EXHIBIT 10.6
EXECUTION COPY
XXXXXXX XXXXX MORTGAGE COMPANY
AS MASTER SERVICER
AND
THE HUNTINGTON NATIONAL BANK,
AS SERVICER
SERVICING AGREEMENT
DATED AS OF AUGUST 2, 2006
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS ............................................................. 1
Section 1.01 Definitions ......................................................... 1
Section 1.02 Other Definitional Provisions ....................................... 10
ARTICLE II POSSESSION OF RECEIVABLE FILES .......................................... 11
Section 2.01 Possession of Receivable Files ...................................... 11
Section 2.02 Custody of the Receivables Files, Duties of Servicer as Custodian ... 11
Section 2.03 Protection of Right, Title and Interest ............................. 14
ARTICLE III REPRESENTATIONS AND WARRANTIES; REMEDIES AND BREACH ..................... 15
Section 3.01 Bank Representations and Warranties ................................. 15
ARTICLE IV ADMINISTRATION AND SERVICING OF RECEIVABLES ............................. 16
Section 4.01 Servicer ............................................................ 16
Section 4.02 Realization of Receivables .......................................... 18
Section 4.03 Commingling of Collections Related to the Receivables ............... 19
Section 4.04 Permitted Retention of Collections by the Servicer .................. 20
Section 4.05 Errors and Omissions Insurance ...................................... 20
Section 4.06 Remittance of HNB GAP Amounts ....................................... 21
ARTICLE V PAYMENTS TO PURCHASER ................................................... 21
Section 5.01 Remittances ......................................................... 21
Section 5.02 Servicer Reports .................................................... 22
Section 5.03 Monthly Advances by Servicer ........................................ 22
ARTICLE VI GENERAL SERVICING PROCEDURES ............................................ 23
Section 6.01 Satisfaction of Receivables and Release of Receivable Files ......... 23
Section 6.02 Annual Statement as to Compliance ................................... 23
Section 6.03 Accountants' Reports ................................................ 23
Section 6.04 Right to Examine Servicer Records ................................... 24
Section 6.05 System Backup File .................................................. 24
ARTICLE VII SERVICER TO COOPERATE ................................................... 24
Section 7.01 Provision of Information ............................................ 24
Section 7.02 Financial Statements; Servicing Facility ............................ 25
ARTICLE VIII THE SERVICER ............................................................ 26
Section 8.01 Indemnification of Third Party Claims by the Servicer ............... 26
Section 8.02 Merger or Consolidation of the Servicer ............................. 27
Section 8.03 Limitation on Liability of Servicer and Others ...................... 28
Section 8.04 Limitation on Resignation and Assignment by Servicer ................ 28
ARTICLE IX PASS-THROUGH TRANSFER ................................................... 29
Section 9.01 Effect of Pass-Through Transfer ..................................... 29
ARTICLE X DEFAULT ................................................................. 30
Section 10.01 Servicer Termination Events ......................................... 30
Section 10.02 Waiver of Servicer Termination Events ............................... 32
ARTICLE XI TERMINATION ............................................................. 32
Section 11.01 Termination ......................................................... 32
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TABLE OF CONTENTS
(continued)
PAGE
ARTICLE XII MISCELLANEOUS PROVISIONS ................................................ 32
Section 12.01 Successor to Servicer ............................................... 32
Section 12.02 Amendment ........................................................... 33
Section 12.03 Governing Law; Jurisdiction; Waiver of Jury Trial ................... 33
Section 12.04 Duration of Agreement ............................................... 34
Section 12.05 Notices ............................................................. 34
Section 12.06 Severability of Provisions .......................................... 35
Section 12.07 Effect on Purchase Agreement ........................................ 35
Section 12.08 Relationship of Parties ............................................. 36
Section 12.09 Counterparts ........................................................ 36
Section 12.10 Successors and Assigns .............................................. 36
Section 12.11 Assignment by Purchaser ............................................. 36
Section 12.12 No Waiver; Cumulative Remedies ...................................... 36
Section 12.13 Further Assurances .................................................. 36
Section 12.14 Effect of Headings; Cross-References ................................ 36
Section 12.15 No Petition Covenant ................................................ 37
Section 12.16 Third Party Beneficiaries ........................................... 37
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EXHIBITS
Exhibit A [Reserved]
Exhibit B Location of Receivable Files
Exhibit C [Reserved]
Exhibit D [Reserved]
Exhibit E [Reserved]
Exhibit F-1 [Reserved]
Exhibit F-2 [Reserved]
Exhibit F-3 List of Monthly Servicer Reports
Exhibit F-4 Form of Servicer Reports (on CD-ROM)
Exhibit G Servicing Standards
Exhibit H-1 [Reserved]
Exhibit H-2 [Reserved]
Exhibit H-3 [Reserved]
Exhibit H-4 [Reserved]
Exhibit I Form of Servicer Annual Statement as to Compliance
Exhibit J [Reserved]
Exhibit K Wire Instructions for the Master Servicer
Exhibit L [Reserved]
Exhibit M [Reserved]
Exhibit N [Reserved]
Exhibit O [Reserved]
Exhibit P [Reserved]
Exhibit Q [Reserved]
Exhibit R [Reserved]
Exhibit S [Reserved]
Exhibit T [Reserved]
SCHEDULES
Schedule 1 [Reserved]
Schedule 2 Form of Lost Note Affidavit
APPENDIXES
Appendix A Servicing Criteria
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This is a Servicing Agreement (this "Agreement") for various retail
automobile and light duty truck loan and installment sale contracts, dated and
effective as of August 2, 2006, and is executed between Xxxxxxx Sachs Mortgage
Company, as master servicer (together with its successors and assigns, the
"Master Servicer"), and The Huntington National Bank, as servicer (together with
its permitted successors and assigns, in such capacity, the "Servicer").
WITNESSETH
WHEREAS, GS Whole Loan Trust II has previously purchased from The
Huntington National Bank, a pool of retail automobile and light truck loan and
installment sale contracts (collectively, the "Receivables") pursuant to a
Purchase Agreement dated June 7, 2005;
WHEREAS, the Purchaser intends to pool the Receivables with other
portfolios of retail automobile and light truck loan and installment sale
contracts originated by other financial institutions, and sell the Receivables
and such other receivables in a securitization;
WHEREAS, the Master Servicer has undertaken the primary servicing
responsibility under the securitization documents for the Receivables and the
other pooled receivables;
WHEREAS, under this Agreement, the Servicer agrees to act as a
subservicer for the Master Servicer for the portion of the securitized portfolio
of retail automobile and light truck loan and installment sale contracts
constituting the Receivables sold pursuant to the Purchase Agreement;
WHEREAS, the Master Servicer desires for the Servicer to service the
Receivables, and the Servicer is willing to service the Receivables, in the
manner provided in this Agreement; and
WHEREAS, the Master Servicer and the Servicer wish to prescribe the
terms of the servicing and control of the Receivables.
NOW, THEREFORE, in consideration of the mutual agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, the parties hereto (each,
a "Party," and collectively, the "Parties") agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 DEFINITIONS.
Whenever used herein, the following words and phrases, unless the
content otherwise requires, shall have the following meanings:
"ABS INFORMATIONAL AND COMPUTATIONAL MATERIAL" means "ABS
informational and computational material" as that term is defined in Item 1101
of Regulation AB; PROVIDED,
HOWEVER, that Derived Information shall not be considered to comprise ABS
Informational and Computational Material.
"AFFILIATE" means, when used with reference to a specified Person,
any Person that directly or indirectly controls or is controlled by or is under
common control with the specified Person.
"AGREEMENT" means this Servicing Agreement, including all schedules
and exhibits hereto, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms hereof.
"AMOUNT FINANCED" means, with respect to a Receivable, the amount
advanced under the Receivable toward the purchase price of the Financed Vehicle
and any related costs, including but not limited to, service warranties.
"APPLICABLE LAW" means all provisions of statutes, rules and
regulations, interpretations and orders of any Governmental Authority applicable
to a Person, and all orders and decrees of all courts and arbitrators in
proceedings or actions in which the Person in question is a party including
applicable federal, state and local laws and regulations thereunder.
"ASSIGNMENT, ASSUMPTION AND RECOGNITION AGREEMENT" means an
agreement in substantially the form of Exhibit J hereto.
"BANK" means HNB, in its capacity as Servicer hereunder.
"BANK INFORMATION" means any and all information and documentation,
in any form, provided by the Bank relating to the Bank and its Affiliates, the
Receivables (including historical loss and delinquency data), the origination
and servicing of the Receivables or the Seller's underwriting criteria and any
and all information provided by the Bank pursuant to Section 9.01.
"BUSINESS DAY" means any day other than (a) a Saturday or Sunday, or
(b) a day on which banking or savings and loan institutions in the States of New
York or Delaware or the jurisdiction of the principal place of business of the
Servicer are authorized or obligated by law or executive order to be closed.
"CLOSING DATE" means the closing date of the public offering of
notes by Xxxxxxx Xxxxx Auto Loan Trust 2006-1.
"COLLATERAL" means the Financed Vehicles and any other property
securing a Receivable.
"COLLECTION PERIOD" means, with respect to each Remittance Date, the
calendar month preceding the month in which such Remittance Date occurs.
"COLLECTIONS" means, with respect to each Receivable, without
duplication:
(i) all payments on account of interest and principal;
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(ii) all Liquidation Proceeds;
(iii) all Insurance Proceeds (other than proceeds to be applied to
the restoration or repair of the related Financed Vehicle or released to the
related Obligor in accordance with the terms of the related Receivable);
(iv) all GAP Amounts payable by the Seller pursuant to Section
4.06.
(v) any Monthly Advances required to be paid by the Servicer
pursuant to Section 5.03:
(vi) any amounts payable in connection with the purchase or
repurchase of any Receivable pursuant to this Agreement;
(vii) any Deficiency Balance recoveries payable pursuant to Section
4.02(b);
(viii) any rebate of an unearned insurance premium, service warranty
or other amount received by the Servicer which was financed in the contract for
a Financed Vehicle; and
(ix) any other amounts received by the Servicer in respect of a
Receivable;
PROVIDED, THAT "COLLECTIONS" does not include (A) any payments and proceeds
(including Liquidation Proceeds and Insurance Proceeds) of any repurchased
Receivables, the Receivables Repurchase Price of which has been included in the
Collections in a prior Collection Period, (B) any Late Fees collected by and
paid to the Servicer and (C) costs and expenses incurred by the Servicer for or
on behalf of an Obligor (such as retitling costs) that such Obligor repays to
the Servicer.
"COLLECTOR" has the meaning assigned to such term in Section
4.02(b).
"COMMISSION" means the United States Securities and Exchange
Commission.
"CONTRACT RATE" means, with respect to each Receivable, the annual
rate of interest applicable to such Receivable stated in the applicable loan or
installment sale contract.
"CPI POLICY" means an individual physical loss and damage insurance
policy, together with all endorsements thereto, issued by an Eligible Insurance
Provider to Servicer or to Servicer and the Obligor on a Receivable and obtained
by the Servicer with respect to a Financed Vehicle for which the related Obligor
fails to maintain physical loss and damage insurance as required by the related
Receivable.
"CRAM DOWN LOSS" means, with respect to a Receivable, any loss
resulting from an order issued by a court of appropriate jurisdiction in an
insolvency proceeding that reduces the amount owed on a Receivable or otherwise
modifies or restructures the scheduled payments to be made thereon. The amount
of any such Cram Down Loss will equal the excess of (i) the Principal Balance of
the Receivable immediately prior to such order over (ii) the Principal Balance
of such Receivable as so reduced, modified or restructured. A Cram Down Loss
will be deemed to have occurred at the end of the Collection Period in which the
Servicer enters the
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Cram Down Loss into its computer system (and Servicer shall make such entry
within two Business Days after receipt of notice of such order).
"DEFAULTED RECEIVABLE" means, with respect to any Collection Period,
a Receivable (a) which, at the end of such Collection Period, is deemed
uncollectible by the Servicer in accordance with the Servicing Standard, (b) in
respect of which the Servicer has repossessed the related Financed Vehicle and
such Financed Vehicle has been liquidated during such Collection Period, (c) in
respect of which the Servicer has repossessed the related Financed Vehicle and
has held such Financed Vehicle in its repossession inventory for 60 (sixty) days
or more as of the last day of such Collection Period, (d) which becomes 120 days
past due during such Collection Period and in respect of which the related
Financed Vehicle is not in repossession inventory or (e) which becomes 180 days
past due during such Collection Period.
"DEFICIENCY BALANCE" means the outstanding Principal Balance of a
Defaulted Receivable remaining unpaid after the application, to reduce the
Principal Balance of such Receivable, of all Liquidation Proceeds, Insurance
Proceeds and any payments under HNB GAP delivered to the Issuer or Master
Servicer under Section 4.06(a), in each case, to the extent received for such
Defaulted Receivable and after all proceeds have been received from the
disposition of the related Financed Vehicle.
"DETERMINATION DATE" means the fourth Business Day preceding the
Remittance Date, or if such day is not a Business Day, the immediately preceding
Business Day.
"DISTORTED INFORMATION" means any additional changes, calculations,
processing, manipulation or formatting applied to Bank Information by the Master
Servicer or any underwriter or initial purchaser in a Prospectus or term sheet
in any ABS Informational and Computational Material in such a manner and to the
extent that the substance or meaning of such information in the form in which it
was disclosed in such Prospectus or term sheet is substantively different than
the substance or meaning of the Seller Information in the form in which it was
provided by the Bank. For further clarity, the term "Purchaser Distortions"
shall include only the additional changes, calculations, processing,
manipulation or formatting made by the Purchaser or any underwriter or initial
purchaser and shall exclude all Bank Information in the form provided by the
Bank.
"ELIGIBLE INSURANCE PROVIDER" means (a) any insurance company that
is licensed to do business in the state or states in which its policy or
policies of insurance are issued and which is rated A+ or better by A.M. Best,
and (b) Ohio Indemnity Company in connection with the issuance of a VSI Policy.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"FINANCED VEHICLE" means a new or used automobile or light truck
which secures a Receivable.
"FITCH" means Fitch, Inc. and its successors.
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"GAP AMOUNT" means the amount of the outstanding Principal Balance
of a Receivable which Seller determines is required to be cancelled pursuant to
HNB GAP (as described in the related contract or other documents), if the
Obligor on such Receivable has purchased HNB GAP.
"GOVERNMENTAL AUTHORITY" means the government of the United States
of America or any political subdivision thereof, whether state, federal or
local, and any agency, authority, instrumentality, regulatory body, court,
administrative court or judge, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or
functions of or pertaining to government.
"HNB" means The Huntington National Bank, a national banking
association organized under the laws of the United States of America.
"HNB GAP" means HNB's debt cancellation plan pursuant to which some
or all of the outstanding Principal Balance of a Receivable is required to be
cancelled as provided under the terms of the debt cancellation plan as set forth
in the contract or related documents for the related Receivable.
"INSURANCE PROCEEDS" means proceeds of any insurance policy or
service warranty related to a Receivable or the related Collateral, to the
extent such proceeds are not to be applied to the restoration of the related
Financed Vehicle or released to the Obligor in accordance with Applicable Law or
the procedures that the Servicer would follow in servicing retail automobile and
light duty truck loan and installment sale contracts or repossessed collateral
held for its own account. For the sake of clarity it is understood that HNB GAP
is not a policy of insurance and that payments under HNB GAP with respect to a
Receivable are not Insurance Proceeds.
"INTEREST COLLECTIONS" means that portion of Collections that are
allocated or allocable to payment of interest in accordance with the Simple
Interest Method and the terms of each Receivable.
"LATE FEES" means any late fees, prepayment charges, extension fees,
pass-a-payment fees, or other administrative fees or similar charges allowed by
Applicable Law with respect to the Receivables.
"LIEN" means a security interest, lien, charge, claim, pledge,
equity or encumbrance of any kind other than tax liens, mechanics' liens and any
liens that attach to the applicable Receivable by operation of Applicable Law.
"LIQUIDATION PROCEEDS" means cash (other than Insurance Proceeds) in
excess of the costs of liquidation received in connection with the liquidation
of a Defaulted Receivable, whether through the sale or assignment of such
Receivable, trustee's sale or otherwise, including the sale or other disposition
of the related Financed Vehicle.
"LOST NOTE AFFIDAVIT" means an affidavit in substantially the form
of Schedule 2 hereto.
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"MONTHLY ADVANCE" means the interest portion of each Monthly Payment
that is delinquent with respect to each Receivable at the close of business on
the last day of the Collection Period required to be advanced by the Servicer
pursuant to Section 5.03 on the Business Day immediately preceding the
Remittance Date for the related month.
"MONTHLY PAYMENT" means the scheduled monthly payment of principal
and interest on a Receivable that is payable by an Obligor under the contract
evidencing such Receivable.
"MOODY'S" means Xxxxx'x Investors Service, Inc., and its successors.
"OBLIGOR" means the obligor or obligors on a Receivable, including
any guarantor thereof.
"OFFICER'S CERTIFICATE" means a certificate signed by (a) the
chairman of the board, the vice chairman of the board, the president, an
executive vice president, a senior vice president, a vice president, an
assistant vice president, the treasurer, the secretary or (b) two of the
assistant treasurers and/or assistant secretaries of the Servicer, and delivered
to the Master Servicer as required by this Agreement.
"OPINION OF COUNSEL" means a written opinion of counsel in form and
substance acceptable to the Purchaser and its counsel.
"PARTY OR PARTIES" has the meaning assigned to such term in the
recitals to this Agreement.
"PASS-THROUGH TRANSFER" means the sale or transfer of some or all of
the Receivables by the Purchaser, directly or through one or more Affiliates, to
the Issuer as part of a publicly issued or privately placed asset-backed
securities transaction.
"PERSON" means any individual, corporation, partnership, joint
venture, limited liability company, joint venture, association, joint-stock
company, trust, national banking association, unincorporated organization or
Governmental Authority or any agency or political subdivision thereof or any
other entity.
"PRIME RATE" means the prime rate announced to be in effect from
time to time, as published as the average rate in THE WALL STREET JOURNAL.
"PRINCIPAL BALANCE" means, with respect to any Receivable, as of the
related date of determination on the last day of a Collection Period, the Amount
Financed minus an amount equal to the sum, as of the close of business on the
last day of the related Collection Period, of (i) that portion of all amounts
received by the Servicer, from or on behalf of the related Obligor on or prior
to such date and allocable to principal using the Simple Interest Method plus
(ii) Cram Down Losses in respect of such Receivable. In no event will the
Principal Balance of any Receivable include any amount allocable to the premium
of any CPI Policy.
"PROSPECTUS" means a prospectus (including a preliminary prospectus)
and any amendment thereof or supplement thereto that in either case is included
in a registration
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statement filed with the Commission under the Securities Act or that is filed
pursuant to rule 424(b) promulgated by the Commission under the Securities Act
and shall also include any Current Report on Form 8-K or 10-D that are filed to
provide information with respect to the Receivables after giving effect to any
Receivables that are securitized during a pre-funding period and any offering
memorandum (including a preliminary offering memorandum) relating to an offering
that is exempt from the registration requirements of the Securities Act.
"PURCHASE AGREEMENT" means the purchase and servicing agreement,
dated as of June 7, 2005, between GS Whole Loan Trust II, as purchaser, and HNB,
as seller and as servicer.
"PURCHASER" means GS Whole Loan Trust II, Delaware statutory trust,
and its successors and permitted assigns.
"RATING AGENCY" means Moody's or Standard & Poor's and any other
nationally recognized statistical credit rating agency rating any security
issued in connection with the Pass-Through Transfer.
"RECEIVABLE FILE" means, with respect to each Receivable:
(i) the original Receivable or a copy of the original Receivable
or the fully executed original, electronically authenticated original or
authoritative copy (in each case within the meaning of the UCC) of the
Receivable, including any written amendments or extensions thereto;
(ii) the original credit application, whether in paper or
electronic form, or any copy, duplicate or electronic record thereof;
(iii) the original, duplicate or replacement certificate of title as
issued in paper or electronic form by the appropriate governmental agency in the
State in which the Financed Vehicle is titled, or if the original certificate of
title is required to be held by the agency, department or office that issued
such original certificate of title, a receipt thereof (which for Michigan and
Arizona shall be in the form of RD-108 and for Kentucky shall be in the form of
a "Lien Statement"), or such documents that the Servicer shall keep on file, in
accordance with its customary standards, policies and procedures, evidencing the
security interest of the Seller in the related Financed Vehicle;
(iv) if the odometer reading of the Financed Vehicle at the time of
sale to the Obligor is not listed on the certificate of title or the original
credit application, the odometer statement; and
(v) any and all other documents that the Servicer shall have kept
on file in accordance with its customary procedures relating to a Receivable.
"RECEIVABLE SCHEDULE" means the schedule of retail automobile and
light truck loan and installment sale contracts to be delivered on the Closing
Date.
"RECEIVABLES" means all of the retail automobile and light truck
loan and installment sale contracts listed on a Receivable Schedule.
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"RECEIVABLES POOL" means the pool of Receivables.
"RECEIVABLES REPURCHASE PRICE" means the price to be paid by the
Servicer under this Agreement, in connection with the repurchase or purchase of
a Receivable from the Purchaser, which price shall be determined as follows:
(i) if the purchase or repurchase is to occur on or before the
closing date of a Pass-Through Transfer related to such Receivable, a price
equal to (a) the product of (x) the remaining Principal Balance of the
Receivable as of the last day of the Collection Period related to the Remittance
Date on which the purchase or repurchase occurs times (y) the price (expressed
as a percentage) at which the Purchaser purchased the Receivable from the
Seller, plus (b) accrued interest on such outstanding Principal Balance at the
Contract Rate from the date the Obligor on such Receivable last made a payment
of interest through the last day of the Collection Period related to the
Remittance Date on which the purchase or repurchase occurs, less (c) Monthly
Advances which have not been reimbursed in accordance with this Agreement; and
(ii) thereafter, at the Repurchase Price.
"REGULATION AB" shall mean Subpart 229.1100 - Asset Backed
Securities (Regulation AB), 17 C.F.R. Sections 229.110-229.1123, as such
regulation may be amended from time to time and subject to such clarification
and interpretation as have been provided by the Commission in the adopting
release (Asset-Backed Securities, Securities Act Release No. 33-8518, 70 Fed.
Reg. 1,506, 1,531 (January 7, 2005)) or by the staff of the Commission, or as
may be provided by the Commission or its staff from time to time.
"REMITTANCE DATE" means the 11th day (or if such 11th day is not a
Business Day, the first Business Day immediately preceding such date) of any
month, beginning August 11, 2006.
"REPURCHASE PRICE" means, as to each Receivable, a price equal to
(a) the remaining Principal Balance of the Receivable as of the last day of the
Collection Period related to the Remittance Date on which the purchase or
repurchase occurs, plus (b) accrued interest on such outstanding Principal
Balance at the Contract Rate from the date the Obligor on such Receivable last
made a payment of interest through the last day of the Collection Period related
to the Remittance Date on which the purchase or repurchase occurs, less (c)
Monthly Advances in respect of such Receivable which have not been reimbursed in
accordance with this Agreement.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"SELLER" means HNB and its permitted successors and assigns under
the Purchase Agreement, as seller of the Receivables pursuant to the Purchase
Agreement.
"SERVICER" means HNB, acting in its capacity as servicer and
custodian of the Receivables hereunder on and after the Closing Date, unless a
successor shall have been appointed pursuant to Section 12.01.
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"SERVICER ANNUAL CERTIFICATION" has the meaning assigned to such
term in Section 6.02.
"SERVICER INDEMNIFIED CLAIM" has the meaning assigned to such term
in Section 8.01.
"SERVICER INDEMNIFIED PARTIES" means (a) the Master Servicer and its
Affiliates, (b) in the event of the Pass-Through Transfer, any underwriter,
placement agent, initial purchaser or the equivalent in the offering and sale of
the securities issued in connection therewith and any trustee, swap counterparty
or other participant in the Pass-Through Transfer, (c) each person, if any, who
controls any of the foregoing within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act and (d) any of their respective
officers, directors, agents, partners, members, shareholders and employees.
"SERVICER REPORTS" means each of the reports required to be
delivered by the Servicer pursuant to Section 5.02 hereof.
"SERVICER TERMINATION EVENT" means any one of the conditions or
circumstances enumerated in Section 10.01(a).
"SERVICING ADVANCES" means all customary, reasonable and necessary
"out-of-pocket" costs and expenses other than Monthly Advances (including
reasonable attorney's fees and disbursements) incurred in the performance by the
Servicer of its servicing obligations, including, but not limited to, the cost
of (a) repossessing a Financed Vehicle, (b) restoring and reconditioning a
Financed Vehicle in preparation of such Financed Vehicle for auction, (c) any
enforcement or judicial proceedings or (d) the sale or other disposition of
repossessed Financed Vehicles.
"SERVICING CRITERIA" shall mean the "servicing criteria" set forth
in Item 1122(d) of Regulation AB.
"SERVICING RIGHTS" means all rights relating to the servicing of the
Receivables.
"SERVICING STANDARD" has the meaning assigned to such term in
Section 4.01(a).
"SIMPLE INTEREST METHOD" means the method of allocating a fixed
level payment between principal and interest, pursuant to which the portion of
such payment that is allocated to interest is equal to the product of the
Contract Rate multiplied by the unpaid Principal Balance multiplied by the
period of time (expressed as a fraction of a year, based on the actual number of
days in the month and a 365-day year or, in the event of a leap year, a 366-day
year) elapsed since the preceding payment was made and the remainder of such
payment is allocable to fees and charges, if any, then to principal and then to
any receivable relating to the premium paid on any CPI Policy; PROVIDED,
HOWEVER, that the Servicer applies Liquidation Proceeds, Insurance Proceeds and
amounts in respect of Deficiency Balances first to unpaid principal, second to
interest, third to unpaid Late Fees and fourth to any receivable relating to the
premium paid on any CPI Policy.
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"SIMPLE INTEREST RECEIVABLE" means any Receivable under which the
portion of a payment allocated to interest and the portion allocable to
principal is determined in accordance with the Simple Interest Method.
"STANDARD & POOR'S" or "S&P" means Standard & Poor's, a division of
The XxXxxx-Xxxx Companies, Inc., and its successors.
"THIRD PARTY CUSTODIAN" has the meaning assigned to such term in
Section 2.02.
"UCC" means the Uniform Commercial Code in effect in the relevant
jurisdiction.
"VEHICLE INSURANCE" means, with respect to a Financed Vehicle,
insurance against loss and damage due to fire, theft, collision or other
physical damage that is either (a) obtained by the Obligor in conformity with
the requirements of the applicable Receivable, (b) provided pursuant to a VSI
Policy or (c) provided pursuant to a CPI Policy.
"VSI POLICY" means a blanket vehicle single interest insurance
policy, together with any endorsements thereto, issued by an Eligible Insurance
Provider to HNB, providing physical loss and damage coverage in the event a
Financed Vehicle in connection with a Receivable is repossessed by or
surrendered to HNB and the Obligor with respect to such Receivable has failed to
maintain physical loss and damage insurance as required by the related
Receivable, including without limitation that certain "Ultimate Loss Blanket
Single Interest Policy" issued by Ohio Indemnity Company to HNB, together with
all endorsements thereto.
"WEIGHTED AVERAGE COUPON" means the weighted average Contract Rate
(weighted on the basis of the Principal Balance of each Receivables) for the
Receivables in the Receivables Pool as of the related Cut-Off Date.
Section 1.02 OTHER DEFINITIONAL PROVISIONS.
(a) All terms defined in this Agreement shall have the defined
meanings when used in any instrument governed hereby and in any certificate or
other document made or delivered pursuant hereto unless otherwise defined
therein.
(b) As used in this Agreement, in any instrument governed hereby
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
instrument, certificate or other document, and accounting terms partly defined
in this Agreement or in any such instrument, certificate or other document to
the extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles as in effect on the date of this
Agreement or any such instrument, certificate or other document, as applicable.
To the extent that the definitions of accounting terms in this Agreement or in
any such instrument, certificate or other document are inconsistent with the
meanings of such terms under generally accepted accounting principles, the
definitions contained in this Agreement or in any such instrument, certificate
or other document shall control.
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(c) 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; Section, Schedule and Exhibit
references contained in this Agreement are references to Sections, Schedules and
Exhibits in or to this Agreement unless otherwise specified; the term
"including" shall mean "including without limitation"; and "or" shall include
"and/or".
(d) The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine as
well as to the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein;
references to a Person are also to its permitted successors and assigns.
(f) Unless the context clearly requires otherwise, (i) a reference
to a Cut-Off Date in relation to a Collection Period or Closing Date or other a
date of determination shall be deemed to refer to the Cut-Off Date on or
immediately prior to such Collection Period or Closing Date or other date of
determination, and (ii) the reference to a Semi-Annual Calculation Date in
relation to a Semi-Annual Calculation Period shall be deemed to refer to the
Semi-Annual Calculation Date immediately following the end of such Semi-Annual
Calculation Period.
ARTICLE II
POSSESSION OF RECEIVABLE FILES
Section 2.01 POSSESSION OF RECEIVABLE FILES. The Servicer shall
hold, as sub-custodian for the Master Servicer (as the custodian for the owner
thereof), the Receivable Files. The possession of each Receivable File by the
Servicer shall be for the sole purpose of servicing the related Receivable. Such
retention and possession by the Servicer is in a custodial capacity only. The
ownership of each Receivable File shall be vested immediately in the Issuer, and
the ownership of all records and documents with respect to the Receivables
prepared by or which come into the possession of the Servicer shall vest in the
Issuer and shall be retained and maintained by the Servicer, as sub-custodian
for the Master Servicer, in trust, only in such custodial capacity. The Servicer
shall release its custody of the contents of any Receivable File only in
accordance with written instructions from the Master Servicer, unless such
release is pursuant to the Servicer's servicing of the Receivables or is in
connection with a repurchase of any Receivable pursuant to this Agreement or the
Purchase Agreement or termination of the Servicer's role as servicer with
respect to the Receivables Pool.
Section 2.02 CUSTODY OF THE RECEIVABLES FILES, DUTIES OF SERVICER AS
CUSTODIAN.
(a) All rights in, to and under the Receivables, including but not
limited to all funds received on or in connection with such Receivables, shall
be received and held by the Servicer, in trust, as sub-custodian of the Master
Servicer, for the benefit of the Issuer as owner
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of the Receivables and the Servicer shall, subject to the terms and conditions
of this Agreement, retain custody of the related certificates of title and other
documents constituting the Receivable Files for the sole purpose of facilitating
the servicing and the supervision of the servicing of such Receivables.
(b) To assure uniform quality in servicing the Receivables and to
reduce administrative costs, the Master Servicer appoints the Servicer, and the
Servicer accepts such appointment, to act for the benefit of the Issuer as
custodian of the Receivable Files. To the extent that original documents are not
required for purposes of realization of Liquidation Proceeds or Insurance
Proceeds, as certified in an Officer's Certificate to the Master Servicer,
documents maintained by the Servicer may be in the form of microfilm or
microfiche or such other reliable means of recreating original documents by
electronic means, including but not limited to, optical imagery techniques so
long as the Servicer complies with the requirements of all Applicable Laws.
(c) Each Receivable File shall be maintained by the Servicer at
one of the locations specified in Exhibit B attached hereto or such other
location in the United States as specified by the Servicer by written notice to
the Master Servicer not later than ninety (90) days prior to any change in
location. The Servicer shall also make available to the Master Servicer or its
designee a current list of the locations of the Receivable Files upon written
request. The Servicer shall maintain with respect to the Receivables and shall
make available for inspection by Master Servicer or its designee the related
Receivable Files without charge during normal business hours at the offices of
the Servicer and shall permit Master Servicer or its designee to make copies of
and obtain abstracts from the Receivable Files, in each case during the time the
Issuer retains ownership of a Receivable and thereafter in accordance with
Applicable Law.
(d) As sub-custodian on behalf of the Master Servicer, 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 motor vehicle receivables that the Servicer services
for itself or others. The Servicer shall conduct, or cause to be conducted,
periodic internal 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 Master Servicer to verify the accuracy of the Servicer's record
keeping. The Servicer shall promptly report to the Master Servicer 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 Master Servicer of the Receivable Files.
(e) The Servicer shall maintain its computer systems, in
accordance with its customary standards, policies and procedures, so that, from
and after the time of conveyance of the Receivables to the Purchaser, the
Servicer's master computer records (including any back-up archives) that refer
to a Receivable shall indicate clearly the interest of the Purchaser in such
Receivable and that such Receivable is owned by the Purchaser through a unique
identification code that is reflected on the records of the Servicer and set
forth in each Receivables Schedule as being owned by the Purchaser and through
marking of the Receivable pursuant to Section 2.04. The unique identification
code which Servicer shall use is "GL type code 308" and the "REIT" identifier as
set forth in the Assignment for each Receivables Pool delivered pursuant to the
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Purchase Agreement and the applicable Assignment (as defined in the Purchase
Agreement). Servicer shall have the right to change such code upon written
notice to Purchaser, provided that such new code is a unique identification
code. The Servicer shall take no action to remove, alter or obliterate any stamp
placed on a Receivable that consists of tangible chattel paper to show the
ownership of any Receivable by the Purchaser or the Issuer. Indication of the
Issuer's ownership of a Receivable shall be deleted from or modified on the
Servicer's computer systems or from the contract itself when, and only when, the
Receivable shall have been paid in full (or within $25 thereof), transferred to
a successor or assign of Issuer (in which case the Servicer shall cause its
records to indicate the interest and ownership of such successor or assign), or
repurchased by the Seller in accordance with the terms of the Purchase Agreement
or purchased by the Servicer in accordance with the terms of this Agreement.
(f) In the event the Receivable Files held by the Servicer are
destroyed due to fire or other casualty, the Servicer will bear the
responsibility for (i) having new titles issued for each Financed Vehicle and
providing printed copies of the destroyed title from the Servicer's imaging
system which shall remain in the Receivable File until such new titles are
received, (ii) replacing each Receivable (by printing a copy thereof held on the
Servicer's imaging system), and (iii) creating a Lost Note Affidavit to
accompany each replaced Receivable, certifying that the original Receivable was
destroyed; PROVIDED, HOWEVER, that in the event any additional document is
needed in order to service the Receivable, the Servicer shall print a copy
thereof from its imaging system. All costs incurred in connection with this
clause (f) shall be paid by the Servicer and the Servicer shall indemnify the
Master Servicer and the Issuer for any losses suffered by the Master Servicer
and the Issuer as a result of the loss or destruction of the original Receivable
Files.
(g) Upon written instruction from the Issuer or the Master
Servicer, the Servicer shall release any Receivable File to the Master Servicer
at such place or places as the Master Servicer may designate, as soon as
practicable (but in no event more than five (5) days after the date of such
instruction) and the Issuer or the Master Servicer shall reimburse the Servicer
for its reasonable out-of-pocket expenses incurred in connection with any such
delivery. Upon the release and delivery of any such document in accordance with
the instructions of the Master Servicer, the Servicer shall be released from any
further liability and responsibility with respect to such documents and any
other provision of this Agreement if the fulfillment of the Servicer's
responsibilities is dependent upon possession of such documents, unless and
until such time as such documents shall be returned to the Servicer. In no event
shall the Servicer be responsible for any loss occasioned by the Master
Servicer's failure to return any Receivable File or any portion thereof in a
timely manner.
(h) At any time, with or without cause, the Master Servicer shall
have the right to immediately remove any or all Receivable Files from the
property of the Servicer and cause a third party designated by the Master
Servicer (the "THIRD PARTY CUSTODIAN") to maintain custody of such Receivables
Files as agent for the benefit of the Master Servicer at such location or
locations as shall be approved by the Master Servicer. Any costs associated with
the transfer of the Receivable Files in connection with this clause (j) and all
fees and expenses incurred by the Third Party Custodian as custodian pursuant to
this clause (j) shall be paid by the Master Servicer; PROVIDED, HOWEVER, that in
the event such transfer occurs after the occurrence of an event which, with the
giving of notice or lapse of time or both, would become a Servicer
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Termination Event under Section 10.01(a), such costs shall be paid by the
Servicer. Although any removal of the Receivables Files is likely to cause some
disruption to the Servicer's business operations, the Master Servicer shall, and
shall cause the Third Party Custodian to, cooperate with the Servicer in a
commercially reasonable manner, consistent with the prompt removal of such
Receivables Files, to minimize any disruptions to the Servicer's business
operations. Upon such transfer, the Master Servicer shall be entitled to cause
the Third Party Custodian to hold all Receivable Files, as custodian, for the
exclusive use and benefit of the Master Servicer and the Master Servicer's
successors and assigns, and shall make disposition thereof only in accordance
with the terms of this Agreement and the written instructions of the Master
Servicer; PROVIDED, HOWEVER, that the Master Servicer, pursuant to agreement
with or written instructions to the Third Party Custodian, shall require the
Third Party Custodian, with normal and customary promptness after receipt of a
written or electronic request by the Servicer in a form mutually acceptable to
the Third Party Custodian and the Servicer, to release to the Servicer, at the
Master Servicer's expense, a Receivable File (or portion thereof) to the place
indicated in any such written or electronic request from the Servicer (i) as
required by the Servicer for the servicing of the related Receivable or (ii)
upon repurchase of the related Receivable by the Seller or Servicer. All
Receivable Files (or portions thereof) released to the Servicer as required by
the Servicer for the servicing of a Receivable shall be held by the Servicer in
trust for the benefit of the Master Servicer, and the Servicer shall return to
the Third Party Custodian the Receivable File (or portion thereof), at the
Master Servicer's expense, when the Servicer's need therefor in connection with
servicing the related Receivable no longer exists. The Servicer shall not be
liable for any delay in performing or failure to perform any obligation of the
Servicer under this Agreement to the extent resulting from any delay in
receiving or failure to receive a Receivable File from the Third Party
Custodian.
Section 2.03 PROTECTION OF RIGHT, TITLE AND INTEREST. The Servicer
covenants and agrees with the Master Servicer as follows:
(a) If at any time the Servicer shall propose to sell, grant a
security interest in, or otherwise transfer any interest in motor vehicle loan
and installment sale contracts to any prospective purchaser, lender, or other
transferee, the Servicer shall give to such prospective purchaser, lender, or
other transferee computer tapes, records, or print-outs (including any restored
from back-up archives) that, if they shall refer in any manner whatsoever to any
Receivable, shall indicate that such Receivable has been conveyed to and is
owned by the Purchaser.
(b) Except as provided herein, the Servicer will not sell, pledge,
assign or transfer any Conveyed Asset (as defined in the Purchase Agreement) to
any Person, or grant, create, incur, assume or suffer to exist any Lien on any
interest therein, and the Servicer shall defend the right, title, and interest
of the Purchaser in, to and under such Conveyed Assets against all claims of
third parties claiming through or under the Seller.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES; REMEDIES AND BREACH
Section 3.01 BANK REPRESENTATIONS AND WARRANTIES. (a) The Bank makes
the following representations and warranties to the Master Servicer as of the
date of this Agreement, on which the Master Servicer relies in entering into
this Agreement:
(i) DUE ORGANIZATION AND QUALIFICATION. The Bank (A) is duly organized and
validly existing as a national banking association under the laws of the United
States of America, (B) is in good standing under such laws and (C) is duly
qualified to transact business and is in good standing in each jurisdiction in
the United States of America in which the conduct of its business or the
ownership of its property requires such qualification. The Bank is an insured
depository institution under the provisions of the Federal Deposit Insurance
Act, 12 U.S.C. Sections 1811-1831 and the Bank's status as an insured depository
institution has not been terminated under the provisions of Section 8 of the
Federal Deposit Insurance Act, 12 U.S.C. Section 1818.
(ii) POWER AND AUTHORITY; DUE AUTHORIZATION; ENFORCEABILITY. The Bank has
full power and authority to perform its obligations under this Agreement and has
duly authorized the performance of its obligations under this Agreement by all
necessary action. This Agreement has been duly authorized, executed and
delivered by the Bank and constitutes the legal, valid, binding and enforceable
obligation of the Bank except as the same may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or affecting the
enforcement of creditors' rights or by general equity principles.
(iii) NO VIOLATION. The Bank is not in default under any indenture,
mortgage, deed of trust, loan agreement, guarantee, lease financing agreement or
similar agreement or instrument to which the Bank is a party, as borrower or
guarantor, and the consummation of the transactions contemplated by this
Agreement, and the fulfillment of the terms hereof, will not conflict with or
result in a breach of any of the terms or provisions of, or constitute (with or
without notice or lapse of time or both) a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any of the
property or assets of the Bank pursuant to the terms of, any such indenture,
mortgage, deed of trust, loan agreement, guarantee, lease financing agreement or
similar agreement or instrument, in each case where such a default, conflict or
breach would materially and adversely affect the performance by the Bank of its
obligations under this Agreement and the consummation of the transactions
contemplated by this Agreement; and the fulfillment of the terms hereof will not
result in any violation of the provisions of the organizational documents of the
Bank.
(iv) NO PROCEEDINGS. No legal or governmental proceedings are pending to
which the Bank is a party or of which any property of the Bank is the subject,
and no such proceedings are threatened or contemplated by Governmental
Authorities or threatened by others, other than such proceedings which will not
have a material adverse effect upon the general affairs, financial position, net
worth or operations of the Bank and its subsidiaries considered as a whole and
will not materially and adversely affect the performance by the Bank of its
obligations under, or the validity and enforceability of this Agreement.
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(v) ORDINARY COURSE OF BUSINESS. The consummation of the transactions
contemplated by this Agreement are in the ordinary course of business of the
Servicer.
(vi) LICENSES AND APPROVALS. The Bank has obtained all the licenses and
approvals necessary for the conduct of Bank's business in the jurisdictions
where the failure to do so would materially and adversely affect its performance
of its obligations under this Agreement.
(vii) ABILITY TO PERFORM. The Bank has the facilities, procedures and
experienced personnel necessary for the servicing of retail motor vehicle loan
and installment sale contracts of the same type as the Receivables in accordance
with the Servicing Standard. The Bank does not believe, nor does it have any
reason or cause to believe, that it cannot perform each and every one of its
obligations under this Agreement.
(viii) NO CONSENT REQUIRED. The Bank is not required to obtain the consent
of any other Person, or any consent, license, approval or authorization or make
any registration, filing or declaration with, any Governmental Authority in
connection with the execution, delivery or performance of this Agreement, except
for such as have been obtained, effected or made or will be obtained with
respect to each Receivables Pool on or prior to the applicable Closing Date for
such Receivables Pool.
(ix) NO LITIGATION PENDING. There is no action, suit, proceeding or
investigation pending or, to the Bank's knowledge, threatened against the Bank
or any of its Affiliates which, if determined adversely against the Bank, would
materially adversely affect the sale of any of the Receivables to the Purchaser,
or the execution, delivery or enforceability of this Agreement, or draw into
question the validity of this Agreement or have a material adverse effect on the
financial condition of the Bank or the Bank's ability to perform its obligations
under the terms of this Agreement.
(x) LOCATION OF RECEIVABLE FILES. The Receivable File with respect to
each Receivable is kept at one or more of the locations listed in Exhibit B
hereto.
(xi) MARKING OF SERVICER COMPUTER FILES. The Servicer has clearly and
unambiguously marked its computer files and any other applicable electronic
records to indicate that such Receivable has a unique identification code (as
described in Section 2.02(e)) that is reflected on the records of the Servicer
and Receivables Schedule hereto as being owned by the Issuer.
ARTICLE VI
ADMINISTRATION AND SERVICING OF RECEIVABLES
Section 4.01 SERVICER.
(a) From and after the Closing Date, the Servicer, as an
independent contractor, shall manage, service, administer and make Collections
on the Receivables in such Receivables Pool and perform the other actions
required by the Servicer under this Agreement, all in accordance with all
Applicable Laws. The Servicer's duties include, but are not limited to,
collection and posting of all payments, responding to inquiries of the Obligors
on such
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Receivables, investigating delinquencies, sending payment coupons to Obligors,
reporting tax information to Obligors, accounting for Collections, preparing tax
forms required by any federal, state or local tax authority, if any, furnishing
the Servicer Reports and annual statements required pursuant to Sections 5.02
and 6.03 and making Monthly Advances pursuant to Section 5.03. The Servicer will
service the Receivables in accordance with the servicing standard set forth in
Exhibit G or in the event that Exhibit G does not specify a standard with
respect to a particular servicing function, in accordance with its usual and
customary procedures consistent with the procedures employed by institutions
that service motor vehicle retail installment contracts or motor vehicle
installment loan notes for their own account or for the account of third parties
(the foregoing, the "SERVICING STANDARD").
(b) The Servicer may, in accordance with the Servicing Standard,
grant extensions on a Receivable with respect to a Receivable for which the
related Obligor is delinquent for failure of payment. The Servicer shall not
grant more than one (1) extension on such Receivable in any calendar year and
not more than three (3) extensions on any such Receivable and shall not extend
the date for the final payment by any Obligor of any Receivable beyond six (6)
months of the original final payment date of such Receivable, the Servicer shall
promptly purchase such Receivable in the manner provided in Section 6.01(b). As
necessary to maximize collections on the Receivables and in accordance with its
Servicing Standards, the Servicer may in its discretion waive any Late Fees that
may be collected in the ordinary course of servicing a Receivable. The use of a
pass-a-payment coupon shall not be considered an extension on a Receivable
pursuant to this Section 4.01(b).
(c) Without limiting the generality of the foregoing, the Servicer
is hereby authorized and empowered, to execute and deliver on behalf of itself
and the Purchaser, all instruments of satisfaction or cancellation, or of
partial or full release, discharge and all other comparable instruments, with
respect to the Receivables and Financed Vehicles. If the Servicer commences a
legal proceeding to enforce a Receivable, the Purchaser will 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 is not a real party in interest or a holder entitled to enforce the
Receivable, the Servicer may, with the prior written approval of the Purchaser,
maintain such enforcement suit or legal proceeding in the name of the Purchaser
or an affiliate. If reasonably required by the Servicer, the Purchaser shall
furnish the Servicer, with any powers of attorney and other documents necessary
or appropriate to enable the Servicer to carry out its servicing and
administrative duties under this Agreement.
(d) The Servicer shall, consistent with the Servicing Standard,
take such steps as are necessary to maintain perfection of the security interest
created by each Receivable in the related Financed Vehicle in favor of the
Purchaser and its successors and assigns. The Servicer is hereby authorized to
take such steps as are necessary to re-perfect such security interest on behalf
of the Purchaser and its successors and assigns in the event of the relocation
of the related Financed Vehicle, or for any other reason. Notwithstanding the
foregoing, (i) the Servicer, shall have no obligation to audit the perfection or
re-perfection of security interests in the Financed Vehicles; and (ii) the
Seller shall have no obligation to perfect or re-perfect unless it is aware that
perfection or re-perfection is necessary.
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(e) Except as permitted by the Servicing Standard, the Servicer
shall not (i) release the Financed Vehicle securing each Receivable from the
security interest granted by such Receivable in whole or in part except in the
event of payment in full (or within $25 thereof) by or on behalf of the Obligor
thereunder or repossession, (ii) impair the rights of the Purchaser in the
Receivables, (iii) change the Contract Rate with respect to any Receivable, or
(iv) modify the Principal Balance or the total number of originally scheduled
due dates of any Receivable.
(f) The Servicer shall comply with Applicable Law in connection
with the satisfaction of a Receivable and the release of Receivable Files.
(g) With respect to any Financed Vehicle that is not covered by a
VSI Policy and as to which the Obligor fails to maintain Vehicle Insurance, the
Servicer shall obtain a CPI Policy in respect of such Financed Vehicle and shall
administer such CPI Policy in accordance with (x) any generally applicable
program or policies of the Servicer with respect to creditor-placed insurance,
(y) all Applicable Laws and (z) the terms of the applicable Receivable.
(h) The Servicer or the Master Servicer, as the case may be, shall
promptly inform the other Party, in writing, upon the discovery of any breach by
the Servicer of Section 4.01(b), (d) or (e). If such breach is curable and the
Servicer shall have timely commenced such cure but notwithstanding its due and
diligent efforts, the breach shall not be capable of cure within sixty (60) days
of the earlier of either discovery by or notice to the Servicer of such breach,
the Servicer shall, upon receipt of written consent by the Master Servicer, have
up to two additional thirty (30) day periods to effectuate the cure (up to an
aggregate total of 120 days) so long as it is acting in good faith to effectuate
such cure. If such cure is not effectuated after 120 days (or within sixty (60)
or ninety (90) days, if the applicable extension was not granted by the Master
Servicer), the Servicer shall purchase the Receivable affected by such breach at
the Receivable Repurchase Price by deposit of the Receivable Repurchase Price on
the next Remittance Date. The sole remedy of the Master Servicer with respect to
a breach pursuant to Section 4.01(b), (d) or (e) shall be limited to the
purchase of Receivables in accordance with this clause (h) and the
indemnification provisions set forth in Section 8.01. The provisions of this
Section 4.01(h) shall be subject to Section 10.01(e).
(i) The Servicer and the Master Servicer each agree that, should
any Governmental Authority with bank regulatory powers find that the terms of
this Agreement relating to the servicing of the Receivables constitute an unsafe
and unsound condition with respect the Servicer, and such Governmental Authority
notifies the Servicer of such finding, then the Servicer and the Master Servicer
shall negotiate in mutual good faith to correct any such deficiencies and to
bring this Agreement into compliance with Applicable Law.
Section 4.02 REALIZATION OF RECEIVABLES.
(a) In the event that any payment due under any Receivable is not
paid when the same becomes due and payable, or in the event the related Obligor
fails to perform any other covenant or obligation under the Receivable and such
failure continues beyond any applicable grace period, the Servicer shall take
such action as (i) it would take under similar circumstances with respect to a
similar motor vehicle retail installment contract or motor vehicle installment
loan note held for its own account for investment, (ii) shall be consistent with
Servicing
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Standard, and (iii) it shall determine prudently to be in the best interest of
Purchaser. In connection herewith, the Servicer shall from its own funds make
all necessary and proper Servicing Advances, subject to reimbursement pursuant
to Section 4.04(c)(ii); PROVIDED, HOWEVER, that the foregoing shall not be
construed to require Servicer to undertake repossession, restoration or
preservation of any Financed Vehicle, unless the Servicer shall determine (x)
that such preservation, restoration and/or repossession will increase the
proceeds of liquidation of the Receivable to Purchaser after reimbursement to
itself for such expenses and (y) that expenses in connection with such
repossession, restoration or repossession will be recoverable either through
Liquidation Proceeds or through Insurance Proceeds.
(b) In connection with any Deficiency Balance, the Servicer in
accordance with the Servicing Standards will (A)(i) pursue collection of the
deficiency for a period of no more than 120 days, which may be extended an
additional 60 days if, in the Servicer's reasonable judgment such extension will
maximize recovery of the Deficiency Balance and then (ii) refer the related
account to (x) its routinely preferred third party collector or (y) such other
third party collector as approved by the Master Servicer (the entity hired
pursuant to clause (x) or (y), the "Collector"), which will pursue collection of
such Deficiency Balance; or (B) refer the related account directly to the
Collector as provided in (A)(ii) above, if, in the Servicer's reasonable
judgment referral of such account to the Collector will maximize recovery of the
Deficiency Balance. In the event the Servicer refers the related account to the
Collector, the Servicer shall no longer remain obligated or be liable to any
other party for the collection of such Receivable. The Servicer shall, in
accordance with Section 5.01, remit to the Master Servicer any amounts collected
by it or remitted to it by the Collector (from which the Collector may net a
portion of the Collector's costs, expenses and other charges not to exceed an
amount equal to 40% of the recovery amount prior to deducting such costs,
expenses and charges) in regards to such Deficiency Balance.
Section 4.03 COMMINGLING OF COLLECTIONS RELATED TO THE RECEIVABLES.
(a) For so long as the Servicer's short term senior unsecured debt
rating remains A-1 (by S&P) and P-1 (by Xxxxx'x) or better or, if the Master
Servicer otherwise agrees with respect to some or all of the Receivables, the
Servicer shall be permitted to commingle all Collections relating to the
Receivables received in the immediately preceding Collection Period with its own
corporate funds.
(b) In the event the Servicer's short term ratings fall below A-1
or P-1, as the case may be, the Servicer shall within five (5) calendar days of
such ratings downgrade deliver all Collections in its possession relating to the
Receivables to an account designated by the Master Servicer. Thereafter, the
Servicer shall remit to the account so designated all Collections relating to
the Receivables within two (2) Business Days of receipt thereof. Amounts in such
account with respect to a Collection Period shall remain on deposit therein
until the related Remittance Date and the Master Servicer agrees that it shall
cause to be remitted to the Servicer on each Remittance Date, solely from
Collections deposited in such account, amounts which the Servicer is entitled to
receive or retain for itself (in respect of fees, reimbursement of expenses or
advances or otherwise) in accordance with the terms of this Agreement.
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Section 4.04 PERMITTED RETENTION OF COLLECTIONS BY THE SERVICER.
(a) As compensation for its services hereunder, the Servicer shall
be entitled in accordance with the Purchase Agreement to retain from the
interest portion of Monthly Payments collected or the interest portion of
Liquidation Proceeds received on the Receivables the amount of its servicing
fees in accordance with the Purchase Agreement; provided, however, that the
servicing fees payable to Servicer from Collections with respect to the
Receivables shall not exceed 1.00% per annum, and any additional servicing fee
amounts payable to Servicer under the Purchase Agreement shall be paid by the
Master Servicer. To the extent the interest portions are insufficient to pay the
full amount of the servicing fee in a particular month, the Servicer shall be
entitled to retain the interest portions of Monthly Payments collected and
Liquidation Proceeds received in subsequent months to recover the unpaid
portion. As additional servicing compensation, the Seller shall be entitled to
receive all Late Fees with respect to the Receivables serviced pursuant to this
Agreement and all interest accrued on any funds held by the Servicer
constituting Collections of any of the Receivables.
(b) The Servicer shall pay all expenses incurred by it in
connection with its servicing activities hereunder and shall not be entitled to
reimbursement thereof except to the extent specifically provided for herein.
(c) On each Remittance Date, the Servicer shall retain amounts
that constitute Collections on the Receivables for the following purposes:
(i) to reimburse itself out of Interest Collections for Monthly Advances
of the Servicer's funds made pursuant to Section 5.03.
(ii) to reimburse itself for unreimbursed Servicing Advances; provided
that such reimbursement with respect to any Receivable shall be limited to
Liquidation Proceeds, Insurance Proceeds and Deficiency Balance recoveries with
respect to such Receivable.
(iii) to reimburse itself out of Interest Collections for unpaid servicing
fees for the Receivables Pool.
Section 4.05 ERRORS AND OMISSIONS INSURANCE. The Servicer, shall
maintain, at its own expense, an errors and omissions insurance policy on all
officers, employees or other persons acting in any capacity with regard to the
Receivables to handle funds, money, documents and papers relating to the
Receivables, which policy shall protect and insure the Servicer, against losses,
including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such persons. Such errors and omissions insurance policy shall
also protect and insure the Servicer, against losses in connection with the
release or satisfaction of a Receivables without having obtained payment in full
of the indebtedness secured thereby. No provision of this Section 4.05 requiring
such errors and omissions insurance shall diminish or relieve the Servicer from
its duties and obligations as set forth in this Agreement. Notwithstanding the
foregoing, such errors and omission policy may have a deductible consistent with
prudent corporate practice. Nothing in the preceding sentence shall limit any of
the Servicer's indemnification obligations under this Agreement.
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Section 4.06 REMITTANCE OF HNB GAP AMOUNTS.
(a) The Seller has agreed under the Purchase Agreement to handle
all claims of Obligors in connection with HNB GAP for any Receivable.
Notwithstanding any other provision of this Agreement or the Purchase Agreement,
if the Servicer has been notified by the Seller pursuant to the Purchase
Agreement that the Seller has determined that all or some portion of the
Principal Balance of a Receivable is required to be cancelled pursuant to HNB
GAP in effect for such Receivable, the Servicer shall take the appropriate steps
to reduce the Principal Balance of such Receivable by the GAP Amount, and such
reduction shall not be a violation of any other provision of this Agreement. The
Servicer shall hold all amounts remitted by the Seller in respect of GAP Amounts
in accordance with Section 4.03, and shall remit such amount to the Issuer or
the Master Servicer on the immediately following Remittance Date, or as
otherwise required by Section 4.03.
(b) The Master Servicer agrees that it shall have no right to
collect from the Obligor the amount of any GAP Amount that the Seller has
determined pursuant to the Purchase Agreement to be applicable to any Receivable
as described in the preceding paragraph, and that Master Servicer shall not, on
its own or through any agent, attempt to collect any GAP Amount from any
Obligor.
ARTICLE V
PAYMENTS TO PURCHASER
Section 5.01 REMITTANCES.
(a) On each Remittance Date, the Servicer, shall remit by wire
transfer of immediately available funds to the Master Servicer at the wire
transfer instructions set forth on Exhibit K (or as otherwise directed by the
Master Servicer from time to time in writing) all amounts constituting
Collections on Receivables for the related Collection Period, as determined on
the related Determination Date (net of amounts retained pursuant to Section 4.04
as of such date).
(b) With respect to any remittance received by the Master Servicer
after the Business Day on which such payment was due, the Servicer, shall pay to
the Master Servicer interest on any such late payment at an annual rate equal to
the Prime Rate, adjusted as of the date of each charge, plus two percentage
points, but in no event greater than the maximum amount permitted by Applicable
Law. Such interest shall be paid by the Servicer, to the Master Servicer on the
date such late payment is made and shall cover the period commencing with the
Business Day on which such payment was due and ending with the Business Day on
which such payment is made, both inclusive. Such interest shall be remitted
along with the distribution payable on the next succeeding Remittance Date. The
payment by the Servicer of any such interest shall not be deemed an extension of
time for payment or a waiver of any Servicer Termination Event.
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Section 5.02 SERVICER REPORTS.
(a) By no later than the First Remittance Date, the Servicer shall
deliver to the Master Servicer a copy of each monthly remittance report
(collectively, the "Servicer Reports") listed in Exhibit F-3 and each Servicer
Report shall be substantially in the applicable form set forth in Exhibit F-4
and be satisfactory to the Master Servicer.
(b) On each Determination Date, the Servicer shall provide to the
Master Servicer each of the Servicer Reports listed in Exhibit F-3 attached
hereto, with respect to Collections for the preceding Collection Period, in hard
copy or electronic format as mutually agreed by the Servicer and the Master
Servicer and each Servicer Report shall contain a certification from an Officer
of the Servicer regarding the accuracy of the information contained therein.
Section 5.03 MONTHLY ADVANCES BY SERVICER. On each Remittance Date,
the Servicer shall remit from its own funds or from amounts held for future
distribution an amount equal to the interest portion of all Monthly Payments
that were (i) due on the Receivables during the applicable Collection Period and
that were delinquent at the close of business on the last day of the Collection
Period immediately preceding such Remittance Date or (ii) not due during the
applicable Collection Period because payment in the Collection Period was
deferred by the Servicer (including for this purpose, any extension made in
connection with a pass-a-payment coupon). Any amounts held for future
distribution used in the manner provided in the preceding sentence shall be
reimbursed by the Servicer on or before any future Remittance Date, if funds
available on such Remittance Date shall be less than payments required to be
made to the Master Servicer on such Remittance Date. Notwithstanding the
foregoing, the Servicer shall not be permitted to make any Monthly Advances
pursuant to this Section 5.03 from amounts held for future distribution, and
instead shall be required to make all Monthly Advances from its own funds,
unless the Servicer shall have a long-term credit rating of at least "A" by
Standard & Poor's and "A2" by Xxxxx'x. The Servicer's obligation to make such
Monthly Advances as to any Receivable shall continue through the earlier to
occur of (i) the last Monthly Payment due prior to the payment in full of the
Receivable or (ii) the last Remittance Date prior to the Remittance Date for the
distribution of all Liquidation Proceeds and other payments or recoveries
(including Insurance Proceeds) with respect to the Receivable; PROVIDED,
HOWEVER, that if requested by a Rating Agency in connection with a Pass-Through
Transfer, the Servicer shall be obligated to make such Monthly Advances through
the Remittance Date prior to the date on which cash is received in connection
with the liquidation of the related Financed Vehicle; PROVIDED, FURTHER,
HOWEVER, that the obligation to pay Monthly Advances shall cease if the Servicer
determines, in its sole reasonable opinion, that advances with respect to such
Receivable are non-recoverable by the Servicer from Liquidation Proceeds or
otherwise from amounts allocable to interest with respect to a particular
Receivable.
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ARTICLE VI
GENERAL SERVICING PROCEDURES
Section 6.01 SATISFACTION OF RECEIVABLES AND RELEASE OF RECEIVABLE
FILES.
(a) The Servicer shall comply with Applicable Law in
connection with the satisfaction of a Receivable and the release of Receivable
Files. Subject to the foregoing, upon the payment in full of any Receivable, or
otherwise in accordance with the Servicer's customary policies and procedures
consistent with the Servicing Standard, the Servicer is authorized to execute an
instrument in satisfaction of such Receivable and to do such other acts and
execute such other documents as the Servicer deems necessary to discharge the
Obligor thereunder and terminate the security interest in the Financed Vehicle
related thereto. To the extent that insufficient payments are received on a
Receivable credited by the Servicer as prepaid or paid in full and satisfied,
the shortfall shall be paid by the Servicer out of its own funds if the
shortfall is in excess of $25.
(b) If the Servicer (I) satisfies or releases the Collateral
securing a Receivable without first having either (x) obtained voluntary payment
in full (or within $25 of payment in full) of the indebtedness secured by the
Collateral or (y) repossessed and liquidated such Collateral, or (II)(x)
otherwise prejudices any rights the Purchaser may have under the Collateral
securing a Receivable (in addition to the rights of the Purchaser in connection
therewith set forth in Section 4.01(h)) or (y) extends or otherwise amends the
terms of the Receivable (including any change of the Contract Rate applicable to
any Receivable or the Principal Balance or the total number of originally
scheduled due dates of any Receivable), except as provided in Sections 4.01(b)
and 4.01(e), upon written demand of the Issuer or the Master Servicer, the
Servicer shall repurchase the related Receivable at the Receivable Repurchase
Price and remit such amount to the Issuer on the next Remittance Date.
Section 6.02 ANNUAL STATEMENT AS TO COMPLIANCE. The Servicer shall
deliver to the Master Servicer on or before March 15 each year, beginning March
15, 2007, an Officer's Certificate (the "SERVICER ANNUAL CERTIFICATION") in
substantially the form of Exhibit I.
Section 6.03 ACCOUNTANTS' REPORTS. (a) On or before March 15 of each
year beginning March 15, 2007, the Servicer, at its expense, shall cause a firm
of independent certified public accountants that is a member of the American
Institute of Certified Public Accountants to furnish a report to the Master
Servicer (and consent of such firm for inclusion of such report in any filings
with the Securities and Exchange Commission in connection with the Pass-Through
Transfer) to the effect that such firm has examined the documents or records of
the Servicer relating to the Receivables and that such examination (a) was made
in accordance with generally accepted auditing standards and (b) included tests
relating to retail motor vehicle loan and installment sale contracts serviced
for others and that such firm is of the opinion that the provisions of this
Agreement have been complied with during the preceding calendar year (or, with
respect to the first report, the period from the Closing Date to December 31st
of such year), and that, on the basis of such examination, nothing has come to
their attention that would indicate that such servicing has not been conducted
in compliance therewith during such
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calendar year or other period, except for (x) such exceptions as such firm shall
believe to be immaterial and (y) such other exceptions as shall be set forth in
such statement.
(b) In connection with the Pass-Through Transfer and on or before
March 15 of each year beginning March 15, 2007, the Servicer, at its expense,
shall cause Deloitte & Touche or any other nationally recognized certified
public accountants engaged by the Servicer from time to time that is a member of
the American Institute of Certified Public Accountants to furnish a letter the
Purchaser (and consent of such firm for inclusion of such report in any filings
with the Securities and Exchange Commission in connection with the Pass-Through
Transfer) covering such matters relating to the Receivables as reasonably
requested by the Purchaser, including verification that none of the Receivables
bear the same account number of any receivable transferred under any other
financing transaction of the Servicer; PROVIDED, HOWEVER, that the Servicer
shall not be required to furnish the aforesaid letter if it has previously
furnished such letter to the Purchaser pursuant to the Purchase Agreement.
Section 6.04 RIGHT TO EXAMINE SERVICER RECORDS. The Master Servicer,
or its designee, shall have the right to examine and audit any and all of the
books, records, or other information of the Servicer, whether held by the
Servicer or by another on its behalf, with respect to or concerning this
Agreement or the Receivables, during business hours or at such other times as
may be reasonable under applicable circumstances, upon reasonable advance
notice. The Master Servicer shall pay its expenses associated with such
examination.
Section 6.05 SYSTEM BACKUP FILE. Within forty-five (45) days after
the Closing Date, the Servicer shall provide to the Master Servicer a copy (on a
medium mutually agreed upon between the Servicer and the Master Servicer) of a
complete image from the Servicer's imaging system of each item in a Receivable
File for each Receivable in the Receivables Pool transferred on the Closing
Date. The Servicer shall at all times maintain a complete system backup file
with respect to the Receivables and shall, by no later than each Determination
Date, deliver to the Master Servicer a copy of (i) the loan file tape
(determined by the data dictionary, in the form of Exhibit A attached hereto, as
may hereafter be modified by mutual agreement of the Servicer and the Master
Servicer) and (ii) the extracts from other applicable servicing systems of the
Servicer's.
ARTICLE VII
SERVICER TO COOPERATE
Section 7.01 PROVISION OF INFORMATION. (a) The Servicer shall
furnish to the Master Servicer such periodic, special, or other reports or
information, and copies or originals of any other documents contained in the
Receivable File for each Receivable provided for herein. All other special
reports or information not provided for herein as shall be necessary,
reasonable, or appropriate with respect to the Master Servicer or any regulatory
agency shall be provided at the Master Servicer's expense. All such reports,
documents or information shall be provided by and in accordance with all
reasonable instructions and directions which the Master Servicer may give.
(b) The Servicer shall, promptly after any request by the Master
Servicer in
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connection with the Pass-Through Transfer either (i) deliver to the Master
Servicer an Officer's Certificate stating that there exists no material
litigation relating to the Bank and no material investigation or proceeding
which may exist at any time between the Bank and any Governmental Authority or
(ii) notify the Master Servicer that the Servicer is unable to deliver such
Officer's Certificate as requested.
(c) Promptly after the Servicer obtains knowledge thereof, the
Servicer shall furnish to the Master Servicer notice of any material litigation
relating to the Bank or any material investigation or proceeding which may exist
at any time between the Bank and any Governmental Authority which, in either
case, would have an impact on the Receivables or on the Bank's ability to act as
Servicer hereunder with respect to the Receivables.
(d) The Servicer shall execute and deliver all such instruments
and take all such action as the Master Servicer may reasonably request from time
to time, in order to effectuate the purposes, and to carry out the terms, of
this Agreement.
(e) As soon as available but no later than March 1 of each
calendar year for so long as the Issuer is required to report under the Exchange
Act, commencing in 2007, the Servicer shall:
(i) deliver to the Master Servicer a report regarding the
Servicer's assessment of compliance with the applicable Servicing
Criteria during the immediately preceding calendar year, as required
under paragraph (b) of Rule 13a-18, Rule 15d-18 of the Exchange Act
and Item 1122 of Regulation AB. Such report shall be signed by an
authorized officer of the Indenture Trustee, and shall address each
of the Servicing Criteria related to Huntington National Bank
specified in Appendix A or such criteria as mutually agreed upon by
the Master Servicer and the Servicer; and
(ii) deliver to the Master Servicer a report of a registered
public accounting firm that attests to, and reports on, the
assessment of compliance made by the Servicer and delivered pursuant
to the preceding paragraph. Such attestation shall be in accordance
with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the
Securities Act and the Exchange Act.
Section 7.02 FINANCIAL STATEMENTS; SERVICING FACILITY. The Servicer
shall make available to the Purchaser and any prospective purchaser a
knowledgeable financial or accounting officer for the purpose of answering
questions respecting recent developments affecting the Servicer or the financial
statements of the Servicer, and to permit the Purchaser and any prospective
purchaser to inspect the Servicer's servicing facilities for the purpose of
satisfying the Purchaser and such prospective purchaser that the Servicer has
the ability to service the Receivables as provided in this Agreement.
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ARTICLE VIII
THE SERVICER
Section 8.01 INDEMNIFICATION OF THIRD PARTY CLAIMS BY THE SERVICER.
(a) Subject to the limitations set forth in Section 10.01(e), the
Servicer shall indemnify each Servicer Indemnified Party and hold each Servicer
Indemnified Party harmless against any and all claims, losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and any other costs, fees and expenses that any Servicer
Indemnified Party may sustain in any way related to (A) the failure of the
Servicer to perform its duties as servicer and custodian and to service the
Receivables in compliance with the terms of this Agreement, (B) the provision to
the Master Servicer, any other Servicer Indemnified Party, any rating agency,
any investor or any other participant in the Pass-Through Transfer of any Bank
Information (other than Distorted Information), including all such information
included in any offering document, term sheet or marketing materials relating to
the Pass-Through Transfer and all such information included in an Exchange Act
report or filing make by the Purchaser or any transferee under the Pass-Through
Transfer, that is false, incorrect, incomplete or misleading in any material
respect when delivered, (C) the breach of any representation or warranty,
covenant or other agreement of Servicer set forth in this Agreement, (D) the
use, ownership or operation by the Servicer or any Affiliate thereof of a
Financed Vehicle or (E) any actual or alleged violations of law, breach of
contract or tort by the Servicer in obtaining any CPI Policy for any Financed
Vehicle.
(b) The Servicer or the Servicer Indemnified Party, as applicable,
shall promptly notify the other upon becoming aware that a claim subject to
indemnification under Section 8.01(a) (a "SERVICER INDEMNIFIED CLAIM") has been
made by a third party; PROVIDED, HOWEVER, that the failure of the Servicer
Indemnified Party to notify the Servicer of a Servicer Indemnified Claim shall
not relieve the Servicer from any liability under Section 8.01(a) which it may
have to any Servicer Indemnified Party, but only to the extent such failure to
notify does not prejudice the Servicer's ability to defend. The Servicer shall
assume the defense of any such Servicer Indemnified Claim and be responsible for
all fees and expenses of counsel incurred therewith as well as any other
litigation expenses; PROVIDED, HOWEVER, THAT counsel chosen by the Servicer
shall be reasonably acceptable to the Master Servicer; and PROVIDED FURTHER,
HOWEVER, that at any time the Servicer Indemnified Party shall be entitled to
participate therein and, to the extent that it shall wish, hire counsel (who
shall not, except with the consent of the Servicer, be counsel to the Servicer)
and, jointly with the Servicer, assume the defense thereof. The Servicer shall
not be liable to the Servicer Indemnified Party for the cost of the Servicer
Indemnified Party's counsel. If, in connection with any Servicer Indemnified
Claim, the actual or potential defendants in, or targets of, any such action
include both the Servicer and the Servicer Indemnified Party, and counsel
retained by the Servicer cannot adequately represent both the Servicer and the
Servicer Indemnified Party in light of the claims and defenses that each intends
to raise, the Servicer Indemnified Party shall have the right to hire separate
counsel to assume the defense of any such Servicer Indemnified Claim and the
Servicer shall be responsible for all fees and expenses of such separate counsel
incurred therewith as well as any other litigation expense. The Servicer shall
not, without the written consent of the Servicer Indemnified Party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any
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pending or threatened action or claim in respect of which indemnification may be
sought hereunder (whether or not the Servicer Indemnified Party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the Servicer Indemnified Party
from all liability arising out of such action or claim and (ii) does not include
a statement as to, or an admission of, fault, culpability or failure to act, by
or on behalf of the Servicer Indemnified Party.
(c) To the extent the indemnification provided for in this Section
8.01 is unavailable to a Servicer Indemnified Party or is insufficient in
respect of any losses, claims, damages or liabilities that are subject to such
provisions, then the Servicer, in lieu of indemnifying such Servicer Indemnified
Party, shall contribute to the amount paid or payable by such Servicer
Indemnified Party as a result of such losses, claims, damages or liabilities in
such proportion as is appropriate to reflect the relative fault of the Bank on
one hand and the Master Servicer on the other hand with respect to the facts and
circumstances giving rise to such Servicer Indemnified Claim. The relative fault
with respect to any Servicer Indemnified Claim arising out of a violation of the
Securities Act or the Exchange Act shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to the
Servicer's relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Servicer and the Master
Servicer agree that it would not be just and equitable if contribution were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to in the
immediately preceding sentences. The amount paid or payable by the Servicer as a
result of the losses, claims, damages and liabilities referred to in the first
sentence of this paragraph shall be deemed to include, subject to the
limitations set forth otherwise in this Section 8.01, any legal or other
expenses reasonably incurred by such Servicer Indemnified Party in connection
with investigating or defending any such action or claim. Notwithstanding any
other provision of this Agreement, no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not also guilty of
such fraudulent misrepresentation.
(d) The indemnification obligations of the Servicer under Section
8.01(a) shall survive the assignment and transfer of the Receivables in
connection with the Pass-Through Transfer, the termination of the Servicer and
the termination of this Agreement and shall be in addition to any liability
which it may otherwise have.
Section 8.02 MERGER OR CONSOLIDATION OF THE SERVICER. The Servicer
shall 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 or any of the Receivables and to perform its
duties under this Agreement.
Any Person into which the Servicer may be merged or consolidated, or
any entity resulting from any merger, conversion or consolidation to which the
Servicer shall be a party, or any Person succeeding to the business of the
Servicer, shall be the successor of the Servicer hereunder, without the
execution or filing of any paper or any further act on the part of either Party,
anything herein to the contrary notwithstanding; PROVIDED, HOWEVER, that (i)
immediately after giving effect to such transaction, no representation or
warranty made pursuant to Section
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3.01(a) shall have been breached (for purposes hereof, the representations and
warranties set forth in Sections 3.01(a)(i) through (ix) shall speak as of the
date of consummation of such transaction) and no event that, with notice or
lapse of time or both, would become a Servicer Termination Event shall have
occurred and be continuing, (ii) the Servicer shall have delivered to the Master
Servicer an Officer's Certificate and Opinion of Counsel each stating that such
consolidation, merger or succession and any such related agreements comply with
this Section 8.02 and that all conditions precedent, if any, provided for in
this Agreement relating to such transaction have been complied with and (iii)
the Servicer shall have delivered to the Master Servicer 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
Purchaser and its successors and assigns in the Receivables or (B) no such
action shall be necessary to preserve and protect such interest. Furthermore, in
the event the Servicer transfers or otherwise disposes of all or substantially
all of its assets to an Affiliate of the Servicer, such Affiliate shall satisfy
the condition described in the preceding sentence and shall also be fully liable
to the Purchaser for all of the Servicer's obligations and liabilities
hereunder.
Section 8.03 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 Master Servicer or any other
Person for taking any action or for refraining from the taking of any action in
good faith pursuant to this Agreement, or for errors in judgment; PROVIDED,
HOWEVER, that this Section 8.03 shall not protect the Servicer from (i) any
obligation to repurchase any Receivable where the remedy under this Agreement
with respect to any breach of warranties or representations in this Agreement is
to require Servicer to repurchase such Receivable; (ii) any obligation to
indemnify any Servicer Indemnified Party for any matters indemnified under
Section 8.01(a); (iii) actual damages for breach of this Agreement that would
constitute a Servicer Termination Event under Section 10.01(a)(i) or (ii); or
(iv) any right of the Master Servicer to terminate the Servicer for a Servicer
Termination Event as specified in Section 10.01. 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 hereunder; PROVIDED FURTHER, HOWEVER, that in no
event shall the Servicer be liable to Master Servicer or any other Person for
any consequential, exemplary or punitive damages, except to the extent awarded
to a third party with respect to any matters indemnified under Section 8.01(a).
Section 8.04 LIMITATION ON RESIGNATION AND ASSIGNMENT BY SERVICER.
(a) The Master Servicer has entered into this Agreement with the
Servicer, and subsequent permitted purchasers or transferees pursuant to the
Pass-Through Transfer will purchase the Receivables, in reliance upon the
representations as to the adequacy of Servicer's servicing facilities, plant,
personnel, records and procedures, its integrity, reputation and financial
standing, and the continuance thereof. Therefore, the Servicer shall neither
assign this Agreement or its the servicing or custodial obligations hereunder,
nor delegate its rights or duties hereunder or any portion hereof.
(b) The Servicer shall not resign from the obligations and duties
hereby imposed on it, except by mutual consent of the Servicer and the Master
Servicer or upon the
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determination that its duties hereunder are no longer permissible under
Applicable Law and such incapacity cannot be cured by the Servicer. Any such
determination permitting the resignation of the Servicer shall be evidenced by
an Opinion of Counsel to such effect delivered to the Master Servicer. No
resignation under this Section 8.04 shall become effective until a successor
shall have assumed the Servicer's responsibilities and obligations hereunder in
the manner provided in Section 12.01, unless the Servicer is prohibited by
Applicable Law from serving as Servicer, in which instance the Master Servicer
shall immediately designate a successor Servicer.
ARTICLE IX
PASS-THROUGH TRANSFER
Section 9.01 EFFECT OF PASS-THROUGH TRANSFER.
The Servicer shall:
(i) cooperate with the Master Servicer and the trustee or similar
entity, at the expense of the Master Servicer or such other trustee or entity,
to satisfy, in connection with the Pass-Through Transfer, the applicable
entity's reporting obligations under the Exchange Act and Applicable Law,
including providing any information or report required by Form 10-D, Form 10-K,
Form 8-K or by any item of Regulation AB to the extent required to be provided
by or with respect to the Servicer (including, without limitation, Items 1117
(to the extent consistent with Sections 7.01(b) and 7.01(c)), 1119, 1121, 1122
and 1123 (to the extent consistent with Sections 6.02 and 6.03) of Regulation AB
and any certification necessary to comply in form and substance with the
Xxxxxxxx-Xxxxx Act and the rules and regulations promulgated thereunder;
PROVIDED, HOWEVER, that with respect to affiliations between the sponsor,
depositor and issuing entity (as such terms are defined in Regulation AB) and
the Servicer, the Servicer's obligation with respect to Item 1119 shall be
limited to commenting on proposed disclosure under Item 1119 that has been
provided by or on behalf of Issuer.
(ii) provide as applicable, at the expense of the Master Servicer:
(A) (x) an Officer's Certificate executed by a senior
officer of the Bank, responsible for the servicing of the
Receivables; and (y) such additional statements, certificates or
other similar documents of the Bank or reports from the Bank's
accountants in connection with the Pass-Through Transfer and in
substance as required by Applicable Law; and
(B) access for rating agencies, credit enhancers or
investors reasonable to each Bank representative with
responsibility, knowledge or experience with respect to the
servicing of the Receivables, upon reasonable prior notice and
during regular business hours, for the purpose of answering
questions about the origination of the Receivables and the servicing
of the Receivables;
(iii) provide such periodic reports and other information relating the
Receivables transferred in connection with the Pass-Through Transfer to and as
required by the purchaser of the Receivables, the trustee or similar entity to
effectuate the foregoing;
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ARTICLE X
DEFAULT
Section 10.01 SERVICER TERMINATION EVENTS. (a) Each of the following
shall constitute a Servicer Termination Event:
(i) any failure by the Servicer to remit to the Purchaser (x) any
payment to be made on a Remittance Date that continues unremedied for a period
of one (1) Business Day after the date upon which such payment was due or (y)
any payment required to be made under the terms of this Agreement (other than
any payment to be made on a Remittance Date) that continues unremedied for a
period of three (3) Business Days after the date upon which such payment was
due; or
(ii) failure by the Servicer duly to observe or perform in any material
respect any other of the covenants or agreements on the part of the Bank set
forth in this Agreement which continues unremedied for a period of thirty (30)
days after the date on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Bank, by the Master Servicer; or
(iii) failure by the Servicer to maintain its license to do business in
any jurisdiction where the Servicer is required to be licensed in connection
with the servicing of the Receivables or the performance of its other
obligations under this Agreement, which continues unremedied for a period of
thirty (30) days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Bank, by the
Master Servicer; or
(iv) any change in the business, assets, operations, prospects or
condition, financial or otherwise, of the Bank that has a material adverse
effect on the ability of the Bank to perform any of its obligations under this
Agreement; or
(v) the long-term unsecured debt rating of the Bank is withdrawn or
reduced to "Baa2" by Xxxxx'x, "BBB" by Standard & Poor's or "BBB" by Fitch; or
(vi) the Bank shall default in the payment of indebtedness for any
borrowed monies (after giving effect to all applicable cure periods in any
agreement governing such indebtedness) in an amount in excess of $10,000,000; or
(vii) a decree or order of a court or agency or supervisory authority
having jurisdiction for the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, including bankruptcy,
marshaling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against the
Servicer and such degree or order shall have remained in force undischarged or
unstayed for a period of sixty (60) days; or
(viii) the Servicer shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to either the
Servicer or of or relating to all or substantially all of its property; or
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(ix) the Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency, bankruptcy or reorganization statute, make an assignment
for the benefit of its creditors or voluntarily suspend payment of its
obligations; or
(x) the Servicer attempts to assign its right to servicing compensation
hereunder or to assign this Agreement or the servicing responsibilities or
custodial responsibilities hereunder or to delegate its duties hereunder or any
portion thereof in violation of Section 8.04; or
(xi) the indictment of Servicer, any director or employee thereof, any
Affiliate or any director or employee thereof for criminal activity related to
the origination or servicing activities of the Servicer, in each case, where
such indictment materially and adversely affects the ability of the Servicer, as
applicable, to perform its obligations under this Agreement subject to the
condition that such indictment is not dismissed within ninety (90) days; or
(xii) any Servicer Termination Event (as defined in the Purchase
Agreement) under the Purchase Agreement.
(b) The Bank shall deliver to the Master Servicer, promptly after
having obtained knowledge thereof, but in no event later than three (3) Business
Days thereafter, written notice in an Officer's Certificate of any event which
with the giving of notice or lapse of time, or both, would become a Servicer
Termination Event under Section 10.01(a).
(c) In each case, so long as a Servicer Termination Event shall
not have been remedied, in addition to whatever rights the Master Servicer may
have for damages or equitable relief, including injunctive relief and specific
performance, except as may be limited by Section 8.03, the Master Servicer, by
notice in writing to the Seller and the Servicer, may (i) terminate the Bank as
Servicer under this Agreement and the servicing of the Receivables and the
proceeds thereof, including the Servicer's custodial responsibilities hereunder;
(ii) give notice to each Obligor of the sale of the related Receivable to the
Purchaser and that such Obligor shall, effective as of the date of such notice,
remit all Monthly Payments to an account specified by the Master Servicer or
(iii) require the Servicer to deliver within five (5) Business Days all
Receivable Files to an entity designated by the Master Servicer.
(d) Upon receipt by the Servicer of such written notice pursuant
to clause (c)(i) above, all authority and power of the Servicer under this
Agreement, whether with respect to the Receivables or otherwise, shall pass to
and be vested in the successor appointed pursuant to Section 12.01. Upon written
request from the Master Servicer, the Servicer shall prepare, execute and
deliver to the successor servicer designated by the Master Servicer any and all
documents and other instruments, place in such successor's possession all
Receivable Files, and do or cause to be done all other acts or things necessary
or appropriate to effect the purposes of such notice of termination, including
but not limited to the transfer and endorsement or assignment of the Receivable
Files, at the Servicer's sole expense. The Servicer shall cooperate with the
Master Servicer and such successor servicer in effecting the termination of the
Servicer's responsibilities and rights hereunder, including without limitation,
the transfer to such successor for administration by it of all cash amounts
which shall at the time be held by the Servicer with respect to the Receivables
or thereafter received with respect to the Receivables.
-31-
(e) The Servicer shall not be required to repurchase a Receivable
pursuant to Section 4.01(g) or to indemnify the Master Servicer pursuant to
Section 8.01 in connection with (x) a Receivable being deemed to be
unenforceable in a jurisdiction or (y) the impairment of receipt by the
Purchaser of Collections on a Receivable if either (x) or (y) above occurs as a
result of the Master Servicer's failure to obtain any license or consent
necessary in connection with its ownership of the Receivables. In addition, the
Servicer shall not be required to repurchase a Receivable pursuant to Section
4.01(h) or to indemnify the Purchaser pursuant to Section 8.01 in connection
with (A) the impairment of the Servicer's ability to collect amounts due on the
Receivables or (B) a negative effect on servicing performance, if either (A) or
(B) above occurs as a result of the inability of the Servicer to pursue
litigation due to the restrictions set forth in Section 4.01(c).
Section 10.02 WAIVER OF SERVICER TERMINATION EVENTS. By a written
notice, the Master Servicer may waive any Servicer Termination Event and its
consequences. Upon any waiver of a past default, such default shall cease to
exist, and any Servicer Termination Event arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereon
except to the extent expressly so waived. Notwithstanding the foregoing, if any
Servicer Termination Event that has occurred is continuing, unless and until the
Master Servicer shall waive such Servicer Termination Event by written notice,
the Master Servicer may by notice in writing to the Servicer in the manner
provided in Section 10.01(c), terminate the rights of the Servicer under this
Agreement and in and to the servicing and the custody of the Receivables
constituting one or more Receivables Pools and the proceeds thereof at any time
thereafter.
ARTICLE XI
TERMINATION
Section 11.01 TERMINATION. This Agreement shall terminate upon the
earlier of (i) the later to occur of (A) the final payment or other liquidation
(or any advance with respect thereto) of the last maturing Receivable and (B)
the disposition of any Financed Vehicle with respect to the last Receivable and
the remittance of all funds due hereunder or (ii) the mutual consent of the
Servicer and the Master Servicer in writing. The representations and warranties
made by the Servicer in Section 3.01 and the indemnification obligations of the
Servicer under Section 8.01(a) shall survive the termination of this Agreement.
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01 SUCCESSOR TO SERVICER. (a) Prior to termination of any
of the Servicer's responsibilities and duties under this Agreement pursuant to
Section 8.04, 9.01(a), 10.01(c) or 11.01, the Master Servicer shall (i) succeed
to and assume all of the Seller's responsibilities, rights, duties and
obligations under this Agreement, or (ii) appoint a successor satisfying the
conditions set forth in Section 8.02 which successor shall succeed to all rights
and assume all of the responsibilities, duties and liabilities of the Servicer
under this Agreement, including as servicer and custodian, prior to the
termination of the Servicer's responsibilities,
-32-
duties and liabilities under this Agreement. In connection with such appointment
and assumption, the Master Servicer may make such arrangements for the
compensation of such successor out of payments on Receivables as it and such
successor shall agree. In the event that the Servicer's duties, responsibilities
and liabilities under this Agreement should be terminated in whole or in part
pursuant to the aforementioned sections, the Servicer shall discharge such
duties and responsibilities during the period from the date it acquires
knowledge of such termination until the effective date thereof with the same
degree of diligence and prudence which it is obligated to exercise under this
Agreement, and shall take no action whatsoever that might impair or prejudice
the rights or financial condition of its successor and shall continue to receive
the servicing fees and any other amounts payable to the Servicer hereunder with
respect to each affected Receivables Pool through but not including the day on
which a successor Servicer is appointed. The resignation or removal of the
Servicer pursuant to the aforementioned sections shall not become effective
until a successor shall be appointed pursuant to this Section 12.01 and shall in
no event relieve the Servicer of the representations and warranties made
pursuant to Section 3.01(a) and the remedies available to the Master Servicer
under Sections 4.01(h) and 6.01, it being understood and agreed that the
provisions of such Sections 3.01(a), 4.01(h) and 6.01 shall be applicable to the
Servicer notwithstanding any such termination of the Servicer, or the
termination of this Agreement.
(b) Any successor appointed as provided herein shall execute,
acknowledge and deliver to the Servicer and to the Master Servicer an instrument
accepting such appointment, wherein the successor shall make the representations
and warranties set forth in Section 3.01(a), whereupon such successor shall
become fully vested with all the rights, powers, duties, responsibilities,
obligations and liabilities of the Servicer, with like effect as if originally
named as a party to this Agreement. Any termination of the Servicer or
termination of this Agreement pursuant to Section 8.04, 10.01 or 11.01 shall not
affect any claims that Master Servicer may have against the Servicer arising out
of the Servicer's actions or failure to act prior to any such termination.
(c) The Servicer shall deliver promptly to the successor servicer
all Collections held by it in respect of the Receivables and all Receivable
Files and related documents and statements held by it hereunder and the Servicer
shall account for all funds and shall execute and deliver such instruments and
do such other things as may reasonably be required to more fully and
definitively vest in the successor all such rights, powers, duties,
responsibilities, obligations and liabilities of the Servicer.
(d) Any successor servicer shall be required to remit to the
Master Servicer all collections received with respect to the Receivables on a
daily basis unless otherwise agreed to by the Master Servicer.
Section 12.02 AMENDMENT. This Agreement may only be amended from
time to time by written agreement signed by the Servicer and the Master
Servicer.
Section 12.03 GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
-33-
LAWS, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF (EXCEPT FOR
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).
(a) In connection with any suit, claim, action or proceeding
arising out of or relating to this Agreement and the transactions contemplated
hereby, (i) each of the Bank and the Master Servicer hereby consents to the in
personam jurisdiction of any court of the State of New York or any U.S. federal
court located in the Borough of Manhattan in the State of New York; (ii) each of
the Bank and the Master Servicer agrees that service by prepaid certified or
registered mail, or any other form equivalent thereto (or, in the alternative,
by any other means sufficient under applicable law, rules and regulations) at
the addresses set forth in Section 12.05 shall be valid and sufficient for all
purposes; and (iii) each of the Bank and the Master Servicer agrees to, and
irrevocably waives any objection based on forum non conveniens or venue not to,
appear in such state or U.S. federal court located in the Borough of Manhattan.
(b) EACH OF THE BANK AND THE MASTER SERVICER HEREBY IRREVOCABLY
AND UNCONDITIONALLY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY AND ALL
RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING BASED
ON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, OR ANY
OTHER DOCUMENTS AND INSTRUMENTS EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE
OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS
OF THE BANK OR THE MASTER SERVICER. THIS PROVISION IS A MATERIAL INDUCEMENT FOR
THE MASTER SERVICER TO ENTER INTO THIS AGREEMENT.
Section 12.04 DURATION OF AGREEMENT. This Agreement shall continue
in existence and effect until terminated as herein provided.
Section 12.05 NOTICES.
(a) Any notice pursuant to this Agreement shall be in writing
signed by or on behalf of the Party giving it and may be served by sending it by
confirmed facsimile, personal delivery or overnight courier to the address of
the addressee set forth below (or to such other address as the addressee shall
have specified to such Party by not less than fifteen (15) days prior notice
given in accordance with this Section 12.05). Notice given is deemed for
purposes of this Agreement:
(i) in the case of a facsimile transmission, on the day a confirmation
of receipt is confirmed, or, if such day is not a Business Day, on the first
Business Day thereafter; and
(ii) in the case of personal delivery or delivery by overnight courier,
on the day of delivery at the address of the addressee or, if such day is not a
Business Day, on the first Business Day thereafter.
(b) The details for notices are:
(i) if to Master Servicer:
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Xxxxxxx Xxxxx Mortgage Company
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000
with a copy to:
Xxxxxxx Xxxxx Mortgage Company
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X'Xxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000
(ii) if to the Seller or Servicer:
The Huntington National Bank
Huntington Center
00 Xxxxx Xxxx Xxxxxx - XX0000
Xxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Tel.: (000) 000-0000
Fax.: (000) 000-0000
with a copy to:
The Huntington National Bank
Huntington Center
00 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
Section 12.06 SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be held
unenforceable or invalid in any jurisdiction, then such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement in such jurisdiction to the
extent of such unenforceability or invalidity, and such unenforceability or
invalidity shall in no way affect the validity or enforceability of the other
provisions of this Agreement or of such provisions in any other jurisdiction.
Section 12.07 EFFECT ON PURCHASE AGREEMENT. The provisions of the
Purchase Agreement, and all indemnities, agreements, representations, warranties
and other statements of the parties thereunder, shall remain in full force and
effect with respect to the Receivables. The obligations of the parties hereto
under this Agreement shall be in addition to any liability which
-35-
the parties may otherwise have under the Purchase Agreement, provided that no
party shall be entitled to claim a double recovery of any amount.
Section 12.08 RELATIONSHIP OF PARTIES. Nothing contained herein
shall be deemed or construed to create a partnership or joint venture between
the Master Servicer and the Servicer.
Section 12.09 COUNTERPARTS. This Agreement may be executed in one or
more counterparts and by each Party on separate counterparts, each of which,
when so executed, shall be deemed to be an original; such counterparts,
together, shall constitute one and the same agreement. Transmission by facsimile
of an executed counterpart hereof shall be deemed to constitute due and
sufficient delivery of such counterpart.
Section 12.10 SUCCESSORS AND ASSIGNS. This Agreement shall inure to
the benefit of and be binding upon, and shall be enforceable by the Servicer and
the Master Servicer and their permitted successors and assigns. The Servicer may
not assign all or any portion of its rights or obligations under this Agreement
without the prior written consent of the Master Servicer. Any such purported
assignment without such consent shall be null and void.
Section 12.11 ASSIGNMENT BY PURCHASER. The Purchaser shall have the
right, without the consent of the Servicer, and consistent with Section 9.01(a),
to assign, in whole or in part, its interest under this Agreement with respect
to some or all of the Receivables in connection with a Pass-Through Transfer,
and designate any Person to exercise any rights of the Purchaser hereunder, by
executing one or more Assignment, Assumption and Recognition Agreements
substantially in the form of Exhibit J to the Purchase Agreement and each
assignee or designee shall accede to the rights and obligations hereunder of the
Purchaser with respect to such Receivables. All references to the Purchaser in
this Agreement shall be deemed to include such assignees and designees.
Section 12.12 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise
and no delay in exercising, on the part of the Master Servicer or the Servicer,
any right, remedy, power or privilege hereunder, will operate as a waiver
thereof; nor will any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges therein provided are cumulative and not exhaustive of any
rights, remedies, powers and privileges provided by law.
Section 12.13 FURTHER ASSURANCES. The Servicer and the Master
Servicer agree to do and perform, from time to time, any and all acts and to
execute any and all further instruments required or reasonably requested to more
fully to effect the purposes of this Agreement, including, without limitation,
the execution of any financing statements or continuation statements relating to
the Receivables for filing under the provisions of the UCC of any applicable
jurisdiction.
Section 12.14 EFFECT OF HEADINGS; CROSS-REFERENCES. The article,
section and subsection headings herein and the table of contents of this
Agreement are for convenience only and shall not affect the construction of this
Agreement. References in this Agreement to article,
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section and subsection numbers are to such article, section and subsection
numbers of this Agreement.
Section 12.15 NO PETITION COVENANT. Each of the Servicer and the
Master Servicer, by entering into this Agreement, covenants that it shall not,
prior to the date that is one year and one day after the payment in full of all
securities issued in connection with the Pass-Through Transfer, acquiesce,
petition or otherwise invoke or cause the issuer of such securities or trustee
or other similar entity for such securities to invoke the process of any court
or government authority for the purpose of commencing or sustaining a case
against such issuer or trustee or other entity under any bankruptcy, insolvency
or similar law, or for the purpose of appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of such
issuer or trustee or other entity or any substantial part of its properties, or
ordering the winding up or liquidation of the affairs of such issuer, trustee or
other entity. This Section 12.15 shall survive the termination of this
Agreement.
Section 12.16 THIRD PARTY BENEFICIARIES. This Agreement is solely
for the benefit of the parties hereto, and, to the extent expressly provided
herein, the other Persons named herein, and, except to the extent expressly
provided herein, no provision of this Agreement shall be deemed to confer upon
other third parties any remedy, claim, liability, reimbursement, cause of action
or other right.
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IN WITNESS WHEREOF, the Servicer and the Master Servicer have caused
their names to be signed hereto by their respective duly authorized officers as
of the day and year first above written.
XXXXXXX XXXXX MORTGAGE COMPANY,
as Master Servicer
By: XXXXXXX SACHS REAL ESTATE
FUNDING CORP., as the General Partner
of Xxxxxxx Xxxxx Mortgage Company
By: /s/ Xxxxxxxx Xxxxx
------------------
Name: Xxxxxxxx Xxxxx
Title: Vice President
S-1 HUNTINGTON SERVICING AGREEMENT
THE HUNTINGTON NATIONAL BANK, as
Servicer
By: /s/ Xxxxxxx X. Xxxxxx
---------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
S-2 HUNTINGTON SERVICING AGREEMENT
EXHIBIT A
[Reserved]
A-1
EXHIBIT B
LOCATION OF RECEIVABLE FILES
The location of the Receivable Files shall be:
The Huntington National Bank
0000 Xxxxx Xxxx
Xxxxxxxx, XX 00000
X-0
XXXXXXX X
[Xxxxxxxx]
X-0
XXXXXXX X
[Reserved]
D-1
EXHIBIT E
[Reserved]
E-1
EXHIBIT F-1
[Reserved]
F-1-1
EXHIBIT F-2
[Reserved]
F-2-1
EXHIBIT F-3
LIST OF MONTHLY SERVICER REPORTS
1. MONTHLY FLAT FILE: Electronic file of data elements as specified in
Purchaser's Data Dictionary (which shall be attached as Exhibit A to the
Purchase Agreement).
2. MONTHLY OUTSTANDING ROLL-FORWARD REPORT/SERVICER'S CERTIFICATE: A
summary of the changes in the portfolio balance for the previous month.
This report provides a summary of the categories (and dollar values of
each) which impacted the portfolio's principal for the previous month.
This includes principal payments, payoff payments, charged-off amounts,
repossession proceeds, other charges and any non-cash items.
3. MONTHLY ACCOUNT ACTIVITY REPORT: A loan level detail of the activity
and monetary transactions that impacted each account in the portfolio.
This report provides detail by account with regards to the amount of
principal and interest collected, account status code (bankrupt or
repossession), unpaid principal balance, and totals for interest and
principal due to investor. Status accounts are also summarized by numbers
and totals.
4. MONTHLY LOSS TREND ANALYSIS: Provides delinquency and loss total
information for a given period of time summarized on monthly intervals.
5. MONTHLY SERVICING STANDARDS COMPLIANCE REPORT: Comparison of actual
monthly performance levels achieved to those specified in the Performance
Standards.
6. REPOSSESSION/LOSS REPORT: Provides account level detail on each
repossession, charge-offs, cram-down, GAP claim or settlement that was
processed the previous month. Includes total repossession expenses, sale
proceeds, deficiency balance amount(s) along with comparisons to industry
average value guides and miscellaneous information regarding days in
inventory and type of loss.
7. REPOSSESSION TRACKING REPORTS: Monthly reports providing account
level detail of pertinent data throughout the repossession process,
including reports for: accounts assigned for repossession, accounts in
repossession inventory and repossessions sold.
8. BANKRUPTCY REPORT: Provides account level detail to include original
balance, current balance, loan date, date of last payment, type of
bankruptcy and scheduled payment amount.
9. MONTHLY CONTRACTUAL DELINQUENCY REPORT: Provides information sorted
by account number which displays account level detail by delinquency grade
(current, 30, 60, 90 & 120+) with totals by category.
10. PAID OUT ACCOUNT ACTIVITY REPORT: Loan level detail of accounts paid
in full in a reporting period.
F-3-1
11. DAILY SWEEP REPORT: Provides information sorted by account number
relative to the previous day's payment activity. This includes the total
amount of payment posted to (or retracted from) each account, including a
summary of those amounts applied to principal, interest and other.
12. PAYMENT TRANSMITTAL REPORT: Provides a weekly and month-end summary
of the cash transactions applied to all accounts for the specified period
of time.
Ad-Hoc Daily Reports (upon request):
INDIVIDUAL ACCOUNT RECORDS: Screen prints can be made available for any given
customer upon request (quantities limited). This will provide individual account
detail relative to transaction history and current demographic information.
CALL VOLUME REPORTS: Daily CMS dialer call volume reports will be made available
on an as requested basis in a to be determined format. Skip tracing log reports
will also be made available upon request in a format to be defined at a later
date.
Note: Optional Ad-Hoc daily reports based upon the previous month end data.
Details of this reporting option to be obtained by providing specific reporting
requests in writing. It is also noted that in the event of securitization, the
trustee will define the final securitization format.
F-3-2
EXHIBIT F-4
FORM OF SERVICER REPORTS
(On CD-ROM)
F-4-1
EXHIBIT G
SERVICING STANDARDS
The Servicer shall provide the loan accounting and servicing functions described
in this document for the Portfolio(s) attached hereto, and for any other
Portfolios that may become subject to this Agreement from time to time.
Servicing fees shall cover all servicing costs (including various borrower
account maintenance updates and title cures). The Servicer shall provide
reconstitution support to the Purchaser if accounts in the Portfolio are sold
pursuant to a Pass Through Transfer.
SERVICING ENVIRONMENT SETUP:
Set up unique identification for the Portfolio in the Servicer loan accounting
and servicing system to provide servicing and process standards, reporting of
results, data, and reports as mutually agreed upon for this Portfolio.
Establish procedures for calculating and assigning Deficiency Balances to HNB
recovery units or through a third party vendor.
All customer statements, forms, letter, correspondence and default notices and
resulting actions will be identified in the name of the Servicer and the Master
Servicer name shall not be conveyed in any written or verbal correspondence
unless required by law.
Report monthly to the 3 major credit bureaus in the name of the Servicer and not
the Master Servicer.
LOAN ACCOUNT SERVICING AND REPORTING:
Maintain appropriate customer and loan account records for all accounts on the
Servicer Accounting System. The system will accurately account for interest
accruals, payoff calculations, late charge processing, payment application
processing, delinquency processing and closed loan processing.
Process all loan payments in compliance with the Retail Installment Loan
Contracts.
Process on a daily basis all payments received from customers.
Perform all exception processing for non exact items, misapplied payments, or
other correspondence received from the customers.
Appropriately staff (including with Bilingual counselors) the toll free customer
service and collection line to respond to customer inquiries using live
operators (define and agree upon working hours and days).
Respond to and resolve written customer inquiries regarding their accounts.
Process account maintenance changes to the loan accounting system.
Generate and mail late notices to customers when their account becomes past due.
G-1
Generate and maintain an interface to the Servicer Collection Management System
for all accounts that are past due to initiate collection efforts.
Investigate and process refunds on overpayment accounts.
Process and address any credit bureau disputes received from customers directly
or the credit bureaus.
Update the credit bureau risk score for each account within the portfolio on a
quarterly basis, and provide updates to Master Servicer.
Periodically update the behavior score (as applicable) for each account in the
portfolio.
Generate and mail appropriate forms and letters to customers throughout the life
of the loan (i.e. payoff letters, final payment bills, paid letters, etc.).
Send any notices provided by the Master Servicer or its designee to maintain
compliance with the Privacy Act.
Maintain customer accounts in an automated loan accounting system ensuring the
information contained in the account records is accurate and authorized change
requests are processed.
Provide all payment processing for loan accounts including ACH, other electronic
payment processes currently available and supported, and Lock box account for
receipt of customer payments.
Provide 24/7 toll-free incoming call service to loan customers for inquiries on
their accounts.
Establish access to a VRU to provide automated balance and payoff information
for loan customers.
Perform paid loan processing functions including credit bureau updates.
Process lien satisfactions for paid out/closed installment loans.
Archive all loan documents on hard copy or film for the appropriate retention
period.
LOAN ACCOUNT COLLECTION:
Establish and maintain collection records in the Servicer Collection Management
System for all past due accounts. Record all collection efforts within the
collection history for each account.
Process extensions in accordance with Master Servicer or its designee's
guidelines.
No Skip a Payment or other deferment programs (other than as provided in Section
4.01(b)) allowed other than existing pass a payment in current coupon books.
EARLY STAGE DELINQUENCY:
Utilize the Servicer's STRATA Decisioning System including any Behavior Scoring
System and updated FICO scores to assign collection strategies as specified
herein. Loans will have phone
G-2
calls start as early as 1 day past due depending on the account level strategy.
First payment default loans must be called between the fifth and tenth day.
Minimum contact per account ratio of 2.5 monthly, and call penetration rates to
be actively managed to achieve these results.
Customer contact inquiries will be made to determine and provide the reason(s)
for default including but not limited to status of employment and household
income, any insurance claims in process, status of insurance on and location and
condition of collateral if applicable.
Collection actions and contact attempts will be taken in accordance with
collection strategies as often as necessary and at various times of the day,
evening, and weekend in compliance with applicable law.
Accounts with no contact after 10 days (or earlier, if there is no phone number
in service for the related Account) will be escalated to manual review to
determine on-going strategy. If account has still not been contacted through the
dialer, account will be assigned to an off-dialer collection resource for the
purpose of direct scheduled calling sequence which may include a targeted call
period (evenings, weekends, breaks, etc.). This process will occur approximately
17-20 days after scheduled due date.
At any stage (either by on-dialer recognition or through off-dialer review) the
account can be forwarded to an off-dialer resource or to a supervisor. No
promise in excess of ten days will be allowed. An account is currently
considered a broken promise 3 days after the date made. Advanced collection
resources will become involved if the customer has broken an existing promise to
pay. These resources will work the account within two business days after the
broken promise. In special circumstances, the account can be issued directly to
supervisor for review for repossession, or to the skip department for advance
location review. Broken promises are sent to a specific queue and will be
prioritized in CACS to maximize the next day call rate.
Skip tracing will commence as soon as indicated (telephone disconnected, mail
returned), and no later than 10 days after no contact. Making borrower contacts
attempts based on information obtained through methods such as credit reports,
internet services, place of employment and co-signer information, door knocks,
etc. If all account information is still considered to be valid, account will be
placed back into the dialer for 2nd random call sequencing.
MID-STAGE AND FRONT-END COLLECTIONS:
A supervisor reviews most accounts that progress to beyond 30-days delinquent,
or that have been referred to the supervisor by the collector due to an adverse
situation or unacceptable customer request. No accounts (other than,
potentially, accounts with a balance of less than $2,500) will remain in
front-end collections for longer than 45 days.
For accounts 30 or more days past due, continued regular phone attempts to
contact the Borrower will be made.
Customers 30 or more days past due will be requested to send payments via
overnight mail or through an automatic payment service.
Exclusive of any on-line automated late notices, the collection resource will
have the ability to generate an on-line collection letter to the debtor. These
notices to range from a friendly
G-3
reminder to a firm demand letter based upon the severity of the delinquency and
the history of the account.
Account will remain in the collection resource's queue with a follow-up code.
This code will only be changed if the customer makes a payment, or the
collection resource performs an action on the account. Accounts are typically
sorted based upon the oldest follow-up date and the outstanding balance of
delinquency. Account follow-up should not exceed two days without the account
being reviewed.
Between the 45th and 60th day of delinquency of accounts where no payment
arrangements have been made, Servicer will order a current credit bureau report
if appropriate, verify title lien if applicable, and value of collateral if
applicable and order a copy of the Contract as needed.
The supervisor can submit the account for repossession during the standard
review process, or during special request by the off-dialer collection resource.
This will occur when the account has progressed to approximately 55 days, but no
more than 70 days contractually delinquent, but may occur at any time based upon
the supervisor's/portfolio manager's determination.
ADVANCE COLLECTIONS:
Late Stage Collectors will be dedicated to collect on accounts at or near 45
days contractually delinquent. No more than 200 accounts will be assigned to any
one Late Stage Collector at any one time.
Advance collections include:
o Accounts that are skip and cannot be located
o Accounts that have broken multiple promises to pay without activity by the
customer
o Accounts that are out for repossession or liquidation
o Accounts with pending insurance activity
For most accounts that becomes 60 days past due, a supervisor shall review the
account and determine and execute a collection strategy. Strategies will be
based upon the borrowers ability to pay, delinquency status, payment history and
the asset's value/location. If it is not conceivable that arrangements can be
made to bring the customer current over a period of time through a repayment
plan or extension (in accordance with the agreed upon procedures), the
supervisor will submit the account to the collateral management group for review
for asset liquidation.
The account is placed into a special queue, where a mini-skip routine is
performed to secure the whereabouts of the asset prior to assigning the account
for repossession. This process is designed to expedite the recovery and sale
process, and minimizes acquisition and storage costs.
The collector will examine the collateral type and value, and make an evaluation
as to the time necessary to liquidate the asset, and estimate the potential
selling price prior to the final decision to liquidate.
G-4
Servicer will charge off accounts from the Servicer Loan Accounting System at
the earliest of:
i) when the account is deemed uncollectible, or
ii) when the asset has been sold and proceeds received, or
iii) 60 days after repossession, if the asset is still in inventory, or
iv) by the end of the month during which a loan becomes 120 days past
due and is not in repossession inventory, or
v) by the end of the month during which a loan becomes 180 days past
due.
Unrecovered balances will be charged off promptly after collateral liquidation
and receipt of funds. Servicing functions supporting the collection,
repossession and remarketing, or securing of insurance or other proceeds due on
the account will continue regardless of the charge off designation. Servicing
and Accounting systems, reports and data files must contain an identifier for
Repossession, and/or Charge-off status.
In cases of loan default and charge offs only, Servicer will apply for and use
reasonable efforts to realize upon insurance proceeds, including GAP insurance
and rebates on insurance and warranty policies in order to mitigate the loss
incurred. In all other cases, customers will be directed to the originating
dealership for cancellations, refunds, and all other insurance and warranty
matters.
Accounts in repossession and bankruptcy status remain in special queues that are
not accessed by the general collection resources unless redemption,
reaffirmation, dismissal, or other action has occurred which would qualify the
account for general collection processing.
REPOSSESSION:
Servicer will provide a repossession and remarketing network and contract with
such third party service providers.
Contracts assigned for repossession shall be handled in accordance with the
following standards and procedures:
o Verify lien on title.
o Order copy of contract and original title, if appropriate.
o Complete assignment to repossessor with borrower and collateral
information within 48 hours of receipt in repossession department.
o Follow up with repossessor on progress weekly.
o Continue to attempt contact and payment arrangements with borrower.
o When contacted by repossessor that property has been repossessed, obtain
condition report, storage location and costs.
o Follow state requirements regarding borrower notification and redemption
or reinstatement periods.
o If appropriate, negotiate redemption, notify storage lot of redemption and
terms. Provide borrower with redemption release to claim property once
terms have been met.
o If no redemption, determine value of collateral, set floor price and
proceed with sale at auction.
G-5
o All auction expenses to be netted from proceeds of sale and net proceeds
applied to the loan balance. Repossession expenses are paid by invoice and
added to account balance.
o Calculate deficiency balance and send deficiency letter to borrower.
o Obtain any warranty or insurance proceeds due on account.
o Charge off deficiency, or if overage exists after full payment of account
and expenses, send overage to borrower with notice of sale.
Servicer remarketing specialist to attend auctions to inspect collateral,
validate the auction process, and/or evaluate the remarketing strategy.
RECOVERY:
Account collection activities will continue after charge-off by following
recovery procedures in accordance with this Agreement.
Accounts may be outsourced to a collection agency immediately following
charge-off as determined by Huntington's recovery scorecard. Accounts with
respect to which such a determination is made will typically be maintained
in-house for no more than 180 days and will be managed by Huntington Agency
Management Specialists. If in-house efforts will exceed 180 days the Supervisor
of the unit will review the account and fully document the situation with his or
her approval.
All collection agencies will be audited on a quarterly basis. Every such agency
is required to adhere to the Huntington MARS Guidelines.
Accounts that are not immediately outsourced to a collection agency will be
tagged with one of the following "EXCLUDED STATUS CODES:
o PPA - Accounts that are coded with a PPA Status Code, (Promise to Pay) will
be excluded from the Recovery Score Strategy. Accounts may exceed 180 days
in-house provided scheduled monthly payments are being made. Reduced costs to
the investors and customer service are best practices.
o SEC - Accounts that are coded with a SEC Status Code, (Secured) will be
excluded from the Recovery Score Strategy. Internal efforts along with skip
trace vendors will be utilized to recover and liquidate the collateral.
Efforts will be made for a period not to exceed 180 days. Once the internal
efforts to secure the vehicle are exhausted the accounts will be referred to
a collection agency to be worked under the Huntington MARS guidelines.
o FRD - Accounts that are coded with a FRD Status Code (Fraud), will be
excluded from the Recovery Score Strategy. Huntington Fraud Investigators
and/or Bank Security will handle investigation and recovery efforts. In some
cases litigation and/or prosecution will be necessary. If it is determined
that a fraudulent transaction has occurred the account will not be referred
to a collection agency. Accounts will be worked to conclusion and then placed
into a "uncollectible work queue". Collection Agencies do not work fraudulent
accounts.
o LGL - Accounts that are coded with a LGL Status Code, (Legal) will be
excluded from the Recovery Score Strategy. Huntington Litigation Specialists
will work with outside counsel to secure and liquidate collateral. Litigation
Specialists may also enter into agreed upon payment arrangements of the
deficiency balance through agreed judgment entries. Accounts, in most cases
will exceed the contractual number of days worked in-house. Collection
G-6
agencies do not have the expertise to work through complex litigation matters
and would not work the account without an increase in contingency fees.
o DEF - Accounts that are coded with a DEF Status Code, (Defense) will be
excluded from the Recovery Strategy. Huntington Litigation Specialists will
work with in-house or outside counsel to defend any actions brought against
the bank. Accounts, in most cases will exceed the contractual number of days
worked in-house. On going strategy will need to be identified on a
case-by-case basis. Outside collection agencies do not have the expertise to
work through complex litigation matters.
o BNK - Accounts that are coded with a bankruptcy status code, (XXX, X00, XX0
etc.,) will be excluded from the recovery strategy. Huntington Bankruptcy
Specialists will work in-house and with outside counsel to represent the
investor in the bankruptcy proceedings. Accounts in most cases will the
contractual number of days worked in-house. On going strategy will need to be
identified on a case-by-case basis. Collection Agencies do not work bankrupt
accounts on a contingency fee agreement.
GUIDELINE COSTS ASSOCIATED WITH REPOSSESSION AND REMARKETING PROCESS
(ESTIMATED):
Judicial Fees: $500
Repossessor charge: $285 per unit (includes keys) average of voluntary and
involuntary
Storage Fee: $10 average per unit repossessed and sold
Standard Auction Clean-Up Fee: $83 per vehicle
Auction or Sale fee: Average of $105 per unit sold
Title conversion or Duplicate Title (if applicable): $45 per unit sold
Move collateral to auction: $37 per vehicle
Impound fees if applicable: Average of $45 per account processed
ALL COSTS ARE TO BE RECOUPED FROM THE LIQUIDATION SALE PROCEEDS. NET LIQUIDATION
PROCEEDS CANNOT BE LESS THAN ZERO.
BANKRUPTCY:
In the event that a debtor declares bankruptcy, servicer enters the bankruptcy
transaction on the account the same or following business day that the
notification is received. The account is placed into the bankruptcy department's
worklist, where follow-up dates and codes are placed on the account to ensure
that the servicer is following state and federal law in the handling of these
accounts. Servicer will perform all necessary actions for bankruptcy including,
at a minimum, the following:
o Acknowledge receipt of bankruptcy notice
o Stop all collection activity to comply with Federal Stay Order, including
property sale
o Conduct initial review verifying payment status, collateral, account
balance and debtor's attorney
o Obtain knowledge and understanding of the customer's plan
o Lift stay on collateral, as needed
o Motion to discharge/dismiss, as needed
o Objection to confirmation, as needed
o File proof of claim on all BKs as necessary
G-7
o Monitor customer's compliance to the confirmed plan
o Aggressively pursue reaffirmation of debt
o Process Cram Down amount when received from the court
G-8
PERFORMANCE STANDARDS:
The following Performance Standards will be measured on a calendar month basis
during the term of this Agreement. Servicer and Master Servicer will jointly
develop specific measurement process and documentation during the
implementation.
Performance
Customer Service Standard
--------------------------------------------------------------------------------
Timeliness: % of calls answered in under 30 seconds 70%
Timeliness: % incoming calls answered. Manage to 5%
abandonment rate or better 95%
For routine customer service inquiries (e.g. due date
changes, automatic deductions) fulfillment confirmation
letters will be sent within 2 business days. All written
service inquiries will be processed within the standard
day guidelines detailed by Servicer. 90%
% of payments posted same business day if received in lock
box by 10:00 AM EST with payment coupon. Payments
received after 10:00 AM EST, will be posted the next
business day. All other exception payments will be posted
not more than 5 business days after receipt. 95%
G-9
Performance
Collections Standard
--------------------------------------------------------------------------------
Timeliness: Percent of incoming calls to the defined 800#
answered within 30 seconds 70%
Adherence to Collection Standards specified herein 90%
Contact per account ratio 2.50 per month
Maximum Late Stage Accounts (60+ Days Past Due) assigned
per Collector 200
New bankruptcy filings assigned per Bankruptcy Specialist 120 - 150
Performance
Repossession Standard
Maximum number of repossessed Financed Vehicles in
inventory for more than 60 days 50%
Performance
Mainframe Systems Standard
Availability 98%
G-10
EXHIBIT H-1
[Reserved]
X-0-0
XXXXXXX X-0
[Reserved]
X-0-0
XXXXXXX X-0
[Reserved]
X-0-0
XXXXXXX X-0
[Reserved]
H-4-1
EXHIBIT I
FORM OF SERVICER ANNUAL STATEMENT AS TO COMPLIANCE
I [ ] certify that I am a duly elected [ ] of The Huntington
National Bank, a national banking association (the "Bank"), authorized to
execute and deliver this certificate in the name and on behalf of the Bank, as
required by Section 6.02 of the Servicing Agreement, dated as of [ ], 2006
(the "Servicing Agreement"), among the Bank, as servicer (in such capacity, the
"Servicer"), and Xxxxxxx Xxxxx Mortgage Company, as master servicer, and further
certify in the name of and behalf of the Servicer, that:
1. A review of the activities of the Servicer and of the
performance of its obligations under the Servicing Agreement during the period
from [ ], 200[ ] to and including December 31, 200[ ] (the "Review Period") [or,
with respect to the first Officer's Certificate, the period from the Closing
Date to December 31 of such year] was conducted under the supervision of the
undersigned.
2. Based on my knowledge and such review, except as otherwise
disclosed pursuant to paragraph 3 below, the Servicer has fulfilled its
obligations under the Servicing Agreement during the applicable Review Period
and there is no significant deficiency known by the undersigned with respect to
the applicable Review Period which has not been disclosed herein.
3. Based on such review, to the undersigned's knowledge, the
following is a description of each significant deficiency during the Review
Period in the performance of the Servicer's obligations under the provisions of
the Servicing Agreement, which sets forth in detail (i) the nature and status of
each such deficiency and (ii) the action taken by the Servicer, if any, to
remedy each such deficiency: [List Out]
4. I have reviewed all distribution or servicing reports (the
"Reports") delivered by the Servicer in respect of periods included in the
Review Period.
5. Based on my knowledge, the information in these Reports, taken
as a whole, does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of the
last day of the applicable Review Period.
6. Based on my knowledge, the distribution or servicing
information required to be provided to the Purchaser by the Servicer under the
Servicing Agreement for inclusion in these Reports is included in these Reports.
7. I am responsible for reviewing the activities performed by the
Servicer under the Servicing Agreement and based upon my knowledge and review,
and except as disclosed to Purchaser in this Certificate or otherwise in
writing, the Servicer has fulfilled its obligations under the Servicing
Agreement.
I-1
8. To the knowledge of the undersigned, the Servicer has provided
all of the reports and certificates required under Sections 5.02, 6.02 and 6.03
to the parties to which such reports and certificates are required to be
provided with respect to the applicable Review Period.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated:____________________ By:________________________
Name:
Title:
I-2
EXHIBIT J
[Reserved]
J-1
EXHIBIT K
WIRE INSTRUCTIONS FOR THE MASTER SERVICER
To: Xxxxxxx Xxxxx Mortgage Company
Bank Name: CITIBANK
ABA #: 000000000
A/C#: 40711421
REF: Huntington Auto Flow Program
K-1
EXHIBIT L
[Reserved]
L-1
EXHIBIT M
[Reserved]
M-1
EXHIBIT N
[Reserved]
N-1
EXHIBIT O
[RESERVED]
O-1
EXHIBIT P
[Reserved]
P-1
EXHIBIT Q
[Reserved]
Q-1
EXHIBIT R
[RESERVED]
R-1
EXHIBIT S
[RESERVED]
S-1
EXHIBIT T
[Reserved]
T-1
SCHEDULE 1
[Reserved]
Schedule 1-1
SCHEDULE 2
FORM OF LOST NOTE AFFIDAVIT
I, the undersigned, do hereby state that:
1. I, a duly authorized Officer of The Huntington National Bank,
(the "Bank"), am authorized to make this Affidavit on behalf of the Bank.
2. The Bank is the owner of the following installment note or
loan agreement (the "Contract"):
Loan No:
Obligor:
Automobile Make and Model:
Year Model:
Body Style:
Vehicle Identification Number:
Date:
Original Amount:
3. The Bank is the lawful owner of the Contract, and the Bank has
not assigned or hypothecated the Contract.
4. The original Contract could not be located after a thorough
and diligent search, which consisted of searching through such records of the
Bank as were reasonable and appropriate.
5. ( ) Attached is a true and correct copy of the original
Contract.
6. This affidavit is intended to be relied on by the purchaser of
the Contract from the Bank and such purchaser's successors and assigns.
7. The Bank agrees immediately and without further consideration
to surrender the original Contract to the foregoing purchaser, its successor or
the assignee thereof if such original Contract ever comes into the Bank's
possession, custody or power.
8. The Bank further agrees to indemnify and hold harmless the
foregoing purchaser and its successors and assigns from any and all losses,
liabilities, costs, damages, reasonable attorney's fees and expenses in
connection with the inability of the Bank to locate the original Contract.
Schedule 2-1
EXECUTED THIS _____day of __________, 200[]
On behalf of:
___________________________________________
Name:
Title:
STATE OF
COUNTY OF
Before me, a Notary Public in and for said County and State,
personally appeared __________________________________, a duly authorized
Officer of ___________________, who acknowledges the signing thereof to be
his/her free and voluntary act and deed and the free act and deed of said board.
IN TESTIMONY WHEREOF, I have hereunto subscribed my name and affixed
my official seal on the day and year last aforesaid.
________________________________________________________
Notary Public
Schedule 2-2
APPENDIX A
----------------------------------------------------------------------------------------------
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
----------------------------------------------------------------------------------------------
REFERENCE CRITERIA
----------------------------------------------------------------------------------------------
GENERAL SERVICING CONSIDERATIONS
----------------------------------------------------------------------------------------------
1122(d)(1)(i) Policies and procedures are instituted to monitor Indenture Trustee, GSMC
any performance or other triggers and events of
default in accordance with the transaction
agreements.
----------------------------------------------------------------------------------------------
1122(d)(1)(ii) If any material servicing activities are Indenture Trustee, GSMC
outsourced to third parties, policies and
procedures are instituted to monitor the third
party's performance and compliance with such
servicing activities.
----------------------------------------------------------------------------------------------
1122(d)(1)(iii) Any requirements in the transaction agreements to N/A
maintain a back-up servicer for the pool assets
are maintained.
----------------------------------------------------------------------------------------------
1122(d)(1)(iv) A fidelity bond and errors and omissions policy N/A
is in effect on the party participating in the
servicing function throughout the reporting
period in the amount of coverage required by and
otherwise in accordance with the terms of the
transaction agreements.
----------------------------------------------------------------------------------------------
CASH COLLECTION AND ADMINISTRATION
----------------------------------------------------------------------------------------------
1122(d)(2)(i) Payments on pool assets are deposited into the SST, Ford, Huntington
appropriate custodial bank accounts and related
bank clearing accounts no more than two business
days following receipt, or such other number of
days specified in the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of SST, Ford,
an obligor or to an investor are made only by Huntington,
authorized personnel. Indenture Trustee
----------------------------------------------------------------------------------------------
1122(d)(2)(iii) Advances of funds or guarantees regarding Indenture Trustee,
collections, cash flows or distributions, and any Huntington
interest or other fees charged for such advances,
are made, reviewed and approved as specified in
the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(2)(iv) The related accounts for the transaction, such as Indenture Trustee
cash reserve accounts or accounts established as
a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of
cash) as set forth in the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(2)(v) Each custodial account is maintained at a Indenture Trustee
federally insured depository institution as set
forth in the transaction agreements. For purposes
of this criterion,
----------------------------------------------------------------------------------------------
Appendix A-1
----------------------------------------------------------------------------------------------
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
----------------------------------------------------------------------------------------------
REFERENCE CRITERIA
----------------------------------------------------------------------------------------------
"federally insured depository institution" with
respect to a foreign financial institution means
a foreign financial institution that meets the
requirements of Rule 13k-1(b)(1) of the
Securities Exchange Act.
----------------------------------------------------------------------------------------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent Indenture Trustee
unauthorized access.
----------------------------------------------------------------------------------------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis Indenture Trustee
for all asset-backed securities related bank
accounts, including custodial accounts and
related bank clearing accounts. These
reconciliations are (A) mathematically accurate;
(B) prepared within 30 calendar days after the
bank statement cutoff date, or such other number
of days specified in the transaction agreements;
(C) reviewed and approved by someone other than
the person who prepared the reconciliation; and
(D) contain explanations for reconciling items.
These reconciling items are resolved within 90
calendar days of their original identification,
or such other number of days specified in the
transaction agreements.
----------------------------------------------------------------------------------------------
INVESTOR REMITTANCES AND REPORTING
----------------------------------------------------------------------------------------------
1122(d)(3)(i) Reports to investors, including those to be filed Indenture Trustee
with the Commission, are maintained in accordance
with the transaction agreements and applicable
Commission requirements. Specifically, such
reports (A) are prepared in accordance with
timeframes and other terms set forth in the
transaction agreements; (B) provide information
calculated in accordance with the terms specified
in the transaction agreements; (C) are filed with
the Commission as required by its rules and
regulations; and (D) agree with investors' or the
trustee's records as to the total unpaid
principal balance and number of pool assets
serviced by the Servicer.
----------------------------------------------------------------------------------------------
1122(d)(3)(ii) Amounts due to investors are allocated and Indenture Trustee
remitted in accordance with timeframes,
distribution priority and other terms set forth
in the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(3)(iii) Disbursements made to an investor are posted Indenture Trustee
within two business days to the Servicer's
investor records, or such other number of days
specified in the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(3)(iv) Amounts remitted to investors per the investor Indenture Trustee
reports agree with cancelled checks, or other
form of payment, or custodial bank statements.
----------------------------------------------------------------------------------------------
Appendix A-2
----------------------------------------------------------------------------------------------
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
----------------------------------------------------------------------------------------------
REFERENCE CRITERIA
----------------------------------------------------------------------------------------------
POOL ASSET ADMINISTRATION
----------------------------------------------------------------------------------------------
1122(d)(4)(i) Collateral or security on pool assets is SST, Ford, Huntington
maintained as required by the transaction
agreements or related asset pool documents.
----------------------------------------------------------------------------------------------
1122(d)(4)(ii) Pool assets and related documents are safeguarded SST, Ford, Huntington
as required by the transaction agreements
----------------------------------------------------------------------------------------------
1122(d)(4)(iii) Any additions, removals or substitutions to the SST, Ford, Huntington,
asset pool are made, reviewed and approved in
accordance with any conditions or requirements in
the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(4)(iv) Payments on pool assets, including any payoffs, SST, Ford, Huntington
made in accordance with the related pool asset
documents are posted to the Servicer's obligor
records maintained no more than two business days
after receipt, or such other number of days
specified in the transaction agreements, and
allocated to principal, interest or other items
(e.g., escrow) in accordance with the related
asset pool documents.
----------------------------------------------------------------------------------------------
1122(d)(4)(v) The Servicer's records regarding the accounts and SST, Ford, Huntington
the accounts agree with the Servicer's records
with respect to an obligor's unpaid principal
balance.
----------------------------------------------------------------------------------------------
1122(d)(4)(vi) Changes with respect to the terms or status of an SST, Ford, Huntington
obligor's account (e.g., loan modifications or
re-agings) are made, reviewed and approved by
authorized personnel in accordance with the
transaction agreements and related pool asset
documents.
----------------------------------------------------------------------------------------------
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., SST, Ford, Huntington
forbearance plans, modifications and deeds in
lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated,
conducted and concluded in accordance with the
timeframes or other requirements established by
the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(4)(viii) Records documenting collection efforts are SST, Ford, Huntington
delinquent in accordance with the transaction
agreements. Such records are maintained on at
least a monthly basis, or such other period
specified in the transaction agreements, and
describe the entity's activities in monitoring
delinquent pool assets including, for example,
phone calls, letters and payment rescheduling
plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).
----------------------------------------------------------------------------------------------
Appendix A-3
----------------------------------------------------------------------------------------------
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
----------------------------------------------------------------------------------------------
REFERENCE CRITERIA
----------------------------------------------------------------------------------------------
1122(d)(4)(ix) Adjustments to interest rates or rates of return N/A
for pool assets with variable rates are computed
based on the related pool asset documents.
----------------------------------------------------------------------------------------------
1122(d)(4)(x) Regarding any funds held in trust for an obligor N/A
(such as escrow accounts): (A) such funds are
analyzed, in accordance with the obligor's
Account documents, on at least an annual basis,
or such other period specified in the transaction
agreements; (B) interest on such funds is paid,
or credited, to obligors in accordance with
applicable Account documents and state laws; and
(C) such funds are returned to the obligor within
30 calendar days of full repayment of the related
Accounts, or such other number of days specified
in the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(4)(xi) Payments made on behalf of an obligor (such as N/A
tax or insurance payments) are made on or before
the related penalty or expiration dates, as
indicated on the appropriate bills or notices for
such payments, provided that such support has
been received by the servicer at least 30
calendar days prior to these dates, or such other
number of days specified in the transaction
agreements.
----------------------------------------------------------------------------------------------
1122(d)(4)(xii) Any late payment penalties in connection with any N/A
payment to be made on behalf of an obligor are
paid from the servicer's funds and not charged to
the obligor, unless the late payment was due to
the obligor's error or omission.
----------------------------------------------------------------------------------------------
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are SST, Ford, Huntington
posted within two business days to the obligor's
records maintained by the servicer, or such other
number of days specified in the transaction
agreements.
----------------------------------------------------------------------------------------------
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible SST, Ford, Huntington
accounts are recognized and recorded in
accordance with the transaction agreements.
----------------------------------------------------------------------------------------------
1122(d)(4)(xv) Any external enhancement or other support, N/A
identified in Item 1114(a)(1) through (3) or Item
1115 of Regulation AB, is maintained as set forth
in the transaction agreements.
----------------------------------------------------------------------------------------------
Appendix A-4
