EXHIBIT 4.2
Form of Pooling and Servicing Agreement
DEUTSCHE RECREATIONAL ASSET FUNDING CORPORATION
as Depositor
__________________________
as Trustee
and
DEUTSCHE FINANCIAL SERVICES CORPORATION
as Servicer
Dated as of __________________________
__________________ TRUST 199__-__
___% Asset Backed Certificates, Class A
___% Asset Backed Certificates, Class B
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.01. Definitions......................................................... 1
SECTION 1.02. Other Definitional Provisions....................................... 14
ARTICLE II
Establishment of Trust
SECTION 2.01. Creation of Trust................................................... 14
SECTION 2.02. Acceptance by Trustee............................................... 15
SECTION 2.03. Conveyance of Receivables........................................... 15
ARTICLE III
The Receivables
SECTION 3.01. Representations and Warranties of the Transferor.................... 15
SECTION 3.02. Representations and Warranties of the Depositor..................... 16
SECTION 3.03. Purchase Upon Breach................................................ 16
SECTION 3.04. Custody of Receivable Files......................................... 17
SECTION 3.05. Duties of Servicer as Custodian..................................... 17
SECTION 3.06. Instructions; Authority to Act...................................... 18
SECTION 3.07. Custodian's Indemnification......................................... 18
SECTION 3.08. Effective Period and Termination.................................... 18
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.01. Duties of Servicer.................................................. 19
SECTION 4.02. Collection and Allocation of Receivable Payments.................... 19
SECTION 4.03. Realization Upon Receivables........................................ 20
SECTION 4.04. Physical Damage Insurance........................................... 20
SECTION 4.05. Maintenance of Security Interests in Financed Assets................ 20
SECTION 4.06. Covenants of Servicer............................................... 20
SECTION 4.07. Purchase of Receivables Upon Breach................................. 20
SECTION 4.08. Servicing Fee....................................................... 21
SECTION 4.09. Servicer's Certificate.............................................. 21
SECTION 4.10. Annual Statement as to Compliance; Notice of Default................ 21
SECTION 4.11. Annual Independent Certified Public Accountant's Report............. 22
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SECTION 4.12. Access to Certain Documentation and Information Regarding
Receivables........................................................ 22
SECTION 4.13. Servicer Expenses.................................................. 22
SECTION 4.14. Appointment of Subservicer......................................... 22
ARTICLE V
Distributions; Reserve Account; Statements to Certificateholders
SECTION 5.01. Establishment of Trust Accounts.................................... 23
SECTION 5.02. Collections........................................................ 24
SECTION 5.03. Application of Collections......................................... 24
SECTION 5.04. Advances........................................................... 24
SECTION 5.05. Additional Deposits................................................ 25
SECTION 5.06. Distributions...................................................... 25
SECTION 5.07. Reserve Account.................................................... 27
SECTION 5.08. Statements to Certificateholders................................... 30
SECTION 5.09. Tax Returns........................................................ 32
SECTION 5.10. Net Deposits....................................................... 32
ARTICLE VI
The Certificates
SECTION 6.01. The Certificates................................................... 32
SECTION 6.02. Authentication of Certificates..................................... 32
SECTION 6.03. Registration of Transfer and Exchange of Certificates.............. 33
SECTION 6.04. Mutilated, Destroyed, Lost or Stolen Certificates.................. 33
SECTION 6.05. Persons Deemed Owners.............................................. 34
SECTION 6.06. Access to List of Certificateholders' Names and Addresses.......... 34
SECTION 6.07. Maintenance of Office or Agency.................................... 34
SECTION 6.08. Book-Entry Certificates............................................ 34
SECTION 6.09. Notices to Clearing Agency......................................... 35
SECTION 6.10. Definitive Certificates............................................ 35
ARTICLE VII
The Depositor
SECTION 7.01. Representations of Depositor....................................... 36
SECTION 7.02. Corporate Existence................................................ 37
SECTION 7.03. Liabilities of Depositor; Indemnities.............................. 37
SECTION 7.04. Merger or Consolidation of, or Assumption of the Obligations of,
Depositor.......................................................... 38
SECTION 7.05. Limitation on Liability of Depositor and Others.................... 39
SECTION 7.06. Depositor May Own Certificates..................................... 39
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SECTION 7.07. No Transfer of Excess Amounts...................................... 39
ARTICLE VIII
The Servicer
SECTION 8.01. Representations of Servicer........................................ 39
SECTION 8.02. Indemnities of Servicer............................................ 40
SECTION 8.03. Merger or Consolidation of, or Assumption of the Obligations of,
Servicer........................................................... 41
SECTION 8.04. Limitation on Liability of Servicer and Others..................... 42
ARTICLE IX
Default
SECTION 9.01. Events of Default................................................. 42
SECTION 9.02. Appointment of Successor.......................................... 43
SECTION 9.03. Repayment of Advances............................................. 44
SECTION 9.04. Notification to Certificateholders................................ 44
SECTION 9.05. Waiver of Past Defaults........................................... 44
ARTICLE X
The Trustee
SECTION 10.01. Duties of Trustee................................................. 44
SECTION 10.02. Certain Matters Affecting Trustee................................. 45
SECTION 10.03. Trustee Not Liable for Certificates or Receivables................ 46
SECTION 10.04. Trustee May Own Certificates...................................... 47
SECTION 10.05. Trustee's Fees and Expenses....................................... 47
SECTION 10.06. Eligibility Requirements for Trustee.............................. 47
SECTION 10.07. Resignation or Removal of Trustee................................. 47
SECTION 10.08. Successor Trustee................................................. 48
SECTION 10.09. Merger or Consolidation of Trustee................................ 48
SECTION 10.10. Appointment of Co-Trustee or Separate Trustee..................... 49
SECTION 10.11. Representations and Warranties of Trustee......................... 50
SECTION 10.12. No Bankruptcy Petition............................................ 50
SECTION 10.13. Trustee's Certificate............................................. 50
SECTION 10.14. Trustee's Assignment of Purchased Receivables..................... 51
ARTICLE XI
Termination
SECTION 11.01. Termination of the Trust.......................................... 51
SECTION 11.02. Optional Purchase of All Receivables.............................. 52
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ARTICLE XII
Miscellaneous Provisions
SECTION 12.01. Amendment........................................................ 52
SECTION 12.02. Protection of Title to Trust..................................... 53
SECTION 12.03. Separate Counterparts............................................ 54
SECTION 12.04. Limitation on Rights of Certificateholders....................... 54
SECTION 12.05. Governing Law.................................................... 55
SECTION 12.06. Notices.......................................................... 55
SECTION 12.07. Severability of Provisions....................................... 56
SECTION 12.08. Assignment....................................................... 56
SECTION 12.09. Certificates Nonassessable and Fully Paid........................ 56
SECTION 12.10. Limitations on Rights of Others.................................. 56
SECTION 12.11. Headings......................................................... 56
SECTION 12.12. Nonpetition Covenants............................................ 56
Exhibit A Form of Class A Certificate
Exhibit B Form of Class B Certificate
Exhibit C Form of Depository Agreement
Exhibit D Form of Servicer's Certificate
SCHEDULE A Schedule of Receivables
SCHEDULE B Location of Receivable Files
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POOLING AND SERVICING AGREEMENT dated as of __________, among DEUTSCHE
RECREATIONAL ASSET FUNDING CORPORATION., a Nevada corporation, as depositor (the
"Depositor"),______________, DEUTSCHE FINANCIAL SERVICES CORPORATION, as
servicer (the "Servicer"), and ____________________, a ______________________
banking corporation, as trustee (the "Trustee").
WHEREAS, the Depositor ________________________ has acquired a portfolio of
receivables arising in connection with a pool of (boat) (recreational vehicle)
retail installment sale contracts or installment loans (the "Contracts"); and
WHEREAS, the Depositor, the Servicer and the Trustee wish to set forth the
terms and conditions pursuant to which the Trust (as hereinafter defined) will
acquire the Contracts from the Depositor, and the Servicer will service the
Contracts on behalf of the Trust;
NOW, THEREFORE, in consideration of the premises and the mutual agreements
hereinafter set forth, the Depositor, the Servicer and the Trustee agree as
follows:
ARTICLE I
Definitions
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SECTION 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:
"Advance" means the amount of interest, as of the close of business on the
last day of a Collection Period, which the Servicer is required to advance on
the Receivables pursuant to Section 5.04(b).
"Affiliate" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Agreement" means this Pooling and Servicing Agreement.
"Amount Financed" means with respect to a Receivable, the amount advanced
under such Receivable toward the purchase price of the Financed Asset and any
related costs, exclusive of any amount allocable to the premium of force-placed
physical damage insurance covering the Financed Asset.
"Annual Percentage Rate" or "APR" of a Receivable means the annual rate of
finance charges stated in the related Contract.
"Book-Entry Certificates" means, unless otherwise specified in this
Agreement, a beneficial interest in the Class A or Class B Certificates,
ownership and transfers of which shall be registered through book entries by a
Clearing Agency as described in Section 6.08.
"Business Day" means any day other than a Saturday, a Sunday or a day on
which banking institutions or trust companies in [ ] or the
city in which the Corporate Trust Office is located, are authorized or obligated
by law, regulation or executive order to be closed.
"Certificate Balance" means, as of any date, the aggregate outstanding
principal amount of the Certificates at such date.
"Certificate Owner" means, with respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate, as reflected
on the books of the Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency Participant or
as an indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Certificate Register" and "Certificate Registrar" mean the register
maintained and the registrar appointed pursuant to Section 6.03.
"Certificateholder" or "Holder" means a Person in whose name a Certificate
is registered in the Certificate Register.
"Certificates" means the Class A Certificates and the Class B Certificates.
"Class A Certificate" means a ___% Asset Backed Certificate, Class A,
evidencing a beneficial interest in the Trust, substantially in the form of
Exhibit A hereto.
"Class A Certificate Balance" means, as of any date of determination, the
Initial Class A Certificate Balance reduced by all amounts previously
distributed to Holders of Class A Certificates and allocable to principal.
"Class A Certificateholder" means the Holder of a Class A Certificate.
"Class A Distributable Amount" means, with respect to any Distribution
Date, the sum of the Class A Principal Distributable Amount and the Class A
Interest Distributable Amount for such date.
"Class A Interest Carryover Shortfall" means, with respect to any
Distribution Date, the excess of the sum of the Class A Interest Distributable
Amount for the preceding Distribution Date and any outstanding Class A Interest
Carryover Shortfall on such preceding Distribution Date, over the amount in
respect of interest that Holders of the Class A Certificates actually received
on such preceding Distribution Date, plus 30 days' interest on such excess, to
the extent permitted by law, at the Class A Pass-Through Rate.
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"Class A Interest Distributable Amount" means, with respect to any
Distribution Date, 30 days of interest at the Class A Pass-Through Rate on the
Class A Certificate Balance on the last day of the preceding Collection Period.
"Class A Pass-Through Rate" means _____% per annum.
"Class A Percentage" means _____%.
"Class A Pool Factor" means, as of the close of business on the last day of
any Collection Period, a seven-digit decimal figure equal to the Class A
Certificate Balance as of such Record Date divided by the Initial Class A
Balance.
"Class A Principal Carryover Shortfall" means, as of the close of any
Distribution Date, the excess of the Class A Principal Distributable Amount and
any outstanding Class A Principal Carryover Shortfall from the preceding
Distribution Date, over the amount in respect of principal that is actually
distributed to Holders of the Class A Certificates on such current Distribution
Date.
"Class A Principal Distributable Amount" means, with respect to any
Distribution Date, the Class A Percentage of the Principal Distribution Amount.
In addition, on the Final Scheduled Distribution Date, the principal required to
be included in the Class A Principal Distributable Amount will include the
lesser of (a) the Class A Percentage of any principal due and remaining unpaid
on each Receivable, in each case, in the Trust as of the Final Scheduled
Maturity Date or (b) the amount that is necessary (after giving effect to the
other amounts to be deposited in the Distribution Account on such Distribution
Date and allocable to principal) to reduce the Class A Certificate Balance to
zero.
"Class B Certificate" means a ___% Asset Backed Certificate, Class B,
evidencing a beneficial interest in the Trust, substantially in the form of
Exhibit B hereto.
"Class B Certificate Balance" means, as of any date of determination, the
Initial Class B Certificate Balance reduced by all amounts previously
distributed to Holders of Class B Certificates (or deposited in the Reserve
Account, exclusive of the Reserve Account Initial Deposit) and allocable to
principal and by Realized Losses to the extent of the amount of such Realized
Losses paid from the Class B Percentage of the Principal Distribution Amount.
"Class B Certificateholder" means the Holder of a Class B Certificate.
"Class B Distributable Amount" means, with respect to any Distribution
Date, the sum of the Class B Principal Distributable Amount and the Class B
Interest Distributable Amount.
"Class B Interest Carryover Shortfall" means, with respect to any
Distribution Date, the excess of the sum of the Class B Interest Distributable
Amount for the preceding Distribution Date and any outstanding Class B Interest
Carryover Shortfall on such preceding Distribution
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Date, over the amount in respect of interest that Holders of the Class B
Certificates actually received on such preceding Distribution Date, plus 30
days' interest on such excess, to the extent permitted by law, at the Class B
Pass-Through Rate.
"Class B Interest Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class B Interest Distributable Amount for such
Distribution Date and the Class B Interest Carryover Shortfall for such
Distribution Date. Unless otherwise specified in this Agreement, interest with
respect to the Class B Certificates shall be computed on the basis of a 360-day
year consisting of twelve 30-day months.
"Class B Interest Distributable Amount" means, with respect to any
Distribution Date, 30 days of interest at the Class B Pass-Through Rate on the
Class B Certificate Balance on the last day of the preceding Collection Period.
"Class B Pass-Through Rate" means ___% per annum.
"Class B Percentage" means ___%.
"Class B Pool Factor" means, as of the close of business on the last day of
any Collection Period, a seven-digit decimal figure equal to the Class B
Certificate Balance as of such Record Date divided by the Initial Class B
Balance.
"Class B Principal Carryover Shortfall" means, as of the close of any
Distribution Date, the excess of the Class B Principal Distributable Amount and
any outstanding Class B Principal Carryover Shortfall from the preceding
Distribution Date, over the amount in respect of principal that is actually
distributed to Holders of the Class B Certificates on such current Distribution
Date.
"Class B Principal Distributable Amount" means, with respect to any
Distribution Date, the Class B Percentage of the Principal Distribution Amount.
In addition, on the Final Scheduled Distribution Date, the principal required to
be included in the Class B Principal Distributable Amount will include the
lesser of (a) the Class B Percentage of any principal due and remaining unpaid
on each Receivable, in each case, in the Trust as of the Final Scheduled
Maturity Date or (b) the amount that is necessary (after giving effect to the
other amounts to be deposited in the Distribution Account on such Distribution
Date and allocable to principal) to reduce the Class B Certificate Balance to
zero.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended.
"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.
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"Closing Date" means ______________________.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collection Account" means the account designated as such, established and
maintained pursuant to Section 5.01(a)(i).
"Collection Period" means a calendar month (or in the case of the first
Distribution Date, the period from and including the Cutoff Date to and
including the last day of the calendar month in which the Closing Date occurs).
Any amount stated as of the last day of a Collection Period or as of the first
day of a Collection Period shall give effect to the following calculations as
determined as of the close of business on such last day: (1) all applications of
collections, (2) all Advances and reductions of Advances and (3) all
distributions to be made on the following Distribution Date.
"Contract" means a (boat) (recreational vehicle) retail installment sale
contract or installment loan.
"Corporate Trust Office" means the principal corporate trust office of the
Trustee, which at the time of execution of this agreement is
______________________, Attention: ____________.
"Cutoff Date" means[, with respect to any Receivable, the date as of which
collections on such Receivable will be included in the Trust or the related
Trust Account pursuant to this Agreement].
"Dealer" means the dealer who sold a Financed Asset to an Obligor.
"Definitive Certificates" shall have the meaning specified in Section 6.10.
"Delivery" means:
(a) with respect to bankers' acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute "instruments"
within the meaning of Section 9-105(1)(i) of the UCC and are susceptible of
physical delivery, transfer thereof to the Trustee or its nominee or custodian
by physical delivery to the Trustee or its nominee or custodian endorsed to, or
registered in the name of, the Trustee or its nominee or custodian or endorsed
in blank, and, with respect to a certificated security (as defined in Section 8-
102 of the UCC) transfer thereof (i) by delivery of such certificated security
endorsed to, or registered in the name of, the Trustee or its nominee or
custodian or endorsed in blank to a financial intermediary (as defined in
Section 8-313 of the UCC) and the making by such financial intermediary of
entries on its books and records identifying such certificated securities as
belonging to the Trustee or its nominee or custodian and the sending by such
financial intermediary of a confirmation of the purchase of such certificated
security by the Trustee or its
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nominee or custodian, or (ii) by delivery thereof to a "clearing corporation"
(as defined in Section 8-102(3) of the UCC) and the making by such clearing
corporation of appropriate entries on its books reducing the appropriate
securities account of the transferor and increasing the appropriate securities
account of a financial intermediary by the amount of such certificated security,
the identification by the clearing corporation of the certificated securities
for the sole and exclusive account of the financial intermediary, the
maintenance of such certificated securities by such clearing corporation or a
"custodian bank" (as defined in Section 8-102(4) of the UCC) or the nominee of
either, subject to the clearing corporation's exclusive control, the sending of
a confirmation by the financial intermediary of the purchase by the Trustee or
its nominee or custodian of such securities and the making by such financial
intermediary of entries on its books and records identifying such certificated
securities as belonging to the Trustee or its nominee or custodian (all of the
foregoing, "Physical Property"), and, in any event, any such Physical Property
in registered form shall be in the name of the Trustee or its nominee or
custodian; and such additional or alternative procedures as may hereafter become
appropriate to effect the complete transfer of ownership of any such [Trust
Account Property] to the Trustee or its nominee or custodian, consistent with
changes in applicable law or regulations or the interpretation thereof;
(b) with respect to any securities issued by the U.S. Treasury, the Federal
Home Loan Mortgage Corporation or by the Federal National Mortgage Association
that is a book-entry securities held through the Federal Reserve System pursuant
to federal book-entry regulations, the following procedures, all in accordance
with applicable law, including applicable federal regulations and Articles 8 and
9 of the UCC: book-entry registration of such Trust Account Property to an
appropriate book-entry account maintained with a Federal Reserve Bank by a
financial intermediary that is also a "depository" pursuant to applicable
federal regulations and issuance by such financial intermediary of a deposit
advice or other written confirmation of such book-entry registration to the
Trustee or its nominee or custodian of the purchase by the Trustee or its
nominee or custodian of such book-entry securities; the identification by the
Federal Reserve Bank of such book-entry securities on its record being credited
to the financial intermediary's participant's securities account; the making by
such financial intermediary of entries in its books and records identifying such
book-entry security held through the Federal Reserve System pursuant to federal
book-entry regulations as being credited to the Trustee's securities account or
custodian's securities account and indicating that such custodian holds such
Trust Account Property solely as agent for the Trustee or its nominee or
custodian; and such additional or alternative procedures as may hereafter become
appropriate to effect complete transfer of ownership of any such Trust Account
Property to the Trustee or its nominee or custodian, consistent with changes in
applicable law or regulations or the interpretation thereof; and
(c) with respect to any item of Trust Account Property that is an
uncertificated security under Article 8 of the UCC and that is not governed by
clause (b) above, registration on the books and records of the issuer thereof in
the name of the financial intermediary, the sending of a confirmation by the
financial intermediary of the purchase by the Trustee or its nominee or
custodian of such uncertificated security, the making by such financial
intermediary of entries on
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its books and records identifying such uncertificated certificates as belonging
to the Trustee or its nominee or custodian.
"Depositor" means Deutsche Recreational Asset Funding Corporation, a Nevada
corporation, and its successors in interest to the extent permitted hereunder.
"Depository Agreement" means the agreement dated _____________, among the
Trustee and The Depository Trust Company, as the initial Clearing Agency,
substantially in the form attached as Exhibit C hereto.
"Determination Date" means, unless otherwise specified in this Agreement,
the ______ Business Day of each calendar month.
"DFS" means Deutsche Financial Services Corporation, a Delaware
corporation, and its successors.
"Distribution Account" means the account designated as such, established
and maintained pursuant to Section 5.01(a)(ii).
"Distribution Date" means, with respect to each Collection Period, the
_______ day of the following calendar month or, if such day is not a Business
Day, the immediately following Business Day, commencing on _________________.
"Eligible Deposit Account" means either (a) a segregated account with an
Eligible Institution or (b) a segregated trust account with the corporate trust
department of a depository institution organized under the laws of the United
States of America or any one of the states thereof or the District of Colombia
(or any domestic branch of a foreign bank), having corporate trust powers and
acting as trustee for funds deposited in such account, so long as any of the
securities of such depository institution shall have a credit rating from each
Rating Agency in one of its generic rating categories that signifies investment
grade.
"Eligible Institution" means (a) the corporate trust department of the
Trustee or any other entity specified in this Agreement or (b) a depository
institution organized under the laws of the United States of America or any one
of the states thereof or the District of Columbia (or any domestic branch of a
foreign bank), which (i) has either (A) a long-term unsecured debt rating of AAA
or better by Standard & Poor's and A1 or better by Moody's or (B) a certificate
of deposit rating of A-1+ by Standard & Poor's and P-1 or better by Moody's or
any other long-term, short-term or certificate of deposit rating acceptable to
the Rating Agencies and (ii) whose deposits are insured by the FDIC. If so
qualified, the Trustee or any such other entity specified in this Agreement may
be considered an Eligible Institution for the purposes of clause (b) of this
definition.
"Eligible Investments" mean book-entry securities, negotiable instruments
or securities represented by instruments in bearer or registered form which
evidence:
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(a) direct obligations of, and obligations fully guaranteed as to timely
payment by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit of any
depository institution or trust company incorporated under the laws of the
United States of America or any state thereof (of any domestic branch of a
foreign bank) and subject to supervision and examination by Federal or State
banking or depository institution authorities; provided, however, that at the
time of the investment or contractual commitment to invest therein, the
commercial paper or other short-term unsecured debt obligations (other than such
obligations the rating of which is based on the credit of a Person other than
such depository institution or trust company) thereof shall have a credit rating
from each of the Rating Agencies in the highest applicable rating category
granted thereby;
(c) commercial paper, variable amount notes or other short term debt
obligations, having, at the time of the investment or contractual commitment to
invest therein, a rating from each of the Rating Agencies in the highest
applicable rating category granted thereby;
(d) investments in money market or common trust funds having a rating from
each of the Rating Agencies in the highest applicable rating category granted
thereby (including funds for which the Trustee or any of its Affiliates is
investment manager or advisor);
(e) bankers' acceptances issued by any depository institution or trust
company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that is a direct
obligation of, or fully guaranteed by, the United States of America or any
agency or instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either case entered
into with a depository institution or trust company (acting as principal)
described in clause (b);
(g) any other investment with respect to which the Trustee or the Servicer
has received written notification from the Rating Agencies that the acquisition
of such investment as an Eligible Investment will not result in a withdrawal or
downgrading of the ratings of the Certificates.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Event of Default" means an event specified in Section 9.01.
"FDIC" means the Federal Deposit Insurance Corporation.
"Final Scheduled Distribution Date" means ______________________.
"Final Scheduled Maturity Date" means ______________________.
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"Financed Asset" means a (recreational vehicle), (boat, boat motor, and
accompanying trailers) together with all accessions thereto, securing an
Obligor's indebtedness under the respective Receivable.
"Funding Period" means [ ].
"Ganis" means Ganis Credit Corporation, a Delaware corporation, and its
successors.
"Initial Certificate Balance" means $______________________.
"Initial Class A Balance" means $______________________.
"Initial Class B Balance" means $______________________.
"Initial Collection Period" means the period beginning on, and including,
_______________ to and including ______________________.
"Insolvency Event" means, with respect to a specified Person, (a) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property in an
involuntary case under any applicable federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator, or similar official for
such Person or for any substantial part of its property, or ordering the
winding-up or liquidation or such Person's affairs, and such decree or order
shall remain unstayed and in effect for a period of 60 consecutive days; or (b)
the commencement by such Person of a voluntary case under any applicable federal
or state bankruptcy, insolvency or other similar law now or hereafter in effect,
or the consent by such Person to the entry of an order for relief in an
involuntary case under any such law, or the consent by such Person to the
appointment of or taking possession by, a receiver, liquidator, assignee,
custodian, trustee, sequestrator, or similar official for such Person or for any
substantial part of its property, or the making by such Person of any general
assignment for the benefit of creditors, or the failure by such Person generally
to pay its debts as such debts become due, or the taking of action by such
Person in furtherance of any of the foregoing.
"Interest Distribution Amount" means, with respect to any Distribution
Date, the sum of the following amounts in respect of the Receivables and the
preceding Collection Period: (i) that portion of all collections on Receivables
allocable to interest, (ii) Liquidation Proceeds with respect to the Receivables
to the extent allocable to interest due thereon in accordance with the
Servicer's customary servicing procedures; (iii) all Advances made by the
Servicer of interest due on Receivables, (iv) the Purchase Amount of each
Receivable that became a Purchased Receivable during the related Collection
Period to the extent attributable to accrued interest on such Receivable and (v)
Recoveries for such Collection Period; provided, however, that in calculating
the Interest Distribution Amount the following will be excluded: (i) all
payments and proceeds (including Liquidation Proceeds) of any Purchased
Receivables the Purchase Amount of which has been included in the Interest
Distribution Amount in a prior Collection Period; (ii)
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the sum for all Receivables of collections on each such Receivable received
during the preceding Collection Period in excess of the amount of interest that
would be due on the aggregate Principal Balance of the Receivables during such
Collection Period at their respective APRs if a payment were received on each
Receivable during such Collection Period on the date payment is due under the
terms of the related Contract; (iii) Liquidation Proceeds with respect to a
Receivable attributable to accrued and unpaid interest thereon (but not
including interest for the then current Collection Period) but only to the
extent of any unreimbursed Advances; and (iv) amounts released from the Pre-
Funding Account.
"Investment Earnings" means, with respect to any Distribution Date, the
investment earnings (net of losses and investment expenses) on amounts on
deposit in the Trust Accounts to be deposited to the Distribution Account on
such Distribution Date pursuant to Section 5.01(b).
"Lien" means a security interest, lien, charge, pledge, equity, or
encumbrance of any kind, other than tax liens, mechanics' liens and any liens
that attach to the respective Receivable or Financed Asset, as applicable, by
operation of law as a result of any act or omission by the related Obligor.
"Liquidated Receivable" means any Receivable liquidated by the Servicer
through sale of a Financed Asset or otherwise.
"Liquidation Proceeds" means, with respect to a Liquidated Receivable, the
monies collected in respect thereof, from whatever source, during the Collection
Period in which such Receivable became a Liquidated Receivable, net of the sum
of any amounts expended by the Servicer in connection with such liquidation,
plus any amounts required by law to be remitted to the Obligor.
"Moody's" means Xxxxx'x Investors Service, Inc., or its successor.
"Obligor" on a Receivable means the purchaser or co-purchasers of the
Financed Asset and any other Person who owes payments under the Receivable.
"Officers' Certificate" means a certificate signed by the (a) chairman of
the board, the president, any executive vice president or any vice president and
(b) any treasurer, assistant treasurer, secretary or assistant secretary of the
Depositor or the Servicer, as appropriate.
"Opinion of Counsel" means one or more written opinions of counsel, who may
be an employee of or counsel to the Depositor or the Servicer, which counsel
shall be acceptable to the Trustee or Rating Agencies, as applicable.
"Original Pool Balance" means the Pool Balance as of the Cutoff Date.
"Originator" means [DFS and/or Ganis and/or ___________].
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"Outstanding Advances" on the Receivables means the sum, as of the close of
business on the last day of a Collection Period, of all Advances, reduced as
provided in Section 5.04(b).
"Person" means any individual, corporation, limited liability company,
estate, partnership, joint venture, association, joint stock company, trust,
unincorporated organization, or government or any agency or political
subdivision thereof.
"Physical Property" has the meaning assigned to such term in the definition
of "Delivery" above.
"Pool Balance" means, as of the close of business on the last day of a
Collection Period, the aggregate Principal Balance of the Receivables as of such
date (excluding Purchased Receivables and Liquidated Receivables).
"Pre-Funded Amount" means [ ].
"Pre-Funding Account" means [ ].
"Principal Balance" means the Amount Financed minus the sum, as of the
close of business on the last day of a Collection Period, of (i) the portion of
all payments made by or on behalf of the related Obligor on or prior to such day
and allocable to principal using the Simple Interest Method and (ii) any payment
of the Purchase Amount allocable to principal.
"Principal Distribution Amount" means, for any Distribution Date, the sum
of the following amounts with respect to the preceding Collection Period: (i)
that portion of all collections on Receivables allocable to principal; (ii) all
Liquidation Proceeds attributable to the principal amount of Receivables that
became Liquidated Receivables during the Collection Period in accordance with
the Servicer's customary servicing procedures, plus the amount of Realized
Losses with respect to such Liquidated Receivables; (iii) to the extent
attributable to principal, the Purchase Amount received with respect to each
Receivable that became a Purchased Receivable during the related Collection
Period; and (iv) partial prepayments relating to refunds of extended warranty
protection plan costs or of physical damage, credit life or disability insurance
policy premiums, but only if such costs or premiums were financed by the
respective Obligor as of the date of the original Contract; and provided,
however, that in calculating the Principal Distribution Amount the following
will be excluded: (x) all payments and proceeds (including Liquidation
Proceeds) of any Purchased Receivables the Purchase Amount of which has been
included in the Principal Distribution Amount in a prior Collection Period, and
(y) Recoveries.
"Purchase Amount" means the amount, as of the close of business on the last
day of a Collection Period, required to prepay in full a Receivable under the
terms thereof including interest to the end of the month of purchase.
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"Purchased Receivable" means a Receivable purchased as of the close of
business on the last day of a Collection Period by the Servicer pursuant to
Section 4.07 by the Depositor pursuant to Section 3.02 or by the Transferor
pursuant to Section 3.01.
"Rating Agency" means Moody's and Standard & Poor's. If no such
organization or successor is any longer in existence, "Rating Agency" shall mean
any nationally recognized statistical rating organization or other comparable
Person designated by the Depositor, notice of which designation shall be given
to the Trustee and the Servicer.
"Rating Agency Condition" means, with respect to any action, that each
Rating Agency shall have been given 10 days' (or such shorter period as shall be
acceptable to each Rating Agency) prior notice thereof and that each of the
Rating Agencies shall have notified the Depositor, the Servicer and the Trustee
in writing that such action will not result in a reduction or withdrawal of the
then current rating of the Certificates.
"Realized Losses" means, with respect to any Receivable that becomes a
Liquidated Receivable, the excess of the Principal Balance of such Liquidated
Receivable over Liquidation Proceeds to the extent allocable to principal.
"Receivable" means any Contract transferred to the Trust on the Closing
Date that is listed on Schedule A to this Agreement (which schedule may be in
the form of microfiche).
"Receivable Files" means the documents specified in Section 3.04.
"Receivables Transfer Agreement" means the receivables transfer agreement
dated as of ________________ between the Transferor and the Depositor.
"Record Date" with respect to each Distribution Date means the first day of
the calendar month in which such Distribution Date occurs, unless otherwise
specified in this Agreement.
"Recoveries" means, with respect to any Receivable that becomes a
Liquidated Receivable, monies collected in respect thereof, from whatever
source, during any Collection Period following the Collection Period in which
such Receivable became a Liquidated Receivable, net of the sum of any amounts
expended by the Servicer for the account of the Obligor and any amounts required
by law to be remitted to the Obligor.
"Reserve Account" means the account designated as such, established and
maintained pursuant to Section 5.07.
"Reserve Account Initial Deposit" means, with respect to the Closing Date
and taking into account any transfer of Subsequent Receivables on such date, an
amount equal to the Specified Reserve Account Balance on the Closing Date (which
is equal to $________________) and, with respect to each Subsequent Transfer
Date after the Closing Date,
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an amount equal to ___% of the Principal Balance of the Subsequent Receivables
transferred to the Trust on such Subsequent Transfer Date.
"Reserve Account Property" has the meaning assigned thereto in Section
5.07(b).
"Servicer" means DFS, as the servicer of the Receivables, and each
successor Servicer pursuant to Section 8.03 or 9.02.
"Servicer's Certificate" means an Officers' Certificate of the Servicer
delivered pursuant to Section 4.09, substantially in the form of Exhibit D.
"Servicing Fee" means the fee payable to the Servicer for services rendered
during each Collection Period, determined pursuant to Section 4.08.
"Servicing Rate" means ___% per annum.
"Simple Interest Method" means the method of allocating a fixed level
payment to principal and interest, pursuant to which the portion of such payment
that is allocated to interest is equal to the product of the fixed rate of
interest multiplied by the unpaid principal balance multiplied by the period of
time elapsed since the preceding payment of interest was made and the remainder
of such payment is allocable to principal.
"Specified Reserve Account Balance" means (STATE FORMULA).
"Standard & Poor's" means Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc. or its successor.
"Subsequent Receivables" means [ ].
"Subsequent Transfer Date" means [ ].
"Total Distribution Amount" means, for each Distribution Date, the sum of
the Interest Distribution Amount and the Principal Distribution Amount (other
than the portion thereof attributable to Realized Losses).
"Transferor" means Ganis.
"Trust" shall have the meaning set forth in Section 2.01.
"Trust Account" means __________________.
"Trustee" means ______________________, a ___________________ banking
corporation, its successors in interest and any successor Trustee hereunder.
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"Trustee Officer" means the chairman or vice-chairman of the board of
directors, the chairman or vice-chairman of the executive committee of the board
of directors, the president, any vice president, the secretary, any assistant
secretary, the treasurer, any assistant treasurer, the cashier, any assistant
cashier, any trust officer or assistant trust officer, the controller and any
assistant controller or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of such officer's knowledge of
and familiarity with the particular subject.
"UCC" means the Uniform Commercial Code as in effect in the relevant
jurisdiction.
SECTION 1.02. Other Definitional Provisions. (a) All terms defined in this
Agreement shall have the defined meanings when used in any certificate or other
document made or delivered pursuant hereto or thereto unless otherwise defined
therein.
(b) As used herein and in any certificate or other document made or
delivered pursuant hereto, accounting terms not defined herein or in any such
certificate or other document, and accounting terms partly defined herein or in
any such certificate or other document to the extent not defined, shall have the
respective meanings given to them under generally accepted accounting
principles. To the extent that the definitions of accounting terms herein or in
any such certificate or other document are inconsistent with the meanings of
such terms under generally accepted accounting principles, the definitions
contained herein, or in any such certificate or other document shall control.
(c) The words "hereof," "herein," "hereunder" and word of similar import
when used herein shall refer to this Agreement as a whole and not to any
particular provision of this Agreement; Article, Section, Schedule and Exhibit
references contained in this Agreement are references to Articles, Sections,
Schedules and Exhibits in or to this Agreement, respectively; and the term
"including" and its variations shall mean "including without limitation".
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred to herein or
in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments) references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.
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ARTICLE II
Establishment of Trust
----------------------
SECTION 2.01. Creation of Trust. Upon the execution of this Agreement by
the parties hereto, there is hereby created a separate trust, which shall be
known as (_______________) Trust 199__-__ (the "Trust"). The Trust shall be
administered pursuant to the provisions of this Agreement for the benefit of the
Certificateholders.
SECTION 2.02. Acceptance by Trustee. The Trustee hereby accepts all
consideration conveyed by the Depositor pursuant to Section 2.03 and declares
that it will hold such consideration upon the trusts set forth herein for the
benefit of the Certificateholders, subject to the terms and provisions of this
Agreement.
SECTION 2.03. Conveyance of Receivables. In consideration of the
Trustee's delivery on the Closing Date to or upon the order of the Depositor of
Class A Certificates in an initial aggregate principal amount equal to the
Initial Class A Balance and Class B Certificates in an initial aggregate
principal amount equal to the Initial Class B Balance, the Depositor does hereby
transfer, assign, set over and otherwise convey to the Trustee for the benefit
of the Certificateholders, without recourse (subject to the obligations set
forth herein), all right, title and interest of the Depositor in and to:
(1) the Receivables, and all moneys received thereon on and after
__________;
(2) the security interests in the Financed Assets granted by Obligors
pursuant to the Receivables and any other interest of the Transferor or the
Depositor in such Financed Assets;
(3) any proceeds with respect to the Receivables from claims on any
physical damage, credit life or disability insurance policies covering
Financed Assets or Obligors;
(4) any Financed Asset that shall have secured any such Receivable and
shall have been acquired by or on behalf of the Transferor, the Depositor,
the Servicer or the Trust;
(5) all right, title and interest of the Depositor under the
Receivables Transfer Agreement, including, without limitation, the right of
the Depositor to cause the Transferor to purchase Receivables under certain
circumstances; and.
(6) the proceeds of any and all of the foregoing.
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ARTICLE III
The Receivables
---------------
SECTION 3.01. Representations and Warranties of the Transferor. (a) The
Transferor has consented to the assignment by the Depositor to the Trust of the
Depositor's rights with respect to the representations and warranties of the
Transferor set forth in the Receivables Transfer Agreement. Such
representations and warranties speak as of the execution and delivery of this
Agreement and as of the Closing Date, but shall survive the transfer and
assignment of the Receivables to the Trust. Pursuant to Section 2.03 of this
Agreement, the Depositor has assigned, transferred and conveyed to the Trust, as
part of the assets of the Trust, its rights under the Receivables Transfer
Agreement, including the representations and warranties of the Transferor
therein, upon which the Trustee relies in accepting the Receivables and
delivering the Certificates, together with all rights of the Depositor with
respect to any breach thereof, including the right to require the Transferor to
purchase Receivables in accordance with the Receivables Transfer Agreement. It
is understood and agreed that the representations and warranties referred to in
this Section shall survive the delivery of the Receivable Files to the Trustee
or any custodian.
(b) The Transferor hereby agrees that the Trustee shall have the right, on
behalf of the Trust and the Certificateholders, to enforce any and all rights
under the Receivables Transfer Agreement assigned to the Trust herein, including
the right to cause the Transferor to purchase any Receivable with respect to
which it is in breach of any of its representations and warranties set forth in
the Receivables Transfer Agreement, directly against the Transferor as though
the Trustee, as trustee of the Trust, were a party to the Receivables Transfer
Agreement, and the Trustee shall not be obligated to exercise any such rights
indirectly through the Depositor.
SECTION 3.02. Representations and Warranties of the Depositor. The
Depositor makes the following representations and warranties as to the
Receivables on which the Trustee relies in accepting the Receivables and
delivering the Certificates. Such representations and warranties speak as of
the execution and delivery of this Agreement and as of the Closing Date, but
shall survive the transfer and assignment of the Receivables by the Depositor to
the Trust.
(a) Title. It is the intention of the Depositor that (i) the transfer and
assignment herein contemplated constitute an absolute conveyance of the
Receivables from the Depositor to the Trust, conveying good title thereto, free
and clear of any Liens or rights of other Persons and (ii) the beneficial
interest in and title to the Receivables not be part of the debtor's estate in
the event of the filing of a bankruptcy petition by or against the Depositor
under any bankruptcy law. No Receivable has been sold, transferred, assigned
or pledged by the Depositor to any Person other than the Trust. Immediately
prior to the transfer and assignment herein contemplated, the Depositor had good
and marketable title to each Receivable, free and clear of all Liens and rights
of others and, immediately upon the transfer thereof, the Trust shall have good
and marketable title to each such Receivable, free and clear of all Liens and
rights of others; and the transfer has been perfected under the UCC.
16
(b) All Filings Made. All filings (including UCC filings) necessary in any
jurisdiction to give the Trust a first perfected ownership interest in the
Receivables shall have been made.
SECTION 3.03. Purchase Upon Breach. The Depositor, the Servicer or the
Trustee, as the case may be, shall inform the other parties to this Agreement
promptly, in writing, upon the discovery of any breach of the Depositor's
representations and warranties made pursuant to Section 3.01 of this Agreement
or Section ___ of the Receivable Transfer Agreement or of the Depositor's
representations and warranties made pursuant to Section 3.02 above. Unless any
such breach shall have been cured by the last day of the second Collection
Period following the discovery thereof by the Trustee or receipt by the Trustee
of notice from the Depositor or the Servicer of such breach, the Depositor shall
be obligated to purchase any Receivable materially and adversely affected by any
such breach as of such last day (or, at the Depositor's option, the last day of
the first Collection Period following such discovery or notice). In
consideration of such purchase of any Receivable, the Depositor shall remit the
Purchase Amount, in the manner specified in Section 5.05 provided, however, that
the obligation of the Depositor to purchase any Receivable arising solely as a
result of a breach of the Transferor's representations and warranties under
Section 3.02 of the Receivables Transfer Agreement is subject to the receipt by
the Depositor of the Purchase Amount from the Transferor. Subject to the
provisions of Section 7.03, the sole remedy of the Trustee, the Trust or the
Certificateholders with respect to a breach of representations and warranties
pursuant to Section 3.01 and 3.02 and the agreement contained in this Section
shall be to require the Depositor to purchase Receivables pursuant to this
Section, subject to the conditions contained herein or to enforce the
Transferor's obligation to the Depositor to purchase such Receivables pursuant
to the Receivables Transfer Agreement.
SECTION 3.04. Custody of Receivable Files. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Trustee, upon
the execution and delivery of this Agreement, hereby revocably appoints the
Servicer, and the Servicer hereby accepts such appointment, to act as the agent
of the Trustee as custodian of the following documents or instruments which are
hereby constructively delivered to the Trustee as of the Cutoff Date with
respect to each Receivable:
(i) the original of the Receivable;
(ii) the original credit application fully executed by the Obligor;
(iii) the original certificate of title or such documents that the
Servicer or the Depositor shall keep on file, in accordance with its
customary procedures, evidencing the security interest of the Depositor in
the Financed Asset; and
(iv) any and all other documents that the Servicer or the Depositor
shall keep on file, in accordance with its customary procedures, relating
to a Receivable, an Obligor or a Financed Asset.
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SECTION 3.05. Duties of Servicer as Custodian. (a) Safekeeping. The
Servicer shall hold the Receivable Files as custodian on behalf of the Trustee
for the benefit of all present and future Certificateholders, and shall maintain
such accurate and complete accounts, records and computer systems pertaining to
each Receivable File as shall enable the Trustee to comply with this Agreement.
In performing its duties as custodian the Servicer shall act with reasonable
care, using that degree of skill and attention that the Servicer exercises with
respect to the receivable files relating to all comparable (boat) (recreational
vehicle) receivables that the Servicer services for itself or others. The
Servicer shall conduct, or cause to be conducted, periodic audits of the
Receivable Files held by it under this Agreement, and of the related accounts,
records and computer systems, in such a manner as shall enable the Trustee to
verify the accuracy of the Servicer's record keeping. The Servicer shall
promptly report to the Trustee any failure on its part to hold the Receivable
Files and maintain its accounts, records and computer systems as herein provided
and shall promptly take appropriate action to remedy any such failure. Nothing
herein shall be deemed to require an initial review or any periodic review by
the Trustee of the Receivable Files.
(b) Maintenance of and Access to Records. The Servicer shall maintain each
Receivable File at one of its offices specified in Schedule B to this Agreement
or at such other office as shall be specified to the Trustee by written notice
not later than 30 days after any change in location. The Servicer shall make
available to the Trustee or its duly authorized representatives, attorneys or
auditors a list of locations of the Receivable Files and the related accounts,
records and computer systems maintained by the Servicer at such times during
normal business hours as the Trustee shall instruct.
(c) Release of Documents. Upon instruction from the Trustee, the Servicer
shall release any Receivable File to the Trustee, the Trustee's agent or the
Trustee's designee, as the case may be, at such place or places as the Trustee
may designate, as soon as practicable.
SECTION 3.06. Instructions; Authority to Act. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable Files
upon its receipt of written instructions signed by a Trustee Officer.
SECTION 3.07. Custodian's Indemnification. The Servicer as custodian
shall indemnify the Trustee and each of its officers, directors, employees and
agents for any and all liabilities, obligations, losses, compensatory damages,
payments, costs, or expenses of any kind whatsoever that may be imposed on,
incurred by or asserted against the Trustee or any of its officers, directors,
employees or agents as the result of any improper act or omission in any way
relating to the maintenance and custody by the Servicer as custodian of the
Receivable Files; provided, however, that the Servicer shall not be liable to
the Trustee or any such officers, director, employee or agent of the Trustee for
any portion of any such amount resulting from the willful misfeasance, bad faith
or negligence of the Trustee or any such officer, director, employee or agent of
the Trustee.
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SECTION 3.08. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Cutoff Date and shall
continue in full force and effect until terminated pursuant to this Section. If
a Servicer shall resign as Servicer in accordance with the provisions hereof, or
if all of the rights and obligations of any Servicer shall have been terminated
under Section 9.01, the appointment of such Servicer as custodian shall be
terminated by the Trustee or by Holders of the Class A Certificates evidencing
not less than 25% of the Class A Certificate Balance, in the same manner as the
Trustee or such Holders may terminate the rights and obligations of the Servicer
under Section 9.01. The Trustee may terminate the Servicer's appointment as
custodian, with cause, at any time upon written notification to the Servicer,
and without cause upon 30 days' prior written notification. As soon as
practicable after any termination of such appointment, the Servicer shall
deliver the Receivable Files to the Trustee or the Trustee's agent at such place
or places as the Trustee may reasonably designate.
ARTICLE IV
Administration and Servicing of Receivables
-------------------------------------------
SECTION 4.01. Duties of Servicer. The Servicer, as agent for the Trustee
(to the extent provided herein), shall manage, service, administer and make
collections on the Receivables (other than Purchased Receivables) with
reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to all comparable receivables that it services for itself
or others. The Servicer's duties shall include collection and posting of all
payments, responding to inquiries of Obligors on such Receivables, investigating
delinquencies, sending payment coupons to Obligors, reporting tax information to
Obligors, accounting for collections, furnishing monthly and annual statements
to the Trustee with respect to distributions, and making Advances pursuant to
Section 5.04. Subject to the provisions of Section 4.02, the Servicer shall
follow its customary standards, policies and procedures in performing its duties
as Servicer. Without limiting the generality of the foregoing, the Servicer is
authorized and empowered by the Trustee to execute and deliver, on behalf of
itself, the Trust, the Certificateholders, the Trustee, or any of them, any and
all instruments of satisfaction or cancellation, or partial or full release or
discharge, and all other comparable instruments, with respect to such
Receivables or to the Financed Assets securing such Receivables. If the
Servicer shall commence a legal proceeding to enforce a Receivable, the Trustee
(in the case of any Receivable other than a Purchased Receivable) shall
thereupon be deemed to have automatically assigned, solely for the purpose of
collection, such Receivable to the Servicer. If in any enforcement suit or
legal proceeding it shall be held that the Servicer may not enforce a Receivable
on the ground that it shall not be a real party in interest or a holder entitled
to enforce such Receivable, the Trustee shall, at the Servicer's expense and
direction, take steps to enforce such Receivable, including bringing suit in its
name or the name of the Certificateholders. The Trustee shall, upon written
request of the Servicer, furnish the Servicer with any powers of attorney and
other documents reasonably necessary or appropriate to enable the Servicer to
carry out its servicing and administrative duties hereunder.
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SECTION 4.02. Collection and Allocation of Receivable Payments. The
Servicer shall make reasonable efforts to collect all payments called for under
the terms and provisions of the Receivables as and when the same shall become
due and shall follow such collection procedures as it follows with respect to
all comparable (boat) (recreational vehicle) receivables that it services for
itself or others. The Servicer shall allocate collections between principal and
interest in accordance with the customary servicing procedures it follows with
respect to all comparable (boat) (recreational vehicle) receivables that it
services for itself or others. The Servicer may grant extensions, rebates or
adjustments on a Receivable, which shall not, for the purposes of this
Agreement, modify the original due dates [or amounts of the originally scheduled
payments of interest on] Receivables; provided, however, that if the Servicer
extends the date for final payment by the Obligor of any Receivable beyond the
Final Scheduled Maturity Date, it shall promptly purchase such Receivable from
the Trust in accordance with the terms of Section 4.07. The Servicer may in its
discretion waive any late payment charge or any other fees that may be collected
in the ordinary course of servicing a Receivable. The Servicer shall not agree
to any alteration of [the interest rate] or the originally scheduled payments on
any Receivable.
SECTION 4.03. Realization Upon Receivables. On behalf of the Trust, the
Servicer shall use its best efforts, consistent with its customary servicing
procedures, to repossess or otherwise convert the ownership of the Financed
Asset securing any Receivable as to which the Servicer shall have determined
eventual payment in full is unlikely. The Servicer shall follow such customary
and usual practices and procedures as it shall deem necessary or advisable in
its servicing of such Receivables, which shall include reasonable efforts to
realize upon any recourse, if any, to Dealers and transferring the Financed
Asset at public or private sale. The foregoing shall be subject to the provision
that, in any case in which the Financed Asset shall have suffered damage, the
Servicer shall not expend funds in connection with the repair or the
repossession of such Financed Asset unless it shall determine in its discretion
that such repair and/or repossession will increase the Liquidation Proceeds by
an amount greater than the amount of such expenses.
SECTION 4.04. Physical Damage Insurance. [The Servicer, in accordance with
its customary servicing procedures, shall require that each Obligor shall have
obtained physical damage insurance covering the Financed Asset as of the
execution of the Receivable.]
SECTION 4.05. Maintenance of Security Interests in Financed Assets. The
Servicer shall, in accordance with its customary servicing procedures, take such
steps as are necessary to maintain perfection of the security interest created
by each Receivable in the related Financed Asset. The Trustee hereby authorizes
the Servicer to take such steps as are necessary to re-perfect such security
interest on behalf of the Trust in the event of the relocation of a Financed
Asset or for any other reason.
SECTION 4.06. Covenants of Servicer. The Servicer shall not release the
Financed Asset securing any Receivable from the security interest granted by
such Receivable in whole or in part except in the event of payment in full by
the Obligor thereunder or repossession, nor shall
20
the Servicer impair the rights of the Trust or the Certificateholders in such
Receivables, nor shall the Servicer increase the number of scheduled payments
due under a Receivable.
SECTION 4.07. Purchase of Receivables Upon Breach. The Servicer or the
Trustee shall inform the other party and the Depositor promptly, in writing,
upon the discovery of any breach of Section 4.02, 4.05 or 4.06. Unless the
breach shall have been cured by the last day of the second Collection Period
following such discovery (or, at the Servicer's election, the last day of the
first following Collection Period), the Servicer shall purchase any Receivable
materially and adversely affected by such breach as of such last day. If the
Servicer takes any action in any Collection Period pursuant to Section 4.02 that
impairs the right of the Trustee, the Trust or the Certificateholders in any
Receivable or as otherwise provided in Section 4.02, the Servicer shall purchase
such Receivable as of the last day of such Collection Period. In consideration
of the purchase of any such Receivable pursuant to either of the two preceding
sentences, the Servicer shall remit the Purchase Amount in the manner specified
in Section 5.05. For purposes of this Section, the Purchase Amount shall consist
in part of a release by the Servicer of all rights of reimbursement with respect
to Outstanding Advances on the Receivable. Subject to Section 8.02, the sole
remedy of the Trustee, the Trust or the Certificateholders with respect to a
breach pursuant to Section 4.02, 4.05 or 4.06 shall be to require the Servicer
to purchase Receivables pursuant to this Section. The Trustee shall have no duty
to conduct any affirmative investigation as to the occurrence of any condition
requiring the purchase of any Receivable pursuant to this Section.
SECTION 4.08. Servicing Fee. The Servicing Fee for a Distribution Date
shall equal the product of (a) one twelfth, (b) the Servicing Rate and (c) the
Pool Balance as of the first day of the preceding Collection Period. The
Servicer shall also be entitled to all late fees, prepayment charges and other
administrative fees or similar charges allowed by applicable law with respect to
the Receivables, collected (from whatever source) on the Receivables, plus any
reimbursement pursuant to Section 8.02.
SECTION 4.09. Servicer's Certificate. Not later than (11:00 a.m. (New York
time)) on each Determination Date, the Servicer shall deliver to the Trustee,
the Rating Agencies and the Depositor, a Servicer's Certificate containing all
information necessary to make the distributions on the related Distribution Date
pursuant to Section 5.06 (including, if required, withdrawals from any Reserve
Account and Advances by the Servicer pursuant to Section 5.04) for the related
Collection Period. Receivables to be purchased by the Servicer or to be
purchased by the Depositor or the Transferor shall be identified by the Servicer
by account number with respect to such Receivable (as specified in Schedule A).
SECTION 4.10. Annual Statement as to Compliance; Notice of Default. (a) The
Servicer shall deliver to the Trustee, on or before ___________ of each year, an
Officers' Certificate, dated as of _____________ of the preceding year, stating
that (A) a review of the activities of the Servicer during the preceding 12-
month period (or such shorter period as shall have elapsed since the Closing
Date) and of its performance hereunder and under this Agreement has been made
under such officers' supervision and (B) to the best of such officers'
knowledge,
21
based on such review, the Servicer has fulfilled all its obligations under this
Agreement throughout such year or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officers and the nature and status thereof. The Trustee shall send a copy of
such certificate and the report referred to in Section 4.11 to the Rating
Agencies. A copy of such certificate and the report referred to in Section 4.11
may be obtained by any Certificateholder by a request in writing to the Trustee
addressed to the Corporate Trust Office.
(b) The Servicer shall deliver to the Trustee and to the Rating Agencies,
promptly after having obtained knowledge thereof, but in no event later than 5
Business Days thereafter, written notice in an Officers' Certificate of any
event which with the giving of notice or lapse of time, or both, would become an
Event of Default under Section 9.01, clause (a) or (b).
SECTION 4.11. Annual Independent Certified Public Accountant's Report. [The
Servicer shall cause a firm of independent certified public accountants, which
may also render other services to the Servicer, the Depositor or their
Affiliates, to deliver to the Trustee on or before __________ of each year
beginning ________ , 199__, a report addressed to the Board of Directors of the
Servicer, to the effect that such firm has examined the financial statements of
the Servicer and issued its report thereon and that such examination (1) was
made in accordance with generally accepted auditing standards and accordingly
included such tests of the accounting records and such other auditing procedures
as such firm considered necessary in the circumstances; (2) included tests
relating to (boat) (recreational vehicle) loans serviced for others in
accordance with the requirements of the Uniform Single Attestation Program for
Mortgage Bankers (the "Program"), to the extent the procedures in such Program
are applicable to the servicing obligations set forth in this Agreement; and (3)
except as described in the report, disclosed no exceptions or errors in the
records relating to (boat) (recreational vehicle) loans serviced for others
that, in the firm's opinion, paragraph four of such Program requires such firm
to report.
Such report will also indicate that the firm is independent of the Servicer
within the meaning of the Code of Professional Ethics of the American Institute
of Certified Public Accountants.]
SECTION 4.12. Access to Certain Documentation and Information Regarding
Receivables. The Servicer shall provide to the Certificateholders access to the
Receivable Files in such cases where the Certificateholder shall be required by
applicable statutes or regulations to review such documentation. Access shall be
afforded without charge, but only upon reasonable request and during the normal
business hours at the offices of the Servicer. Nothing in this Section shall
affect the obligation of the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors, and the failure of the
Servicer to provide access to information as a result of such obligation shall
not constitute a breach of this Section.
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SECTION 4.13. Servicer Expenses. The Servicer shall be required to pay all
expenses incurred by it in connection with its activities hereunder, including
fees and disbursements of independent accountants, taxes imposed on the Servicer
and expenses incurred in connection with distributions and reports to
Certificateholders.
SECTION 4.14. Appointment of Subservicer. The Servicer may at any time
appoint a subservicer to perform all or any portion of its obligations as
Servicer hereunder; provided that the Rating Agency Condition shall have been
satisfied in connection therewith; and, provided, further, that the Servicer
shall remain obligated and shall be liable to the Trustee and the
Certificateholders for the servicing and administering of the Receivables in
accordance with the provisions hereof without diminution of such obligation and
liability by virtue of the appointment of such subservicer and to the same
extent and under the same terms and conditions as if the Servicer alone were
servicing and administering the Receivables. The fees and expenses of the
subservicer shall be as agreed between the Servicer and its subservicer from
time to time, and none of the Trust, the Trustee or the Certificateholders shall
have any responsibility therefor.
ARTICLE V
Distributions; Reserve Account;
Statements to Certificateholders
--------------------------------
SECTION 5.01. Establishment of Trust Accounts.
(a) (i) The Servicer, for the benefit of the Certificateholders, shall
establish and maintain in the name of the Trustee an Eligible Deposit
Account (the "Collection Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Certificateholders. Investment earnings on funds in the Collection Account
shall be paid to the Servicer as additional servicing compensation.
(ii) The Servicer, for the benefit of the Certificateholders, shall
establish and maintain in the name of the Trustee a non-interest bearing
account (the "Distribution Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Certificateholders.
(b) Funds on deposit in the Collection Account shall be invested by the
Trustee in Eligible Investments selected in writing by the Servicer or an
investment manager selected by the Servicer, which investment manager shall have
agreed to comply with the terms of this Agreement as they relate to investing
such funds; provided, however, that it is understood and agreed that the Trustee
shall not be liable for any loss arising from such investment in Eligible
Investments. All such Eligible Investments shall be held by the Trustee for the
benefit of the Servicer, and on each Distribution Date all interest and other
investment income (net of losses and investment expenses) on funds on deposit
therein shall be paid to the Servicer. Other than as permitted by the Rating
Agencies, funds on deposit in the Collection Account shall be invested
23
in Eligible Investments that will mature (A) not later than the Business Day
immediately preceding the next Distribution Date or (B) on such next
Distribution Date if either (x) such investment is held in the corporate trust
department of the institution with which the Collection Account is then
maintained and is invested in a time deposit of (the Trustee) rated at least A-1
by Standard & Poor's and P-1 by Moody's (such account being maintained within
the corporate trust department of the Trustee) or (y) the Trustee (so long as
the short-term unsecured debt obligations of the Trustee are either (1) rated at
least P-1 by Moody's and A-1 by Standard & Poor's on the date such investment is
made or (2) guaranteed by an entity whose short-term unsecured debt obligations
are rated at least P-1 by Moody's and A-1 by Standard & Poor's on the date such
investment is made) has agreed to advance funds on such Distribution Date to the
Distribution Account in the amount payable on such investment on such
Distribution Date pending receipt thereof to the extent necessary to make
distributions on such Distribution Date. The guarantee referred to in clause (y)
of the preceding sentence shall be subject to the Rating Agency Condition. For
the purpose of the foregoing, unless the Trustee affirmatively agrees in writing
to make such advance with respect to such investment prior to the time an
investment is made, it shall not be deemed to have agreed to make such advance.
Funds deposited in the Collection Account upon the maturity of any Eligible
Investments on the day immediately preceding a Distribution Date are not
required to be invested overnight. If, at any time, the Collection Account
ceases to be an Eligible Deposit Account, the Trustee (or the Servicer on its
behalf) shall within 10 Business Days (or such longer period, not to exceed 30
calendar days, as to which each Rating Agency may consent) establish a new
Collection Account as an Eligible Deposit Account and shall transfer any cash
and/or any investments to such new account.
SECTION 5.02. Collections. The Servicer shall remit within two Business
Days of receipt thereof to the Collection Account all payments by or on behalf
of the Obligors with respect to the Receivables (other than Purchased
Receivables) and all Liquidation Proceeds, both as collected during the
Collection Period. Notwithstanding the foregoing, for so long as (i) DFS remains
the Servicer, (ii) no Event of Default shall have occurred and be continuing and
(iii) prior to ceasing daily remittances, the Rating Agency Condition shall have
been satisfied (and any conditions or limitations imposed by the Rating Agencies
in connection therewith are complied with), the Servicer shall remit such
collections with respect to the preceding calendar month to the Collection
Account on the Determination Date immediately preceding the related Distribution
Date. For purposes of this Article V the phrase "payments by or on behalf of
Obligors" shall mean payments made with respect to the Receivables by Persons
other than the Servicer or the Depositor.
SECTION 5.03. Application of Collections. All collections for the
Collection Period shall be applied by the Servicer as follows:
With respect to each Receivable (other than a Purchased Receivable),
payments by or on behalf of the Obligor shall be applied first to reduce
Outstanding Advances to the extent described in Section 5.04(b). Next, any
excess shall be applied to interest and principal in accordance with the
Simple Interest Method.
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SECTION 5.04. Advances.
As of the close of business on the last day of each Collection Period, the
Servicer shall advance an amount equal to the amount of interest due on the
Receivables at their respective APRs for the related Collection Period (assuming
the Receivables pay on their respective due dates) minus the amount of interest
actually received on the Receivables during the related Collection Period (such
amount, an "Advance"). With respect to each Receivable, the Advance shall
increase Outstanding Advances. If such calculation results in a negative number,
an amount equal to the absolute value of such negative number shall be paid to
the Servicer and the amount of Outstanding Advances shall be reduced by such
amount. In addition, in the event that a Receivable becomes a Liquidated
Receivable, Liquidation Proceeds with respect to such Receivable attributable to
accrued and unpaid interest thereon (but not including interest for the then
current Collection Period) shall be paid to the Servicer to reduce Outstanding
Advances, but only to the extent of any Outstanding Advances. The Servicer shall
not make any advance with respect to principal of Receivables.
SECTION 5.05. Additional Deposits. The Servicer shall deposit in the
Collection Account the aggregate Advances pursuant to Section 5.04. To the
extent that the Servicer fails to make an Advance pursuant to Section 5.04(b) on
the date required, the Trustee shall withdraw such amount (or, if determinable,
such portion of such amount as does not represent advances for delinquent
interest) from the Reserve Account and deposit such amount in the Collection
Account. The Servicer and the Depositor shall deposit or cause to be deposited
in the Collection Account the aggregate Purchase Amount with respect to
Purchased Receivables, and the Servicer shall deposit therein all amounts to be
paid under Section 11.02. The Servicer shall deposit the aggregate Purchase
Amount with respect to Purchased Receivables when such obligations are due,
unless the Servicer shall not be required to make daily deposits pursuant to
Section 5.02.
SECTION 5.06. Distributions. (a) On each Distribution Date, the Trustee
shall cause to be transferred from the Collection Account to the Distribution
Account, in immediately available funds, the entire amount then on deposit in
the Collection Account; provided, however, that in the event that the Servicer
is required to make deposits to the Collection Account on a daily basis pursuant
to Section 5.02, the amount of the funds transferred from the Collection Account
to the Distribution Account will include only those funds that were deposited in
the Collection Account for the Collection Period related to such Distribution
Date.
(b) On or prior to each Determination Date, the Servicer shall calculate
the Total Distribution Amount, the Interest Distribution Amount, the Principal
Distribution Amount, the Class A Distributable Amount, and the Class B
Distributable Amount, and, based on the Total Distribution Amount and the other
amounts to be distributed on the related Distribution Date, determine the amount
distributable to Holders of each class of Certificates.
(c) On each Distribution Date, the Trustee (based on the information
contained in the Servicer's Certificate delivered on the related Determination
Date pursuant to Section 5.09) shall
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distribute amounts on deposit in the Distribution Account and, if applicable,
the Reserve Account, in the manner and priority set forth below:
(i) to the Servicer, from the Interest Distribution Amount, the
Servicing Fee and all unpaid Servicing Fees from prior Collection Periods;
(ii) to the Class A Certificateholders:
(A) from the Class A Percentage of the Interest Distribution
Amount (as such Interest Distribution Amount has been reduced by
Servicing Fee payments), the sum of the Class A Interest Distributable
Amount and the Class A Interest Carryover Shortfall as of the close of
the preceding Distribution Date;
(B) from the Class A Percentage of the Principal Distribution
Amount (other than the portion thereof attributable to Realized
Losses), the sum of the Class A Principal Distributable Amount and the
Class A Principal Carryover Shortfall as of the close of the preceding
Distribution Date;
(iii) to the Class B Certificateholders:
(A) from the Class B Percentage of the Interest Distribution
Amount (as such Interest Distribution Amount has been reduced by
Servicing Fee payments), the sum of the Class B Interest Distributable
Amount and the Class B Interest Carryover Shortfall as of the close of
the preceding Distribution Date; and
(B) from the Class B Percentage of the Principal Distribution
Amount, the sum of the Class B Principal Distributable Amount and the
Class B Principal Carryover Shortfall as of the close of the preceding
Distribution Date.
(d) The rights of the Class B Certificateholders to receive distributions
in respect of the Class B Certificates shall be and hereby are subordinated to
the rights of the Class A Certificateholders to receive distributions in respect
of the Class A Certificates and the rights of the Servicer to receive the
Servicing Fee (and any accrued and unpaid Servicing Fees from prior Collection
Periods) in the event of delinquency or defaults on the Receivables. In
addition, the Class A Certificateholders and the Class B Certificateholders
shall have the respective rights to receive funds from the Reserve Account in
the order of priority set forth below. Such subordination and withdrawals from
the Reserve Account shall be effected as follows, and all payments shall be
effected by applying funds in the following order:
(i) If the Class A Percentage of the Interest Distribution Amount
(as such Interest Distribution Amount has been reduced by Servicing Fee
payments) is less than the sum of the Class A Interest Distributable Amount
and any Class A Interest Carryover Shortfall from the preceding
Distribution Date, the Class A Certificateholders shall be entitled to
receive distributions in respect of such deficiency first, from the Class B
26
Percentage of the Interest Distribution Amount; second, if such amounts are
insufficient, from amounts on deposit in the Reserve Account; and third, if
such amounts are insufficient, from the Class B Percentage of the Principal
Distribution Amount (other than the portion thereof attributable to
Realized Losses).
(ii) If the Class A Percentage of the Principal Distribution Amount
(other than the portion thereof attributable to Realized Losses) is less
than the sum of the Class A Principal Distributable Amount and the Class A
Principal Carryover Shortfall from the preceding Distribution Date, the
Class A Certificateholders shall be entitled to receive distributions in
respect of such deficiency first, from the Class B Percentage of the
Principal Distribution Amount (other than the portion thereof attributable
to Realized Losses); second, if such amounts are insufficient, from amounts
on deposit in the Reserve Account; and third, if such amounts are
insufficient, from the Class B Percentage of the Interest Distribution
Amount.
(iii) If the Class B Percentage of the Interest Distribution Amount,
less the portion thereof, if any, distributed to the Class A
Certificateholders pursuant to clause (i) above, is less than the Class B
Interest Distributable Amount, the Class B Certificateholders shall be
entitled to receive such deficiency from amounts on deposit in the Reserve
Account (after giving effect to any withdrawals therefrom pursuant to
clauses (i) and (ii) above).
(iv) If the Class B Percentage of the Principal Distribution Amount
(other than the portion thereof attributable to Realized Losses), less the
portion thereof, if any, distributed to the Class A Certificateholders
pursuant to clause (ii) above, is less than the Class B Principal
Distributable Amount, the Class B Certificateholders shall be entitled to
receive such deficiency from amounts on deposit in the Reserve Account
(after giving effect to any withdrawals therefrom pursuant to clauses (i),
(ii) and (iii) above).
(e) On each Distribution Date, the Trustee shall distribute any amounts
remaining in the Distribution Account after making the distributions described
in Sections 5.06(c) and (d) above in the following amounts and in the following
order of priority: (i) into the Reserve Account until the amount on deposit
therein equals the Specified Reserve Account Balance and (ii) to the Depositor.
(f) Subject to Section 11.01 respecting the final payment upon retirement
of each Certificate, the Servicer shall on each Distribution Date instruct the
Trustee to distribute to each Certificateholder of record on the preceding
Record Date either by wire transfer in immediately available funds to the
account of such Holder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided to the Servicer
appropriate instructions prior to such Distribution Date and such Holder's
Certificates of either Class in the aggregate evidence a denomination of not
less than $1,000,000, or, if not, by check mailed to such Certificateholder at
the address of such Holder appearing in the Certificate Register, the amounts to
be distributed to such Certificateholder pursuant to such Holder's Certificates.
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SECTION 5.07. Reserve Account. (a) In order to effectuate the subordination
provided for herein and to assure that sufficient amounts to make required
distributions to Certificateholders will be available, the Servicer shall
establish and maintain an Eligible Deposit Account (the "Reserve Account"),
bearing a designation clearly indicating that the funds deposited therein are
held in trust for the benefit of the Certificateholders. The Reserve Account
will include the money and other property deposited and held therein pursuant to
Section 5.06(e), 5.08(a) and this Section.
On or prior to the Closing Date, the Depositor shall deposit an amount
equal to the Reserve Account Initial Deposit into the Reserve Account. The
Reserve Account and the Reserve Account Property shall not be part of the Trust,
but instead will be held by the Trustee, as collateral agent, for the benefit of
the Holders of the Certificates. The Depositor hereby acknowledges that the
Reserve Account Initial Deposit (and any investment earnings thereon) is owned
directly by it, and the Depositor hereby agrees to treat the same as its assets
(and earnings) for federal income tax and all other purposes.
(b) In order to give effect to the subordination provided for herein and
to assure the availability of the amounts maintained in the Reserve Account, the
Depositor hereby conveys and transfers to the Trustee, as collateral agent, and
its successors and assigns, the Reserve Account Initial Deposit and all proceeds
thereof and hereby pledges to the Trustee as collateral agent, and its
successors and assigns, all other amounts deposited in or credited to the
Reserve Account from time to time under this Agreement, all Eligible Investments
made with amounts on deposit therein, all earnings and distributions thereon and
proceeds thereof (other than proceeds constituting net investment earnings
attributable to the Reserve Account Property) subject, however, to the
limitations set forth below, and solely for the purpose of securing and
providing for payment of the Class A Distributable Amount and the Class B
Distributable Amount in accordance with Section 5.06 and this Section (all the
foregoing, subject to the limitations set forth below, the "Reserve Account
Property"), to have and to hold all the aforesaid property, rights and
privileges unto the Trustee, its successors and assigns, in trust for the uses
and purposes, and subject to the terms and provisions, set forth in this
Section. The Trustee hereby acknowledges such transfer and accepts the trusts
hereunder and shall hold and distribute the Reserve Account Property in
accordance with the terms and provisions of this Section.
(c) Consistent with the limited purposes for which such trust is granted,
the amounts on deposit in the Reserve Account on each Distribution Date shall be
available for distribution as provided in Section 5.06, in accordance with and
subject to the following: if the amount on deposit in the Reserve Account (after
giving effect to all deposits thereto and withdrawals therefrom on such
Distribution Date) is greater than the Specified Reserve Account Balance, the
Trustee shall release and distribute all such amounts to the Depositor. Upon any
such distribution to the Depositor, the Certificateholders will have no further
rights in, or claims to, such amounts.
(d) Funds on deposit in the Reserve Account shall be invested by the
Trustee, as collateral agent, in Eligible Investments selected in writing by the
Depositor or an investment
28
manager selected by the Servicer, which investment manager shall have agreed to
comply with the terms of this Agreement as they relate to investing such funds;
provided, however, that it is understood and agreed that the Trustee shall not
be liable for any loss arising from such investment in Eligible Investments.
Other than as permitted by the Rating Agencies, funds on deposit in the Reserve
Account shall be invested in Eligible Investments that will mature (A) not later
than the Business Day immediately preceding the next Distribution Date or (B) on
such next Distribution Date if either (x) such investment is held in the
corporate trust department of the institution with which the Reserve Account is
then maintained and is invested in a time deposit of (the Trustee) rated at
least A-1 by Standard & Poor's and P-1 by Moody's (such account being maintained
within the corporate trust department of the Trustee) or (y) the Trustee (so
long as the short-term unsecured debt obligations of the Trustee are either (1)
rated at least P-1 by Moody's and A-1 by Standard & Poor's on the date such
investment is made or (2) guaranteed by an entity whose short-term unsecured
debt obligations are rated at least P-1 by Moody's and A-1 by Standard & Poor's
on the date such investment is made) has agreed to advance funds on such
Distribution Date to the Distribution Account in the amount payable on such
investment on such Distribution Date pending receipt thereof to the extent
necessary to make distributions on such Distribution Date. The guarantee
referred to in clause (y) of the preceding sentence shall be subject to the
Rating Agency Condition. For the purpose of the foregoing, unless the Trustee
affirmatively agrees in writing to make such advance with respect to such
investment prior to the time an investment is made, it shall not be deemed to
have agreed to make such advance. Funds deposited in the Reserve Account upon
the maturity of any Eligible Investments on the day immediately preceding a
Distribution Date are not required to be invested overnight. If, at any time,
the Reserve Account ceases to be an Eligible Deposit Account, the Trustee as
collateral agent (or the Servicer on its behalf) shall within 10 Business Days
(or such longer period, not to exceed 30 calendar days, as to which each Rating
Agency may consent) establish a new Reserve Account as an Eligible Deposit
Account and shall transfer any cash and/or any investments to such new account.
Investment earnings attributable to the Reserve Account Property shall not
be available to satisfy the subordination provisions of this Agreement and shall
not otherwise be subject to any claims or rights of the Certificateholders or
the Servicer. All such investments shall be made in the name of the Trustee or
its nominee, as collateral agent, and all net income and gain realized thereon
shall be solely for the benefit of the Depositor and shall be payable by the
Trustee to the Depositor on each Distribution Date. Realized losses, if any, on
investments of the Reserve Account Property shall be charged first against
undistributed investment earnings attributable to the Reserve Account Property
and then against the Reserve Account Property.
(e) With respect to the Reserve Account Property, the Depositor, on behalf
of itself, its successors and assigns, and the Trustee agree that:
(i) Any Reserve Account Property that is held in deposit accounts
shall be held solely in the name of the Trustee, as collateral agent, at an
Eligible Institution. Each such deposit account shall be subject to the
exclusive custody and control of the Trustee, and the Trustee shall have
sole signature authority with respect thereto.
29
(ii) Any Reserve Account Property that constitutes Physical Property
shall be delivered to the Trustee, as collateral agent, in accordance with
paragraph (a) of the definition of "Delivery" and shall be held, pending
maturity or disposition, solely by the Trustee, as collateral agent, or a
financial intermediary (as such term is defined in Section 8- 313(4) of the
UCC) acting solely for the Trustee, as collateral agent.
(iii) Any Reserve Account Property that is a book-entry security held
through the Federal Reserve System pursuant to federal book-entry
regulations shall be delivered in accordance with paragraph (b) of the
definition of "Delivery" and shall be maintained by the Trustee, as
collateral agent, pending maturity or disposition, through continued book-
entry registration of such Reserve Account Property as described in such
paragraph.
(iv) Any Reserve Account Property that is an "uncertificated
security" under Article 8 of the UCC and that is not governed by clause (C)
above shall be delivered to the Trustee, as collateral agent, in accordance
with paragraph (c) of the definition of "Delivery" and shall be maintained
by the Trustee, as collateral agent, pending maturity or disposition,
through continued registration of the Trustee's (or its custodian's or it
nominee's) ownership of such security, in its capacity as collateral agent.
Effective upon Delivery of any Reserve Account Property in the form of
Physical Property, book-entry securities or uncertificated securities, the
Trustee shall be deemed to have acquired such Reserve Account Property for
value, in good faith and without notice of any adverse claim thereto.
(f) Each of the Depositor and the Servicer agrees to take or cause to be
taken such further actions, to execute, deliver and file or cause to be
executed, delivered and filed such further documents and instruments (including
any UCC financing statements or this Agreement) as may be determined to be
necessary in an Opinion of Counsel to the Depositor delivered to the Trustee in
order to perfect the interests created by this Section and otherwise fully to
effectuate the purposes, terms and conditions of this Section. The Depositor
shall:
(i) promptly execute, deliver and file any financing statements,
amendments, continuation statements, assignments, certificates, and other
documents with respect to such interests and perform all such other acts as
may be necessary in order to perfect or to maintain the perfection of the
Trustee's security interest; and
(ii) file the necessary financing statements or amendments thereto
within five days, and promptly notify the Trustee of any such filing, after
the occurrence of any of the following: (1) any change in its corporate
name or any trade name; (2) any change in the location of its chief
executive office or principal place of business; and (3) any merger or
consolidation or other change in its identity or corporate structure and
promptly notify the Trustee of any such filings.
30
(g) The Trustee shall not enter into any subordination or intercreditor
agreement with respect to the Reserve Account Property.
(h) Following the payment in full of the Certificate Balance and of all
other amounts owing or to be distributed under this Agreement to
Certificateholders and the termination of the Trust, any amount remaining on
deposit in the Reserve Account shall be distributed to the Depositor.
SECTION 5.08. Statements to Certificateholders. On each Distribution
Date, the Servicer shall provide to the Trustee for the Trustee to forward to
each Certificateholder of record as of the most recent Record Date, a statement
substantially in the form of Exhibit D setting forth at least the following
information as to each Class of Certificates to the extent applicable:
(i) the amount of such distribution allocable to principal of each
class of Certificates;
(ii) the amount of such distribution allocable to interest of each
class of Certificates;
(iii) the Pool Balance as of the close of business on the last day of
the preceding Collection Period;
(iv) the Class A Certificate Balance and Class B Certificate Balance
and the Class A Pool Factor and Class B Pool Factor after giving effect to
all payments reported under clause (i) above on such date;
(v) the amount of the Servicing Fee paid to the Servicer with
respect to the related Collection Period or Collection Periods, as the case
may be;
(vi) the amount of the Class A Principal Carryover Shortfall and
Class A Interest Carryover Shortfall and Class B Principal Carryover
Shortfall and Class B Interest Carryover Shortfall, as applicable, if any,
on such Distribution Date and the change in the Class A Principal Carryover
Shortfall and Class A Interest Carryover Shortfall and Class B Principal
Carryover Shortfall and Class B Interest Carryover Shortfall, as
applicable, from the preceding Distribution Date;
(vii) the amount of aggregate Realized Losses, if any, for the second
preceding Collection Period;
(viii) the aggregate Purchase Amounts for Receivables, if any, that
were purchased in such period;
31
(ix) the amount otherwise distributable to the Class B
Certificateholders that is distributed to Class A Certificateholders on
such Distribution Date;
(x) the balance of the Reserve Account on such Distribution Date,
after giving effect to deposits and withdrawals made on such Distribution
Date;
(xi) for Distribution Dates during the Funding Period (if any), the
remaining Pre-Funded Amount; and
(xii) for the first Distribution Date that is on or immediately
following the end of the Funding Period (if any), the amount of any
remaining Pre-Funded Amount that has not been [used to fund the purchase of
Subsequent Receivables] [to make distributions to the Transferor] and is
passed through as payments of principal of the Certificates.
Each amount set forth pursuant to subclauses (i), (ii), (v) or (vi) above shall
be expressed as a dollar amount per $1,000 of original principal balance of a
Class A or Class B Certificate, as applicable.
SECTION 5.09. Tax Returns. The Trustee shall deliver to each Holder of a
Certificate, as may be required by the Code and applicable Treasury Regulations,
such information as may be required to enable each Holder to prepare its federal
and state income tax returns.
SECTION 5.10. Net Deposits. As an administrative convenience, unless the
Servicer is required to remit collections daily, the Servicer will be permitted
to make the deposit of collections on the Receivables, aggregate Advances and
Purchase Amounts for or with respect to each Collection Period net of
distributions to be made to the Servicer with respect to such Collection Period.
The Servicer, however, will account to the Trustee and to the Certificateholders
as if all deposits, distributions and transfers were made individually.
ARTICLE VI
The Certificates
----------------
SECTION 6.01. The Certificates. Unless otherwise specified in this
Agreement, the Certificates shall be issued in fully registered form in minimum
denominations of $1,000. The Certificates shall be executed on behalf of the
Trust by manual or facsimile signature of an authorized officer of the Trustee.
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such signatures shall have been affixed, authorized to sign on
behalf of the Trust, shall be validly issued and entitled to the benefit of this
Agreement, notwithstanding that such individuals or any of them shall have
ceased to be so authorized prior to the authentication and delivery of such
Certificates or did not hold such offices at the date of authentication and
delivery of such Certificates.
32
A transferee of a Certificate shall become a Certificateholder and shall be
entitled to the rights and subject to the obligations of a Certificateholder
hereunder upon such transferee's acceptance of a Certificate duly registered in
such transferee's name pursuant to Section 6.03.
SECTION 6.02. Authentication of Certificates. The Trustee shall cause
the Certificates to be executed on behalf of the Trust, authenticated and
delivered to or upon the written order of the Depositor, signed by its chairman
of the board, its president, any vice president, secretary, or assistant
treasurer, without further corporate action by the Depositor, in authorized
denominations, pursuant to this Agreement. No Certificate shall entitle its
Holder to any benefit under this Agreement or shall be valid for any purpose
unless there shall appear on such Certificate a certificate of authentication
substantially in the form set forth in Exhibit A or Exhibit B, as appropriate,
executed by the Trustee by manual signature. Such authentication shall
constitute conclusive evidence that such Certificate shall have been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication.
SECTION 6.03. Registration of Transfer and Exchange of Certificates. The
Certificate Registrar shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 6.08, a Certificate Register in which, subject
to such reasonable regulations as it may prescribe, the Trustee shall provide
for the registration of Certificates and of transfers and exchanges of
Certificates as herein provided. Unless otherwise specified in this Agreement,
the Trustee shall be the initial Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Trustee shall execute, authenticate and deliver, in
the name of the designated transferee or transferees, one or more new
Certificates in authorized denominations of a like aggregate amount dated the
date of authentication by the Trustee. At the option of a Holder, Certificates
may be exchanged for other Certificates of authorized denominations of a like
aggregate amount upon surrender at the Corporate Trust Office of the
Certificates to be exchanged.
Every Certificate presented or surrendered for registration of transfer or
exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar duly executed by the
Holder or such Holder's attorney duly authorized in writing. Each Certificate
surrendered for registration of transfer and exchange shall be cancelled and
subsequently disposed of by the Trustee.
No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
SECTION 6.04. Mutilated, Destroyed, Lost or Stolen Certificates. If (a)
any mutilated Certificate shall be surrendered to the Certificate Registrar, or
if the Certificate Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (b) there
33
shall be delivered to the Certificate Registrar and the Trustee such security or
indemnity as may be required by them to save each of them harmless, then in the
absence of notice that such Certificate has been acquired by a bona fide
purchaser, the Trustee on behalf of the Trust shall execute, and the Trustee
shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
tenor and denomination. In connection with the issuance of any new Certificate
under this Section, the Trustee and the Certificate Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section shall constitute conclusive evidence of ownership in
the Trust, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
SECTION 6.05. Persons Deemed Owners. Prior to due presentation of a
Certificate for registration of transfer, the Trustee or the Certificate
Registrar may treat the Person in whose name any Certificate shall be registered
as the owner of such Certificate for the purpose of receiving distributions
pursuant to Section 5.06 and for all other purposes whatsoever, and neither the
Trustee nor the Certificate Registrar shall be bound by any notice to the
contrary.
SECTION 6.06. Access to List of Certificateholders' Names and Addresses.
The Trustee shall furnish or cause to be furnished to the Servicer, within 15
days after receipt by the Trustee of a request therefor from the Servicer in
writing, a list, in such form as the Servicer may reasonably require, of the
names and addresses of the Certificateholders as of the most recent Record Date.
If three or more Certificateholders, or one or more Holders of Class A
Certificates evidencing not less than 25% of the Class A Certificate Balance
apply in writing to the Trustee, and such application states that the applicants
desire to communicate with other Certificateholders with respect to their rights
under this Agreement or under the Certificates and such application shall be
accompanied by a copy of the communication that such applicants propose to
transmit, then the Trustee shall, within five Business Days after the receipt
for such application, afford such applicants access during normal business hours
to the current list of Certificateholders. Each Holder, by receiving and
holding a Certificate, shall be deemed to have agreed to hold neither the
Servicer nor the Trustee accountable by reason of the disclosure of its name and
address, regardless of the source from which such information was derived.
SECTION 6.07. Maintenance of Office or Agency. The Trustee shall
maintain in the Borough of Manhattan, The City of New York, an office or offices
or agency or agencies where Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Trustee in
respect of the Certificates and this Agreement may be served. The Trustee
initially designates the Corporate Trust Office as specified in this Agreement
as its office for such purposes. The Trustee shall give prompt written notice
to the Servicer and to Certificateholders of any change in the location of the
Certificate Register or any such office or agency.
SECTION 6.08. Book-Entry Certificates. The Class A Certificates and[, if
so specified in this Agreement,] the Class B Certificates may be issued in the
form of one or more
34
typewritten Certificates representing Book-Entry Certificates, to be delivered
by, or on behalf of, the Depositor to the initial Clearing Agency, which, unless
otherwise specified in this Agreement, shall be The Depository Trust Company.
In such case, the Certificates delivered to the Depository Trust Company shall
initially be registered on the Certificate Register in the name of Cede & Co.,
the nominee of the initial Clearing Agency, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's interest
in the Certificates, except as provided in Section 6.10. Unless and until
definitive, fully registered Certificates (the "Definitive Certificates") have
been issued to such Certificate Owners pursuant to Section 6.10:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Depositor, the Servicer, the Certificate Registrar and the
Trustee may deal with the Clearing Agency for all purposes (including the
making of distributions on such Certificates) as the sole Holder of such
Certificates and shall have no obligation to the related Certificate
Owners;
(iii) to the extent that the provisions of this Section conflict with
any other provisions of this Agreement, the provisions of this Section
shall control;
(iv) the rights of such Certificate Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by
law and agreements between such Certificate Owners and the Clearing Agency
and/or the Clearing Agency Participants. Pursuant to the Depository
Agreement, unless and until Definitive Certificates are issued pursuant to
Section 6.10, the initial Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit
distributions of principal and interest on such Certificates to such
Clearing Agency Participants; and
(v) whenever this Agreement requires or permits actions to be taken
based upon instructions or directions of Holders of Certificates evidencing
a specified percentage of the Certificate Balance, the Clearing Agency
shall be deemed to represent such percentage only to the extent that it has
received instructions to such effect from Certificate Owners and/or
Clearing Agency Participants owning or representing, respectively, such
required percentage of the beneficial interest in such Certificates and has
delivered such instructions to the Trustee.
SECTION 6.09. Notices to Clearing Agency. Whenever notice or other
communication to the Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 6.10, the Trustee and the Servicer shall give all such
notices and communications specified herein to be given to Certificate Owners to
the Clearing Agency.
SECTION 6.10. Definitive Certificates. If (i) the Servicer advises the
Trustee in writing that the Clearing Agency is no longer willing or able to
properly discharge its responsibilities
35
under the Depository Agreement and the Trustee or the Depositor is unable to
locate a qualified successor, (ii) the Depositor at its option advises the
Trustee in writing that it elects to terminate the book-entry system through the
Clearing Agency or (iii) after the occurrence of an Event of Default,
Certificate Owners representing beneficial interests aggregating not less than a
majority of the aggregate outstanding principal amount of the Book-Entry
Certificates advise the Trustee and the Clearing Agency in writing that the
continuation of a book-entry system through the Clearing Agency is no longer in
the best interests of the Certificate Owners, then the Clearing Agency shall
notify all Certificate Owners and the Trustee of the occurrence of such event
and of the availability of Definitive Certificates to Certificate Owners
requesting the same. Upon surrender to the Trustee of the typewritten
Certificates representing the Book-Entry Certificates by the Clearing Agency,
accompanied by registration instructions, the Trustee shall execute and
authenticate the Definitive Certificates in accordance with the instructions of
the Clearing Agency. None of the Depositor, the Certificate Registrar or the
Trustee shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates, the Trustee shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder. The
Definitive Certificates shall be printed, lithographed or engraved or may be
produced in any other manner as is reasonably acceptable to the Trustee, as
evidenced by its execution thereof.
ARTICLE VII
The Depositor
-------------
SECTION 7.01. Representations of Depositor. The Depositor makes the
following representations on which the Trustee shall be deemed to have relied in
accepting the Receivables in trust and executing and authenticating the
Certificates. The representations speak as of the execution and delivery of
this Agreement and as of the Closing Date, in the case of Initial Receivables
and as of the applicable Subsequent Transfer Date, in the case of Subsequent
Receivables, if any, and shall survive the transfer of the Receivables to the
Trustee.
(i) Organization and Good Standing. The Depositor is duly organized and
validly existing as a corporation in good standing under the laws of the State
of Nevada, with power and authority to own its properties and to conduct its
business as such properties are currently owned and such business is presently
conducted, and had at all relevant times, and has, the corporate power,
authority and legal right to acquire and own the Receivables.
(ii) Due Qualification. The Depositor is duly qualified to do business as
a foreign corporation in good standing, and has obtained all necessary licenses
and approvals in all jurisdictions in which the ownership or lease of property
or the conduct of its business shall require such qualifications.
(iii) Power and Authority. The Depositor has the corporate power and
authority to execute and deliver this Agreement and to carry out its respective
terms; the Depositor has full power and authority to transfer and assign the
property to be transferred and assigned to and
36
deposited with the Trustee as part of the Trust, and the Depositor shall have
duly authorized such transfer and assignment to the Trustee, as applicable, by
all necessary corporate action; and the execution, delivery and performance of
this Agreement and of each Subsequent Transfer Assignment or Eligible Investment
Transfer Assignment, as applicable, shall have been duly authorized by the
Depositor by all necessary corporate action.
(iv) Binding Obligation. This Agreement, each Subsequent Transfer
Assignment and Eligible Investment Transfer Assignment, when executed and
delivered by the Depositor, shall constitute legal, valid and binding
obligations of the Depositor enforceable in accordance with their respective
terms.
(v) No Violation. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof and thereof do not
conflict with, result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time) a default under, the
articles of incorporation or bylaws of the Depositor, or any indenture,
agreement or other instrument to which the Depositor is a party or by which it
is bound; or result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement or other
instrument (other than pursuant to this Agreement); or violate any law or, to
the best of the Depositor's knowledge, any order, rule or regulation applicable
to the Depositor of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having jurisdiction
over the Depositor or its properties.
(vi) No Proceedings. To the Depositor's best knowledge, there are no
proceedings or investigations pending, or threatened, before any court,
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Depositor or its properties: (i) asserting the
invalidity of this Agreement or the Certificates; (ii) seeking to prevent the
issuance of the Certificates or the consummation of any of the transactions
contemplated by this Agreement; (iii) seeking any determination or ruling that
might materially and adversely affect the performance by the Depositor of its
obligations under, or the validity or enforceability of, this Agreement or the
Certificates, or (iv) that might adversely affect the federal income tax
attributes of the Certificates.
SECTION 7.02. Corporate Existence. During the term of this Agreement,
the Depositor will keep in full force and effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction of its
incorporation and will obtain and preserve its qualification to do business in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement and each other
instrument or agreement necessary or appropriate to the proper administration of
this Agreement and the transactions contemplated hereby and thereby.
SECTION 7.03. Liabilities of Depositor; Indemnities. The Depositor shall
be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Depositor under this Agreement.
37
(i) The Depositor shall indemnify, defend and hold harmless the
Trustee and the Trust from and against any taxes that may at any time be
asserted against the Trustee or the Trust with respect to the transactions
contemplated in this Agreement, including any sales, gross receipts,
general corporation, tangible personal property, privilege, or license
taxes (but, in the case of the Trust, not including any taxes asserted with
respect to, and as the date of, the transfer of the Receivables to the
Trust or the issuance and original sale of the Certificates, or asserted
with respect to ownership of the Receivables, or federal or other income
taxes arising out of the distributions on the Certificates) and costs and
expenses in defending against the same.
(ii) The Depositor shall indemnify, defend and hold harmless the
Trustee and the Certificateholders from and against any loss, liability or
expense incurred by reason of (a) the Depositor's willful misfeasance, bad
faith or negligence in the performance of its duties under this Agreement,
or by reason of reckless disregard of its obligations and duties under this
Agreement, and (b) the Depositor's or Trust's violation of federal or state
securities laws in connection with the offering and sale of the
Certificates.
(iii) The Depositor shall indemnify, defend and hold harmless the
Trustee and its officers, directors, employees and agents from and against
all costs, expenses, losses, claims, damages and liabilities arising out of
or incurred in connection with the acceptance or performance of the trusts
and duties in this Agreement contained, except to the extent that such
cost, expense, loss, claim, damage or liabilities shall be due to the
willful misfeasance, bad faith or negligence (except for errors in
judgment) of the Trustee.
Indemnification under this Section shall survive the resignation or removal
of the Trustee and the termination of this Agreement and shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Depositor shall have made any indemnity payments to the Trustee pursuant to this
Section and the Trustee thereafter shall collect any of such amounts from
others, the Trustee shall promptly repay such amounts to the Depositor, without
interest.
SECTION 7.04. Merger or Consolidation of, or Assumption of the Obligations
of, Depositor. Any Person (a) into which the Depositor may be merged or
consolidated, (b) which may result from any merger or consolidation to which the
Depositor shall be a party or (c) which may succeed to the properties and assets
of the Depositor substantially as a whole, which Person in any of the foregoing
cases executes an agreement of assumption to perform every obligation of the
Depositor under this Agreement, shall be the successor to the Depositor
hereunder without the execution or filing of any document or any further act by
any of the parties to this Agreement; provided, however, that (i) immediately
after giving effect to such transaction, no representation or warranty made
pursuant to Section 3.01 shall have been breached and no Event of Default, and
no event which, after notice or lapse of time, or both, would become an Event of
Default shall have happened and be continuing, (ii) the Depositor shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel each
stating that such consolidation, merger or succession and such agreement of
assumption comply with this
38
Section and that all conditions precedent, if any, provided for in this
Agreement relating to such transaction have been complied with, (iii) the Rating
Agency Condition shall have been satisfied with respect to such transaction and
(iv) the Depositor shall have delivered to the Trustee an Opinion of Counsel
stating that, in the opinion of such Counsel, either (A) all financing
statements and continuation statements and amendments thereto have been executed
and filed that are necessary fully to preserve and protect the interest of the
Trustee in the Receivables and reciting the details of such filings or (B) no
such action shall be necessary to preserve and protect such interest.
Notwithstanding anything herein to the contrary, the execution of the foregoing
agreement of assumption and compliance with clauses (i), (ii), (iii) and (iv)
above shall be conditions to the consummation of the transactions referred to in
clauses (a), (b) or (c) above.
SECTION 7.05. Limitation on Liability of Depositor and Others. The
Depositor and any director, officer, employee or agent of the Depositor may rely
in good faith on the advice of counsel or on any document of any kind, prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder. The Depositor shall not be under any obligation to appear in,
prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement and that in its opinion may involve it in any
expense or liability.
SECTION 7.06. Depositor May Own Certificates. The Depositor and any
Affiliate thereof may in its individual or any other capacity become the owner
or pledgee of Certificates with the same rights as it would have if it were not
the Depositor or an Affiliate thereof, except as otherwise provided herein.
SECTION 7.07. No Transfer of Excess Amounts. The Depositor hereby covenants
that, except as otherwise provided in this Agreement, it will not transfer,
pledge or assign to any Person any part of its right to receive any amounts in
excess of the Specified Reserve Account Balance pursuant to Section 5.07(c) and
(h) unless it has first delivered to the Trustee and each Rating Agency an
Opinion of Counsel in form and substance satisfactory to the Trustee stating
that such transfer will not (i) adversely affect the status of the Trust as a
grantor trust pursuant to subpart E, part I of subchapter J of the Code or (ii)
cause the Reserve Account to be taxable as a corporation under the Code. The
Depositor shall give written notice to each Rating Agency of any proposed
transfer, pledge or assignment to any Person of all or any part of its right to
receive such excess amounts.
SECTION 7.08. Non-Consolidation. [Covenants to follow.]
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ARTICLE VIII
The Servicer
------------
SECTION 8.01. Representations of Servicer. The Servicer makes the following
representations on which the Trustee shall be deemed to have relied in accepting
the Receivables in trust and executing and authenticating the Certificates. The
representations speak as of the execution and delivery of this Agreement and as
of the Closing Date, in the case of the initial Receivables and as of the
applicable Subsequent Transfer Date, in the case of the Subsequent Receivables,
if any, and shall survive the transfer of the Receivables to the Trustee.
(a) Organization and Good Standing. The Servicer is duly organized and
validly existing as a corporation in good standing under the laws of the state
of its incorporation, with power and authority to own its properties and to
conduct its business as such properties are currently owned and such business is
presently conducted, and had at all relevant times, and has, the corporate
power, authority and legal right to acquire, own, transfer and service the
Receivables and to hold the Receivable Files as custodian.
(b) Due Qualification. The Servicer is duly qualified to do business as a
foreign corporation in good standing, and has obtained all necessary licenses
and approvals in all jurisdictions in which the ownership or lease of property
or the conduct of its business (including the servicing of the Receivables as
required by this Agreement) shall require such qualifications.
(c) Power and Authority. The Servicer has the power and authority to
execute and deliver this Agreement and to carry out the terms of this Agreement;
and the execution, delivery and performance of this Agreement has been duly
authorized by the Servicer by all necessary corporate action.
(d) Binding Obligation. This Agreement constitutes the legal, valid and
binding obligations of the Servicer enforceable in accordance with their
respective terms.
(e) No Violation. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof shall not conflict with,
result in any breach of any of the terms and provisions of, or constitute (with
or without notice or lapse of time) a default under, the articles of
incorporation or bylaws of the Servicer, or any indenture, agreement or other
instrument to which the Servicer is a party or by which it is bound; or result
in the creation or imposition of any Lien upon any of its properties pursuant to
the terms of any such indenture, agreement or other instrument (other than this
Agreement); or violate any law or, to the best of the Servicer's knowledge, any
order, rule or regulation applicable to the Servicer of any court or of any
federal or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Servicer or its properties.
(f) No Proceedings. To the Servicer's best knowledge, there are no
proceedings or investigations pending, or threatened, before any court,
regulatory body, administrative agency
40
or other governmental instrumentality having jurisdiction over the Servicer or
its properties: (i) asserting the invalidity of this Agreement or the
Certificates, (ii) seeking to prevent the issuance of the Certificates or the
consummation of any of the transactions contemplated by this Agreement, (iii)
seeking any determination or ruling that might materially and adversely affect
the performance by the Servicer of its obligations under, or the validity or
enforceability of, this Agreement or the Certificates, or (iv) relating to the
Servicer and which might adversely affect the federal income tax attributes of
the Certificates.
(g) No Insolvent Obligors. As of the related Cutoff Date, no Obligor on a
Receivable shall be shown on the Receivable Files as the subject of a bankruptcy
proceeding.
SECTION 8.02. Indemnities of Servicer. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer under this Agreement.
(a) The Servicer shall defend, indemnify and hold harmless the Trustee,
the Trust, the Certificateholders and the Depositor from and against any and all
costs, expenses, losses, damages, claims, and liabilities, arising out of or
resulting from the use, ownership or operation by the Servicer or any Affiliate
thereof of a Financed Asset.
(b) The Servicer shall indemnify, defend and hold harmless the Trustee,
the Depositor, the Trust and the Certificateholders from and against any and all
costs, expenses, losses, claims, damages, and liabilities to the extent that
such cost, expense, loss, claim, damage, or liability arose out of, or was
imposed upon any such Person through, the negligence, willful misfeasance or bad
faith of the Servicer in the performance of its duties under this Agreement or
by reason of reckless disregard of its obligations and duties under this
Agreement.
For purposes of this Section, in the event of the termination of the
rights and obligations of DFS (or any successor thereto pursuant to Section
8.03) as Servicer pursuant to Section 9.01, or a resignation by such Servicer
pursuant to this Agreement, such Servicer shall be deemed to be the Servicer
pending appointment of a successor Servicer (other than the Trustee) pursuant to
Section 9.02.
Indemnification under this Section shall survive the resignation or removal
of the Trustee or the termination of this Agreement and shall include reasonable
fees and expenses of counsel and expenses of litigation. If the Servicer shall
have made any indemnity payments pursuant to this Section and the recipient
thereafter collects any of such amounts from others, such Person shall promptly
repay such amounts to the Servicer, without interest.
SECTION 8.03. Merger or Consolidation of, or Assumption of the Obligations
of, Servicer. Any Person (a) into which the Servicer may be merged or
consolidated, (b) which may result from any merger or consolidation to which the
Servicer shall be a party, (c) which may succeed to the properties and assets of
the Servicer substantially as a whole or (d) with respect to the Servicer's
obligations hereunder, which is a corporation 50% or more of the voting stock of
41
which is owned, directly or indirectly, by DFS shall be the successor to the
Servicer under this Agreement without further act on the part of any of the
parties to this Agreement; provided, however, that (i) immediately after giving
effect to such transaction, no Event of Default and no event which, after notice
or lapse of time, or both, would become an Event of Default shall have happened
and be continuing, (ii) the Servicer shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption comply with
this Section and that all conditions precedent provided for in this Agreement
relating to such transaction have been complied with, (iii) the Rating Agency
Condition shall have been satisfied with respect to such transaction, (iv) the
Servicer shall have delivered to the Trustee an Opinion of Counsel stating that,
in the opinion of such counsel, either (A) all financing statements and
continuation statements and amendments thereto have been executed and filed that
are necessary fully to preserve and protect the interest of the Trustee in the
Receivables and reciting the details of such filings or (B) no such action shall
be necessary to preserve and protect such and (v) such Person shall have
executed an agreement of assumption to perform every obligation of the Servicer
hereunder. Notwithstanding anything herein to the contrary, compliance with
clauses (i), (ii), (iii), (iv) and (v) above shall be conditions to the
consummation of the transactions referred to in clauses (a), (b), (c) or (d)
above.
SECTION 8.04. Limitation on Liability of Servicer and Others. Neither the
Servicer nor any of the directors, officers, employees or agents of the Servicer
shall be under any liability to the Trust or the Certificateholders, except as
provided under this Agreement, for any action taken or for refraining from the
taking of any action pursuant to this Agreement or for errors in judgment;
provided, however, that this provision shall not protect the Servicer or any
such Person against any liability that would otherwise be imposed by reason of
willful misfeasance, bad faith or negligence in the performance of duties or by
reason of reckless disregard of obligations and duties under this Agreement. The
Servicer and any director, officer, employee or agent of the Servicer may rely
in good faith on any document of any kind prima facie properly executed and
submitted by any Person respecting any matters arising under this Agreement.
Except as provided in this Agreement, the Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action that shall not be
incidental to its duties to service the Receivables in accordance with this
Agreement and that in its opinion may involve it in any expense or liability;
provided, however, that the Servicer may undertake any reasonable action that it
may deem necessary or desirable in respect of this Agreement and the rights and
duties of the parties to this Agreement and the interests of the
Certificateholders under this Agreement.
ARTICLE IX
Default
-------
SECTION 9.01. Events of Default. If any one of the following events
("Events of Default") shall occur and be continuing:
42
(a) Any failure by the Servicer to deliver to the Trustee for deposit to
the Collection Account or the Distribution Account any proceeds or payment
required to be so delivered under the terms of the Certificates and this
Agreement that shall continue unremedied for a period of three Business Days
after written notice of such failure is received by the Servicer from the
Trustee or after discovery of such failure by an officer of the Servicer; or
(b) Failure by the Servicer or the Depositor, as the case may be, duly to
observe or to perform in any material respect any other covenants or agreements
of the Servicer or the Depositor (as the case may be) set forth in the
Certificates or in this Agreement, which failure shall (a) materially and
adversely affect the rights of Certificateholders and (b) continue unremedied
for a period of 60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given (1) to the Servicer or
the Depositor (as the case may be) by the Trustee or (2) to the Servicer or the
Depositor (as the case may be) and to the Trustee by the Holders of Class A
Certificates evidencing not less than 25% of the Class A Certificate Balance; or
(c) The occurrence of an Insolvency Event with respect to the Servicer or
the Depositor;
then, and in each and every case, so long as the Event of Default shall not have
been remedied, either the Trustee or the Holders of Class A Certificates
evidencing not less than 25% of the Class A Certificate Balance, by notice then
given in writing to the Servicer (and to the Trustee if given by
Certificateholders) may terminate all of the rights and obligations (other than
the obligations set forth in Section 8.02) of the Servicer under this Agreement.
On or after the receipt by the Servicer of such written notice, all authority
and power of the Servicer under this Agreement, whether with respect to the
Certificates or the Receivables or otherwise, shall, without further action,
pass to and be vested in the Trustee or such successor Servicer as may be
appointed under Section 9.02; and, without limitation, the Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the predecessor
Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement of the Receivables and related documents,
or otherwise. The predecessor Servicer shall cooperate with the successor
Servicer and the Trustee in effecting the termination of the responsibilities
and rights of the predecessor Servicer under this Agreement, including the
transfer to the successor Servicer for administration by it of all cash amounts
that shall at the time be held by the predecessor Servicer for deposit, or shall
thereafter be received with respect to any Receivable. All reasonable costs and
expenses (including attorneys' fees) incurred in connection with transferring
the Receivable Files to the successor Servicer and amending this Agreement to
reflect such succession as Servicer pursuant to this Section shall be paid by
the predecessor Servicer upon presentation of reasonable documentation of such
costs and expenses. Upon receipt of notice of the occurrence of an Event of
Default, the Trustee shall give notice thereof to the Rating Agencies.
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SECTION 9.02. Appointment of Successor. (a) Upon the Servicer's receipt of
notice of termination pursuant to Section 9.01 or the Servicer's resignation in
accordance with the terms of this Agreement, the predecessor Servicer shall
continue to perform its functions as Servicer under this Agreement, in the case
of termination, only until the date specified in such termination notice or, if
no such date is specified in a notice of termination, until receipt of such
notice and, in the case of resignation, until the later of (x) the date 45 days
from the delivery to the Trustee of written notice of such resignation (or
written confirmation of such notice) in accordance with the terms of this
Agreement and (y) the date upon which the predecessor Servicer shall become
unable to act as Servicer, as specified in the notice of resignation and
accompanying Opinion of Counsel. In the event of the Servicer's termination
hereunder, the Trustee shall appoint a successor Servicer, and the successor
Servicer shall accept its appointment by a written assumption in form acceptable
to the Trustee. In the event that a successor Servicer has not been appointed at
the time when the predecessor Servicer has ceased to act as Servicer in
accordance with this Section, the Trustee without further action shall
automatically be appointed the successor Servicer and shall be entitled to the
Servicing Fee. Notwithstanding the above, the Trustee shall, if it shall be
legally unable so to act, appoint, or petition a court of competent jurisdiction
to appoint, any established institution having a net worth of not less than
$100,000,000 and whose regular business shall include the servicing of (boat)
(recreational vehicle) receivables as the successor to the Servicer under this
Agreement.
(b) Upon appointment, the successor Servicer (including the Trustee acting
as successor Servicer) shall be the successor in all respects to the predecessor
Servicer and shall be subject to all the responsibilities, duties and
liabilities arising thereafter relating thereto placed on the predecessor
Servicer and shall be entitled to the Servicing Fee and all of the rights
granted to the predecessor Servicer by the terms and provisions of this
Agreement.
(c) The Servicer may not resign unless it is prohibited from serving as
such by law.
SECTION 9.03. Repayment of Advances. If the Servicer shall change, the
predecessor Servicer shall be entitled to receive reimbursement for Outstanding
Advances pursuant to Sections 5.03 and 5.04 with respect to all Advances made by
the predecessor Servicer.
SECTION 9.04. Notification to Certificateholders. Upon any termination of,
or appointment of a successor to, the Servicer pursuant to this Article IX, the
Trustee shall give prompt written notice thereof to Certificateholders and to
the Rating Agencies.
SECTION 9.05. Waiver of Past Defaults. The Holders of Class A Certificates
evidencing not less than a majority of the Class A Certificate Balance may, on
behalf of all Holders of Certificates, waive any default by the Servicer in the
performance of its obligations hereunder and its consequences, except a default
in making any required deposits to or payments from the Trust Accounts in
accordance with this Agreement. Upon any such waiver of a past default, such
default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been remedied for every purpose of this Agreement. No such
waiver shall extend to any subsequent or other default or impair any right
consequent thereon.
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ARTICLE X
The Trustee
-----------
SECTION 10.01. Duties of Trustee. (a) If an Event of Default has occurred
and is continuing, the Trustee shall exercise the rights and powers vested in it
by this Agreement 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 if the Trustee shall assume
the duties of the Servicer pursuant to Section 9.02, the Trustee in performing
such duties shall use the degree of skill and attention customarily exercised by
a servicer with respect to [(boat) (recreational vehicles)] receivables that it
services for itself or others.
(b) Except during the continuance of an Event of Default:
(i) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Agreement and no implied
covenants or obligations shall be read into this Agreement 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 this Agreement; provided,
however, that the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Agreement.
(c) The Trustee shall take and maintain custody of the Schedule of
Receivables included as Schedule A to this Agreement and shall retain all
Servicer's Certificates identifying Receivables that become Purchased
Receivables and Liquidated Receivables.
(d) The Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken in good faith in accordance with this Agreement
or at the direction of the Holders of Class A Certificates evidencing not less
than 25% of the Class A Certificate Balance 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 this Agreement;
(e) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:
(i) this paragraph does not limit the effect of clause (d) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made
in good faith by a Trustee Officer unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
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(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to this Agreement.
(f) No provision of this Agreement shall require the Trustee to expend or
risk its own funds or otherwise incur financial liability in the performance of
any of its duties hereunder or in the exercise of any of its rights or powers,
if it shall have reasonable grounds to believe that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
SECTION 10.02. Certain Matters Affecting Trustee. Except as otherwise
provided in Section 10.01:
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper Person. The Trustee need
not investigate any fact or matter stated in any such document.
(b) The Trustee may consult with counsel, and the advice or opinion
of counsel with respect to legal matters or relating to this Agreement or
the Certificates shall be full and complete authorization and protection
from liability in respect of any action taken, suffered or omitted by it
under this Agreement in good faith and in accordance with such advice or
opinion of such counsel.
(c) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement, or to institute, conduct
or defend any litigation under this Agreement at the request, order or
direction of any of the Certificateholders pursuant to the provisions of
this Agreement, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that may be incurred therein or thereby.
(d) The Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith which it believes to be authorized or within
its rights or powers conferred upon it by this Agreement; provided, that
such conduct does not constitute willful misconduct, bad faith or
negligence on the part of the Trustee.
(e) The Trustee may execute any of the trusts or powers or perform
any duties hereunder either directly or by or through agents or attorneys
or a custodian, and the Trustee shall not be responsible for any misconduct
or negligence of any such agent, attorney or custodian appointed with due
care by it hereunder.
SECTION 10.03. Trustee Not Liable for Certificates or Receivables. The
recitals contained herein and in the Certificates (other than the certificate of
authentication on the Certificates) shall be taken as the statements of the
Depositor or the Servicer, as the case may be, and the Trustee assumes no
responsibility for the correctness thereof. The Trustee shall make no
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representations as to the validity or sufficiency of this Agreement or of the
Certificates (other than the certificate of authentication on the Certificates),
or of any Receivable or related document. The Trustee shall at no time have any
responsibility or liability for or with respect to the legality, validity and
enforceability of any Receivable, or the perfection and priority of any security
interest created by any Receivable in any Financed Asset or the maintenance of
any such perfection and priority, or for or with respect to the efficacy of the
Trust or its ability to generate the payments to be distributed to
Certificateholders under this Agreement, including, without limitation: the
existence, condition and ownership of any Financed Asset; the existence and
enforceability of any insurance thereon; the existence and contents of any
Receivable or any computer or other record thereof; the validity of the
assignment of any Receivable to the Trust or of any intervening assignment; the
completeness of any Receivable; the performance or enforcement of any
Receivable; the compliance by the Depositor or the Servicer with any warranty or
representation made under this Agreement or in any related document and the
accuracy of any such warranty or representation or any action of the Servicer
taken in the name of the Trustee.
SECTION 10.04. Trustee May Own Certificates. The Trustee in its individual
or any other capacity may become the owner or pledgee of Certificates and may
deal with the Depositor and the Servicer in banking transactions with the same
rights as it would have if it were not Trustee.
SECTION 10.05. Trustee's Fees and Expenses. The Servicer shall pay to the
Trustee, and the Trustee shall be entitled to receive, reasonable compensation
as shall have been separately agreed upon before the date of this Agreement
between the Depositor and the Trustee (which shall not be limited by any
provision of law regarding the compensation of a trustee of an express trust)
for all services rendered by it in the execution of the trusts created by this
Agreement and in the exercise and performance of any of the Trustee's powers and
duties under this Agreement. The Trustee shall be entitled to be reimbursed by
the Depositor for its reasonable expenses under this Agreement, including the
reasonable compensation, expenses and disbursements of such agents,
representatives, experts and counsel as the Trustee may employ in connection
with the exercise and performance of its rights and duties under this Agreement.
SECTION 10.06. Eligibility Requirements for Trustee. The Trustee shall at
all times be a corporation having an office in the same state as the location of
the Corporate Trust Office; organized and doing business under the laws of such
state or the United States of America; authorized under such laws to exercise
corporate trust powers; having a combined capital and surplus of at least
$50,000,000 and subject to supervision or examination by federal or state
authorities; and having (or having a parent that has) a rating of at least Baa3
by Moody's and [___] by Standard & Poor's. If such corporation shall publish
reports of condition at least annually pursuant to law or to the requirements of
the aforesaid supervising or examining authority, then for the purpose of this
Section, the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Trustee shall cease to be
eligible in
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accordance with the provisions of this Section, the Trustee shall resign
immediately in the manner and with the effect specified in Section 10.07.
SECTION 10.07. Resignation or Removal of Trustee. The Trustee may at any
time resign and be discharged from the trusts hereby created by giving written
notice thereof to the Servicer. Upon receiving such notice of resignation, the
Servicer shall promptly appoint a successor Trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor Trustee. If no successor Trustee shall
have been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 10.06 and shall fail to resign after written request
therefor by the Servicer, or if at any time the Trustee shall be legally unable
to act, or shall be adjudged bankrupt or insolvent, or a receiver of the Trustee
or of its property shall be appointed, or any public officer shall take charge
or control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then the Servicer may remove the
Trustee. If the Servicer shall remove the Trustee under the authority of the
immediately preceding sentence, the Servicer shall promptly appoint a successor
Trustee by written instrument, in duplicate, one copy of which instrument shall
be delivered to the outgoing Trustee so removed and one copy to the successor
Trustee, and shall pay all fees owed to the outgoing Trustee.
Any resignation or removal of the Trustee and appointment of a successor
Trustee pursuant to any of the provisions of this Section shall not become
effective until acceptance of appointment by the successor Trustee pursuant to
Section 10.08 and payment of all fees and expenses owed to the outgoing Trustee.
The Servicer shall provide notice of such resignation or removal of the Trustee
to each of the Rating Agencies.
SECTION 10.08. Successor Trustee. Any successor Trustee appointed pursuant
to Section 10.07 shall execute, acknowledge and deliver to the Servicer and to
its predecessor Trustee an instrument accepting such appointment under this
Agreement, and thereupon the resignation or removal of the predecessor Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor under this Agreement, with like effect as if
originally named as Trustee. The predecessor Trustee shall upon payment of its
fees and expenses deliver to the successor Trustee all documents and statements
and monies held by it under this Agreement; and the Servicer and the predecessor
Trustee shall execute and deliver such instruments and do such other things as
may reasonably be required for fully and certainly vesting and confirming in the
successor Trustee all such rights, powers, duties and obligations.
No successor Trustee shall accept appointment as provided in this Section
unless at the time of such acceptance such successor Trustee shall be eligible
pursuant to Section 10.06.
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Upon acceptance of appointment by a successor Trustee pursuant to this
Section, the Servicer shall mail notice thereof to all Certificateholders and to
the Rating Agencies. If the Servicer shall fail to mail such notice within 10
days after acceptance of appointment by the successor Trustee, the successor
Trustee shall cause such notice to be mailed at the expense of the Servicer.
SECTION 10.09. Merger or Consolidation of Trustee. Any corporation into
which the Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be eligible pursuant to Section 10.06, without the execution
or filing of any instrument or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding. The Trustee shall mail
notice of any such merger or consolidation to the Rating Agencies
SECTION 10.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust or any Financed Asset may at the time be located, the Servicer and
the Trustee acting jointly shall have the power and shall execute and deliver
all instruments to appoint one or more Persons approved by the Trustee to act as
co-trustee, jointly with the Trustee, or separate trustee or separate trustees,
of all or any part of the Trust, and to vest in such Person, in such capacity
and for the benefit of the Certificateholders, such title to the Trust or any
part thereof and, subject to the other provisions of this Section, such powers,
duties, obligations, rights, and trusts as the Servicer and the Trustee may
consider necessary or desirable. If the Servicer shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, the
Trustee alone shall have the power to make such appointment. No co-trustee or
separate trustee under this Agreement shall be required to meet the terms of
eligibility as a successor Trustee pursuant to Section 10.06 and no notice of
the appointment of any co-trustee or separate trustee shall be required pursuant
to Section 10.08.
Each separate trustee and co-trustee shall, to the extent permitted by law,
be appointed and act subject to the following provisions and conditions:
(i) All rights, powers, duties and obligations conferred or imposed
upon any such separate trustee or co- trustee shall be conferred 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 Trust or any portion thereof in any such
49
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(ii) No trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement;
and
(iii) The Servicer and the Trustee acting jointly may at any time
accept the resignation of or remove any separate trustee or co-trustee.
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 Agreement and the conditions
of this Article. 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 Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Each
such instrument shall be filed with the Trustee and a copy thereof given to the
Servicer.
Any separate trustee or co-trustee may at any time appoint 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 of this Agreement on
its behalf and in its name. If any separate trustee or co-trustee shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor co-trustee or separate trustee.
SECTION 10.11. Representations and Warranties of Trustee. The Trustee shall
make the following representations and warranties on which the Depositor and
Certificateholders shall be deemed to rely:
(i) The Trustee is a banking corporation duly organized, validly
existing and in good standing under the laws of its place of incorporation.
(ii) The Trustee has full corporate power, authority and legal right
to execute and deliver, and to perform its obligations under, this
Agreement, and shall have taken all necessary action to authorize the
execution and delivery of, and the performance of its obligations under,
this Agreement.
(iii) This Agreement shall have been duly executed and delivered by
the Trustee.
SECTION 10.12. No Bankruptcy Petition. The Trustee, by entering into this
Agreement, and each Certificateholder, by accepting a Certificate, hereby
covenant and agree
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that they will not at any time institute against, or join any other Person in
instituting against, the Depositor or the Trust any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other similar proceedings
under any federal or state bankruptcy or similar law in connection with the
Certificates or this Agreement.
SECTION 10.13. Trustee's Certificate. On or as soon as practicable after
each Record Date as of which Receivables shall be assigned to the Depositor or
the Servicer pursuant to Section 10.14, the Trustee shall execute a certificate
(in form and substance reasonably satisfactory to the Depositor or the Servicer,
as the case may be), based on the information contained in the Servicer's
Certificate for the related Collection Period, amounts deposited to the
Collection Account and notices received pursuant to this Agreement, identifying
the Receivables purchased by the Depositor pursuant to Section 3.02 or purchased
by the Servicer pursuant to Section 4.07 or Section 11.02 during such Collection
Period, and shall deliver such certificate, accompanied by a copy of the
Servicer's Certificate for such Collection Period, to the Depositor or the
Servicer, as applicable. Such certificate submitted with respect to such
Distribution Date shall operate, as of such Distribution Date, as an assignment,
without recourse, representation or warranty, to the Depositor or the Servicer,
as applicable, of all the Trustee's right, title and interest in and to any such
purchased Receivable and to the other property conveyed to the Trust with
respect thereto, and all security and documents relating thereto, such
assignment being an assignment outright and not for security.
SECTION 10.14. Trustee's Assignment of Purchased Receivables. With respect
to all Receivables purchased by the Depositor pursuant to Section 3.02 or
purchased by the Servicer pursuant to Section 4.07 or Section 11.02, the Trustee
shall by a certificate (in form and substance reasonably satisfactory to the
Depositor or the Servicer, as the case may be) assign, without recourse,
representation or warranty, to the Depositor or the Servicer, as applicable, all
the Trustee's right, title and interest in and to any such Receivable and the
other property conveyed to the Trust with respect thereto, and all security and
documents relating thereto, such assignment being an assignment outright and not
for security.
ARTICLE XI
Termination
-----------
SECTION 11.01. Termination of the Trust. (a) The respective obligations and
responsibilities of the Depositor, the Servicer and the Trustee created hereby
and the Trust created by this Agreement shall terminate (i) upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to this
Agreement and the disposition of all property held as part of the Trust and (ii)
at the time provided in Section 11.02; provided, however, that in no event shall
the trust created by this Agreement continue beyond the expiration of 21 years
from the death of the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the
late ambassador of the United States to the Court of St. James's, living on the
date of this Agreement. The Servicer shall promptly notify the Trustee of any
prospective termination pursuant to this Section.
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(b) Except as provided in Section 11.01(a), neither the Depositor nor any
Certificateholder or Certificate Owner shall be entitled to revoke or terminate
the Trust.
(c) Notice of any termination of the Trust, specifying the Distribution
Date upon which Certificateholders shall surrender their Certificates to the
Trustee for payment of the final distribution and cancellation of the
Certificates, shall be given by the Trustee by letter to Certificateholders
mailed not earlier than the 15th day and not later than the 25th day of the
month next preceding the specified Distribution Date stating (A) the
Distribution Date upon which final payment of the Certificates shall be made
upon presentation and surrender of the Certificates at the office of the Trustee
therein designated, (B) the amount of such final payment and (C) that the Record
Date otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Certificates at the
office of the Trustee therein specified. The Trustee shall give such notice to
the Certificate Registrar (if other than the Trustee) at the time such notice is
given to Certificateholders. Upon presentation and surrender of the
Certificates, the Trustee shall cause to be distributed to Certificateholders
amounts distributable on such Distribution Date pursuant to Section 5.06.
In the event that all of the Certificateholders shall not surrender their
Certificates for cancellation within six months after the date specified in the
above mentioned written notice, the Trustee shall give a second written notice
to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after such second notice all of the Certificates shall not have been
surrendered for cancellation, the Trustee may take appropriate steps, or may
appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds and other assets that shall remain
subject to this Agreement. Any funds remaining in the Trust after exhaustion of
such remedies shall be distributed by the Trustee to the Depositor.
SECTION 11.02. Optional Purchase of All Receivables. On the last day of any
Collection Period as of which the Pool Balance shall be less than 10% of the
Original Pool Balance, the Servicer shall have the option to purchase the corpus
of the Trust. To exercise such option, the Servicer shall deposit an amount into
the Collection Account pursuant to Section 5.05 equal to the aggregate Purchase
Amount for the Receivables (including defaulted Receivables), plus the appraised
value of any other property held by the Trust, such value to be determined by an
appraiser mutually agreed upon by the Servicer and the Trustee; provided,
however that such amount so deposited must equal at least the outstanding
Certificate Balance plus accrued and unpaid interest thereon. The Servicer
thereafter shall succeed to all interests in and to the Trust.
ARTICLE XII
Miscellaneous Provisions
------------------------
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SECTION 12.01. Amendment. This Agreement may be amended by the Depositor,
the Servicer and the Trustee, without the consent of the Certificateholders, to
cure any ambiguity, to correct or supplement any provisions in this Agreement or
for the purpose of adding any provisions to or changing in any manner or
eliminating any provision in this Agreement or of modifying in any manner the
rights of the Certificateholders; provided, however, that such action shall not,
as evidenced by an Opinion of Counsel delivered to the Trustee, adversely affect
in any material respect the interests of any Certificateholder.
This Agreement may also be amended from time to time by the Depositor, the
Servicer and the Trustee with the consent of the Holders of Class A Certificates
and Class B Certificates (which consent shall be conclusive and binding on such
Holders and on all future Holders of such Certificates and of any Certificates
issued upon the transfer therefor or in exchange thereof or in lieu thereof,
whether or not notation of such consent is made upon the Certificates), each
voting as a class, evidencing not less than a majority of the Class A
Certificate Balance and Class B Certificate Balance, respectively, for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Agreement, or of modifying in any manner the rights of
the Certificateholders; provided, however, that no such amendment shall (a)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Receivables or distributions that shall be
required to be made on any Certificate or (b) reduce the aforesaid percentage of
the Class A Certificate Balance and Class B Certificate Balance required to
consent to any such amendment without the consent of the Holders of all
Certificates then outstanding.
Promptly after the execution of any such amendment or consent, the Trustee
shall furnish written notification of the substance of such amendment or consent
to each Certificateholder and the Rating Agencies.
It shall not be necessary for the consent of Certificateholders pursuant to
this Section to approve the particular form of any proposed amendment or
consent, but it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents (and any other consents of
Certificateholders provided for in this Agreement) and of evidencing the
authorization of any action by Certificateholders shall be subject to such
reasonable requirements as the Trustee may prescribe.
Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel stating that
the execution of such amendment is authorized or permitted by this Agreement and
the Opinion of Counsel referred to in Section (12.02(i)(1)). The Trustee may,
but shall not be obligated to, enter into any such amendment that affects the
Trustee's own rights, duties or immunities under this Agreement or otherwise.
SECTION 12.02. Protection of Title to Trust. (a) The Depositor shall
execute and file such financing statements and cause to be executed and filed
such continuation statements, all in such manner and in such places as may be
required by law fully to preserve, maintain and protect
53
the interest of the Certificateholders and the Trustee in the Receivables and in
the proceeds thereof. The Depositor shall deliver (or cause to be delivered) to
the Trustee file-stamped copies of, or filing receipts for, any document filed
as provided above, as soon as available following such filing.
(b) Neither the Depositor nor the Servicer shall change its name, identity
or corporate structure in any manner that would, could or might make any
financing statement or continuation statement filed in accordance with paragraph
(a) above seriously misleading within the meaning of Section 9-402(7) of the
UCC, unless it shall have given the Trustee at least five days' prior written
notice thereof and shall have promptly filed appropriate amendments to all
previously filed financing statements or continuation statements.
(c) Each of the Depositor and the Servicer shall have an obligation to
give the Trustee at least 60 days' prior written notice of any relocation of its
principal executive office if, as a result of such relocation, the applicable
provisions of the UCC would require the filing of any amendment of any
previously filed financing or continuation statement or of any new financing
statement, and shall promptly file any such amendment or new financing
statement. The Servicer shall at all times maintain its principal executive
office and each office from which it shall service Receivables within the United
States of America.
(d) The Servicer shall maintain accounts and records as to each Receivable
accurately and in sufficient detail to permit (i) the reader thereof to know at
any time the status of such Receivable, including payments and recoveries made
and payments owing (and the nature of each) and (ii) reconciliation between
payments or recoveries on (or with respect to) each Receivable and the amounts
from time to time deposited in the Distribution Account in respect of such
Receivable.
(e) The Servicer shall maintain its computer systems so that, from and
after the time of transfer under this Agreement of the Receivables to the
Trustee, the Servicer's master computer records (including any back-up archives)
that refer to a Receivable shall indicate clearly the interest of the Trust, in
such Receivable, and that such Receivable is owned by the Trustee. Indication of
the Trustee's ownership of a Receivable shall be deleted from or modified on the
Servicer's computer systems when, and only when, such Receivable shall have been
paid in full or shall have become a Purchased Receivable.
(f) If at any time the Depositor or the Servicer shall propose to sell,
grant a security interest in, or otherwise transfer any interest in (boat)
(recreational vehicle) receivables to, any prospective purchaser, lender or
other transferee, the Servicer shall give to such prospective purchaser, lender
or other transferee computer tapes, records or print-outs (including any
restored from back-up archives) that, if they shall refer in any manner
whatsoever to any Receivable, shall indicate clearly that such Receivable has
been transferred to and is owned by the Trustee.
54
(g) The Servicer shall permit the Trustee and its agents at any time
during normal business hours to inspect, audit and make copies of and abstracts
from the Servicer's records regarding any Receivable.
(h) Upon request, the Servicer shall furnish to the Trustee, within five
Business Days, a list of all Receivables (by contract number and name of
Obligor) then held as part of the Trust, together with a reconciliation of such
list to the Schedule of Receivables attached as Schedule A hereto and to each of
the Servicer's Certificates furnished before such request indicating removal of
Receivables from the Trust.
SECTION 12.03. Separate Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 12.04. Limitation on Rights of Certificateholders. (a) The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust,
nor otherwise affect the rights, obligations and liabilities of the parties to
this Agreement or any of them
(b) No Certificateholder shall have any right to vote (except as provided
in Section 12.01 or 9.05) or in any manner otherwise control the operation and
management of the Trust or the obligations of the parties to this Agreement; nor
shall any provision in this Agreement or contained in the Certificates be
construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third person by reason of any action taken pursuant to any
provision of this Agreement.
(c) No Certificateholder shall have any right to institute any suit,
action or proceeding in equity or at law upon or under or with respect to this
Agreement, unless: (i) such Holder previously shall have given to the Trustee
written notice of a continuing Event of Default; (ii) the Holders of
Certificates evidencing not less than 25% of the Certificate Balance shall have
made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee under this Agreement and shall have
offered to the Trustee such reasonable indemnity as it may require against the
costs, expenses and liabilities to be incurred therein or thereby; (iii) the
Trustee, for 60 days after its receipt of such notice, request and offer of
indemnity shall have neglected or refused to institute any such action, suit or
proceeding; and (iv) during such 60-day period no request or waiver inconsistent
with such written request shall have been given to the Trustee by Holders
representing a majority of the Certificate Balance. It is understood and
intended that no one or more Holders of Certificates shall have any right in any
manner whatever by virtue of, or by availing of, any provisions of this
Agreement to affect, disturb or prejudice the rights of any other Holders of
Certificates, or to obtain or seek to obtain
55
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner provided in this Agreement.
SECTION 12.05. Governing Law. This Agreement SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES UNDER This Agreement SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 12.06. Notices. All demands, notices and communications upon or to
the Depositor, the Servicer, the Trustee or the Rating Agencies under this
Agreement shall be in writing, personally delivered or mailed by certified mail,
return receipt requested, and shall be deemed to have been duly given upon
receipt (a) in the case of the Depositor, Deutsche Recreational Asset Funding
Corporation, 000 Xxxxxxxxx Xxxxxx Xxxxx, Xx. Xxxxx, Xxxxxxxx, 00000, Attention:
President, ((314) - ); (b) in the case of the Servicer, to Deutsche Financial
Services Corporation, 000 Xxxxxxxxx Xxxxxx Xxxxx, Xx. Xxxxx, Xxxxxxxx, 00000,
Attention: _______________ ((314 ) - ); (c) in the case of the Trustee, at the
Corporate Trust Office; (d) in the case of Moody's, to Xxxxx'x Investors
Service, Inc., ABS Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000; and (e) in the case of Standard & Poor's, to Standard & Poor's Ratings
Services, 00 Xxxxxxxx -- 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Asset
Backed Surveillance Department. Any notice required or permitted to be mailed to
a Certificateholder shall be given by first class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder shall
receive such notice.
SECTION 12.07. Severability of Provisions. Any provision of this Agreement
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this
Agreement, and any such prohibition or unenforceability in any jurisdiction
shall not invalidate or render unenforceable such provision in any other
jurisdiction.
SECTION 12.08. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 7.04 and 8.03 and as provided
in the provisions of this Agreement concerning the resignation of the Servicer,
this Agreement may not be assigned by the Depositor or the Servicer without the
prior written consent of the Trustee and the Holders of Certificates evidencing
not less than 66% of the Certificate Balance.
SECTION 12.09. Certificates Nonassessable and Fully Paid.
Certificateholders shall not be personally liable for obligations of the Trust.
The interests represented by the Certificates shall be nonassessable for any
losses or expenses of the Trust or for any reason whatsoever.
SECTION 12.10. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Depositor, the Servicer, the Trustee
and the Certificateholders, and
56
nothing in this Agreement, whether express or implied, shall be construed to
give any other Person any legal or equitable right, remedy or claim in respect
of the Trust or under or in respect of this Agreement or any covenants,
conditions or provisions contained herein.
SECTION 12.11. Headings. The headings of the various Articles and Sections
herein are for convenience of reference only and shall not define or limit any
of the terms or provisions hereof.
SECTION 12.12. Nonpetition Covenants. (a) Notwithstanding any prior
termination of this Agreement, the Servicer and the Depositor shall not, prior
to the date that is one year and one day after the termination of this Agreement
with respect to the Trust, acquiesce to, petition or otherwise invoke or cause
the Trust to invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against the Trust under any federal
or state bankruptcy, insolvency or similar law, or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator, or other similar
official of the Trust or any substantial part of its property, or ordering the
winding up or liquidation of the affairs of the Trust.
(b) Notwithstanding any prior termination of this Agreement, the Servicer
shall not, prior to the date that is one year and one day after the termination
of this Agreement with respect to the Depositor, acquiesce to, petition or
otherwise invoke or cause the Depositor to invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Depositor under any federal or state bankruptcy, insolvency or similar law,
appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator,
or other similar official of the Depositor or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
Depositor.
* * *
57
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers as of the day and year first above
written.
(_________________) TRUST 199_-_
By:__________________________________
Name:________________________________
Title:_______________________________
DEUTSCHE RECREATIONAL ASSET
FUNDING CORPORATION,
as Depositor
By:__________________________________
Name:________________________________
Title:_______________________________
DEUTSCHE FINANCIAL SERVICES
CORPORATION, as Servicer
By:__________________________________
Name:________________________________
Title:_______________________________
58
EXHIBIT A
FORM OF CLASS A CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CLASS A CERTIFICATE
WILL BE MADE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING
PRINCIPAL AMOUNT OF THIS CLASS B CERTIFICATE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.
NUMBER $
R- CUSIP NO.
(______________) TRUST 199_-_
____% ASSET BACKED CERTIFICATE, CLASS A evidencing a fractional undivided
interest in the Trust, as defined below, the property of which includes a pool
of (boat) (recreational vehicle) retail installment sale contracts or
installment loans secured by new and used (boats, boat motors and accompanying
trailers) (recreational vehicles).
(This Class A Certificate does not represent an interest in or obligation
of Deutsche Recreational Asset Funding Corporation, except to the extent
described below.)
THIS CERTIFIES THAT _______________________________________ is the
registered owner of ______________________________________ DOLLARS
nonassessable, fully-paid, fractional undivided interest in
(___________________) Trust 199_-_ (the "Trust") formed pursuant to the Pooling
and Servicing Agreement (the "Agreement") dated as of _________________, among
Deutsche Recreational Asset Funding Corporation, a Nevada corporation, as
depositor (the "Depositor"), Deutsche Financial Services Corporation, as
servicer (the "Servicer") and ______________________, a
________________________________ banking association, as trustee (the
"Trustee"), a summary of certain of the pertinent provisions
A-1
of which is set forth below. To the extent not otherwise defined herein, the
capitalized terms used herein have the meanings assigned to them in the
Agreement.
This Certificate is one of a duly authorized series of Certificates,
designated as the _____% Asset Backed Certificates, Class A (herein called the
"Class A Certificates"), all issued under the Agreement, to which Agreement
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Depositor, the Servicer, the Trustee and Holders
of the Certificates. The Class A Certificates are subject to all terms of the
Agreement. In the event of any conflict or inconsistency between this
Certificate and the Agreements, the Agreement shall control.
The property of the Trust includes a pool of retail installment sale
contracts and installment loans for new and used (boats, boat motors and
accompanying trailers) (recreational vehicles) (the "Receivables"), all monies
received on or after the related Cutoff Date security interests in the assets
financed thereby, certain bank accounts and the proceeds thereof, proceeds from
claims on certain insurance policies and all proceeds of the foregoing.
It is the intent of the Depositor, the Servicer, the Trustee and the
Certificateholders that, for purposes of federal income, state and local income
and single business tax and any other income taxes, the Trust will be treated as
a grantor trust and the Certificates will be treated as interests in a grantor
trust. The Depositor, the Servicer, the Trustee and the Certificateholders, by
acceptance of a Certificate or of a beneficial interest in a Certificate, as the
case may be, agree to treat, and to take no action inconsistent with the
treatment of, the Certificates for such tax purposes as interests in a grantor
trust.
Reference is hereby made to the further provisions of this Class A
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been executed by
an authorized officer of the Trustee, by manual signature, this Class A
Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
A-2
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this Class A Certificate to be duly executed.
Date: (_________________) TRUST 199 __-__
By:__________________________________________,
not its individual capacity but solely as
Trustee
By:___________________________________________
Authorized Signatory
A-3
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the within-mentioned
Agreement.
Date: ____________________________________
as Trustee
By__________________________________
Authorized Signatory
A-4
(REVERSE OF CLASS A CERTIFICATE)
The Class A Certificates do not represent an obligation of, or an interest
in, the Depositor, the Servicer, the Trustee or any affiliates of any of them,
and no recourse may be had against such parties or their assets except as
expressly set forth or contemplated herein or in the Agreement. In addition,
this Class A Certificate is not guaranteed by any governmental agency or
instrumentality and is limited in right of payment to certain collections and
recoveries with respect to the Receivables (and certain other amounts), all as
more specifically set forth herein and in the Agreement. A copy of the Agreement
may be examined by any Certificateholder upon written request during normal
business hours at the principal office of the Depositor and at such other
places, if any, designated by the Depositor.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer and the Trustee and the rights of the Certificateholders
at any time by the Depositor, the Servicer and the Trustee with the consent of
the Holders of Certificates evidencing not less than a majority of the
Certificate Balance. Any such consent by the Holder of this Class A Certificate
shall be conclusive and binding on such Holder and on all future Holders of this
Certificate and of any Class A Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof, whether or not notation of such consent is
made upon this Class A Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Class A Certificate is registerable in the
Certificate Register upon surrender of this Class A Certificate for registration
of transfer at the offices or agencies of the Certificate Registrar maintained
by the Trustee in the Borough of Manhattan, The City of New York, accompanied by
a written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Class A
Certificates of authorized denominations evidencing the same aggregate interest
in the Trust will be issued to the designated transferee. The initial
Certificate Registrar appointed under the Agreement is
________________________________.
The Trustee, the Certificate Registrar and any agent of the Trustee or the
Certificate Registrar may treat the Person in whose name this Class A
Certificate is registered as the owner hereof for all purposes, and none of the
Trustee, the Certificate Registrar or any such agent shall be affected by any
notice to the contrary.
A-5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
(Please print or type name and address, including postal zip code, of assignee)
________________________________________________________________________________
the within Class A Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing _________________________ to transfer said Class A
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated: _________________________________________
Signature Guaranteed:
_____________________________________/*//
A-6
EXHIBIT B
FORM OF CLASS B CERTIFICATE
THIS CLASS B CERTIFICATE IS SUBORDINATE TO THE PRIOR RIGHTS OF THE CLASS A
CERTIFICATES IN ACCORDANCE WITH THE POOLING AND SERVICING AGREEMENT REFERRED TO
BELOW.
THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO ANY PERSON THAT
IS AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS
OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1074, AS AMENDED ("ERISA"), OR
SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1086, AS AMENDED (THE "CODE"), OR
ANY GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW THAT IS, TO A MATERIAL EXTENT, SIMILAR TO THE
FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY, A "PLAN") OR ANY PERSON
INVESTING THE ASSETS OF A PLAN EXCEPT AS PROVIDED IN THE AGREEMENT REFERRED TO
HEREIN.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS CLASS B
CERTIFICATE WILL BE MADE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS CLASS B CERTIFICATE AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
NUMBER $
R- CUSIP NO.
(______________) TRUST 199_-_
____% ASSET BACKED CERTIFICATE, CLASS B evidencing a fractional
undivided interest in the Trust, as defined below, the property of which
includes a pool of (boat) (recreational vehicle) retail installment sale
contracts secured by new and used (boats, boat motors and accompanying trailers)
(recreational vehicles).
(This Class B Certificate does not represent an interest in or
obligation of Deutsche Recreational Asset Funding Corporation, except to the
extent described below.)
THIS CERTIFIES THAT ____________________________________ is the
registered owner of ____________________________ DOLLARS nonassessable, fully-
paid, fractional undivided interest in (___________) Trust 199_-_ (the "Trust")
formed pursuant to a Pooling and Servicing Agreement (the "Agreement") dated as
of _________________, among Deutsche Recreational Asset Funding Corporation, a
Nevada corporation, as depositor (the "Depositor"), Deutsche Financial Services
Corporation, as servicer (the "Servicer") and _____________, a
B-1
_______________ banking association, as trustee (the "Trustee"), a summary of
certain of the pertinent provisions of which is set forth below. To the extent
not otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Agreement.
This Certificate is one of a duly authorized series of Certificates,
designated as the ____% Asset Backed Certificates, Class B (herein called the
"Class B Certificates") all, issued under the Agreement, to which Agreement
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Depositor, the Servicer, the Trustee and holders
of the Certificates. The Class B Certificates are subject to all terms of the
Agreement. In the event of any conflict or inconsistency between this
Certificate and the Agreement, the Agreement shall control.
The property of the Trust includes a pool of (boat) (recreational
vehicle) retail installment sale contracts for new and used (automobiles and
light duty trucks) (boats, boat motors and accompanying trailers) (the
"Receivables"), all monies received on or after __________________, security
interests in the vehicles financed thereby, certain bank accounts and the
proceeds thereof, proceeds from claims on certain insurance policies and all
proceeds of the foregoing.
It is the intent of the Depositor, the Servicer, the Trustee and the
Certificateholders that, for purposes of federal income, state and local income
and single business tax and any other income taxes, the Trust will be treated as
a grantor trust and the Certificates will be treated as interests in a grantor
trust. The Depositor, the Servicer, the Trustee and the Certificateholders, by
acceptance of a Certificate or of a beneficial interest in a Certificate, as the
case may be, agree to treat, and to take no action inconsistent with the
treatment of, the Certificates for such tax purposes as interests in a grantor
trust.
Reference is hereby made to the further provisions of this Class B
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Trustee, by manual signature, this
Class B Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
THIS CLASS B CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
B-2
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this Class B Certificate to be duly executed.
(__________________) TRUST 199_-_
By: ____________________________________________ ,
not in its individual capacity but solely as
Trustee
By: ______________________________________________
Authorized Signatory
B-3
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the within-mentioned
Agreement.
Date: __________________________________________________
as Trustee
By _______________________________________________
Authorized Signatory
B-4
(REVERSE OF CLASS B CERTIFICATE)
The Class B Certificates do not represent an obligation of, or an interest
in, the Depositor, the Servicer, the Trustee or any affiliates of any of them,
and no recourse may be had against such parties or their assets except as
expressly set forth or contemplated herein or in the Agreement. In addition,
this Class B Certificate is not guaranteed by any governmental agency or
instrumentality and is limited in right of payment to certain collections and
recoveries with respect to the Receivables (and certain other amounts), all as
more specifically set forth herein and in the Agreement. A copy of the Agreement
may be examined by any Certificateholder upon written request during normal
business hours at the principal office of the Depositor and at such other
places, if any, designated by the Depositor.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer and the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates evidencing not less than a
majority of the Certificate Balance. Any such consent by the Holder of this
Class B Certificate shall be conclusive and binding on such Holder and on all
future Holders of this Class B Certificate and of any Class B Certificate issued
upon the transfer hereof or in exchange herefor or in lieu hereof, whether or
not notation of such consent is made upon this Class B Certificate. The
Agreement also permits the amendment thereof, in certain limited circumstances,
without the consent of the Holders of any of the Certificates.
The Trustee, the Certificate Registrar and any agent of the Trustee or the
Certificate Registrar may treat the Person in whose name this Class B
Certificate is registered as the owner hereof for all purposes, and none of the
Trustee, the Certificate Registrar or any such agent shall be affected by any
notice to the contrary.
B-5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
(Please print or type name and address, including postal zip code, of assignee)
________________________________________________________________________________
the within Class A Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing _________________________ to transfer said Class A
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated:
_______________________________________
Signature Guaranteed:
_______________________________________/*//
B-6
EXHIBIT C
FORM OF DEPOSITORY AGREEMENT
Letter of Representations
(To be Completed by Issuer and Trustee)
_____________________________
(Name of Issuer)
_____________________________
(Name of Trustee)
_____________________________
(Date)
Attention: General Counsel's Office
THE DEPOSITORY TRUST COMPANY
00 Xxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Re: ___________________________________
___________________________________
___________________________________
(Issue Description)
Ladies and Gentlemen:
This letter sets forth our understanding with respect to certain matters
relating to the above-referenced issue (the "Securities"). Trustee will act as
trustee with respect to the Securities pursuant to a pooling and servicing
agreement dated as of __, 199_ (the "Document"). ___________________________
(the "Underwriter") is distributing the Securities through The Depository Trust
Company ("DTC").
To induce DTC to accept the Securities as eligible for deposit at DTC, and
to act in accordance with its Rules with respect to the Securities, Issuer and
Trustee make the following representations to DTC:
I. Prior to closing on the Securities on ________________, 199_, there
shall be deposited with DTC one Security certificate registered in the name of
DTC's nominee, Cede & Co., for each stated maturity of the Securities in the
face amounts set forth on Schedule A hereto, the total of which represents 100%
of the principal amount of such Securities. If, however, the aggregate principal
amount of any maturity exceeds $150 million, one certificate will be issued
C-1
with respect to each $150 million of principal amount and an additional
certificate will be issued with respect to any remaining principal amount. Each
$150 million certificate shall bear the following legend:
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
II. In the event of any solicitation of consents from or voting by holders
of the Securities, Issuer or Trustee shall establish a record date for such
purposes (with no provision for revocation of consents or votes by subsequent
holders) and shall, to the extent possible, send notice of such record date to
DTC not less than 15 calendar days in advance of such record date. Notices to
DTC pursuant to this Paragraph by telecopy shall be sent to DTC's Reorganization
Department at (000) 000-0000 or (000) 000-0000, and receipt of such notices
shall be confirmed by telephoning (000) 000-0000. Notices to DTC pursuant to
this Paragraph by mail or by any other means shall be sent to DTC's
Reorganization Department as indicated in Paragraph 4.
III. In the event of a full or partial redemption, Issuer or Trustee shall
send a notice to DTC specifying: (a) the amount of the redemption or refunding;
(b) in the case of a refunding, the maturity date(s) established under the
refunding; and (c) the date such notice is to be mailed to Security holders or
published (the "Publication Date"). Such notice shall be sent to DTC by a secure
means (e.g., legible telecopy, registered or certified mail, overnight delivery)
in a timely manner designed to assure that such notice is in DTC's possession no
later than the close of business on the business day before or, if possible, two
business days before the Publication Date. Issuer or Trustee shall forward such
notice either in a separate secure transmission for each CUSIP number or in a
secure transmission for multiple CUSIP numbers (if applicable) which includes a
manifest or list of each CUSIP number submitted in that transmission. (The party
sending such notice shall have a method to verify subsequently the use of such
means and the timeliness of such notice.) The Publication Date shall be not less
than 30 days nor more than 60 days prior to the redemption date or, in the case
of an advance refunding, the date that the proceeds are deposited in escrow.
Notices to DTC pursuant to this Paragraph by telecopy shall be sent to DTC's
Call Notification Department at (000) 000-0000 or (000) 000-0000. If the party
sending the notice does not receive a telecopy receipt from DTC confirming that
the notice has been received, such party shall telephone (000) 000-0000. Notices
to DTC pursuant to this Paragraph by mail or by any other means shall be sent
to:
C-2
Manager; Call Notification Department
The Depository Trust Company
000 Xxxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000-0000
IV. In the event of an invitation to tender the Securities, notice by
Issuer or Trustee to Security holders specifying the terms of the tender and the
Publication Date of such notice shall be sent to DTC by a secure means in the
manner set forth in the preceding Paragraph. Notices to DTC pursuant to this
Paragraph and notices of other corporate actions (including mandatory tenders,
exchanges, and capital changes) by telecopy shall be sent to DTC's
Reorganization Department at (000) 000-0000 or (000) 000-0000, and receipt of
such notices shall be confirmed by telephoning (000) 000-0000. Notices to DTC
pursuant to the above by mail or by any other means shall be sent to:
Manager; Reorganization Department
Reorganization Window
The Depository Trust Company
0 Xxxxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
V. All notices and payment advices sent to DTC shall contain the CUSIP
number of the Securities.
VI. Trustee shall send DTC written notice with respect to the dollar
amount per $1,000 original face value (or other minimum authorized denomination
if less than $1,000 face value) payable on each payment date allocated as to the
interest and principal portions thereof preferably 5, but not less than 2,
business days prior to such payment date. Such notices, which shall also contain
the current pool factor and Trustee contact's name and telephone number, shall
be sent by telecopy to DTC's Dividend Department at (000) 000-0000, or if by
mail or by any other means to:
Manager; Announcements
Dividend Department
The Depository Trust Company
0 Xxxxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
VII. (NOTE: ISSUER MUST REPRESENT ONE OF THE FOLLOWING, AND CROSS OUT THE
OTHER:) (The interest accrual period is record date to record date.) (The
interest accrual period is payment date to payment date.)
VIII. Interest payments and principal payments that are part of periodic
principal-and-interest payments shall be received by Cede & Co., as nominee of
DTC, or its registered assigns in same-day funds on each payment date (or the
equivalent in accordance with
C-3
existing arrangements between Issuer or Trustee and DTC). Such payments shall be
made payable to the order of Cede & Co. Absent any other existing arrangements,
such payments shall be addressed as follows:
Manager; Cash Receipts
Dividend Department
The Depository Trust Company
0 Xxxxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
IX (NOTE: ISSUER MUST REPRESENT ONE OF THE FOLLOWING, AND CROSS OUT THE
OTHER:)
Securities Eligible for DTC's Same-Day Funds Settlement ("SDFS") System.
Other principal payments (redemption payments) shall be made in same-day funds
by Trustee in the manner set forth in the SDFS Paying Agent Operating
Procedures, a copy of which previously has been furnished to Trustee.
Securities Eligible for DTC's Next-Day Funds Settlement ("NDFS") System.
Other principal payments (redemption payments) shall be made in next-day funds
by Trustee to Cede & Co., as nominee of DTC, or its registered assigns, on each
payment date. Such payments shall be made payable to the order of Cede & Co.,
and shall be addressed as follows:
NDFS Redemptions Manager
Reorganization/Redemptions Department
The Depository Trust Company
0 Xxxxxxx Xxxxxx; 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
X. DTC may direct Issuer or Trustee to use any other number or address as
the number or address to which notices or payments of interest or principal may
be sent.
XI. In the event of a redemption, acceleration, or any other similar
transaction (e.g., tender made and accepted in response to Issuer's or Trustee's
invitation) necessitating a reduction in the aggregate principal amount of
Securities outstanding or an advance refunding of part of the Securities
outstanding, DTC, in its discretion: (a) may request Issuer or Trustee to issue
and authenticate a new Security certificate; or (b) may make an appropriate
notation on the Security certificate indicating the date and amount of such
reduction in principal except in the case of final maturity, in which case the
certificate will be presented to Issuer or Trustee prior to payment, if
required.
XII. In the event that Issuer determines that beneficial owners of
Securities shall be able to obtain certificated Securities, Issuer or Trustee
shall notify DTC of the availability of
C-4
certificates. In such event, Issuer or Trustee shall issue, transfer, and
exchange certificates in appropriate amounts, as required by DTC and others.
XIII. DTC may discontinue providing its services as securities depository
with respect to the Securities at any time by giving reasonable notice to Issuer
or Trustee (at which time DTC will confirm with Issuer or Trustee the aggregate
principal amount of Securities outstanding). Under such circumstances, at DTC's
request Issuer and Trustee shall cooperate fully with DTC by taking appropriate
action to make available one or more separate certificates evidencing Securities
to any DTC Participant having Securities credited to its DTC accounts.
XIV. Issuer: (a) understands that DTC has no obligation to, and will not,
communicate to its Participants or to any person having an interest in the
Securities any information contained in the Security certificate(s); and (b)
acknowledges that neither DTC's Participants nor any person having an interest
in the Securities shall be deemed to have notice of the provisions of the
Security certificates by virtue of submission of such certificate(s) to DTC.
XV. Nothing herein shall be deemed to require Trustee to advance funds
on behalf of Issuer.
Very truly yours,
(Authorized Officer's Signature)
Notes:
A. If there is a Trustee (as defined in this Letter of Representations),
Trustee as well as Issuer must sign this Letter. If there is no Trustee, in
signing this Letter Issuer itself undertakes to perform all of the
obligations set forth herein.
________________________________________
(Issuer)
By:______________________________________
(Authorized Officer's Signature)
B. Schedule B contains statements that DTC believes accurately describe
DTC, the method of effecting book-entry transfers of securities distributed
through DTC, and certain related matters.
________________________________________
(Trustee)
C-5
By:_____________________________________
(Authorized Officer's Signature)
________________________________________
(Administrator)
By:_____________________________________
(Authorized Officer's Signature)
Received and Accepted:
THE DEPOSITORY TRUST COMPANY
By:_____________________________________
cc: Underwriter
Underwriter's Counsel
C-6
SCHEDULE A
(Describe Issue)
CUSIP Principal Amount Maturity Date Interest Rate
----- ---------------- ------------- -------------
C-7
EXHIBIT D
FORM OF SERVICER'S CERTIFICATE
(___________________) TRUST 199__-__
___% Asset Backed Certificates, Class A
___% Asset Backed Certificates, Class B
Distribution Date:
Collection Period:
Under the Pooling and Servicing Agreement dated as of _____________ by and
among Deutsche Recreational Asset Funding Corporation, as Depositor, Deutsche
Financial Services Corporation, as Servicer, and __________________________, as
Trustee, the Servicer is required to prepare certain information each month
regarding current distributions to Certificateholders and the performance of the
Trust during the previous month. The information that is required to be prepared
with respect to the Distribution Date and Collection Period listed above is set
forth below. Certain of the information is presented on the basis of an original
principal amount of $1,000 per Class A Certificate or Class B Certificate, as
appropriate, and certain other information is presented based upon the aggregate
amounts for the Trust as a whole.
A. Information Regarding the Current Monthly Distribution.
1. Class A Certificates.
(a) The aggregate amount of the distribution to Class A
Certificateholders........................................... $_________
(b) The amount of the distribution set forth in paragraph A.1.(a)
above in respect of interest................................. $_________
(c) The amount of the distribution set forth in paragraph A.1.(a)
above in respect of principal................................ $_________
(d) The amount of the distribution set forth in paragraph A.1.(a)
above per $1,000 interest.................................... $_________
(e) The amount of the distribution set forth in paragraph A.1.(b)
above per $1,000 interest.................................... $_________
(f) The amount of the distribution set forth in paragraph A.1.(c)
above per $1,000 interest.................................... $_________
D-1
2. Class B Certificates.
(a) The aggregate amount of the distribution to Class B
Certificateholders..................................... $_________
(b) The amount of the distribution set forth in paragraph
A.2(a) above in respect of interest.................... $_________
(c) The amount of the distribution set forth in paragraph
A.2(a) above in respect of principal................... $_________
(d) The amount of the distribution set forth in paragraph
A.2(a) above per $1,000 interest....................... $_________
(e) The amount of the distribution set forth in paragraph
A.2(b) above per $1,000 interest....................... $_________
(f) The amount of the distribution set forth in paragraph
A.2(c) above per $1,000 interest....................... $_________
B. Information Regarding the Performance of the Trust.
1. Pool Balance and Certificate Balances.
(a) The Pool Balance close of business on the last day of
the preceding Collection Period........................ $_________
(b) The Class A Certificate Balance as of the close of
business on the last day of the preceding Collection
Period, after giving effect to payments allocated to
principal set forth in Paragraph A.1(c) above.......... $_________
(c) The Class B Certificate Balance as of the close of
business of the last day of the preceding Collection
Period, after giving effect to payments allocated to
principal set forth in paragraph A.2(c) above.......... $_________
(d) The Class A Pool Factor and the Class B Pool Factor as
of the close of business on the last day of the
preceding Collection Period............................ $_________
D-2
2. Servicing Fee and Advances.
(a) The aggregate amount of the Servicing Fee paid to the
Servicer with respect to the preceding Collection
Period................................................. $_________
(b) The amount of such Servicing Fee per $1,000
interest............................................... $_________
(c) The amount of any unpaid Servicing Fee................. $_________
(d) The change in the amount of any unpaid Servicing Fee
from the previous Distribution Date.................... $_________
(e) Aggregate Advances on such Distribution Date........... $_________
3. Payment Shortfalls.
(a) The amount of the Class A Interest Carryover Shortfall
after giving effect to the payments set forth in
paragraph A.1(b) above................................. $_________
(b) The amount of the Class A Principal Carryover Shortfall
after giving effect to the payment set forth in
paragraph A.1(c) above................................. $_________
(c) The amount of the Class B Interest Carryover Shortfall
after giving effect to the payments set forth in
paragraph A.2(b) above................................. $_________
(d) The amount of the Class B Principal Carryover Shortfall
after giving effect to the payments set forth in
paragraph A.2(c) above................................. $_________
(e) The amount otherwise distributable to Class B
Certificateholders that is distributed to Class A
Certificateholders..................................... $_________
4. Reserve Account.
(a) The Reserve Account balance after giving effect to
distributions made on such Distribution Date........... $_________
(b) The change in the Reserve Account on such
D-3
Distribution Date ................................. $_________
D-4
SCHEDULE A
SCHEDULE OF RECEIVABLES
SCHEDULE B
LOCATION OF RECEIVABLE FILES
