Common use of Realization upon Defaulted Contracts Clause in Contracts

Realization upon Defaulted Contracts. (a) Servicer shall use all commercially reasonable efforts consistent with the servicing procedures set forth herein, to lawfully repossess or otherwise convert the ownership of the Financed Vehicle securing any Contract as to which Servicer shall have determined eventual payment in full is unlikely, and where permitted by the express terms of the Contract and applicable Law. Servicer shall commence efforts to repossess or otherwise convert the ownership of a Financed Vehicle for any Defaulted Contract as determined by Servicer's reasonable judgment after considering the current status of such Contract; provided, however, that Servicer may elect not to commence such efforts within such time period if, in good faith and reasonable judgment, it determines either that such action would violate the terms of the related Contract, it would be impracticable to do so or that the proceeds ultimately recoverable with respect to such Contract would be increased by forbearance, in which case, such Contract shall constitute a Defaulted Contract. (b) Servicer shall use all commercially reasonable efforts to timely make all collections on Contracts, which may include reasonable efforts consistent with the terms hereof and applicable Law to recover under any recourse provisions from Dealers, originators or transferors, and selling the Financed Vehicle at public or private sale. If Servicer determines in its reasonable judgment that it should retain the services of an attorney to exercise Owner's rights pursuant to such recourse provisions by commencing litigation or taking such other action, Servicer shall so advise Owner in writing of such recommended course of action, and if such recommended course of action is agreed to by Owner, Owner will pay all reasonable attorney's fees, court costs and related litigation expenses relating to such proceeding or action. Upon obtaining such approval from the Owner, Servicer will select the attorney(s) to commence litigation and/or take such other action necessary or appropriate to protect the interests of Owner. Servicer shall sell all repossessed Financed Vehicles at auction, unless it determines in its good faith and reasonable judgment either that it would be impractical to do so or that the proceeds ultimately recoverable with respect to such Contracts would be increased by an alternative sale procedure. The foregoing shall be subject to the provision that, in any case in which the Financed Vehicle shall have suffered damage, Servicer shall not expend funds in connection with the repair or the repossession of such Financed Vehicle unless it shall determine in its good faith and reasonable discretion that such repair and/or repossession will increase the net proceeds ultimately recoverable with respect to such Contracts by an amount greater than the amount of such expenses. All amounts received upon sale of a Financed Vehicle shall be remitted directly by Servicer to the Collections Account within one (1) Business Day after receipt by the Servicer. (c) If Servicer receives a notice that an Obligor has died or has filed for relief under the United States Bankruptcy Code, Servicer shall notify Owner of the death or file a proof of claim and notify Owner of the bankruptcy filing. In the event that activities outside the scope of routine consumer bankruptcy proceedings, and follow-up are necessary, Owner may, at its option, instruct Servicer to retain counsel to represent Owner and Servicer in the Obligor's bankruptcy at the expense of Owner. If Owner determines that Servicer should retain the services of an attorney to represent the interests of the Owner, Servicer will select the attorney, and Owner will pay all reasonable attorney's fees and costs, including all filing fees, relating to such proceeding.

Realization upon Defaulted Contracts. (a) Servicer shall use all commercially reasonable efforts consistent In accordance with the servicing procedures set forth hereinspecified in the Servicing Agreement, to lawfully repossess the Servicer shall repossess, or otherwise comparably convert the ownership of the Financed of, any Leased Vehicle securing any a Defaulted Contract and as to which no satisfactory arrangements can be made for collection of delinquent payments pursuant to the Servicing Agreement. In connection with such repossession or other conversion, the Servicer shall have determined eventual payment follow such practices and procedures as it shall deem necessary or advisable and as shall be normal and usual for responsible holders of lease contracts and as shall be in full is unlikelycompliance with all applicable laws, and, in connection with the repossession of any Leased Vehicle or any Defaulted Contract, may commence or prosecute any judicial proceedings in respect of such Contract in its own name, or if the Servicer deems it necessary, in the name of the Buyer or the Trustee, on behalf of the Buyer or on behalf of the Trustee. The Servicer's obligations under this Section are subject to the provision that, in the case of damage to a Leased Vehicle from an insured cause, the Servicer shall not be required to expend its own funds in repairing such motor vehicle unless it shall determine (i) that such restoration will increase the Liquidation Proceeds of the related Contract, after reimbursement to itself for such expenses, and where permitted (ii) that such expenses will be recoverable by the express terms of the Contract and it either as Liquidation Expenses or as expenses recoverable under an applicable Lawinsurance policy. The Servicer shall commence efforts to repossess or otherwise convert the ownership be responsible for all other costs and expenses incurred by it in connection with any action taken in respect of a Financed Vehicle for any Defaulted Contract as determined by Servicer's reasonable judgment after considering the current status of such Contract; provided, however, that it shall be entitled to reimbursement of such costs and expenses to the extent they constitute Liquidation Expenses or expenses recoverable under an applicable insurance policy. All Liquidation Proceeds (net of Liquidation Expenses) and Insurance Proceeds (net of expenses incurred by the Servicer may elect not to commence such efforts within such time period if, in good faith and reasonable judgment, it determines either that such action would violate recoverable under the terms related insurance policy and net of the related Contract, it would be impracticable portion thereof applied to do so the repair of any Leased Vehicle or that the proceeds ultimately recoverable with respect released to such Contract would be increased by forbearance, an Obligor in which case, such Contract shall constitute a Defaulted Contract. (b) Servicer shall use all commercially reasonable efforts to timely make all collections on Contracts, which may include reasonable efforts consistent accordance with the terms hereof and applicable Law to recover under any recourse provisions from Dealers, originators or transferors, and selling the Financed Vehicle at public or private sale. If Servicer determines in its reasonable judgment that it should retain the services of an attorney to exercise OwnerServicer's rights pursuant to such recourse provisions by commencing litigation or taking such other action, Servicer shall so advise Owner in writing of such recommended course of action, and if such recommended course of action is agreed to by Owner, Owner will pay all reasonable attorney's fees, court costs and related litigation expenses relating to such proceeding or action. Upon obtaining such approval from the Owner, Servicer will select the attorney(snormal servicing procedures) to commence litigation and/or take such other action necessary or appropriate to protect the interests of Owner. Servicer shall sell all repossessed Financed Vehicles at auction, unless it determines in its good faith and reasonable judgment either that it would be impractical to do so or that the proceeds ultimately recoverable with respect to such Contracts would be increased by an alternative sale procedure. The foregoing shall be subject deposited in the Master Collections Account to the provision that, in any case in which the Financed Vehicle shall have suffered damage, Servicer shall not expend funds in connection with the repair or the repossession of such Financed Vehicle unless it shall determine in its good faith and reasonable discretion that such repair and/or repossession will increase the net proceeds ultimately recoverable with respect to such Contracts by an amount greater than the amount of such expenses. All amounts received upon sale of a Financed Vehicle shall be remitted directly by Servicer to the Collections Account within one (1) Business Day after receipt extent required by the ServicerServicing Agreement. (c) If Servicer receives a notice that an Obligor has died or has filed for relief under the United States Bankruptcy Code, Servicer shall notify Owner of the death or file a proof of claim and notify Owner of the bankruptcy filing. In the event that activities outside the scope of routine consumer bankruptcy proceedings, and follow-up are necessary, Owner may, at its option, instruct Servicer to retain counsel to represent Owner and Servicer in the Obligor's bankruptcy at the expense of Owner. If Owner determines that Servicer should retain the services of an attorney to represent the interests of the Owner, Servicer will select the attorney, and Owner will pay all reasonable attorney's fees and costs, including all filing fees, relating to such proceeding.

Realization upon Defaulted Contracts. (a) Subject to applicable law, the Servicer shall use all commercially reasonable efforts consistent with the servicing procedures set forth hereinrepossess, to lawfully repossess foreclose upon or otherwise comparably convert the ownership of Collateral securing all Contracts that come into default and which the Financed Vehicle securing any Contract as Servicer believes in its good faith business judgment will not be brought current. Subject to which Section 4.17, the Servicer shall have determined eventual payment in full is unlikelymanage, conserve and protect such Collateral for the purposes of their prompt disposition and sale, and where permitted by shall dispose of such Collateral on such terms and conditions as it deems in the express terms best interests of the Contract and applicable LawCertificateholders. If the Servicer has actual knowledge that a Mortgaged Property is affected by hazardous waste, then the Servicer shall commence efforts not cause the Trust Fund or the Trustee to repossess acquire title to such Mortgaged Property in a foreclosure or otherwise convert similar proceeding. For purposes of the ownership preceding sentence, the Servicer shall not be deemed to have actual knowledge that Collateral is affected by hazardous waste unless it shall have received written notice that hazardous waste is present on such property. In connection with such repossession, foreclosure or other conversion, the Servicer shall take such action as (i) shall be consistent with Section 3.01, (ii) the Servicer shall determine consistently with Accepted Servicing Practices to be in the best interest of a Financed Vehicle for the Trustee and Certificateholders, and (iii) is consistent with the requirements of the insurer under any Defaulted Contract as determined by Servicer's reasonable judgment after considering the current status of such ContractRequired Insurance Policy; provided, however, that the Servicer may elect shall not be required to commence such efforts within such time period if, expend its own funds in good faith and reasonable judgment, connection with any foreclosure or towards the restoration of any property unless it determines either shall determine (i) that such action would violate restoration and/or foreclosure will increase the terms proceeds of liquidation of the related ContractContract after reimbursement to itself of such expenses and (ii) that such expenses will be recoverable to it through Liquidation Proceeds (respecting which it shall have priority for purposes of withdrawals from the related Collection Account). The Servicer shall be responsible for all other costs and expenses incurred by it in any such proceedings; provided, however, that it would shall be impracticable entitled to do so or that reimbursement thereof from the proceeds ultimately recoverable Liquidation Proceeds with respect to such Contract would be increased by forbearance, in which case, such Contract shall constitute a Defaulted Contractthe related Mortgaged Property or otherwise pursuant to Section 3.07(a). (b) The decision of a Servicer shall use all commercially reasonable efforts to timely make all collections foreclose on Contracts, which may include reasonable efforts consistent with the terms hereof and applicable Law to recover under any recourse provisions from Dealers, originators or transferors, and selling the Financed Vehicle at public or private sale. If Servicer determines in its reasonable judgment that it should retain the services of an attorney to exercise Owner's rights pursuant to such recourse provisions by commencing litigation or taking such other action, Servicer shall so advise Owner in writing of such recommended course of action, and if such recommended course of action is agreed to by Owner, Owner will pay all reasonable attorney's fees, court costs and related litigation expenses relating to such proceeding or action. Upon obtaining such approval from the Owner, Servicer will select the attorney(s) to commence litigation and/or take such other action necessary or appropriate to protect the interests of Owner. Servicer shall sell all repossessed Financed Vehicles at auction, unless it determines in its good faith and reasonable judgment either that it would be impractical to do so or that the proceeds ultimately recoverable with respect to such Contracts would be increased by an alternative sale procedure. The foregoing a defaulted Contract shall be subject to a determination by the provision thatServicer that the proceeds of such foreclosure would exceed the costs and expenses of bringing such a proceeding. The income earned from the management of any Repossessed Collateral, in net of reimbursement to the Servicer for expenses incurred (including any case in which the Financed Vehicle shall have suffered damage, Servicer shall not expend funds property or other taxes) in connection with such management and net of applicable accrued and unpaid Servicing Fees, and unreimbursed Advances and Servicing Advances, shall be applied to the repair or payment of principal of and interest on the repossession related defaulted Contracts (with interest accruing as though such Contracts were still current) and all such income shall be deemed, for all purposes in this Agreement, to be payments on account of such Financed Vehicle unless it principal and interest on the related Mortgage Notes and shall determine in its good faith and reasonable discretion that such repair and/or repossession will increase be deposited into the related Collection Account. To the extent the net proceeds ultimately recoverable with respect to such Contracts by an amount greater than income received during any calendar month is in excess of the amount of attributable to amortizing principal and accrued interest at the related Contract Rate on the related Contract for such expenses. All amounts received upon sale of a Financed Vehicle calendar month, such excess shall be remitted directly by Servicer considered to be a partial prepayment of principal of the Collections Account within one (1) Business Day after receipt by the Servicerrelated Contract. (c) If The proceeds from any liquidation of a Contract, as well as any income from an Repossessed Collateral, will be applied in the following order of priority: first, to reimburse the Servicer receives for any related unreimbursed Servicing Advances, including insurance premiums; second, to reimburse the Servicer for any unreimbursed Advances; third, to reimburse the related Collection Account for any Nonrecoverable Advances (or portions thereof) that were previously withdrawn by the Servicer pursuant to Section 3.07 that related to such Contract; fourth, to accrued and unpaid interest (to the extent no Advance has been made for such amount or any such Advance has been reimbursed) on the Contract or related Repossessed Collateral, at the per annum rate equal to the related Contract Rate reduced by the Servicing Fee Rate to the Due Date occurring in the month in which such amounts are required to be distributed; and fifth, as a notice that an Obligor has died or has filed for relief under the United States Bankruptcy Code, Servicer shall notify Owner recovery of principal of the death or file a proof of claim and notify Owner of the bankruptcy filing. In the event that activities outside the scope of routine consumer bankruptcy proceedings, and follow-up are necessary, Owner may, at its option, instruct Servicer to retain counsel to represent Owner and Servicer in the Obligor's bankruptcy at the expense of Owner. If Owner determines that Servicer should retain the services of an attorney to represent the interests of the Owner, Servicer will select the attorney, and Owner will pay all reasonable attorney's fees and costs, including all filing fees, relating to such proceedingContract.

Realization upon Defaulted Contracts. (a) Subject to applicable law, the Servicer shall use all commercially reasonable efforts consistent with the servicing procedures set forth hereinrepossess, to lawfully repossess foreclose upon or otherwise comparably convert the ownership of Collateral securing all Contracts that come into default and which the Financed Vehicle securing any Contract as Servicer believes in its good faith business judgment will not be brought current. Subject to which Section 4.17, the Servicer shall have determined eventual payment in full is unlikelymanage, conserve and protect such Collateral for the purposes of their prompt disposition and sale, and where permitted by shall dispose of such Collateral on such terms and conditions as it deems in the express terms best interests of the Contract and applicable LawCertificateholders. If the Servicer has actual knowledge that a Mortgaged Property is affected by hazardous waste, then the Servicer shall commence efforts not cause the Trust Fund or the Trustee to repossess acquire title to such Mortgaged Property in a foreclosure or otherwise convert similar proceeding. For purposes of the ownership preceding sentence, the Servicer shall not be deemed to have actual knowledge that Collateral is affected by hazardous waste unless it shall have received written notice that hazardous waste is present on such property. In connection with such repossession, foreclosure or other conversion, the Servicer shall take such action as (i) shall be consistent with Section 3.01, (ii) the Servicer shall determine consistently with Accepted Servicing Practices to be in the best interest of a Financed Vehicle for the Trustee and Certificateholders, and (iii) is consistent with the requirements of the insurer under any Defaulted Contract as determined by Servicer's reasonable judgment after considering the current status of such ContractRequired Insurance Policy; provided, however, that the Servicer may elect shall not be required to commence such efforts within such time period if, expend its own funds in good faith and reasonable judgment, connection with any foreclosure or towards the restoration of any property unless it determines either shall determine (i) that such action would violate restoration and/or foreclosure will increase the terms proceeds of liquidation of the related ContractContract after reimbursement to itself of such expenses and (ii) that such expenses will be recoverable to it through Liquidation Proceeds (respecting which it shall have priority for purposes of withdrawals from the related Collection Account). The Servicer shall be responsible for all other costs and expenses incurred by it in any such proceedings; provided, however, that it would shall be impracticable entitled to do so or that reimbursement thereof from the proceeds ultimately recoverable Liquidation Proceeds with respect to such Contract would be increased by forbearance, in which case, such Contract shall constitute a Defaulted Contractthe related Mortgaged Property or otherwise pursuant to Section 3.07(a). (b) The decision of a Servicer shall use all commercially reasonable efforts to timely make all collections foreclose on Contracts, which may include reasonable efforts consistent with the terms hereof and applicable Law to recover under any recourse provisions from Dealers, originators or transferors, and selling the Financed Vehicle at public or private sale. If Servicer determines in its reasonable judgment that it should retain the services of an attorney to exercise Owner's rights pursuant to such recourse provisions by commencing litigation or taking such other action, Servicer shall so advise Owner in writing of such recommended course of action, and if such recommended course of action is agreed to by Owner, Owner will pay all reasonable attorney's fees, court costs and related litigation expenses relating to such proceeding or action. Upon obtaining such approval from the Owner, Servicer will select the attorney(s) to commence litigation and/or take such other action necessary or appropriate to protect the interests of Owner. Servicer shall sell all repossessed Financed Vehicles at auction, unless it determines in its good faith and reasonable judgment either that it would be impractical to do so or that the proceeds ultimately recoverable with respect to such Contracts would be increased by an alternative sale procedure. The foregoing a defaulted Contract shall be subject to a determination by the provision thatServicer that the proceeds of such foreclosure would exceed the costs and expenses of bringing such a proceeding. The income earned from the management of any Repossessed Collateral, in net of reimbursement to the Servicer for expenses incurred (including any case in which the Financed Vehicle shall have suffered damage, Servicer shall not expend funds property or other taxes) in connection with such management and net of applicable accrued and unpaid Servicing Fees, and unreimbursed Advances and Servicing Advances, shall be applied to the repair or payment of principal of and interest on the repossession related defaulted Contracts (with interest accruing as though such Contracts were still current) and all such income shall be deemed, for all purposes in this Agreement, to be payments on account of such Financed Vehicle unless it principal and interest on the related Mortgage Notes and shall determine in its good faith and reasonable discretion that such repair and/or repossession will increase be deposited into the related Collection Account. To the extent the net proceeds ultimately recoverable with respect to such Contracts by an amount greater than income received during any Due Period is in excess of the amount of attributable to amortizing principal and accrued interest at the related Contract Rate on the related Contract for such expenses. All amounts received upon sale of a Financed Vehicle Due Period, such excess shall be remitted directly by Servicer considered to be a partial prepayment of principal of the Collections Account within one (1) Business Day after receipt by the Servicerrelated Contract. (c) If The proceeds from any liquidation of a Contract, as well as any income from an Repossessed Collateral, will be applied in the following order of priority: first, to reimburse the Servicer receives for any related unreimbursed Servicing Advances, including insurance premiums; second, to reimburse the Servicer for any unreimbursed Advances; third, to reimburse the related Collection Account for any Nonrecoverable Advances (or portions thereof) that were previously withdrawn by the Servicer pursuant to Section 3.07 that related to such Contract; fourth, to accrued and unpaid interest (to the extent no Advance has been made for such amount or any such Advance has been reimbursed) on the Contract or related Repossessed Collateral, at the per annum rate equal to the related Contract Rate reduced by the Servicing Fee Rate to the Due Date occurring in the month in which such amounts are required to be distributed; and fifth, as a notice that an Obligor has died or has filed for relief under the United States Bankruptcy Code, Servicer shall notify Owner recovery of principal of the death or file a proof of claim and notify Owner of the bankruptcy filing. In the event that activities outside the scope of routine consumer bankruptcy proceedings, and follow-up are necessary, Owner may, at its option, instruct Servicer to retain counsel to represent Owner and Servicer in the Obligor's bankruptcy at the expense of Owner. If Owner determines that Servicer should retain the services of an attorney to represent the interests of the Owner, Servicer will select the attorney, and Owner will pay all reasonable attorney's fees and costs, including all filing fees, relating to such proceedingContract.