reserve Amount
” means, with respect to any Quarterly Payment Date (and any Weekly Allocation Date
related thereto), an amount equal to the Senior Notes Quarterly Interest Amount due on the next Quarterly Payment Date (assuming (i) that amounts available under each Variable Funding Note Purchase Agreement at such time (after giving effect to any
commitment reductions and corresponding principal payments on such date) are fully drawn and (ii) the rate on each Class A-1 Note is equivalent to the rate on a Class A-2 Note with the shortest time until its Series Anticipated Repayment Date);
provided
that, with respect to the first Interest Accrual Period following the Closing Date, the Senior Notes Interest Reserve Amount will be an amount equal to the Initial Senior Notes Interest Reserve Amount.
“
Senior Notes Post-ARD Contingent Interest Account
” has the meaning set forth in
Section 5.07(a)(viii)
of this Base
Indenture
“
Senior Notes Principal Payment Account
” has the meaning set forth in
Section 5.07(a)(v)
of this Base Indenture.
“
Senior Notes Quarterly Interest Amount
” means for each Quarterly Payment Date, with respect to each Class of Senior Notes
Outstanding, the aggregate amounts identified as the “Senior Notes Quarterly Interest Amount” in the Series Supplement for such Series.
“
Senior Notes Quarterly Interest Shortfall Amount
” has the meaning set forth in
Section 5.13(a)(iii)
of this Base
Indenture.
“
Senior Notes Quarterly Post-ARD Contingent Interest Amount
” means for each Quarterly Payment Date, with respect to each
Class of Senior Notes Outstanding, the amounts identified as “Senior Notes Quarterly Post-ARD Contingent Interest Amount” in the Series Supplement for such Series.
“
Senior Notes Quarterly Scheduled Principal Amounts
” means, with respect to each Class of Senior Notes Outstanding, each
Scheduled Principal Payment with respect to such Class of Senior Notes.
“
Senior Notes Quarterly Scheduled Principal Deficiency Amount
” means with respect to each Weekly Allocation Date, and with
respect to all Senior Notes Outstanding, the aggregate amounts identified as the “Senior Notes Quarterly Scheduled Principal Deficiency Amount” in each Series Supplement for such Series.
“
Senior Subordinated Noteholder
” means any Holder of Senior Subordinated Notes of any Series.
“
Senior Subordinated Notes
” means any issuance of Notes under the Indenture by the Master Issuer that are part of a Class
with an alphanumerical designation that contains any letter from “B” through “L” of the alphabet, together with all Subclasses or Tranches thereof.
“
Senior Subordinated Notes Accrued Quarterly Interest Amount
” means, for each Weekly Allocation Date with respect to a
Quarterly Collection Period, and with respect to any Senior Subordinated Notes Outstanding, the amount identified as the “Senior Subordinated Notes Accrued Quarterly Interest Amount” in the Series Supplement for such Series.
“
Senior Subordinated Notes Accrued Quarterly Post-ARD Contingent Interest Amount
” means, for each Weekly Allocation Date
with respect to a Quarterly Collection Period, and with respect to any Senior Subordinated Notes Outstanding, the amount identified as the “Senior Subordinated Notes Accrued Quarterly Post-ARD Contingent Interest Amount” in the Series Supplement
for such Series.
“
Senior Subordinated Notes Accrued Quarterly Scheduled Principal Amount
” means, with respect to each Weekly Allocation Date,
and with respect to all Senior Subordinated Notes Outstanding, the aggregate amounts identified as the “Senior Subordinated Notes Accrued Quarterly Scheduled Principal Amount” in each Series Supplement for such Series.
“
Senior Subordinated Notes Interest Payment Account
” has the meaning set forth in
Section 5.07(a)(ii)
of this Base
Indenture.
“
Senior Subordinated Notes Interest Reserve Account
” means an account entitled “Citibank, N.A. f/b/o Jack in the Box
Funding, LLC, Senior Subordinated Notes Interest Reserve Account” maintained by the Trustee pursuant to
Section 5.04(a)
of this Base Indenture or any successor securities account maintained pursuant to
Section 5.04(a)
of this Base
Indenture.
“
Senior Subordinated Notes Interest Reserve Account Deficiency Amount
” means, as of any date of determination, the excess,
if any, of the Senior Subordinated Notes Interest Reserve Amount over the sum of (a) the amount on deposit in the Senior Subordinated Notes Interest Reserve Account and (b) the amount available under any Interest Reserve Letter of Credit relating
to the Senior Subordinated Notes.
“
Senior Subordinated Notes Interest Reserve Amount
” means, with respect to any Quarterly Payment Date (and any Weekly
Allocation Date related thereto), an amount equal to the Senior Subordinated Notes Quarterly Interest Amount due on the next Quarterly Payment Date.
“
Senior Subordinated Notes Post-ARD Contingent Interest Account
” has the meaning set forth in
Section 5.07(a)(ix)
of
this Base Indenture.
“
Senior Subordinated Notes Principal Payment Account
” has the meaning set forth in
Section 5.07(a)(vi)
of this Base
Indenture.
“
Senior Subordinated Notes Quarterly Interest Amount
” means, for each Quarterly Payment Date, with respect to each Class of
Senior Subordinated Notes Outstanding, the aggregate amounts identified as the “Senior Subordinated Notes Quarterly Interest Amount” in the Series Supplement for such Series.
“
Senior Subordinated Notes Quarterly Post-ARD Contingent Interest Amount
” means, for each Quarterly Payment Date, with
respect to each Class of Senior Subordinated Notes Outstanding, the amounts identified as “Senior Subordinated Notes Quarterly Post-ARD Contingent Interest Amount” in the Series Supplement for such Series.
“
Senior Subordinated Notes Quarterly Scheduled Principal Amounts
” means, with respect to each Class of Senior Subordinated
Notes Outstanding, each Scheduled Principal Payment with respect to such Class of Senior Subordinated Notes.
“
Senior Subordinated Notes Quarterly Scheduled Principal Deficiency Amount
” means with respect to each Weekly Allocation
Date, and with respect to all Senior Subordinated Notes Outstanding, the aggregate amounts identified as the “Senior Subordinated Notes Quarterly Scheduled Principal Deficiency Amount” in each Series Supplement for such Series.
“
Series Account
” means any account or accounts established pursuant to a Series Supplement for the benefit of a Series of
Notes (or any Class thereof).
“
Series Anticipated Repayment Date
” means, with respect to any Series of Notes, Class, Subclass or Tranche thereunder, the
“Anticipated Repayment Date” as set forth in the related Series Supplement, which will be the Series Anticipated Repayment Date for such Series of Notes, Class, Subclass or Tranche thereunder, as adjusted pursuant to the terms of the Series
Supplement for such Series.
“
Series Closing Date
” means, with respect to any Series of Notes, the date of issuance of such Series of Notes, as specified
in the Series Supplement for such Series.
“
Series Defeasance Date
” has the meaning set forth in
Section 12.01(c)
of this Base Indenture.
“
Series Distribution Account
” means, with respect to any Series of Notes or any Class of any Series of Notes, an account
established to receive distributions to be paid to the Noteholders of such Class or such Series of Notes pursuant to the Series Supplement for such Series.
“
Series Hedge Agreement
” means, with respect to any Series of Notes, the relevant Swap Contract, if any, described in the
Series Supplement for such Series.
“
Series Hedge Payment Amount
” means all amounts payable by the Master Issuer under a Series Hedge Agreement including any
termination payment payable by the Master Issuer.
“
Series Hedge Receipts
” means all amounts received by the Securitization Entities under a Series Hedge Agreement.
“
Series Legal Final Maturity Date
” means, with respect to any Series, the “Legal Final Maturity Date” set forth in the
related Series Supplement.
“
Series Non-Amortization Test
” means, with respect to any Series or Class of Notes, the test specified in the Series
Supplement for such Series or, if not specified therein, means a test that will be satisfied on any Quarterly Payment Date only if both (a) the Holdco Leverage Ratio is less than or equal to 5.00x as calculated on the Quarterly Calculation Date
immediately preceding such Quarterly Payment Date and (b) no Rapid Amortization Event has occurred and is continuing.
“
Series Obligations
” means, with respect to a Series of Notes, (a) all principal, interest, premiums, make-whole payments
and Series Hedge Payment Amounts, at any time and from time to time, owing by the Master Issuer on such Series of Notes or owing by the Guarantors pursuant to the Guarantee and Collateral Agreement on such Series of Notes and (b) the payment and
performance of all other obligations, covenants and liabilities of the Master Issuer or the Guarantors arising under the Indenture, the Notes or any other Indenture Document, in each case, solely with respect to such Series of Notes.
“
Series of Notes
” or “
Series
” means each series of Notes issued and authenticated pursuant to the Base Indenture and
the applicable Series Supplement.
“
Series Supplement
” means a supplement to the Base Indenture in conjunction with the issuance of a Series of Notes complying
(to the extent applicable) with the terms of
Section 2.03
of this Base Indenture.
“
Servicer
” means Midland Loan Services, a division of PNC Bank, National Association, as servicer under the Servicing
Agreement, and any successor thereto.
“
Servicer Termination Event
” has the meaning set forth in the Servicing Agreement.
“
Services
” has the meaning set forth in the Management Agreement.
“
Servicing Agreement
” means the Servicing Agreement, dated as of the Closing Date, by and among the Master Issuer, the other
Securitization Entities party thereto, the Manager, the Servicer and the Trustee, as amended, supplemented or otherwise modified from time to time.
“
Servicing Fees
” has the meaning set forth in the Servicing Agreement.
“
Servicing Standard
” has the meaning set forth in the Servicing Agreement.
“
Single Employer Plan
” means any Pension Plan that is covered by Title IV of ERISA, but that is not a Multiemployer Plan.
“
Software
” has the meaning set forth in the definition of “Intellectual Property.”
“
Specified Bankruptcy Opinion Provisions
” means the provisions contained in the legal opinion(s) delivered in connection
with the issuance of each Series of Notes relating to the non-substantive consolidation of the Securitization Entities with Jack in the Box Inc.
“
Specified Indenture Trust Accounts
” shall mean the Senior Notes Interest Payment Account, the Class A-1 Notes Commitment
Fees Account, the Senior Subordinated Notes Interest Payment Account, the Subordinated Notes Interest Payment Account, the Senior Notes Principal Payment Account, the Senior Subordinated Notes Principal Payment Account, the Subordinated Notes
Principal Payment Account, the Senior Notes Post-ARD Contingent Interest Account, the Senior Subordinated Notes Post-ARD Contingent Interest Account, the Subordinated Notes Post-ARD Contingent Interest Account, the Hedge Payment Account and the
Cash Trap Reserve Account.
“
Subclass
” means, with respect to any Class of any Series of Notes, any one of the subclasses of Notes of such Class as
specified in the Series Supplement for such Series.
“
Subordinated Notes
” means any issuance of Notes under the Indenture by the Master Issuer that are part of a Class with an
alphanumerical designation that contains any letter from “M” through “Z” of the alphabet, together with all Subclasses or Tranches thereof.
“
Subordinated Notes Accrued Quarterly Interest Amount
” means, for each Weekly Allocation Date with respect to a Quarterly
Collection Period, and with respect to any Subordinated Notes Outstanding, the amount identified as “Subordinated Notes Accrued Quarterly Interest Amount” in the Series Supplement for such Series.
“
Subordinated Notes Accrued Quarterly Post-ARD Contingent Interest Amount
” means, for each Weekly Allocation Date with
respect to a Quarterly Collection Period, and with respect to any Subordinated Notes Outstanding, the amount identified as “Subordinated Notes Accrued Quarterly Post-ARD Contingent Interest Amount” in the Series Supplement for such Series.
“
Subordinated Notes Accrued Quarterly Scheduled Principal Amount
” means, with respect to each Weekly Allocation Date, and
with respect to all Subordinated Notes Outstanding, the aggregate amounts identified as the “Subordinated Notes Accrued Quarterly Scheduled Principal Amount” in each Series Supplement for such Series.
“
Subordinated Notes Interest Payment Account
” has the meaning set forth in
Section 5.07(a)(iii)
of this Base
Indenture.
“
Subordinated Notes Post-ARD Contingent Interest Account
” has the meaning set forth in
Section 5.07(a)(x)
of this
Base Indenture.
“
Subordinated Notes Principal Payment Account
” has the meaning set forth in
Section 5.07(a)(vii)
of this Base
Indenture.
“
Subordinated Notes Provisions
” means, with respect to the issuance of any Series of Notes that includes Subordinated Notes,
the terms of such Subordinated Notes will include the following provisions: (a) if there is an Extension Period in effect with respect to the Senior Notes issued on the Closing Date, the principal of any Subordinated Notes will not be permitted to
be repaid out of the Priority of Payments unless such Senior Notes are no longer Outstanding, (b) if the Senior Notes issued on the Closing Date are refinanced on or prior to the Series Anticipated Repayment Date of such Senior Notes and any such
Subordinated Notes having a Series Anticipated Repayment Date on or before the Series Anticipated Repayment Date of such Senior Notes are not refinanced on or prior to the Series Anticipated Repayment Date of such Senior Notes, such Subordinated
Notes will begin to amortize on the date that the Senior Notes are refinanced pursuant to a Scheduled Principal Payment schedule to be set forth in the Series Supplement for such Series and (c) if the Senior Notes issued on the Closing Date are not
refinanced on or prior to the Quarterly Payment Date following the seventh anniversary of the Closing Date, such Subordinated Notes will not be permitted to be refinanced.
“
Subordinated Notes Quarterly Interest Amount
” means for each Quarterly Payment Date, with respect to each Class of
Subordinated Notes Outstanding, the aggregate amounts identified as the “Subordinated Notes Quarterly Interest Amount” in the Series Supplement for such Series.
“
Subordinated Notes Quarterly Interest Shortfall
” has the meaning set forth in
Section 5.13(f)(iii)
of this Base
Indenture.
“
Subordinated Notes Quarterly Post-ARD Contingent Interest Amount
” means, for each Quarterly Payment Date, with respect to
each Class of Subordinated Notes Outstanding, the amounts identified as “Subordinated Notes Quarterly Post-ARD Contingent Interest Amount” in the Series Supplement for such Series.
“
Subordinated Notes Quarterly Scheduled Principal Amounts
” means, with respect to each Class of Subordinated Notes
Outstanding, each Scheduled Principal Payment with respect to such Class of Subordinated Notes.
“
Subordinated Notes Quarterly Scheduled Principal Deficiency Amount
” means with respect to each Weekly Allocation Date, and
with respect to all Subordinated Notes Outstanding, the aggregate amounts identified as “Subordinated Notes Quarterly Scheduled Principal Deficiency Amount” in each Series Supplement for such Series.
“
Subsidiary
” means, with respect to any Person (herein referred to as the “
parent
”), any corporation, partnership,
limited liability company, association or other business entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or more than 50% of the general partnership
interests are, at the time any determination is being made, owned, controlled or held by the parent or (b) that is, at the time any determination is being made, otherwise controlled, by the parent or one or more subsidiaries of the parent or by the
parent and one or more subsidiaries of the parent.
“
Subsidiary Guarantors
” means, collectively, the Franchisor, JIB Properties and the Additional Securitization Entities.
“
Successor Manager
” means any successor to the Manager selected by the Control Party (at the direction of the Controlling
Class Representative) upon the resignation or removal of the Manager pursuant to the terms of the Management Agreement.
“
Successor Manager Transition Expenses
” means all costs and expenses incurred by a Successor Manager in connection with the
termination, removal and replacement of the Manager under the Management Agreement.
“
Successor Servicer Transition Expenses
” means all costs and expenses incurred by a successor Servicer in connection with
the termination, removal and replacement of the Servicer under the Servicing Agreement.
“
Supplement
” means either a supplement to the Base Indenture or a supplement to a Series Supplement, as applicable and in
each case, complying (to the extent applicable) with the terms of
Article XIII
of this Base Indenture.
“
Supplemental Management Fee
” means for each Weekly Allocation Date with respect to any Quarterly Collection Period the
amount (if any) by which, with respect to such Quarterly Collection Period, (A) the sum of (i) the expenses incurred or other amounts charged by the Manager (or the Back-Up Manager, as applicable) since the beginning of such Quarterly Collection
Period in connection with the performance of the Manager’s (or the Back-Up Manager’s, as applicable) obligations under the Management Agreement, approved in writing by the Control Party acting at the direction of the Controlling Class
Representative and (ii) so long as Jack in the Box Inc. (or, if Jack in the Box Inc. is not the taxable parent entity of any Securitization Entity, such other taxable parent entity) is then acting as Manager, any current or projected Tax Payment
Deficiency, if applicable, approved in writing by the Control Party (with such approval not to be unreasonably withheld) exceeds (B) the Weekly Management Fees received and to be received by the Manager (or the Back-Up Manager, as applicable) on
such Weekly Allocation Date and each preceding Weekly Allocation Date with respect to such Quarterly Collection Period.
“
Swap Contract
” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate
transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions,
interest rate options, forward foreign exchange transactions, cap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any
options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement,
together with any related schedules, a “
Master Agreement
”), including any such obligations or liabilities under any Master Agreement.
“
Systemwide Sales
” means, with respect to any Quarterly Calculation Date, Gross Sales (which will be permitted to include
estimated Gross Sales of up to 5.0% of the total) of the Franchised Restaurants and Contributed Securitized Company Restaurants for the four (4) Quarterly Fiscal Periods ended immediately prior to such Quarterly Calculation Date.
“
Tax
” means (i) any U.S. federal, state, local or foreign income, gross receipts, license, payroll, employment, excise,
severance, stamp, occupation, premium, environmental, customs duties, capital stock, profits, documentary, property, franchise, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use,
transfer, registration, value added, alternative or add-on minimum, or other tax of any kind whatsoever, including any interest, penalty, fine, assessment or addition thereto and (ii) any transferee liability in respect of any items described in
clause (i)
above.
“
Tax Lien Reserve Amount
” means any funds contributed by Jack in the Box Inc. or a Subsidiary thereof to satisfy Liens filed
by the IRS pursuant to Section 6323 of the Code against any Securitization Entity.
“
Tax Opinion
” means an opinion of tax counsel of nationally recognized standing in the United States experienced in such
matters to be delivered in connection with the issuance of each new Series of Notes (other than Class A-1 Notes except as required under the Variable Funding Note Purchase Agreement) to the effect that, for U.S. federal income tax purposes, (a) the
issuance of such new Series of Notes will not affect adversely the U.S. federal income tax characterization of any Series of Notes Outstanding or Class thereof that was (based upon an Opinion of Counsel) treated as debt at the time of their
issuance, (b) each Securitization Entity organized in the United States in existence as of the date of the delivery of such opinion (other than any Additional Securitization Entity that is a corporation) (i) will as of the date of issuance be
treated as a disregarded entity for U.S. federal income tax purposes and (ii) will not as of the date of issuance be classified as a corporation or as an association or publicly traded partnership taxable as a corporation for U.S. federal income
tax purposes and (c) such new Series of Notes will as of the date of issuance be treated as debt for U.S. federal income tax purposes.
“
Tax Payment Deficiency
” means any Tax liability of Jack in the Box Inc. (or, if Jack in the Box Inc. is not the taxable
parent entity of any Securitization Entity, such other taxable parent entity) (including Taxes imposed under U.S. Treasury regulations Section 1.1502-6 (or any similar provision of state, local or foreign law)) attributable to the operations of the
Securitization Entities that the Manager determines cannot be satisfied by Jack in the Box Inc. (or such other taxable parent entity) from its available funds.
“
Trade Secrets
” has the meaning set forth in the definition of “Intellectual Property.”
“
Trademarks
” means all trademarks, service marks, trade names, trade dress, designs, logos, slogans and other indicia of
source or origin, whether registered or unregistered, registrations and pending applications to register the foregoing, internet domain names, and all goodwill of any business connected with the use of or symbolized thereby.
“
Tranche
” means, with respect to any Class of Notes, any one of the tranches of Notes of such Class as specified in the
Series Supplement for such Series.
“
Trust Officer
” means any officer within the corporate trust department of the Trustee, including any Vice President,
Assistant Vice President or Assistant Treasurer of the Corporate Trust Office, or any trust officer, or any officer customarily performing functions similar to those performed by the person who at the time will be such officers, in each case having
direct responsibility for the administration of this Indenture, and also any officer to whom any corporate trust matter is referred because of his knowledge of and familiarity with a particular subject.
“
Trustee
” means the party named as such in the Indenture until a successor replaces it in accordance with the applicable
provisions of the Indenture and thereafter means the successor serving thereunder. On the Closing Date, the Trustee shall be Citibank, N.A., a national banking association.
“
Trustee Accounts
” has the meaning set forth in
Section 5.09(a)
of this Base Indenture.
“
U.S. Dollars
” or “
$
” refers to lawful money of the United States of America.
“
UCC
” means the Uniform Commercial Code as in effect from time to time in the specified jurisdiction or any applicable
jurisdiction, as the case may be.
“
United States
” or “
U.S.
” means the fifty States of the United States of America, the territories and possessions of
the United States of America, and the District of Columbia.
“
Unrestricted Cash
” means as of any date, unrestricted cash and Eligible Investments owned by the Non-Securitization
Entities that are not, and are not presently required under the terms of any agreement or other arrangement binding any Non-Securitization Entity on such date to be, (a) pledged to or held in one or more accounts under the control of one or more
creditors of any Non-Securitization Entity or (b) otherwise segregated from the general assets of the Non-Securitization Entities, in one or more special accounts or otherwise, for the purpose of securing or providing a source of payment for
Indebtedness or other obligations that are or from time to time may be owed to one or more creditors of the Non-Securitization Entities. It is agreed that cash and Eligible Investments held in ordinary deposit or security accounts and not subject
to any existing or contingent restrictions on transfer by any Non-Securitization Entity will not be excluded from Unrestricted Cash by reason of setoff rights or other Liens created by law or by applicable Account Agreements in favor of the
depositary institutions or security intermediaries.
“
Variable Funding Note Purchase Agreement
” means any note purchase agreement entered into by the Master Issuer in
connection with the issuance of Class A‑1 Notes that is identified as a “Variable Funding Note Purchase Agreement” in the Series Supplement for such Series.
“
VFN Noteholders
” has the meaning specified in
Section 11.05(b)
of this Base Indenture.
“
Warm Back-Up Management Duties
” has the meaning set forth in the Back-Up Management Agreement.
“
Warm Back-Up Management Trigger Event
” means the occurrence and continuation of (i) any event that causes a Cash Trapping
Period to begin and that continues for at least two (2) consecutive Quarterly Calculation Dates, (ii) a Rapid Amortization Event, in each case, that has not been waived or approved by the Control Party (at the direction of the Controlling Class
Representative),
provided
that any Rapid Amortization Event pursuant to
clause (ii)
of the definition thereof shall not be a Warm Back-Up Management Trigger Event unless such Rapid
Amortization Event has not been cured within six (6) months from the date of such Rapid Amortization Event, (iii) a Potential Rapid Amortization Event for which notice has been delivered, (iv) a Potential Manager Termination Event for which notice
has been delivered or (v) an Event of Default and/or a Default for which notice has been delivered.
“
Weekly Allocation Date
” means the last Business Day of the week following the last day of each Weekly Collection Period,
commencing no later than August 2, 2019.
“
Weekly Allocation Percentage
” means with respect to any Weekly Collection Period, the percentages designated by the Master
Issuer in the relevant Weekly Manager’s Certificate for such Weekly Collection Period within a Quarterly Fiscal Period, each such percentage to be not less than the percentage required to cause the Required Balance to be on deposit in the Senior
Notes Interest Payment Account, the Senior Subordinated Notes Interest Payment Account, the Subordinated Notes Interest Payment Account, the Senior Notes Principal Payment Account, the Senior Subordinated Notes Principal Payment Account, the
Subordinated Notes Principal Payment Account or the Senior Notes Post-ARD Contingent Interest Account, as applicable, for such Weekly Collection Period.
“
Weekly Collection Period
” means each weekly period commencing at 4:00 a.m. (local time) on each Monday and ending at
3:59:59 a.m. (local time) on the following Monday, except that the first such period will be from 4:00 a.m. (local time) on the Cut-Off Date to 3:59:59 a.m. (local time) on July 8, 2019.
“
Weekly Management Fee
” has the meaning set forth in the Management Agreement.
“
Weekly Manager’s Certificate
” has the meaning set forth in
Section 4.01(a)
of this Base Indenture.
“
Welfare Plan
” means any “employee welfare benefit plan” as such term is defined in Section 3(1) of ERISA.
“
Working Capital Reserve Amount
” means, as of any date of determination, an amount determined by the Manager to be retained
in a Concentration Account for working capital expenses not to exceed in the aggregate for all Securitized Company Restaurant Accounts the greater of (i) $5,000,000 and (ii) 10% of the aggregate Retained Collections for the preceding four (4)
Quarterly Collection Periods;
provided
that amounts transferred by the Master Issuer to a Concentration Account from the Residual Amount will not be included in such calculation.
“
Workout Fees
” has the meaning set forth in the Servicing Agreement.