EXHIBIT 10.2.1
FORM OF SALE AND SERVICING AGREEMENT
(OWNER TRUST, VEHICLE LOAN RECEIVABLES)
FORM OF SALE AND SERVICING AGREEMENT
among
[ ] VEHICLE RECEIVABLES TRUST 200[ ]-[ ],
as Issuer,
[GS MORTGAGE SECURITIES CORP.],
as Company,
and
[ ],
as Servicer
Dated as of _______________
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
Section 1.01 Definitions.............................................1
Section 1.02 Other Definitional Provisions..........................13
ARTICLE II
Conveyance of Receivables
Section 2.01 Conveyance of Receivables..............................14
ARTICLE III
The Receivables
Section 3.01 Representations and Warranties of the Company with
Respect to the Receivables.............................15
Section 3.02 Repurchase upon Breach.................................17
Section 3.03 Custody of Receivable Files............................18
Section 3.04 Duties of Servicer as Custodian........................18
Section 3.05 Instructions; Authority To Act........................19
Section 3.06 Custodian's Indemnification............................19
Section 3.07 Effective Period and Termination.......................19
ARTICLE IV
Administration and Servicing of Receivables
Section 4.01 Duties of Servicer.....................................20
Section 4.02 Collection and Allocation of Receivable Payments.......20
Section 4.03 Realization upon Receivables...........................21
Section 4.04 Physical Damage Insurance..............................21
Section 4.05 Maintenance of Security Interests in Financed Vehicles.21
Section 4.06 Covenants of Servicer..................................21
Section 4.07 Purchase of Receivables upon Breach....................21
Section 4.08 Servicing Fee..........................................22
Section 4.09 Servicer's Certificate.................................22
Section 4.10 Annual Statement as to Compliance; Notice of Default...22
Section 4.11 Annual Independent Certified Public Accountants'
Report.................................................23
Section 4.12 Access to Certain Documentation and Information
Regarding Receivables..................................23
Section 4.13 Servicer Expenses......................................23
Section 4.14 Appointment of Subservicer.............................23
ARTICLE V
Distributions; Reserve Account;
Statements to Certificateholders and Noteholders
Section 5.01 Establishment of Trust Accounts........................24
Section 5.02 Collections............................................26
Section 5.03 Application of Collections.............................26
Section 5.04 Advances...............................................27
Section 5.05 Additional Deposits....................................27
Section 5.06 Distributions..........................................28
Section 5.07 Reserve Account........................................29
Section 5.08 Statements to Certificateholders and Noteholders.......31
Section 5.09 Net Deposits...........................................32
ARTICLE VI
The Company
Section 6.01 Representations of the Company.........................32
Section 6.02 Corporate Existence....................................33
Section 6.03 Liability of the Company...............................33
Section 6.04 Merger or Consolidation of, or Assumption of
the Obligations of the Company.........................33
Section 6.05 Limitation on Liability of the Company and Others......34
Section 6.06 The Company May Own Certificates or Notes..............34
ARTICLE VII
The Servicer
Section 7.01 Representations of Servicer............................34
Section 7.02 Indemnities of Servicer................................35
Section 7.03 Merger or Consolidation of, or Assumption of
the Obligations of, Servicer...........................36
Section 7.04 Limitation on Liability of Servicer and Others.........36
Section 7.05 Servicer Not To Resign.................................37
ARTICLE VIII
Default
Section 8.01 Servicer Default.......................................37
Section 8.02 Appointment of Successor...............................38
Section 8.03 Repayment of Advances..................................39
Section 8.04 Notification to Noteholders and Certificateholders.....39
Section 8.05 Waiver of Past Defaults................................39
ARTICLE IX
Termination
Section 9.01 Optional Purchase of All Receivables...................39
ARTICLE X
Miscellaneous
Section 10.01 Amendment..............................................41
Section 10.02 Protection of Title to Trust...........................42
Section 10.03 Notices................................................43
Section 10.04 Assignment by the Company or the Servicer..............44
Section 10.05 Limitations on Rights of Others........................44
Section 10.06 Severability...........................................44
Section 10.07 Separate Counterparts..................................44
Section 10.08 Headings...............................................44
Section 10.09 Governing Law..........................................44
Section 10.10 Assignment by Issuer...................................44
Section 10.11 Nonpetition Covenant...................................44
Section 10.12 Limitation of Liability of Owner Trustee and
Indenture Trustee......................................45
SALE AND SERVICING AGREEMENT dated as of ____________,
among [ ] VEHICLE RECEIVABLES TRUST 200[ ]-[ ], a Delaware business trust
(the "Issuer"), [GS Mortgage Securities Corp. ], a Delaware corporation
(the "Company"), and ____________, a _____________ corporation (the
"Servicer").
WHEREAS, the Issuer desires to purchase a portfolio of
receivables arising in connection with motor vehicle installment loan
contracts and motor vehicle retail installment sale contracts held by the
Company;
WHEREAS, the Company is willing to sell such receivables
to the Issuer; and
WHEREAS, the Servicer is willing to service such receivables;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, the parties hereto agree as follows:
ARTICLE I
Definitions
Section 1.01 Definitions. Whenever used in this Agreement, the following
words and phrases, unless the context otherwise requires, shall have the
following meanings:
"Accelerated Principal Distribution Amount" means, with
respect to any Distribution Date, an amount equal to the portion of the
Total Distribution Amount for such Distribution Date that remains after the
payment of (i) the Servicing Fee, (ii) the Noteholders' Interest
Distributable Amount, (iii) the Regular Principal Distribution Amount, (iv)
the Certificateholders' Interest Distributable Amount and (v) the amount,
if any, required to be deposited into the Reserve Account on such
Distribution Date pursuant to Section 5.06(b)(ii)(F).
"Advance" means either a Precomputed Advance or Simple
Interest Advance or both, as applicable.
"Amount Financed" means with respect to a Receivable, the
amount advanced under the related Motor Vehicle Installment Contract toward
the purchase price of the Financed Vehicle and any related costs.
"Annual Percentage Rate" or "APR" of a Receivable means
the annual rate of finance charges stated in the related Motor Vehicle
Installment Contract.
"Available Amount" means, with respect to any
Distribution Date, the amount of funds on deposit in the Reserve Account on
such Distribution Date less the Certificate Interest Reserve Amount with
respect to such Distribution Date before giving effect to any reduction
thereto on such date.
"Basic Documents" means the Certificate of Trust, the
Trust Agreement, the Sale and Servicing Agreement, the Note Depository
Agreement, the Certificate Depository Agreement and other documents and
certificates delivered in connection therewith.
"Certificate Balance" equals, initially, $___________
and, thereafter, equals such initial Certificate Balance reduced by all
amounts allocable to principal previously distributed to
Certificateholders.
"Certificate Distribution Account" has the meaning
assigned to such term in the Trust Agreement.
"Certificateholders" has the meaning assigned to such
term in the Trust Agreement.
"Certificateholders' Distributable Amount" means, with
respect to any Distribution Date, the sum of the Certificateholders'
Principal Distributable Amount and the Certificateholders' Interest
Distributable Amount for such date.
"Certificateholders' Interest Carryover Shortfall" means,
with respect to any Distribution Date, the excess of the sum of the
Certificateholders' Monthly Interest Distributable Amount for the preceding
Distribution Date and any outstanding Certificateholders' Interest
Carryover Shortfall on such preceding Distribution Date, over the amount in
respect of interest that is actually deposited in the Certificate
Distribution Account on such preceding Distribution Date, plus 30 days'
interest on such excess, to the extent permitted by law, at the
Pass-Through Rate.
"Certificateholders' Interest Distributable Amount"
means, with respect to any Distribution Date, the sum of the
Certificateholders' Monthly Interest Distributable Amount for such
Distribution Date and the Certificateholders' Interest Carryover Shortfall
for such Distribution Date. Interest with respect to the Certificates shall
be computed on the basis of a 360-day year consisting of twelve 30-day
months for all purposes of this Agreement and the Basic Documents.
"Certificateholders' Monthly Interest Distributable
Amount" means, with respect to any Distribution Date, 30 days of interest
(or, in the case of the first Distribution Date, interest accrued from and
including the Closing Date to but excluding _________) at the Pass-Through
Rate on the Certificate Balance on the last day of the preceding Collection
Period (or, in the case of the first Distribution Date, on the Closing
Date).
"Certificateholders' Monthly Principal Distributable
Amount" means, with respect to any Distribution Date prior to the
Distribution Date on which the Notes are paid in full, zero; and with
respect to any Distribution Date on or after the Distribution Date on which
the Notes are paid in full, the Regular Principal Distribution Amount for
such Distribution Date (less, on the Distribution Date on which the Notes
are paid in full, the portion thereof payable on the Notes).
"Certificateholders' Principal Carryover Shortfall"
means, as of the close of any Distribution Date, the excess of the
Certificateholders' Monthly Principal Distributable Amount and any
outstanding Certificateholders' Principal Carryover Shortfall from the
preceding Distribution Date, over the amount in respect of principal that
is actually deposited in the Certificate Distribution Account on such
current Distribution Date.
"Certificateholders' Principal Distributable Amount"
means, with respect to any Distribution Date, the sum of the
Certificateholders' Monthly Principal Distributable Amount for such
Distribution Date and the Certificateholders' Principal Carryover Shortfall
as of the close of the preceding Distribution Date; provided, however, that
the Certificateholders' Principal Distributable Amount shall not exceed the
Certificate Balance. In addition, on the Final Scheduled Distribution Date,
the principal required to be included in the Certificateholders' Principal
Distributable Amount will include the lesser of (a) (i) any Scheduled
Payments of principal due and remaining unpaid on each Precomputed
Receivable and (ii) any principal due and remaining unpaid on each Simple
Interest 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 Certificate Distribution Account
on such Distribution Date and allocable to principal) to reduce the
Certificate Balance to zero.
"Certificate Interest Reserve Amount" means, at the time
of reference, the lesser of (i) $___________ less the amount of any
application of the Certificate Interest Reserve Amount to pay interest on
the Certificates on any prior Distribution Date and (ii) _____% of the
Certificate Balance on such Distribution Date (before giving effect to any
reduction thereof on such Distribution Date); provided, however, that the
Certificate Interest Reserve Amount shall be zero subsequent to any
reduction by any Rating Agency of its rating of any Class of Notes to less
than "A-" or its equivalent, or withdrawal by any Rating Agency of its
rating of any Class of Notes, unless such rating has been restored.
"Certificate Depository Agreement" has the meaning
specified in Section 1.01 of the Trust Agreement.
"Certificate of Trust" means the certificate of trust of
the Issuer substantially in the form of Exhibit B to the Trust Agreement.
"Certificate Pool Factor" means, as of the close of
business on the last day of a Collection Period, a seven-digit decimal
figure equal to the Certificate Balance (after giving effect to any
reductions therein to be made on the immediately following Distribution
Date) divided by the initial Certificate Balance. The Certificate Pool
Factor will be 1.0000000 as of the Closing Date; thereafter, the
Certificate Pool Factor will decline to reflect reductions in the
Certificate Balance.
"Certificates" means the Trust Certificates (as defined
in the Trust Agreement).
"Class" means any one of the classes of Notes.
"Class A-1 Final Scheduled Distribution Date" means the
______________ Distribution Date.
"Class A-1 Noteholder" means the Person in whose name a
Class A-1 Note is registered in the Note Register.
"Class A-2 Final Scheduled Distribution Date" means the
__________ Distribution Date.
"Class A-2 Noteholder" means the Person in whose name a
Class A-2 Note is registered in the Note Register.
"Clearing Agency" means an organization registered as a
clearing agency pursuant to Section 17A of the Exchange Act.
"Collection Account" means the account designated as
such, established and maintained pursuant to Section 5.01(a)(i).
"Collection Period" means a calendar month. 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 current and previous Payaheads, (3)
all applications of Payahead Balances, (4) all Advances and reductions of
Outstanding Precomputed Advances or Outstanding Simple Interest Advances
and (4) all distributions to be made on the following Distribution Date.
"Company" means [GS Mortgage Securities Corp. ], a
Delaware corporation and any successor in interest.
"Corporate Trust Office" means the principal office of
the Indenture Trustee at which at any particular time its corporate trust
business shall be administered, which office at the date of execution of
this Agreement is located at ____________________; or at such other address
as the Indenture Trustee may designate from time to time by notice to the
Noteholders and the Company, or the principal corporate trust office of any
successor Indenture Trustee (of which address such successor Indenture
Trustee will notify the Noteholders and the Company).
"Cutoff Date" means ______________________________.
"Cutoff Date Pool Balance" means the aggregate principal
balance of the Receivables as of the Cutoff Date.
"Delivery" when used with respect to Trust Account
Property means:
(a) with respect to bankers' acceptances, commercial
paper, negotiable certificates of deposit and other obligations that
constitute "instruments" within the meaning of Section 9-105(1)(i) of the
UCC and are susceptible of physical delivery, transfer thereof to the
Indenture Trustee or its nominee or custodian by physical delivery to the
Indenture Trustee or its nominee or custodian endorsed to, or registered in
the name of, the Indenture 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
Indenture 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 Indenture
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 Indenture Trustee or its 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 Indenture 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 Indenture 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
Indenture 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 (as
defined herein) to the Indenture Trustee or its nominee or custodian,
consistent with changes in applicable law or regulations or the
interpretation thereof;
(b) with respect to any 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 security held through
the Federal Reserve System pursuant to Federal book-entry regulations, the
following procedures, all in accordance with applicable law, including
applicable Federal regulations and Articles 8 and 9 of the UCC: book-entry
registration of such Trust Account Property to an appropriate book-entry
account maintained with a Federal Reserve Bank by a financial intermediary
which 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 Indenture
Trustee or its nominee or custodian of the purchase by the Indenture
Trustee or its nominee or custodian of such book-entry securities; 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 belonging to the
Indenture Trustee or its nominee or custodian and indicating that such
custodian holds such Trust Account Property solely as agent for the
Indenture 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
Indenture 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
Indenture Trustee or its nominee or custodian of such uncertificated
security, the making by such financial intermediary of entries on its books
and records identifying such uncertificated certificates as belonging to
the Indenture Trustee or its nominee or custodian.
"Distribution Date" means, with respect to each
Collection Period, the __________ day of the following 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 Columbia (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 Indenture Trustee, the Owner Trustee or _______________
so long as it shall be Paying Agent under the Trust 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 or
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 Indenture Trustee, the Owner Trustee or _______________ may be
considered an Eligible Institution for the purposes of clause (b) of this
definition.
"Eligible Investments" means book-entry securities,
negotiable instruments or securities represented by instruments in bearer
or registered form which evidence:
(a) direct obligations of, and obligations fully
guaranteed as to the full and 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 (or 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 investment category granted
thereby;
(c) commercial paper having, at the time of the
investment or contractual commitment to invest therein, a rating from each
of the Rating Agencies in the highest investment category granted thereby;
(d) investments in money market funds having a rating
from each of the Rating Agencies in the highest investment category granted
thereby;
(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); or
(g) any other investment with respect to which the Issuer
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 on the Notes or
Certificates.
"FDIC" means the Federal Deposit Insurance Corporation.
"Final Scheduled Distribution Date" means the
_______________ Distribution Date.
"Final Scheduled Maturity Date" means _______________.
"Financed Vehicle" means an automobile, van or light-duty
truck, together with all accessions thereto, securing an Obligor's
indebtedness under the related Receivable.
"Indenture" means the Indenture dated as of
_______________, between the Issuer and the Indenture Trustee.
"Indenture Trustee" means the Person acting as Indenture
Trustee under the Indenture, its successors in interest and any successor
trustee under the Indenture.
"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 of such
Person's affairs, and such decree or order shall remain unstayed and in
effect for a period of 60 consecutive days; or (b) the commencement by such
Person of a voluntary case under any applicable 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, without duplication,
with respect to the Receivables for the Collection Period immediately
preceding such Distribution Date: (a) that portion of all collections on
Receivables (including Payaheads) allocable to interest plus that portion
of Payaheads allocable to principal, (b) Liquidation Proceeds with respect
to the Receivables to the extent allocable to interest due thereon in
accordance with the Servicer's customary servicing procedures, (c) all
Advances made by the Servicer of interest due on Receivables, (d) the
Purchase Amount of each Receivable that became a Purchased Receivable
during such Collection Period to the extent attributable to accrued
interest on such Receivable, and (e) Recoveries for such Collection Period;
provided, however, that in calculating the Interest Distribution Amount the
following will be excluded: (i) amounts received on Precomputed Receivables
to the extent of any unreimbursed Precomputed Advances of interest; (ii)
Liquidation Proceeds with respect to a particular Precomputed Receivable to
the extent of any unreimbursed Precomputed Advances of interest; (iii) 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; (iv) the sum for all
Simple Interest Receivables of collections on each such Simple Interest
Receivable received during such preceding Collection Period in excess of
the amount of interest that would be due on the aggregate Principal Balance
of the Simple Interest Receivables during such Collection Period at their
respective APRs if a payment were received on each Simple Interest
Receivable during such Collection Period on the date payment is due under
the terms of such Simple Interest Receivable; and (v) Liquidation Proceeds
with respect to a Simple Interest 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 Simple
Interest Advances.
"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 into
the Collection Account on such Distribution Date pursuant to Section
5.01(b).
"Issuer" means [ ] Vehicle Receivables Trust 200[ ]-[ ].
"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 a Receivable by operation of law.
"Liquidated Receivable" means any Receivable liquidated
by the Servicer through the sale of a Financed Vehicle or otherwise.
"Liquidation Proceeds" means, with respect to any
Liquidated Receivable, the moneys collected in respect thereof, from
whatever source on a Liquidated Receivable 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 and
any amounts required by law to be remitted to the Obligor on such
Liquidated Receivable.
"Motor Vehicle Installment Contract" means a motor
vehicle loan installment contract originated by a Seller or a motor vehicle
retail installment sale contract acquired by a Seller from a motor vehicle
retail dealer or another financial institution.
"Note Depository Agreement" means the agreement dated
_________________, among the Issuer, the Indenture Trustee and the
Depository Trust Company, as the initial Clearing Agency, relating to the
Notes.
"Note Distribution Account" means the account designated
as such, established and maintained pursuant to Section 5.01(a)(iii).
"Note Pool Factor" means, with respect to each Class of
Notes as of the close of business on the last day of a Collection Period, a
seven-digit decimal figure equal to the outstanding principal balance of
such Class of Notes (after giving effect to any reductions thereof to be
made on the immediately following Distribution Date) divided by the
original outstanding principal balance of such Class of Notes. The Note
Pool Factor for each Class of Notes will be 1.0000000 as of the Closing
Date; thereafter, the Note Pool Factor will decline to reflect reductions
in the outstanding principal balance of such Class of Notes.
"Noteholders' Distributable Amount" means, with respect
to any Distribution Date, the sum of the Noteholders' Principal
Distributable Amount and the Noteholders' Interest Distributable Amount for
such Distribution Date.
"Noteholders' Interest Carryover Shortfall" means, with
respect to any Distribution Date, the excess of the sum of the Noteholders'
Monthly Interest Distributable Amount for the preceding Distribution Date
and any outstanding Noteholders' Interest Carryover Shortfall on such
preceding Distribution Date, over the amount in respect of interest that is
actually deposited in the Note Distribution Account on such preceding
Distribution Date, plus interest on the amount of interest due but not paid
to Noteholders on the preceding Distribution Date, to the extent permitted
by law, at the Interest Rate borne by each Class of the Notes for the
related Interest Period.
"Noteholders' Interest Distributable Amount" means, with
respect to any Distribution Date, the sum of the Noteholders' Monthly
Interest Distributable Amount for such Distribution Date and the
Noteholders' Interest Carryover Shortfall for such Distribution Date. For
all purposes of this Agreement and the Basic Documents, interest with
respect to all Classes of Notes shall be computed on the basis of a 360-day
year consisting of twelve 30-day months.
"Noteholders' Monthly Interest Distributable Amount"
means, with respect to any Distribution Date, interest accrued for the
related Interest Accrual Period on each Class of Notes at the Interest Rate
for such Class on the outstanding principal balance of the Notes of such
Class on the immediately preceding Distribution Date (or, in the case of
the first Distribution Date, the Closing Date), after giving effect to all
distributions of principal to Holders of the Notes of such Class on or
prior to such Distribution Date (or, in the case of the first Distribution
Date, on the Closing Date).
"Noteholders Monthly Principal Distributable Amount"
means, with respect to any Distribution Date, the sum of (i) the Regular
Principal Distribution Amount plus (ii) the Accelerated Principal Amount
plus (iii) any accelerated payments of principal required to be made from
amounts on deposit in the Reserve Account pursuant to Section 5.07(b)(ii).
"Noteholders' Principal Carryover Shortfall" means, as of
the close of any Distribution Date, the excess of the Noteholders' Monthly
Principal Distributable Amount and any outstanding Noteholders' Principal
Carryover Shortfall from the preceding Distribution Date, over the amount
in respect of principal that is actually deposited in the Note Distribution
Account on such current Distribution Date.
"Noteholders' Principal Distributable Amount" means, with
respect to any Distribution Date, the sum of the Noteholders' Monthly
Principal Distributable Amount for such Distribution Date and the
Noteholders' Principal Carryover Shortfall as of the close of the preceding
Distribution Date; provided, however, that the Noteholders' Principal
Distributable Amount shall not exceed the outstanding principal balance of
the Notes. In addition, (a) on the Class A-1 Final Scheduled Distribution
Date, the principal required to be deposited in the Note Distribution
Account will include the amount necessary (after giving effect to the other
amounts to be deposited in the Note Distribution Account on such
Distribution Date and allocable to principal) to reduce the Outstanding
Amount of the Class A-1 Notes to zero; and (b) on the Class A-2 Final
Scheduled Distribution Date, the principal required to be deposited in the
Note Distribution Account will include the amount necessary (after giving
effect to the other amounts to be deposited in the Note Distribution
Account on such Distribution Date and allocable to principal) to reduce the
Outstanding Amount of the Class A-2 Notes to zero.
"Obligor" on a Receivable means the purchaser or
co-purchasers of the Financed Vehicle and any other Person who owes
payments under the related Motor Vehicle Installment Contract.
"Officers' Certificate" means a certificate signed by (a)
the chairman of the board, the president, any vice president and (b) the
treasurer, assistant treasurer, secretary or assistant secretary of the
Company 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 Company or the
Servicer, which counsel shall be acceptable to the Indenture Trustee, the
Owner Trustee or the Rating Agencies, as applicable.
"Outstanding Precomputed Advances" on the Precomputed
Receivables means the sum, as of the close of business on the last day of a
Collection Period, of all Precomputed Advances as reduced as provided in
Section 5.04(a).
"Outstanding Simple Interest Advances" on the Simple
Interest Receivables means the sum, as of the close of business on the last
day of a Collection Period, of all Simple Interest Advances as reduced as
provided in Section 5.04(b).
"Owner Trust Estate" has the meaning assigned to such
term in the Trust Agreement.
"Owner Trustee" means the Person acting as Owner Trustee
under the Trust Agreement, its successors in interest and any successor
owner trustee under the Trust Agreement.
"Pass-Through Rate" means __________% per annum.
"Payahead" means, with respect to any Receivable that is
a Precomputed Receivable, the amount, as of the close of business on the
last day of a Collection Period, computed in accordance with Section 5.03.
"Payahead Balance" means, with respect to any Receivable
that is a Precomputed Receivable, the sum, as of the close of business on
the last day of a Collection Period, of all Payaheads made by or on behalf
of the Obligor on such Precomputed Receivable, as reduced by applications
of previous Payaheads with respect to such Precomputed Receivable pursuant
to Section 5.05 and 5.04.
"Payment Distribution Date" means, with respect to any
Distribution Date, the Business Day immediately preceding such Distribution
Date.
"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 day (excluding Purchased Receivables and Liquidated
Receivables).
"Precomputed Advance" means the amount, as of the close
of business on the last day of a Collection Period, that the Servicer is
required to advance on the related Precomputed Receivables pursuant to
Section 5.04(a).
"Precomputed Receivable" means any Receivable (i) under
which the portion of a payment allocable to earned interest (which may be
referred to in the related Motor Vehicle Installment Contract as an add-on
finance charge) and the portion allocable to the Amount Financed is
determined according to the sum of periodic balances or the sum of monthly
balances or any equivalent method or (ii) that is a monthly actuarial
receivable.
"Principal Balance" means (a) with respect to a
Precomputed Receivable, the Amount Financed minus the sum, as of the close
of business on the last day of a Collection Period, of (i) that portion of
all Scheduled Payments due on or prior to such day allocable to principal
using the actuarial or constant yield method, (ii) any refunded portion of
extended warranty protection plan costs or of physical damage, credit life
or disability insurance premiums included in the Amount Financed, (iii) the
portion of any related Purchase Amount allocable to principal and (iv) any
prepayment in full or any partial prepayments applied to reduce the related
Principal Balance and (b) with respect to a Simple Interest Receivable, 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) the portion of any
related Purchase Amount allocable to principal.
"Purchase Amount" means the amount, as of the close of
business on the last day of a Collection Period, required to prepay a
Receivable in full under the terms thereof, including interest to the end
of the month of purchase.
"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 or by the Company pursuant to Section
3.02.
"Rating Agency" means _______________ or, if no such
organization or successor is any longer in existence, a nationally
recognized statistical rating organization or other comparable Person
designated by the Company, notice of which designation shall be given to
the Indenture Trustee, the Owner 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, within 7 days of receipt of such notice, none of the
Rating Agencies shall have notified the Company, the Servicer, the Owner
Trustee or the Indenture Trustee in writing that such action will result in
a reduction or withdrawal of the then current rating of the Notes or 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 Motor Vehicle Installment Contract
listed on Schedule I (which Schedule may be in the form of microfiche).
"Receivable Files" means the documents specified in
Section 3.03.
"Receivables Purchase Agreement" means an agreement,
substantially in the form of Exhibit H hereto, between the Company and a
Seller, pursuant to which such Seller sold Motor Vehicle Installment
Contracts to be included in the Trust to the Company.
"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.
"Regular Principal Distribution Amount" means, with
respect to each Receivable and any Distribution Date, the sum of the
following amounts, without duplication, in respect of the Collection Period
immediately preceding such Distribution Date: (a) that portion of all
collections on Receivables allocable to principal (exclusive of Payaheads
allocable to principal that have not been applied as payments under the
related Receivables in such Collection Period and inclusive of Payaheads
allocable to principal that have been applied as payments under the related
Receivables in such Collection Period), (b) all Liquidation Proceeds
attributable to the principal amount of Receivables that became Liquidated
Receivables during such Collection Period in accordance with the Servicer's
customary servicing procedures, plus the amount of Realized Losses with
respect to such Liquidated Receivables, (c) all Precomputed Advances made
by the Servicer of principal due on the Precomputed Receivables, (d) to the
extent attributable to principal, the Purchase Amount of each Receivable
that became a Purchased Receivable during such Collection Period, (e)
partial prepayments on Precomputed Receivables 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 Obligors thereon as of the date of the
original contract and only to the extent not included under clause (a)
above, and (f) on the Final Scheduled Distribution Date, any amounts
advanced by the Servicer on such Final Scheduled Distribution Date with
respect to principal on the Receivables: provided, however, that in
calculating the Regular Principal Distribution Amount the following will be
excluded: (i) amounts received on Precomputed Receivables to the extent
that the Servicer has previously made an unreimbursed Precomputed Advance
of principal, (ii) Liquidation Proceeds with respect to a particular
Precomputed Receivable to the extent of any unreimbursed Precomputed
Advances of principal, (iii) 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 (iv) Recoveries.
"Reserve Account" means the account designated as such,
established and maintained pursuant to Section 5.01(a)(iv).
"Reserve Account Initial Deposit" means an amount equal
to the Specified Reserve Account Balance on the Closing Date (which is
equal to $______________).
"Scheduled Payment" on a Precomputed Receivable means
that portion of the payment required to be made by the Obligor during each
Collection Period sufficient to amortize the Principal Balance under the
actuarial method over the term of the Receivable and to provide interest at
the APR.
"Seller" means, with respect to any Receivable, the
Person from whom such Receivable was acquired by the Company pursuant to
the related Receivables Purchase Agreement.
"Servicer" means _______________, as the Servicer of the
Receivables, and each successor to ______________ pursuant to Section 7.03
or 8.02.
"Servicer Default" means an event specified in Section
8.01.
"Servicer's Certificate" means an Officers' Certificate
of the Servicer delivered pursuant to Section 4.09.
"Servicing Fee" means the fee payable to the Servicer for
services rendered during each Collection Period, determined pursuant to
Section 4.08.
"Servicing Fee Rate" means __% per annum.
"Simple Interest Advance" means the amount of interest,
as of the close of business on the last day of a Collection Period, that
the Servicer is required to advance on the Simple Interest Receivables
pursuant to Section 5.04(b).
"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.
"Simple Interest Receivable" means any Receivable under
which the portion of a payment allocable to interest and the portion
allocable to principal is determined in accordance with the Simple Interest
Method.
"Specified Reserve Account Balance" means [state formula].
"Total Distribution Amount" means, for each Distribution
Date, the sum of the Interest Distribution Amount and the Regular Principal
Distribution Amount (other than the portion thereof attributable to
Realized Losses).
"Trust" means the Issuer.
"Trust Account Property" means the Trust Accounts, all
amounts and investments held from time to time in any Trust Account
(whether in the form of deposit accounts, Physical Property, book-entry
securities, uncertificated securities or otherwise), including the Reserve
Account Initial Deposit, and all proceeds of the foregoing.
"Trust Accounts" has the meaning assigned thereto in
Section 5.01.
"Trust Agreement" means the Amended and Restated Trust
Agreement dated as of ____________________, between the Company and the
Owner Trustee.
"Trust Officer" means, in the case of the Indenture
Trustee, any Officer within the Corporate Trust Office of the Indenture
Trustee, including any Vice President, Assistant Vice President, Secretary,
Assistant Secretary or any other officer of the Indenture Trustee
customarily performing functions similar to those performed by any of the
above designated officers and also, with respect to a particular matter,
any other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject and, with respect
to the Owner Trustee, any officer in the Corporate Trust Administration
Department of the Owner Trustee with direct responsibility for the
administration of the Trust Agreement and the Basic Documents on behalf of
the Owner Trustee.
Section 1.02 Other Definitional Provisions.
(a) Capitalized terms used and not otherwise
defined herein have the meanings assigned to them in the Indenture.
(b) All terms defined in this Agreement shall
have the defined meanings when used in any certificate or other document
made or delivered pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any
certificate or other document made or delivered pursuant hereto or thereto,
accounting terms not defined in this Agreement or in any such certificate
or other document, and accounting terms partly defined in this Agreement or
in any such certificate or other document to the extent not defined, shall
have the respective meanings given to them under United States generally
accepted accounting principles. To the extent that the definitions of
accounting terms in this Agreement or in any such certificate or other
document are inconsistent with the meanings of such terms under United
States generally accepted accounting principles, the definitions contained
in this Agreement or in any such certificate or other document shall
control.
(d) The words "hereof", "herein", "hereunder"
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement;
Article, Section, Schedule and Exhibit references contained in this
Agreement are references to Articles, Sections, Schedules and Exhibits in
or to this Agreement unless otherwise specified; and the term "including"
shall mean "including without limitation".
(e) 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.
(f) Any agreement, instrument or statute defined
or referred to herein or in any instrument or certificate delivered in
connection herewith means such agreement, instrument or statute as from
time to time amended, modified or supplemented 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.
ARTICLE II
Conveyance of Receivables
Section 2.01 Conveyance of Receivables. In consideration
of the Owner Trustee's delivery on the Closing Date to or upon the order of
the Company of $_______________, the Company does hereby sell, transfer,
assign, set over and otherwise convey to the Issuer, without recourse
(subject to the obligations as set forth herein), all right, title and
interest of the Company in and to:
(a) the Receivables and all moneys due thereon
on and after the Cutoff Date, in the case of Precomputed Receivables, and
all moneys received thereon on and after the Cutoff Date, in the case of
Simple Interest Receivables;
(b) the security interest in the Financed
Vehicles granted by Obligors pursuant to the Receivables and any other
interest of the Company in such Financed Vehicles;
(c) any proceeds with respect to the Receivables
from claims on any physical damage, theft, credit life or disability
insurance policies covering Financed Vehicles or Obligors;
(d) any Financed Vehicle that shall have secured
any such Receivable and shall have been acquired by or on behalf of the
Company, the Servicer or the Issuer; and
(e) the proceeds of any and all of the
foregoing.
ARTICLE III
The Receivables
Section 3.01 Representations and Warranties of the
Company with Respect to the Receivables. The Company makes the following
representations and warranties as to the Receivables conveyed by it to the
Issuer, on which the Issuer is deemed to have relied in acquiring the
Receivables. Such representations and warranties speak as of the execution
and delivery of this Agreement and as of the Closing Date, but shall
survive the sale, transfer and assignment of the Receivables to the Issuer
and the pledge thereof to the Indenture Trustee pursuant to the Indenture.
(a) Characteristics of Receivables. Each
Receivable (1) was originated by the Seller thereof or purchased from a
motor vehicle dealer or another financial institution by such Seller in the
ordinary course of such Seller's business, (2) has created a valid,
subsisting and enforceable first priority security interest in favor of the
Seller in the Financed Vehicle, which security interest is assignable by
the Seller to the Company, by the Company to the Issuer and by the Issuer
to the Indenture Trustee, (3) contains customary and enforceable provisions
such that the rights and remedies of the holder thereof are adequate for
realization against the collateral of the benefits of the security, (4)
provides for level monthly payments (provided, that the payment in the
first or last month in the life of the Receivable may be minimally
different from the level payments) that fully amortize the Amount Financed
by maturity and yield interest at the Annual Percentage Rate, and (5) in
the case of a Precomputed Receivable, in the event that such contract is
prepaid, provides for a prepayment that fully pays the Principal Balance
and includes accrued but unpaid interest through the date of prepayment at
the Annual Percentage Rate.
(b) Schedule of Receivables. The information set
forth in Schedule I to this Agreement is true and correct in all material
respects as of the opening of business on the Cutoff Date, and no selection
procedures believed to be adverse to the Noteholders or the
Certificateholders were utilized in selecting the Receivables. The computer
tape or other listing regarding the Receivables made available to the
Issuer and its assigns is true and correct in all material respects as of
the Cutoff Date.
(c) Compliance with Law. Each Receivable and the
sale of the related Financed Vehicle complied at the time it was originated
or made and at the execution of this Agreement in all material respects
with all requirements of applicable federal, state and local laws and
regulations thereunder, including usury laws, the Federal Truth-in- Lending
Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act, the
Fair Debt Collection Practices Act, the Federal Trade Commission Act, the
Xxxxxxxx-Xxxx Warranty Act, the Federal Reserve Board's Regulations B and
Z, and State adaptations of the National Consumer Act and of the Uniform
Consumer Credit Code, and other consumer credit laws and equal credit
opportunity and disclosure laws.
(d) Binding Obligation. Each Receivable
represents the genuine, legal, valid and binding payment obligation in
writing of the Obligor, enforceable by the holder thereof in accordance
with its terms, subject to applicable bankruptcy, insolvency,
reorganization and similar laws now or hereafter in effect relating to or
affecting creditor's rights generally and to general principles of equity
(whether applied in a proceeding at law or in equity).
(e) No Government Obligor. None of the
Receivables is due from the United States of America or any State thereof
or from any agency, department or instrumentality of the United States of
America or any State.
(f) Security Interest in Financed Vehicle.
Immediately prior to the sale, assignment and transfer thereof to the
Issuer, each Receivable shall be secured by a validly perfected first
security interest in the Financed Vehicle in favor of the related Seller as
secured party of all necessary and appropriate actions have been commenced
that would result in the valid perfection of a first security interest in
the Financed Vehicle in favor of the related Seller as secured party.
(g) Receivables in Force. No Receivable has been
satisfied, subordinated or rescinded, nor has any Financed Vehicle been
released from the lien granted by the related Receivable in whole or in
part.
(h) No Waiver. No provision of a Receivable has
been waived in such a manner that the Receivable fails to meet any other
representation or warranty of the Company with respect thereto.
(i) No Amendments. No Receivable has been
amended such that the amount of the Obligor's Scheduled Payments has been
increased except for increases resulting from the inclusion of any premiums
for forced placed physical damage insurance covering the Financed Vehicle.
(j) No Defenses. No facts are known to the
Company that would give rise to any right of defense, nor shall the same
have been asserted or threatened, with respect to any Receivable.
(k) No Liens. To the best of the Company' s
knowledge, no liens or claims have been filed for work, labor or materials
relating to a Financed Vehicle that are liens prior to, or equal to or
coordinate with, the security interest in the Financed Vehicle granted by
any Receivable.
(l) No Default. No Receivable has a payment that
is more than 90 days overdue as of the Cutoff Date, and, except as
permitted in this paragraph, no default, breach, violation or event
permitting acceleration under the terms of any Receivable has occurred; no
continuing condition that with notice or the lapse of time would constitute
a default, breach, violation or event permitting acceleration under the
terms of any Receivable has arisen; and the Company has not waived and
shall not waive any of the foregoing.
(m) Insurance. The related Seller, in accordance
with its customary procedures, has determined that the Obligor has obtained
physical damage insurance covering the Financed Vehicle and under terms of
the Receivable the Obligor is required to maintain such insurance.
(n) Title. It is the intention of the Company
that the transfer and assignment herein contemplated constitute a sale of
the Receivables from the Company to the Issuer and that 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
Company. No Receivable has been sold, transferred, assigned or pledged by
the Company to any Person other than the Issuer. Immediately prior to the
transfer and assignment herein contemplated, the Company had good and
marketable title to each Receivable conveyed by it hereunder to the Issuer,
free and clear of all Liens and rights of others and, immediately upon the
transfer thereof, the Issuer shall have good and marketable title to each
Receivable, free and clear of all Liens and rights of others; and the
transfer has been perfected under the UCC.
(o) Lawful Assignment. No Receivable has been
originated in, or is subject to the laws of, any jurisdiction under which
the sale, transfer and assignment of such Receivable or any Receivable
under this Agreement or the Indenture is unlawful, void or voidable.
(p) All Filings Made. All filings (including UCC
filings) necessary in any jurisdiction to give the Issuer a first perfected
ownership interest in the Receivables, and to give the Indenture Trustee a
first perfected security interest therein, shall have been made.
(q) One Original. There is only one original
executed copy of each Receivable.
(r) Maturity of Receivables. The weighted
average remaining term of the Receivables as of the Cutoff Date is
_________ months.
(s) Scheduled Payments. (1) No Receivable has
payment that is more than 90 days overdue as of the Cutoff Date; and (2) no
Receivable has a final scheduled payment date that is later than the Final
Scheduled Maturity Date.
(t) Location of Receivable Files. The Receivable
Files are kept at one or more of the locations listed in Schedule II.
(u) No Bankruptcies. No Obligor on any
Receivable as of the Cutoff Date was noted in the related Receivable File
as having filed for bankruptcy.
(v) No Repossessions. No Financed Vehicle
securing any Receivable is in repossession status.
(w) Chattel Paper. Each Receivable constitutes
"chattel paper" as defined in the UCC.
(x) Agreement. The representations and
warranties of the Company in Section 6.01 are true and correct.
(y) Financing. Approximately __% of the
aggregate principal balance of the Receivables, constituting ___% of the
number of the Receivables as of the Cutoff Date represents financing of new
vehicles and the remainder of the Receivables represents financing of used
vehicles; and approximately ____% of the aggregate principal balance of the
Receivables as of the Cutoff Date represents Precomputed Receivables and
the remainder of the Receivables represents Simple Interest Receivables.
The Principal Balance of the Receivables as of the Cutoff Date is
$-----------.
(z) APR. The weighted average Annual Percentage
Rate of the Receivables as of the Cutoff Date is approximately ____%.
Section 3.02 Repurchase upon Breach. The Company, the
Servicer or the Owner Trustee, as the case may be, shall inform the other
parties to this Agreement and the Indenture Trustee promptly, in writing,
upon the discovery of any breach of the Company's representations and
warranties made pursuant to Section 3.01 or 6.01. Unless any such breach
shall have been cured in all material respects by the last day of the
second Collection Period following the discovery thereof (and notice to the
Company) by the Owner Trustee or receipt by the Owner Trustee of written
notice from the Company or the Servicer of such breach, the Company shall
be obligated to repurchase any Receivable materially and adversely affected
by any such breach as of such last day (or, at the Company's option, the
last day of the first Collection Period following the discovery). In
consideration of the repurchase of any such Receivable, the Company shall
remit the Purchase Amount, in the manner specified in Section 5.05. The
sole remedy of the Issuer, the Owner Trustee, the Indenture Trustee, the
Noteholders or the Certificateholders with respect to a breach or
representations and warranties pursuant to Section 3.01 and the agreement
contained in this Section shall be to require the Company to repurchase
Receivables pursuant to this Section, subject to the conditions contained
herein.
Section 3.03 Custody of Receivable Files. To assure
uniform quality in servicing the Receivables and to reduce administrative
costs, the Issuer hereby revocably appoints the Servicer, and the Servicer
hereby accepts such appointment, to act for the benefit of the Issuer and
the Indenture Trustee as custodian of the following documents or
instruments which are hereby or will hereby be constructively delivered to
the Indenture Trustee, as pledgee of the Issuer as of the Closing Date:
(a) the fully executed original of each
Receivable;
(b) a filmed copy of each original credit
application as executed by the Obligor;
(c) the original certificate of title or such
documents that the Servicer shall keep on file, in accordance with its
customary procedures, evidencing the security interest of the related
Seller in each Financed Vehicle; and
(d) any and all other documents that the
Servicer shall keep on file, in accordance with its customary procedures,
relating to a Receivable, an Obligor or a Financed Vehicle.
Section 3.04 Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer shall hold the
Receivable Files as custodian for the benefit of the Issuer and maintain
such accurate and complete accounts, records and computer systems
pertaining to each Receivable File as shall enable the Issuer 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 automotive 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 Issuer or the Indenture Trustee to verify the accuracy of
the Servicer's record keeping. The Servicer shall promptly report to the
Issuer and the Indenture 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 Issuer or the Indenture Trustee of the
Receivables Files.
(b) Maintenance of and Access to Records. The
Servicer shall maintain each Receivable File at one of its offices
specified in Schedule II or at such other office as shall be specified to
the Issuer and the Indenture Trustee by written notice not later than 90
days after any change in location. The Servicer shall make available to the
Issuer and the Indenture Trustee or their respective 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 Issuer or the Indenture Trustee shall instruct.
(c) Release of Documents. Upon instruction from
the Indenture Trustee, the Servicer shall release any Receivable File to
the Indenture Trustee, the Indenture Trustee's agent or the Indenture
Trustee's designee, as the case may be, at such place or places as the
Indenture Trustee may designate, as soon as practicable, and upon the
release and delivery of any such document in accordance with the
instructions of the Indenture Trustee, the Servicer shall be released from
any further liability and responsibility under this Section 3.04 with
respect to such documents unless and until such time as such documents
shall be returned to the Servicer, and in no event shall the Servicer be
responsible for any loss occasioned by the Indenture Trustee's failure to
return any documents in a timely manner.
Section 3.05 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 Trust
Officer of the Indenture Trustee.
Section 3.06 Custodian's Indemnification. The Servicer as
custodian shall indemnify the Trust, the Owner Trustee and the Indenture
Trustee and each of their respective 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 Trust, the Owner Trustee or
the Indenture Trustee or any of their respective officers, directors,
employees and 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 Owner Trustee for any portion of any such amount resulting
from the willful misfeasance, bad faith or negligence of the Owner Trustee,
and the Servicer shall not be liable to the Indenture Trustee for any
portion of any such amount resulting from the willful misfeasance, bad
faith or negligence of the Indenture Trustee.
Section 3.07 Effective Period and Termination. The
Servicer's appointment as custodian shall become effective as of the
Closing Date and shall continue in full force and effect until terminated
pursuant to this Section. If the Servicer shall resign as Servicer in
accordance with the provisions of this Agreement or if all of the rights
and obligations of any Servicer shall have been terminated under Section
8.01, the appointment of such Servicer as custodian shall be terminated by
the Indenture Trustee or by the Holders of Notes evidencing not less than
25% of the Outstanding Amount of the Notes or, with the consent of Holders
of the Notes evidencing not less than 25% the Outstanding Amount of the
Notes or, with the consent of Holders of the Notes evidencing not less than
25% of the Outstanding Amount of the Notes, by the Owner Trustee or by
Certificateholders evidencing not less than 25% of the Certificate Balance,
in the same manner as the Indenture Trustee or such Holders may terminate
the rights and obligations of the Servicer under Section 8.01. The
Indenture Trustee or, with the consent of the Indenture Trustee, the Owner
Trustee may terminate the Servicer's appointment as custodian, with cause,
at any time upon written notification to the Servicer, and without cause
upon 30 days' prior written notification to the Servicer. As soon as
practicable after any termination of such appointment, the Servicer shall
deliver the Receivable Files to the Indenture Trustee or the Indenture
Trustee's agent at such place or places as the Indenture Trustee may
reasonably designate. Notwithstanding any termination of the Servicer as
custodian, the Indenture Trustee or Owner Trustee, as applicable, shall
provide, or shall cause its agent to provide, access to the Receivable
Files to the Servicer for the purpose of carrying out its duties and
responsibilities with respect to the servicing of the Receivables
hereunder.
ARTICLE IV
Administration and Servicing of Receivables
Section 4.01 Duties of Servicer. The Servicer, for the
benefit of the Issuer (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
automotive 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 Owner Trustee and the Indenture 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 to execute and deliver, on behalf of itself, the
Issuer, the Owner Trustee, the Indenture Trustee, the Certificateholders
and the Noteholders 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 the Receivables or to the Financed
Vehicles securing such Receivables. If the Servicer shall commence a legal
proceeding to enforce a Receivable, the Issuer (in the case of a 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 Owner 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 Owner Trustee, the Indenture
Trustee, the Certificateholders or the Noteholders. The Owner Trustee shall
upon the written request of the Servicer furnish the Servicer with any
powers of attorney and other documents reasonably necessary or appropriate
to enable the Servicer to carry out its servicing and administrative duties
hereunder.
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 automotive
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
automotive receivables that it services for itself or others. The Servicer
may grant extensions, rebates or adjustments on Receivable, which shall
not, for the purposes of this Agreement, modify the original due dates or
amounts of the Scheduled Payments on a Precomputed Receivable or the
original due dates or amounts of the originally scheduled payments of
interest on Simple Interest 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
repurchase the Receivable from the Issuer 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 on any Receivable or of the amount of any Scheduled
Payment on Precomputed Receivables or the originally Scheduled Payments on
Simple Interest Receivables.
Section 4.03 Realization upon Receivables. On behalf of
the Issuer, the Servicer shall use its best efforts, consistent with its
customary servicing procedures, to repossess or otherwise convert the
ownership of the Financed Vehicle 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 automotive
receivables, which may include reasonable efforts to realize upon any
recourse to Dealers and selling the Financed Vehicle at public or private
sale. The Servicer shall be entitled to recover all out-of-pocket expenses
incurred by it in the course of converting a Financed Vehicle into cash
proceeds. The foregoing shall be subject to the provision that, in any case
in which the Financed Vehicle shall have suffered damage, the Servicer
shall not expend funds in connection with the repair or the repossession of
such Financed Vehicle 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
shall, in accordance with its customary servicing procedures, require that
each Obligor shall have obtained physical damage insurance covering the
Financed Vehicle as of the execution of the Receivable.
Section 4.05 Maintenance of Security Interests in
Financed Vehicles. 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 Vehicle. The Servicer is hereby authorized to take such
steps as are necessary to re-perfect such security interest on behalf of
the Issuer and the Indenture Trustee in the event of the relocation of a
Financed Vehicle or for any other reason. In the event that the assignment
of a Receivable to the Trust is insufficient, without a notation on the
related Financed Vehicle's's certificate of title, to grant to the Trust a
first perfected security interest in the relaxed Financed Vehicle, the
Servicer hereby agrees to serve as the agent of the Trust for the purposes
of perfecting the security interest in such Financed Vehicle and that the
Servicer's listing as the secured party on the certificate of title is in
its capacity as agent of the Trust.
Section 4.06 Covenants of Servicer. The Servicer shall
not release the Financed Vehicle 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 the
Servicer impair the rights of the Issuer, the Indenture Trustee, the
Certificateholders or the Noteholders in such Receivable, 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 Owner Trustee shall inform the other party and the
Indenture Trustee and the Company promptly, in writing, upon the discovery
of any breach pursuant to Section 4.02, 4.05 or 4.06 that materially and
adversely affects the interests of the Trust in any Receivable. 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,
as of such last day, any Receivable that is materially and adversely
affected by such breach. 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 Precomputed Advances and Outstanding Simple Interest Advances
on the Receivable. The sole remedy of the Issuer, the Owner Trustee, the
Indenture Trustee, the Certificateholders or the Noteholders 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 Owner
Trustee shall have no duty to conduct any affirmative investigation as to
the occurrence of any condition requiring the repurchase of any Receivable
pursuant to this Section.
Section 4.08 Servicing Fee. As compensation for servicing
the Receivables, the Servicer shall be entitled to receive the Servicing
Fee on each Distribution Date, from the Interest Distribution Amount
available on such Distribution Date, in an amount equal to the product of
(a) one-twelfth, (b) the Servicing Fee 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 (including, in the case of
a Receivable that provides for payments according to the "Rule of 78s" and
that is prepaid in full, the difference between the Principal Balance of
such Receivable (plus accrued interest to the date of prepayment) and the
principal balance of such Receivable computed according to the "Rule of
78s"), and other administrative fees or similar charges allowed by
applicable law with respect to the Receivables, collected (from whatever
source) on the Receivables, as and when collected, plus any reimbursement
pursuant to the last paragraph of Section 7.02.
Section 4.09 Servicer's Certificate. Not later than 11:00
a.m. (New York time) on each Payment Determination Date, the Servicer shall
deliver to the Owner Trustee, each Paying Agent, the Indenture Trustee and
the Company, with a copy to the Rating Agencies, a Servicer's Certificate
containing all information necessary to make the distributions to be made
on the related Distribution Date pursuant to Section 5.06 and 5.07 for the
related Collection Period. Receivables to be purchased by the Servicer or
to be repurchased by the Company shall be identified by the Servicer by
account number with respect to such Receivable (as specified in Schedule
I).
Section 4.10 Annual Statement as to Compliance; Notice of
Default. (a) The Servicer shall deliver to the Owner Trustee and the
Indenture Trustee, on or before _____________________ of each year
beginning _________________, 200__, an Officers' Certificate, dated as of
_________________ of the preceding year, stating that (i) 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 under this Agreement has been made under such officers'
supervision and (ii) to the best of such officers' knowledge, 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 Indenture 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, Certificate Owner,
Noteholder or Note Owner by a request in writing to the Owner Trustee
addressed to the Corporate Trust Office. Upon the telephone request of the
Owner Trustee, the Indenture Trustee will promptly furnish the Owner
Trustee a list of Noteholders as of the date specified by the Owner
Trustee.
(b) The Servicer shall deliver to the Owner Trustee, the
Indenture Trustee and the Rating Agencies, promptly after having obtained
knowledge thereof, but in no event later than five (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 a
Servicer Default under Section 8.01(a) or (b). Section 4.11 Annual
Independent Certified Public Accountants' Report. The Servicer shall
deliver to the Owner Trustee and the Indenture Trustee on or before
_____________ of each year beginning _____________, a report of a firm of
independent certified public accountants, 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 (a) 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; (b) included tests relating to automotive
loans serviced for others in accordance with the requirements of the
Uniform Single Audit 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 (c) except as described in the
report, disclosed no exceptions or errors in the records relating to
automobile and light-duty truck 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 and Noteholders access to the Receivable Files in such
cases where the Certificateholders or Noteholders 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 respective 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.
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 and
Noteholders.
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, however, that the Rating
Agency Condition shall have been satisfied in connection therewith; and
provided, further, that the Servicer shall remain obligated and be liable
to the Issuer, the Owner Trustee, the Indenture Trustee, the
Certificateholders and the Noteholders 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
Issuer, the Owner Trustee, the Indenture Trustee, the Certificateholders or
the Noteholders shall have any responsibility therefor.
ARTICLE V
Distributions; Reserve Account; Statements to Certificateholders
and Noteholders
Section 5.01 Establishment of Trust Accounts. (a) (i) The
Servicer, for the benefit of the Noteholders and the Certificateholders,
shall establish and maintain in the name of the Indenture 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 Noteholders and the Certificateholders.
(ii) The Servicer, for the benefit of the
Noteholders, shall establish and maintain in the name of the
Indenture Trustee an Eligible Deposit Account (the "Note
Distribution Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Noteholders.
(iii) The Servicer, for the benefit of the
Noteholders and the Certificateholders, shall establish and
maintain in the name of the Indenture Trustee an Eligible Deposit
Account (the "Reserve Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the
benefit of the Noteholders and the Certificateholders.
(b) Funds on deposit in the Collection Account, the Note
Distribution Account and the Reserve Account (collectively the "Trust
Accounts") shall be invested (1) by the Indenture 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 it relates to investing such
funds or (2) by an investment manager in Eligible Investments selected by
such investment manager, provided that (A) such investment manager shall be
selected by the Servicer, (B) such investment manager shall have agreed to
comply with the terms of this Agreement as it relates to investing such
funds, (C) any investment so selected by such investment manager shall be
made in the name of the Indenture Trustee and shall be settled by a
Delivery to the Indenture Trustee that complies with the terms of this
Agreement as it relates to investing such funds, and (D) prior to the
settlement of any investment so selected by such investment manager the
Indenture Trustee shall affirm that such investment is an Eligible
Investment. It is understood and agreed that the Indenture Trustee shall
not be liable for any loss arising from an investment in Eligible
Investments made in accordance with this Section 5.01(b). All such Eligible
Investments shall be held by the Indenture Trustee for the benefit of the
Noteholders and the Certificateholders or the Noteholders, as applicable;
provided, that on each Payment Determination Date all interest and other
investment income (net of losses and investment expenses) on funds on
deposit in the Trust Accounts shall be deposited into the Collection
Account and shall be deemed to constitute a portion of the Interest
Distribution Amount for the related Distribution Date. Unless otherwise
permitted by the Rating Agencies, funds on deposit in the Collection
Account, the Reserve Account and the Note Distribution 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
trust department of the institution with which the Collection Account, the
Reserve Account, the Note Distribution Account or the Certificate
Distribution Account, as applicable, is then maintained and is invested in
a time deposit of ___________________ rated at least A-1 by Standard &
Poor's and P-1 by Moody's (such account being maintained within the trust
department of ___________________) or (y) the Indenture Trustee (so long as
the short-term unsecured debt obligations of the Indenture Trustee are
either (i) rated at least P-1 by Moody's and A-1 by Standard & Poor's on
the date such investment is made or (ii) 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 Note Distribution Account
and the Certificate 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
Indenture 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
a Trust Account on a day which immediately precedes a Distribution Date
upon the maturity of any Eligible Investments are not required to be
invested overnight.
(c) (i) The Indenture Trustee shall possess all right,
title and interest in all funds on deposit from time to time in the Trust
Accounts and in all proceeds thereof (including all income thereon) and all
such funds, investments, proceeds and income shall be part of the Trust
Estate. The Trust Accounts shall be under the sole dominion and control of
the Indenture Trustee for the benefit of the Noteholders and the
Certificateholders, as the case may be. If, at any time, any of the Trust
Accounts ceases to be an Eligible Deposit Account, the Indenture Trustee
(or the Servicer on its behalf) shall within 10 Business Days (or such
longer period, not to exceed 30 calendar days, as to which each Rating
Agency may consent) establish a new Trust Account as an Eligible Deposit
Account and shall transfer any cash and/or any investments to such new
Trust Account.
(ii) With respect to the Trust Account Property,
the Indenture Trustee agrees, by its acceptance hereof, that:
(A) any Trust Account Property that is
held in deposit accounts shall be held solely in the
Eligible Deposit Accounts, subject to the last sentence
of Section 5.01(c)(i); and each such Eligible Deposit
Account shall be subject to the exclusive custody and
control of the Indenture Trustee, and the Indenture
Trustee shall have sole signature authority with respect
thereto;
(B) any Trust Account Property that
constitutes Physical Property shall be delivered to the
Indenture Trustee in accordance with paragraph (a) of the
definition of "Delivery" and shall be held, pending
maturity or disposition, solely by the Indenture Trustee
or a financial intermediary (as such term is defined in
Section 8-313(4)) of the UCC acting solely for the
Indenture Trustee;
(C) any Trust Account Property that is a
book-entry security held through the Federal Reserve
System pursuant to Federal book-entry regulations shall
be delivered in accordance with paragraph (b) of the
definition of "Delivery" and shall be maintained by the
Indenture Trustee, pending maturity or disposition,
through continued book-entry registration of such Trust
Account Property as described in such paragraph; and
(D) any Trust Account Property that is an
"uncertificated security" under Article VIII of the UCC
and that is not governed by clause (C) above shall be
delivered to the Indenture Trustee in accordance with
paragraph (c) of the definition of "Delivery" and shall
be maintained by the Indenture Trustee, pending maturity
or disposition, through continued registration of the
Indenture Trustee's (or its nominee's) ownership of such
security.
(iii) The Servicer shall have the power,
revocable by the Indenture Trustee or by the Owner Trustee with
the consent of the Indenture Trustee, to instruct the Indenture
Trustee to make withdrawals and payments from the Trust Accounts
for the purpose of permitting the Servicer or the Owner Trustee to
carry out its respective duties hereunder or permitting the
Indenture Trustee to carry out its duties under the Indenture.
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) ___________ remains the Servicer, (ii) no Servicer Default shall have
occurred and be continuing and (iii)(x) ___________ maintains a short-term
rating of at least A-1 by Standard & Poor's and P-1 by Moody's (and for
five Business Days following a reduction in either such rating) or (y)
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 may remit
such collections with respect to the preceding calendar month to the
Collection Account on a less frequent basis, but in no event later than the
Payment Determination Date immediately preceding each 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.
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, in the case of Precomputed Receivables, to reduce
Outstanding Precomputed Advances as described in Section 5.04(a)
and, in the case of Simple Interest Receivables, to reduce
Outstanding Simple Interest Advances to the extent described in
Section 5.04(b). Next, any excess shall be applied, in the case of
Precomputed Receivables, to the Scheduled Payment and, in the case
of Simple Interest Receivables, to interest and principal in
accordance with the Simple Interest Method. With respect to
Precomputed Receivables, any remaining excess shall be added to
the Payahead Balance, and shall be applied to prepay the
Precomputed Receivable, but only if the sum of such excess and the
previous Payahead Balance shall be sufficient to prepay the
Receivable in full. Otherwise, any such remaining excess payments
shall constitute a Payahead and shall increase the Payahead
Balance.
If the Servicer is required to return a Payahead to the related Obligor,
the amount to be returned shall be retained by the Servicer from
collections on the Receivables allocable to principal and paid by the
Servicer to such Obligor.
Section 5.04 Advances. (a) As of the close of business on
the last day of each Collection Period, if the payments by or on behalf of
the Obligor on a Precomputed Receivable (other than a Purchased Receivable)
shall be less than the Scheduled Payment, the Payahead Balance shall be
applied by the Servicer to the extent of the shortfall and such Payahead
Balance shall be reduced accordingly. Next, the Servicer shall advance any
remaining shortfall (such amount, a "Precomputed Advance"), to the extent
that the Servicer, at its sole discretion, shall determine that the
Precomputed Advance shall be recoverable from the Obligor, the Purchase
Amount, Liquidation Proceeds or proceeds of any other Precomputed
Receivables. With respect to each Precomputed Receivable, the Precomputed
Advance shall increase Outstanding Precomputed Advances. Outstanding
Precomputed Advances shall be reduced by subsequent payments by or on
behalf of the Obligor, collections of Liquidation Proceeds in respect of
such Precomputed Receivables or payments of the Purchase Amount with
respect to such Precomputed Receivables.
If the Servicer shall determine that an Outstanding
Precomputed Advance with respect to any Precomputed Receivable shall not be
recoverable as aforesaid, the Servicer shall be reimbursed from any
collections made on other Precomputed Receivables in the Trust and
Outstanding Precomputed Advances with respect to such Precomputed
Receivables shall be reduced accordingly.
(b) 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 Simple Interest Receivables at their
respective APR's for the related Collection Period (assuming the Simple
Interest Receivables pay on their respective due dates) minus the amount of
interest actually received on the Simple Interest Receivables during the
related Collection Period (such amount, a "Simple Interest Advance"). With
respect to each Simple Interest Receivable, the Simple Interest Advance
shall increase Outstanding Simple Interest Advances. If such calculation
results in a negative number, an amount equal to such negative number shall
be paid to the Servicer and the amount of Outstanding Simple Interest
Advances shall be reduced by such amount. In addition, in the event that a
Simple Interest Receivable becomes a Liquidated Receivable, Liquidation
Proceeds with respect to such Simple Interest 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 Simple Interest Advances, but only to the extent of any
Outstanding Simple Interest Advances.
Section 5.05 Additional Deposits. The Servicer shall
deposit in the Collection Account on the Payment Determination Date for the
related Collection Period the aggregate Advances pursuant to Section 5.04.
To the extent that the Servicer fails to make a Simple Interest Advance
pursuant to Section 5.04(b) on the date required, the Servicer shall notify
the Indenture Trustee to 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 Company 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 9.01. The Servicer will 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. All such other deposits shall be
made on the Payment Determination Date for the related Collection Period.
Section 5.06 Distributions. (a) So long as (i) the
long-term unsecured indebtedness of the Servicer is rated Baa3 or better by
Moody's or (ii) the Rating Agency Condition is otherwise satisfied, the
Servicer will be entitled to receive the payment of the Servicing Fee in
respect of a Collection Period (and all unpaid Servicing Fees from prior
Collection Periods) at the beginning of each Collection Period from
payments on the Receivables received during such Collection Period.
(i) On each Payment Determination Date, the
Servicer shall calculate all amounts required to be deposited in
the Note Distribution Account and the Certificate Distribution
Account.
(ii) On each Distribution Date, the Servicer
shall instruct the Indenture Trustee (based on the information
contained in the Servicer's Certificate delivered on the related
Payment Determination Date pursuant to Section 4.09) to make the
following deposits and distributions for receipt by the Servicer
or deposit in the applicable account by 11:00 a.m. (New York
time), to the extent of the Total Distribution Amount, in the
following order of priority:
(A) to the extent the Servicer has not
received the payment of the Servicing Fee at the
beginning of the related Collection Period pursuant to
clause (a) above, to the Servicer, from the Interest
Distribution Amount, the Servicing Fee (and all unpaid
Servicing Fees from prior Collection Periods);
(B) to the Note Distribution Account,
from the Total Distribution Amount remaining after the
application of Section 5.06(a) and clause (A), the
Noteholders' Interest Distributable Amount;
(C) to the Note Distribution Account,
from the Total Distribution Amount remaining after the
application of Section 5.06(a) and clauses (A) and (B),
the Noteholders' Principal Distributable Amount;
(D) to the Certificate Distribution
Account, from the Total Distribution Amount remaining
after the application of Section 5.06(a) and clauses (A)
through (C), the Certificateholders' Interest
Distributable Amount;
(E) to the Certificate Distribution
Account, from the Total Distribution Amount remaining
after the application of Section 5.06(a) and clauses (A)
through (D), the Certificateholders' Principal
Distributable Amount;
(F) to the Reserve Account, from the
Total Distribution Amount remaining after the application
of Section 5.06(a) and clauses (A) through (E) (it being
understood that the Acceleration Principal Distribution
Amount is a function of and subject to the amount
required to be deposited in the Reserve Account pursuant
to this clause (F)), the amount, if any, necessary to
reinstate the balance in the Reserve Account up to the
Specified Reserve Account Balance; and
(G) to the Reserve Account, the portion,
if any, of the Total Distribution Amount remaining after
the application of Section 5.06(a) and clauses (A)
through (F).
Notwithstanding that the Notes have been paid in full,
the Indenture Trustee shall continue to maintain the Collection Account
hereunder until the Certificate Balance is reduced to zero.
Section 5.07 Reserve Account. (a) On the Closing Date,
the Owner Trustee will deposit, on behalf of the Company, the Reserve
Account Initial Deposit into the Reserve Account from the net proceeds of
the sale of the Notes and the Certificates.
(b) (i) After giving effect to clause (ii)
below, if the amount on deposit in the Reserve Account on any Distribution
Date (after giving effect to all deposits thereto or withdrawals therefrom
on such Distribution Date) is greater than the Specified Reserve Account
Balance for such Distribution Date, the Servicer shall instruct the
Indenture Trustee to distribute the amount of such excess to the Company.
(ii) On each Distribution Date subsequent to any
reduction or withdrawal by any Rating Agency of its rating of any
Class of Notes, unless such rating has been restored, if the
amount on deposit in the Reserve Account (taking into account any
deposits therein pursuant to Section 5.06(b) and withdrawals
therefrom on such date pursuant to Section 5.07(c), (d) or (e)) is
greater than the Specified Reserve Account Balance for such
Distribution Date, then the Servicer shall instruct the Indenture
Trustee to include the amount of such excess in the Noteholders'
Monthly Principal Distribution Amount and to deposit the amount of
such excess (up to the amount of cash or cash equivalents in the
Reserve Account) to the Collection Account for deposit to the Note
Distribution Account for distribution to Noteholders as an
accelerated payment of principal on such Distribution Date;
provided, that the amount of such deposit shall not exceed the
outstanding principal balance of the Notes after giving effect to
all other payments of principal to be made on such date.
(c) If the Servicer determines pursuant to
Section 5.04 that it is required to make an Advance on a Payment
Determination Date and does not do so from its own funds, the Servicer
shall instruct the Indenture Trustee to withdraw funds from the Reserve
Account and deposit them in the Collection Account to cover any shortfall.
Such payment shall be deemed to have been made by the Servicer pursuant to
Section 5.04 for purposes of making distributions pursuant to this
Agreement, but shall not otherwise satisfy the Servicer's obligation to
deliver the amount of the Advances, and the Servicer shall within two
Business Days replace any funds in the Reserve Account so used.
(d) (i) In the event that the Noteholders'
Distributable Amount for a Distribution Date exceeds the sum of the amounts
deposited into the Note Distribution Account pursuant to Section
5.06(b)(ii)(B) and (C) on such Distribution Date, the Servicer shall
instruct the Indenture Trustee to withdraw from the Reserve Account on such
Distribution Date an amount equal to such excess, to the extent of funds
available therein up to the Available Amount, and deposit such amount into
the Note Distribution Account.
In the event that the Noteholders' Principal
Distributable Amount on the Class A-1 Final Scheduled Distribution Date or
the Class A-2 Final Scheduled Distribution Date exceeds the amount
deposited into the Note Distribution Account pursuant to Section
5.06(b)(ii)(C) on such Distribution Date, the Servicer shall instruct the
Indenture Trustee to withdraw from the Reserve Account on such Distribution
Date an amount equal to such excess, to the extent of funds available
therein up to the Available Amount, and deposit such amount into the Note
Distribution Account.
(e) (i) In the event that the
Certificateholders' Distributable Amount for a Distribution Date exceeds
the sum of the amounts deposited into the Certificate Distribution Account
pursuant to Section 5.06(b)(ii)(D) and (E) on such Distribution Date, the
Servicer shall instruct the Indenture Trustee to withdraw from the Reserve
Account on such Distribution Date an amount equal to such excess, to the
extent of funds available therein up to the Available Amount after giving
effect to paragraphs (c) and (d) above, and deposit such amount into the
Certificate Distribution Account on such Distribution Date.
(ii) In the event that the Certificateholders'
Monthly Interest Distributable Amount for a Distribution Date
exceeds the amount deposited in the Certificate Distribution
Account pursuant to Section 5.06(b)(ii)(D), the Servicer shall
instruct the Indenture Trustee to withdraw from the Reserve
Account on such Distribution Date an amount equal to such excess,
to the extent of funds available therein, after giving effect to
paragraphs (d)(i) and (e)(i) above, up to the Certificate Interest
Reserve Amount with respect to such Distribution Date, and deposit
such amount into the Certificate Distribution Account.
(iii) In the event that the Certificateholders'
Principal Distributable Amount on the Final Scheduled Distribution
Date exceeds the amount deposited in the Certificate Distribution
Account pursuant to Section 5.06(b)(ii)(E), the Servicer shall
instruct the Indenture Trustee to withdraw from the Reserve
Account on such Distribution Date an amount equal to such excess,
to the extent of funds available therein after giving effect to
paragraphs (d) and (e)(i) above, and deposit such amount into the
Certificate Distribution Account.
(f) Subject to Section 9.01, amounts will
continue to be applied pursuant to Section 5.06(b) following payment in
full of the Outstanding Amount of the Notes and the Certificate Balance
until the Pool Balance is reduced to zero. Following the payment in full of
the aggregate Outstanding Amount of the Notes and the Certificate Balance
and of all other amounts owing or to be distributed hereunder or under the
Indenture or the Trust Agreement to Noteholders and Certificateholders and
the termination of the Trust, any amount remaining on deposit in the
Reserve Account shall be distributed to the Company.
(g) On the Final Scheduled Distribution Date, if
the amount of funds remaining in the Reserve Account (after all other
distributions to be made from the Reserve Account pursuant to this Section
have been made, other than paragraphs (b)(i) and (f)) is in excess of the
amounts described below, a portion of such excess according to the
following schedule shall be deposited in the Certificate Distribution
Account for distribution to Certificateholders:
(i) with respect to all such funds in the
Reserve Account in excess of $________ but which do not exceed
$_______________, 20% of such amount;
(ii) with respect to all such funds in the
Reserve Account in excess of $________ but which do not exceed
$_______________, 40% of such amount;
(iii) with respect to all such funds in the
Reserve Account in excess of $________ but which do not exceed
$_______________, 60% of such amount;
(iv) with respect to all such funds in the
Reserve Account in excess of $________ but which do not exceed
$_______________, 80% of such amount; and
(v) with respect to all such funds in the
Reserve Account in excess of $________, 100% of such amount.
The amounts to be deposited in the Certificate
Distribution Account pursuant to the preceding sentence are in excess of
all amounts otherwise required to be deposited in the Certificate
Distribution Account pursuant to this Agreement, notwithstanding anything
to the contrary contained herein.
Section 5.08 Statements to Certificateholders and
Noteholders. (a) On each Distribution Date, the Servicer shall provide to
the Indenture Trustee (with a copy to the Rating Agencies and each Paying
Agent) for the Indenture Trustee to forward to each Noteholder of record as
of the most recent Record Date and to the Owner Trustee (with a copy to
each Paying Agent) for the Owner Trustee to forward to each
Certificateholder of record as of the most recent Record Date a statement
substantially in the form of Exhibit B setting forth at least the following
information as to the Notes and the Certificates to the extent applicable:
(i) the amount of such distribution allocable to
principal allocable to each Class of Notes and to the
Certificates;
(ii) the amount of such distribution allocable
to interest allocable to each Class of Notes and to the
Certificates;
(iii) the outstanding principal balance of each
Class of Notes, the Note Pool Factor for each such Class, the
Certificate Balance and the Certificate Pool Factor as of the
close of business on the last day of the preceding Collection
Period, after giving effect to payments allocated to principal
reported under clause (i) above;
(iv) the amount of the Servicing Fee paid to the
Servicer with respect to the related Collection Period;
(v) the amount of Realized Losses, if any, with
respect to the related Collection Period;
(vi) the balance of the Reserve Account on such
Payment Determination Date after giving effect to deposits and
withdrawals to be made on the next following Distribution Date, if
any;
(vii) the aggregate Payahead Balance; and
(viii) the Pool Balance as of the close of
business on the last day of the related Collection Period, after
giving effect to payments allocated to principal reported under
subsection (a)(i) above, as reconciled.
Each amount set forth reconciling amounts on the
Distribution Date statement under clauses (i), (ii) or (iv) above shall be
expressed as a dollar amount per $1,000 of original principal balance of a
Certificate or Note, as applicable.
Section 5.09 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
the Collection Period net of distributions to be made to the Servicer with
respect to the Collection Period. The Servicer, however, will account to
the Owner Trustee, the Indenture Trustee, the Noteholders and the
Certificateholders as if all deposits, distributions and transfers were
made individually.
ARTICLE VI
The Company
Section 6.01 Representations of the Company. The Company
makes the following representations on which the Issuer is deemed to have
relied in acquiring the Receivables. The representations speak as of the
execution and delivery of this Agreement and as of the Closing Date and
shall survive the sale of the Receivables to the Issuer and the pledge
thereof to the Indenture Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Company
is duly organized and validly existing as a corporation in good standing
under the laws of the State of Delaware, with the corporate 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.
(b) Due Qualification. The Company 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.
(c) Power and Authority. The Company has the
corporate power and authority to execute and deliver this Agreement and to
carry out its terms; the Company has full power and authority to sell and
assign the property to be sold and assigned to and deposited with the
Issuer, and the Company shall have duly authorized such sale and assignment
to the Issuer by all necessary corporate action; and the execution,
delivery and performance of this Agreement has been duly authorized by the
Company by all necessary corporate action.
(d) Binding Obligation. This Agreement
constitutes a legal, valid and binding obligation of the Company
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization and similar laws now or hereafter in effect
relating to or affecting creditors' rights generally and to general
principles of equity (whether applied in a proceeding at law or in equity).
(e) No Violation. The consummation of the
transactions contemplated by this Agreement and the fulfillment of the
terms hereof do not conflict with, result in any breach of any of the terms
and provisions of, or constitute (with or without notice or lapse of time)
a default under, the articles of incorporation or bylaws of the Company, or
any material term of any indenture, agreement or other instrument to which
the Company 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 the Basic Documents); or violate any law or, to the best of the
Company's knowledge, any order, rule or regulation applicable to the
Company of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Company or its properties.
(f) No Proceedings. There are no proceedings or
investigations pending or, to the Company's knowledge, threatened, before
any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Company or its properties: (i)
asserting the invalidity of this Agreement, the Indenture or any of the
other Basic Documents, the Notes or the Certificates, (ii) seeking to
prevent the issuance of the Notes or the Certificates or the consummation
of any of the transactions contemplated by this Agreement, the Indenture or
any of the other Basic Documents, (iii) seeking any determination or ruling
that might materially and adversely affect the performance by the Company
of its obligations under, or the validity or enforceability of, this
Agreement, the Indenture, any of the other Basic Documents, the Notes or
the Certificates or (iv) relating to the Company and which might materially
and adversely affect the federal or state income tax attributes of the
Notes or the Certificates.
Section 6.02 Corporate Existence. During the term of this
Agreement, the Company 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, the
Basic Documents and each other instrument or agreement necessary or
appropriate to the proper administration of this Agreement and the
transactions contemplated hereby. In addition, all transactions and
dealings between the Company and its Affiliates will be conducted on an
arm's-length basis.
Section 6.03 Liability of the Company. The Company shall
be liable in accordance herewith only to the extent of the obligations
specifically undertaken and the representations and warranties made by the
Company under this Agreement.
Section 6.04 Merger or Consolidation of, or Assumption of
the Obligations of the Company. Any Person (a) into which the Company may
be merged or consolidated, (b) which may result from any merger or
consolidation to which the Company shall be a party or (c) which may
succeed to substantially all of the properties and assets of the Company,
which person in any of the foregoing cases executes an agreement of
assumption to perform every obligation of the Company under this Agreement,
shall be the successor to the Company 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 Servicer Default, and no event that,
after notice or lapse of time, or both, would become a Servicer Default
shall have occurred and be continuing, (ii) the Company shall have
delivered to the Owner Trustee and the Indenture 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, 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 Company shall have delivered to the Owner Trustee
and the Indenture Trustee an Opinion of Counsel either (A) stating that, in
the opinion of such counsel, 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 Owner Trustee
and Indenture Trustee, respectively, in the Receivables and reciting the
details of such filings, or (B) stating that, in the opinion of such
counsel, no such action shall be necessary to preserve and protect such
interests. 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 6.05 Limitation on Liability of the Company and
Others. The Company and any director, officer, employee or agent of the
Company 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 Company shall not be under
any obligation to appear in, prosecute or defend any legal action that
shall not be related to its respective obligations under this Agreement,
and that in the Company's opinion may involve it in any expense or
liability.
Section 6.06 The Company May Own Certificates or Notes.
The Company and any Affiliate thereof may in their individual or any other
capacity become the owner or pledgee of Certificates or Notes with the same
rights as they would have if it were not the Company or an Affiliate
thereof, except as expressly provided herein or in any Basic Document.
ARTICLE VII
The Servicer
Section 7.01 Representations of Servicer. The Servicer
makes the following representations on which the Issuer is deemed to have
relied in acquiring the Receivables. The representations speak as of the
execution and delivery of this Agreement and as of the Closing Date, and
shall survive the sale of the Receivables to the Issuer and the pledge
thereof to the Indenture Trustee pursuant to the Indenture.
(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 the corporate 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, sell and service the Receivables and to hold
the Receivable Files as custodian on behalf of the Trust and the Indenture
Trustee.
(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
corporate power and authority to execute and deliver this Agreement and to
carry out its terms; and the execution, delivery and performance of this
Agreement have been duly authorized by the Servicer by all necessary
corporate action.
(d) Binding Obligation. This Agreement
constitutes a legal, valid and binding obligation of the Servicer
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization and similar laws now or hereafter in effect
relating to or affecting creditor's rights generally and to general
principles of equity (whether applied in a proceeding at law or in equity).
(e) No Violation. The consummation of the
transactions contemplated by this Agreement and the 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 material term of 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 or
other governmental instrumentality having jurisdiction over the Servicer or
its properties: (i) asserting the invalidity of this Agreement, the
Indenture, any of the other Basic Documents, the Notes or the Certificates,
(ii) seeking to prevent the issuance of the Notes or the Certificates or
the consummation of any of the transactions contemplated by this Agreement,
the Indenture or any of the other Basic Documents, (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, the Indenture, any of the other Basic
Documents, the Notes or the Certificates or (iv) relating to the Servicer
and which might materially and adversely affect the federal or state income
tax attributes of the Notes or the Certificates.
(g) No Insolvent Obligors. As of the related
Cutoff Date, no Obligor on a Receivable is shown on the Receivable Files as
the subject of a bankruptcy proceeding.
Section 7.02 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 indemnify, defend and
hold harmless the Issuer, the Owner Trustee, the Indenture Trustee, the
Noteholders, the Certificateholders and the Company and any of the
officers, directors, employees and agents of the Issuer, the Owner Trustee
and the Indenture Trustee 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 Vehicle.
(b) The Servicer shall indemnify, defend and
hold harmless the Issuer, the Owner Trustee, the Indenture Trustee, the
Company, the Certificateholders and the Noteholders and any of the
officers, directors, employees and agents of the Issuer, the Owner Trustee
and the Indenture Trustee 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 the Servicer (or any successor
thereto pursuant to Section 7.03) as Servicer pursuant to Section 8.01, 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 Indenture Trustee) pursuant to Section 8.02.
Indemnification under this Section shall survive the
resignation or removal of the Owner Trustee or the Indenture 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 Person to or
on behalf of whom such payments are made thereafter collects any of such
amounts from others, such Person shall promptly repay such amounts to the
Servicer, without interest.
Section 7.03 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 or (c) which may
succeed to substantially all of the properties and assets of the Servicer,
which Person executed an agreement of assumption to perform every
obligation of the Servicer hereunder, 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 Servicer Default and no event which,
after notice or lapse of time, or both, would become a Servicer Default
shall have occurred and be continuing, (ii) the Servicer shall have
delivered to the Owner Trustee and the Indenture 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 to
such transaction have been complied with, (iii) the Rating Agency Condition
shall have been satisfied with respect to such transaction and (iv) the
Servicer shall have delivered to the Owner Trustee and the Indenture
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 Owner Trustee and the Indenture
Trustee, respectively, in the Receivables and reciting the details of such
filings or (B) no such action shall be necessary to preserve and protect
such interests. 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 clause (a), (b) or (c)
above.
Section 7.04 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 Issuer, the
Owner Trustee, the Indenture Trustee, the Noteholders 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 related 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 Basic Documents and the rights and duties
of the parties to this Agreement and the Basic Documents and the interests
of the Certificateholders under this Agreement and the Noteholders under
the Indenture.
Section 7.05 Servicer Not To Resign. Subject to the
provisions of Section 7.03, the Servicer shall not resign from the
obligations and duties hereby imposed on it as Servicer under this
Agreement except upon a determination that the performance of its duties
under this Agreement shall no longer be permissible under applicable law.
Notice of any such determination permitting the resignation of the Servicer
shall be communicated to the Owner Trustee and the Indenture Trustee at the
earliest practicable time (and, if such communication is not in writing,
shall be confirmed in writing at the earliest practicable time) and any
such determination shall be evidenced by an Opinion of Counsel to such
effect delivered to the Owner Trustee and the Indenture Trustee
concurrently with or promptly after such notice. No such resignation shall
become effective until the Indenture Trustee or a successor Servicer shall
have assumed the responsibilities and obligations of the Servicer in
accordance with Section 8.02.
ARTICLE VIII
Default
Section 8.01 Servicer Default. If any one of the
following events (a "Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to deliver to
the Indenture Trustee for deposit in any of the Trust Accounts or the
Certificate Distribution Account any required payment or to direct the
Indenture Trustee to make any required distributions therefrom, which
failure continues unremedied for a period of three Business Days after
written notice of such failure is received by the Servicer from the Owner
Trustee or the Indenture Trustee or after discovery of such failure by an
officer of the Servicer; or
(b) failure by the Servicer or the Company, 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 Company (as the case
may be) set forth in this Agreement or any other Basic Document, which
failure shall (i) materially and adversely affect the rights of
Certificateholders or Noteholders and (ii) 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 (A) to the
Servicer or the Company (as the case may be) by the Owner Trustee or the
Indenture Trustee or (B) to the Servicer or the Company (as the case may
be), and to the Owner Trustee and the Indenture Trustee by the Holders of
Notes or Certificates, as applicable, evidencing not less than 25% of the
Outstanding Amount of the Notes or 25% of the outstanding Certificate
Balance; or
(c) the occurrence of an Insolvency Event with
respect to the Company, the Servicer or the Company;
then, and in each and every case, so long as the Servicer Default shall not
have been remedied, either the Indenture Trustee or the Holders of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes,
by notice then given in writing to the Servicer (and to the Indenture
Trustee and the Owner Trustee if given by the Noteholders) may terminate
all the rights and obligations (other than the obligations set forth in
Section 7.02 hereof) 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 Notes, the
Certificates or the Receivables or otherwise, shall, without further
action, pass to and be vested in the Indenture Trustee or such successor
Servicer as may be appointed under Section 8.02; and, without limitation,
the Indenture Trustee and the Owner Trustee are hereby authorized and
empowered to execute and deliver, for the benefit 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, the Indenture Trustee and the
Owner 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 by it 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 a Servicer Default,
the Owner Trustee shall give notice thereof to the Rating Agencies.
Section 8.02 Appointment of Successor. (a) Upon the
Servicer's receipt of notice of termination pursuant to Section 8.01 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 earlier of (i) the date 45 days from the delivery to
the Owner Trustee and the Indenture Trustee of written notice of such
resignation (or written confirmation of such notice) in accordance with the
terms of this Agreement and (ii) 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 Indenture Trustee shall appoint a
successor Servicer, and the successor Servicer shall accept its appointment
by a written assumption in form acceptable to the Owner Trustee and the
Indenture 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 Indenture Trustee without
further action shall automatically be appointed the successor Servicer and
shall be entitled to the Servicing Fee. Notwithstanding the above, the
Indenture 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 automotive receivables, as
the successor to the Servicer under this Agreement.
(b) Upon appointment, the successor Servicer
(including the Indenture 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 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 8.03 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 8.04 Notification to Noteholders and
Certificateholders. Upon any termination of, or appointment of a successor
to, the Servicer pursuant to this Article VIII, the Owner Trustee shall
give prompt written notice thereof to Certificateholders, and the Indenture
Trustee shall give prompt written notice thereof to Noteholders and the
Rating Agencies.
Section 8.05 Waiver of Past Defaults. The Holders of
Notes evidencing not less than a majority of the Outstanding Amount of the
Notes or the Holders (as defined in the Trust Agreement) of Certificates
evidencing not less than a majority of the outstanding Certificate Balance
(in the case of any default which does not adversely affect the Indenture
Trustee or the Noteholders) may, on behalf of all Noteholders and
Certificateholders, waive in writing 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 any of the
Trust Accounts in accordance with this Agreement. Upon any such waiver of a
past default, such default shall cease to exist, and any Servicer 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 thereto.
ARTICLE IX
Termination
Section 9.01 Optional Purchase of All Receivables. (a) As
of the last day of any Collection Period immediately preceding a
Distribution Date as of which the then outstanding Pool Balance is 10% or
less of the Original Pool Balance and the Class A-1 Notes have been paid in
full, the Servicer shall have the option to purchase the Owner Trust
Estate, other than the Trust Accounts and the Certificate Distribution
Account; provided, however, that, unless Moody's agrees otherwise, the
Servicer may not effect any such purchase if the rating of the Servicer's
long-term debt obligations is less than Baa3 by Moody's, unless the Owner
Trustee and the Indenture Trustee shall have received an Opinion of Counsel
to the effect that such purchase would not constitute a fraudulent
conveyance. To exercise such option, the Servicer shall deposit pursuant to
Section 5.05 in the Collection Account an amount equal to the aggregate
Purchase Amount for the Receivables (including defaulted Receivables), plus
the appraised value of any such other property held by the Trust other than
the Trust Accounts and the Certificate Distribution Account, such value to
be determined by an appraiser mutually agreed upon by the Servicer, the
Owner Trustee and the Indenture Trustee, and shall succeed to all interests
in and to the Trust. Notwithstanding the foregoing, the Servicer shall not
be permitted to exercise such option unless the amount to be deposited in
the Collection Account pursuant to the preceding sentence is greater than
or equal to the sum of the outstanding principal balance of the Notes and
the Certificate Balance and all accrued but unpaid interest (including any
overdue interest and premium) thereon.
(b) Upon any sale of the assets of the Trust
pursuant to Section 9.02 of the Trust Agreement, the Servicer shall
instruct the Indenture Trustee to deposit the proceeds from such sale after
all payments and reserves therefrom have been made (the "Insolvency
Proceeds") in the Collection Account. On the Distribution Date on which the
Insolvency Proceeds are deposited in the Collection Account (or, if such
proceeds are not so deposited on a Distribution Date, on the Distribution
Date immediately following such deposit), the Servicer shall instruct the
Indenture Trustee to make the following deposits (after the application on
such Distribution Date of the Total Distribution Amount and funds on
deposit in the Reserve Account pursuant to Sections 5.06 and 5.07) from the
Insolvency Proceeds and any funds remaining on deposit in the Reserve
Account (including the proceeds of any sale of investments therein as
described in the following sentence):
(i) to the Note Distribution Account, any
portion of the Noteholders' Interest Distributable Amount not
otherwise deposited into the Note Distribution Account on such
Distribution Date;
(ii) to the Note Distribution Account, the
outstanding principal balance of the Notes (after giving effect to
the reduction in the outstanding principal balance of the Notes to
result from the deposits made in the Note Distribution Account on
such Distribution Date and on prior Distribution Dates);
(iii) to the Certificate Distribution Account,
any portion of the Certificateholders' Interest Distributable
Amount not otherwise deposited into the Certificate Distribution
Account on such Distribution Date; and
(iv) to the Certificate Distribution Account,
the Certificate Balance after giving effect to the reduction in
the Certificate Balance to result from the deposits made in the
Certificate Distribution Account on such Distribution Date).
Any investments on deposit in the Reserve Account or Note
Distribution Account which will not mature on or before such Distribution
Date shall be sold by the Indenture Trustee at such time as will result in
the Indenture Trustee receiving the proceeds from such sale not later than
the Payment Determination Date preceding such Distribution Date. Any
Insolvency Proceeds remaining after the deposits described above shall be
paid to the Company.
(c) As described in Article IX of the Trust
Agreement, notice of any termination of the Trust shall be given by the
Servicer to the Owner Trustee and the Indenture Trustee as soon as
practicable after the Servicer has received notice thereof.
(d) Following the satisfaction and discharge of
the Indenture and the payment in full of the principal of and interest on
the Notes, the Certificateholders will succeed to the rights of the
Noteholders hereunder other than Section 5.07(b) and the Owner Trustee will
succeed to the rights of, and assume the obligations of, the Indenture
Trustee pursuant to this Agreement.
ARTICLE X
Miscellaneous
Section 10.01 Amendment. This Agreement may be amended by
the Company, the Servicer and the Issuer, with the consent of the Indenture
Trustee, but without the consent of any of the Noteholders or 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 of the provisions in this
Agreement or of modifying in any manner the rights of the Noteholders or
the Certificateholders; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel delivered to the Owner Trustee and the
Indenture Trustee, adversely affect in any material respect the interests
of any Noteholder or Certificateholder. This Agreement may also be amended
from time to time by the Company, the Servicer and the Issuer, with the
consent of the Holders of Notes evidencing not less than a majority of the
Outstanding Amount of the Notes and the consent of the Holders (as defined
in the Trust Agreement) of outstanding Certificates evidencing not less
than a majority of the outstanding Certificate Balance, for the purpose of
adding any provisions to or changing in any manner or eliminating any of
the provisions of this Agreement or of modifying in any manner the rights
of the Noteholders or the Certificateholders; provided, however, that no
such amendment shall (a) except as otherwise provided in the first
paragraph of this Section, 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 for the
benefit of the Noteholders or the Certificateholders or (b) reduce the
aforesaid percentage of the Outstanding Amount of the Note and the
Certificate Balance, the Holders of which are required to consent to any
such amendment, without the consent of the Holders of all the outstanding
Notes and the Holders (as defined in the Trust Agreement) of all the
outstanding Certificates.
Promptly after the execution of any such amendment or
consent, the Owner Trustee shall furnish written notification of the
substance of such amendment or consent to each Certificateholder, the
Indenture Trustee and each of the Rating Agencies.
It shall not be necessary for the consent of
Certificateholders or Noteholders 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.
Prior to the execution of any amendment to this
Agreement, the Owner Trustee and the Indenture Trustee shall be entitled to
receive and rely upon an Opinion of Counsel stating that the execution of
such amendment is authorized or permitted by this Agreement and the Opinion
of Counsel referred to in Section 10.02(i)(1). The Owner Trustee and the
Indenture Trustee may, but shall not be obligated to, enter into any such
amendment which affects the Owner Trustee's or the Indenture Trustee's, as
applicable, own rights, duties or immunities under this Agreement or
otherwise.
Section 10.02 Protection of Title to Trust. (a) The
Company and the Servicer 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 the interest of the Issuer and of the Indenture
Trustee in the Receivables and in the proceeds thereof. The Company and the
Servicer shall deliver (or cause to be delivered) to the Owner Trustee and
the Indenture Trustee file-stamped copies of, or filing receipts for, any
document filed as provided above, as soon as available following such
filing.
(b) Neither the Company nor the Servicer shall
change their respective name, identity or corporate structure in any manner
that would, could or might make any financing statement or continuation
statement or continuation statement filed in accordance with paragraph (a)
above seriously misleading within the meaning of (S) 9-4.02(7) of the UCC,
unless the Company or the Servicer, as the case may be, shall have given
the Owner Trustee and the Indenture 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) The Company and the Servicer shall have an
obligation to give the Owner Trustee and the Indenture 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 each office from which it shall
service Receivables, and its principal executive office, 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 Collection Account and the Payahead Account in respect of such
Receivable.
(e) The Servicer shall maintain its computer
systems so that, from and after the time of sale under this Agreement of
the Receivables, the Servicer's master computer records (including any
backup archives) that refer to a Receivable shall indicate clearly the
interest of the Issuer and the Indenture Trustee in such Receivable and
that such Receivable is owned by the Issuer and has been pledged to the
Indenture Trustee. Indication of the Issuer's and the Indenture Trustee's
interest in a Receivable shall be deleted from or modified on the
Servicer's computer systems when, and only when, the related Receivable
shall have been paid in full or repurchased.
(f) If at any time the Company or the Servicer
shall propose to sell, grant a security interest in or otherwise transfer
any interest in automotive 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 printouts (including
any restored from backup archives) that, if they shall refer in any manner
whatsoever to any Receivable, shall indicate clearly that such Receivable
has been sold and is owned by the Issuer and has been pledged to the
Indenture Trustee.
(g) The Servicer shall permit the Indenture
Trustee and its agents to inspect, audit and make copies of and abstracts
from the Servicer's records regarding any Receivable at any time during
normal business hours upon reasonable notice.
(h) Upon request, the Servicer shall furnish to
the Owner Trustee or to the Indenture 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 and to each of the Servicer's Certificates
furnished before such request indicating removal of Receivables from the
Trust.
(i) The Servicer shall deliver to the Owner
Trustee and the Indenture Trustee:
(1) promptly after the execution and
delivery of this Agreement and of each amendment hereto, an
Opinion of Counsel stating that, in the opinion of such counsel,
either (A) all financing statements and continuation statements
have been executed and filed that are necessary fully to preserve
and protect the interest of the Owner Trustee and the Indenture
Trustee in the Receivables, and reciting the details of such
filings or referring to prior Opinions of Counsel in which such
details are given, or (B) no such action shall be necessary to
preserve and protect such interest; and
(2) within 90 days after the beginning of
each calendar year beginning with the first calendar year
beginning more than three months after the Cutoff Date to occur,
an Opinion of Counsel, dated as of a date during such 90-day
period, stating that, in the opinion of such counsel, either (A)
all financing statements and continuation statements have been
executed and filed that are necessary fully to preserve and
protect the interest of the Owner Trustee and the Indenture
Trustee in the Receivables, and reciting the details of such
filings or referring to prior Opinions of Counsel in which such
details are given, or (B) no such action shall be necessary to
preserve and protect such interest.
Each Opinion of Counsel referred to in clause (1) or (2) above shall
specify any action necessary (as o the date of such opinion) to be taken in
the following year to preserve and protect such interest.
(j) The Company shall, to the extent required by
applicable law, cause the Certificates and the Notes to be registered with
the Commission pursuant to Section 12(b) or Section 12(g) of the Exchange
Act within the time periods specified in such sections.
Section 10.03 Notices. All demands, notices,
communications and instructions upon or to the Company, the Servicer, the
Owner Trustee, the Indenture 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 Company, _____________________,
Attention _______________; (b) in the case of the Servicer, to
_________________________________, Attention _____________; (c) in the case
of the Indenture Trustee, at the Corporate Trust Office; (d) in the case of
the Owner Trustee, at the Corporate Trust Office; (e) in the case of the
Rating Agencies, ----------------------------------------- ; or, as to each
of the foregoing, at such other address as shall be designated -by written
notice to the other parties.
Section 10.04 Assignment by the Company or the Servicer.
Notwithstanding anything to the contrary contained herein, except as
provided in the remainder of this Section, as provided in Sections 6.04 and
7.03 herein and as provided in the provisions of this Agreement concerning
the resignation of the Servicer, this Agreement may not be assigned by the
Company or the Servicer. The Issuer and the Servicer hereby acknowledge and
consent to the conveyance and assignment by the Company
to_______________________, of any and all of the Company rights and
interests (and corresponding obligations, if any) hereunder with respect to
receiving amounts from the Reserve Account, and the Issuer and the Servicer
hereby agree that any such assignee of the Company, shall be entitled to
enforce such rights and interests directly against the Issuer as if such
assignee of the Company, were itself a party to this Agreement.
Section 10.05 Limitations on Rights of Others. The
provisions of this Agreement are solely for the benefit of the Company (and
any assignee of the Company pursuant to Section 10.04), the Servicer, the
Issuer, the Owner Trustee, the Certificateholders, the Indenture Trustee
and the Noteholders, and nothing in this Agreement, whether express or
implied, shall be construed to give to any other Person any legal or
equitable right, remedy or claim in the Owner Trust Estate or under or in
respect of this Agreement or any covenants, conditions or provisions
contained herein.
Section 10.06 Severability. Any provision of this
Agreement that is prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
Section 10.07 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 10.08 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 10.09 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 hereunder shall be determined in accordance
with such laws.
Section 10.10 Assignment by Issuer. The Company hereby
acknowledges and consents to any mortgage, pledge, assignment and grant of
a security interest by the Issuer to the Indenture Trustee pursuant to the
Indenture for the benefit of the Noteholders of all right, title and
interest of the Issuer in, to and under the Receivables and/or the
assignment of any or all of the Issuer's rights and obligations hereunder
to the Indenture Trustee.
Section 10.11 Nonpetition Covenant. Notwithstanding any
prior termination of this Agreement, the Servicer shall not, prior to the
date which is one year and one day after the termination of this Agreement
with respect to the Issuer or the Company, acquiesce, petition or otherwise
invoke or cause the Issuer or the Company (or any assignee of the Company
pursuant to Section 10.04) to invoke the process of any court or government
authority for the purpose of commencing or sustaining a case against the
Issuer or the Company (or any assignee of the Company pursuant to Section
10.04) 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 Issuer or the Company (or any
assignee of the Company pursuant to Section 10.04) or any substantial part
of its property, or ordering the winding up or liquidation of the affairs
of the Issuer or the Company (or any assignee of the Company pursuant to
Section 10.04).
Section 10.12 Limitation of Liability of Owner Trustee
and Indenture Trustee. (a) Notwithstanding anything contained herein to the
contrary, this Agreement has been countersigned by ___________________ not
in its individual capacity but solely in its capacity as Owner Trustee of
the Issuer and in no event shall _______________ in its individual capacity
or, except as expressly provided in the Trust Agreement, as beneficial
owner of the Issuer have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in
any of the certificates, notices or agreements delivered pursuant hereto,
as to all of which recourse shall be had solely to the assets of the
Issuer. For all purposes of this Agreement, in the performance of its
duties or obligations hereunder or in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee shall be subject to,
and entitled to the benefits of, the terms and provisions of Articles VI,
VII and VIII of the Trust Agreement.
(b) Notwithstanding anything contained herein to
the contrary, this Agreement has been accepted by The Bank of New York, not
in its individual capacity but solely as Indenture Trustee and in no event
shall The Bank of New York have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer
hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the
assets of the Issuer.
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.
[ ] VEHICLE RECEIVABLES TRUST 200[ ]-[ ]
By: _____________, not in its individual
capacity but solely as Owner Trustee
on behalf of the Trust
By:_____________________________________
Name:
Title:
[GS Mortgage Securities Corp. ], as Company
By: __________________________________________
Name:
Title:
____________________________, as Servicer
By: __________________________________________
Name:
Title:
Acknowledged and accepted as
of the day and year first above
written:
---------------------------------
not in its individual capacity
but solely as Indenture Trustee
By: _______________________________
Name:
Title:
SCHEDULE I
Schedule of Receivables
-----------------------
[To be Delivered to the Trust at Closing]
SCHEDULE II
Location of Receivable Files
[To be supplied]
EXHIBIT A
[To be supplied]
EXHIBIT B
[To be supplied]
