Exhibit 4.1(A)
Form of Pooling and
Servicing Agreement
(Grantor Trust)
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CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
as Seller and Servicer
and
[__________________________________]
as Trustee
on behalf of the Certificateholders
and as Collateral Agent
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POOLING AND SERVICING AGREEMENT
Dated as of ________ __, 200_
==================================
$_____________________________
Chase Manhattan Auto Grantor Trust 200_-_
_____% Automobile Loan Pass-Through Certificates, Class A
_____% Automobile Loan Pass-Through Certificates, Class B
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Table of Contents
Page
ARTICLE I DEFINITIONS.............................................................................................1
SECTION 1.1. Definitions...................................................................1
SECTION 1.2. Usage of Terms...............................................................14
SECTION 1.3. Simple Interest Method; Allocations..........................................14
ARTICLE II THE TRUST CONVEYANCE OF THE RECEIVABLES...............................................................15
SECTION 2.1. Creation of the Trust........................................................15
SECTION 2.2. Conveyance of Receivables....................................................15
ARTICLE III THE RECEIVABLES......................................................................................16
SECTION 3.1. Representations and Warranties of Seller;
Conditions Relating to Receivables...........................................16
SECTION 3.2. Repurchase Upon Breach or Failure of a Condition.............................20
SECTION 3.3. Custody of Receivable Files..................................................20
SECTION 3.4. Duties of Servicer as Custodian..............................................21
SECTION 3.5. Instructions; Authority to Act...............................................22
SECTION 3.6. Custodian's Indemnification..................................................22
SECTION 3.7. Effective Period and Termination.............................................22
ARTICLE IV ADMINISTRATION AND SERVICING OF RECEIVABLES...........................................................22
SECTION 4.1. Duties of Servicer...........................................................22
SECTION 4.2. Collection of Receivable Payments; Refinancing...............................23
SECTION 4.3. Realization Upon Receivables.................................................24
SECTION 4.4. Non-Credit Related Extensions to Obligors....................................25
SECTION 4.5. Maintenance of Security Interests in Financed Vehicles.......................26
SECTION 4.6. Covenants of Servicer........................................................26
SECTION 4.7. Purchase of Receivables Upon Breach..........................................27
SECTION 4.8. Servicing Fee................................................................27
SECTION 4.9. Servicer's Certificate.......................................................27
SECTION 4.10. Annual Statement as to Compliance............................................28
SECTION 4.11. Annual Audit Report..........................................................28
SECTION 4.12. Access by Certificateholders to Certain Documentation
and Information Regarding Receivables........................................29
SECTION 4.13. Reports to Certificateholders and the Rating Agencies........................29
SECTION 4.14. Reports to the Securities and Exchange Commission............................30
ARTICLE V ACCOUNTS; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS..............................................30
SECTION 5.1. Establishment of the Accounts................................................30
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Page
SECTION 5.2. Collections..................................................................31
SECTION 5.3. Advances.....................................................................32
SECTION 5.4. Additional Deposits..........................................................32
SECTION 5.5. Distributions................................................................33
SECTION 5.6. Reserve Account; Assignment of Retained Yield to
Collateral Agent.............................................................34
SECTION 5.7. Net Deposits.................................................................35
SECTION 5.8. Statements to Certificateholders.............................................35
ARTICLE VI THE CERTIFICATES......................................................................................36
SECTION 6.1. The Certificates.............................................................36
SECTION 6.2. Execution, Authentication and Delivery of Certificates.......................37
SECTION 6.3. Registration of Transfer and Exchange of Certificates........................37
SECTION 6.4. Mutilated, Destroyed, Lost, or Stolen Certificates...........................38
SECTION 6.5. Persons Deemed Owners........................................................39
SECTION 6.6. Access to List of Certificateholders' Names and Addresses....................39
SECTION 6.7. Maintenance of Office or Agency..............................................39
SECTION 6.8. Book-Entry Certificates......................................................40
SECTION 6.9. Notices to Clearing Agency...................................................41
SECTION 6.10. Definitive Certificates......................................................41
SECTION 6.11. Appointment of Paying Agent..................................................41
SECTION 6.12. Authenticating Agent.........................................................43
SECTION 6.13. Actions of Certificateholders................................................44
ARTICLE VII THE SELLER...........................................................................................45
SECTION 7.1. Representations of Seller....................................................45
SECTION 7.2. Liability of Seller; Indemnities.............................................46
SECTION 7.3. Merger or Consolidation of Seller............................................46
SECTION 7.4. Limitation on Liability of Seller and Others.................................46
SECTION 7.5. Seller May Own Certificates..................................................47
ARTICLE VIII THE SERVICER........................................................................................47
SECTION 8.1. Representations of Servicer..................................................47
SECTION 8.2. Liability of Servicer; Indemnities...........................................48
SECTION 8.3. Merger or Consolidation of Servicer..........................................49
SECTION 8.4. Limitation on Liability of Servicer and Others...............................49
SECTION 8.5. Servicer Not To Resign.......................................................50
SECTION 8.6. Delegation of Duties.........................................................50
ARTICLE IX DEFAULT...............................................................................................51
SECTION 9.1. Events of Servicing Termination..............................................51
SECTION 9.2. Trustee to Act; Appointment of Successor Servicer............................52
SECTION 9.3. Notification to Certificateholders...........................................53
SECTION 9.4. Waiver of Past Defaults......................................................53
ARTICLE X THE TRUSTEE............................................................................................53
SECTION 10.1. Duties of Trustee............................................................53
ii
SECTION 10.2. Trustee's Assignment of Repurchased Receivables
and Trustee's Certificate....................................................55
SECTION 10.3. Certain Matters Affecting the Trustee........................................55
SECTION 10.4. Trustee Not Liable for Certificates or Receivables...........................56
SECTION 10.5. Trustee May Own Certificates.................................................57
SECTION 10.6. Trustee's Fees and Expenses..................................................57
SECTION 10.7. Indemnity of Trustee.........................................................58
SECTION 10.8. Eligibility Requirements for Trustee.........................................58
SECTION 10.9. Resignation or Removal of Trustee............................................58
SECTION 10.10. Successor Trustee............................................................59
SECTION 10.11. Merger or Consolidation of Trustee...........................................59
SECTION 10.12. Appointment of Co-Trustee or Separate Trustee................................59
SECTION 10.13. Representations and Warranties of Trustee....................................61
SECTION 10.14. Tax Returns..................................................................61
SECTION 10.15. Trustee May Enforce Claims Without Possession
of Certificates..............................................................62
SECTION 10.16. Suits for Enforcement........................................................62
SECTION 10.17. Maintenance of Office or Agency..............................................62
SECTION 10.18. [ ], as Collateral Agent...............62
ARTICLE XI TERMINATION...........................................................................................62
SECTION 11.1. Termination of the Trust.....................................................62
SECTION 11.2. Optional Purchase of All Receivables.........................................63
ARTICLE XII MISCELLANEOUS PROVISIONS.............................................................................64
SECTION 12.1. Amendment....................................................................64
SECTION 12.2. Protection of Title to Trust.................................................65
SECTION 12.3. Limitation on Rights of Certificateholders...................................67
SECTION 12.4. GOVERNING LAW................................................................67
SECTION 12.5. Notices......................................................................68
SECTION 12.6. Severability of Provisions...................................................68
SECTION 12.7. Assignment...................................................................68
SECTION 12.8. Certificates Nonassessable and Fully Paid....................................68
SECTION 12.9. Third-Party Beneficiaries....................................................68
SECTION 12.10. Counterparts.................................................................68
SECTION 12.11. Tax Matters..................................................................69
SCHEDULES
Schedule A - List of Receivables
Schedule B - Location of Receivables
iii
EXHIBITS
Exhibit A-1 - Form of Class A Certificate
Exhibit A-2 - Form of Class B Certificate
Exhibit B - Form of Depositary Receipt Agreement
Exhibit C-1 - Trustee's Certificate pursuant to Section 11.2 (assignment to Seller)
Exhibit C-2 - Trustee's Certificate pursuant to Section 11.2 (assignment to Servicer)
Exhibit D - Form of Servicer's Certificate
Exhibit E - Form of Certificateholder Report
Exhibit F - Form of Collection Account Control Agreement
Exhibit G - Form of Reserve Account Control Agreement
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This POOLING AND SERVICING AGREEMENT, dated as of ______________ __, 200_
(as amended, supplemented or otherwise modified and in effect from time to
time, this "Agreement") is made with respect to the formation of the Chase
Manhattan Auto Grantor Trust 200_ (the "Trust"), between CHASE MANHATTAN BANK
USA, National Association, a national banking association ("Chase USA" and the
"Seller" and the "Servicer" in its respective capacities as such), and
[________ ____________________________________], a national banking
association, as trustee (in such capacity, the "Trustee") and as collateral
agent with respect to the Reserve Account and the Retained Yield (in such
capacity, the "Collateral Agent").
W I T N E S S E T H :
- - - - - - - - - -
In consideration of the premises and of the mutual agreements herein
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. Whenever used in this Agreement, the following
words and phrases, unless the context otherwise requires, shall have the
following meanings:
"Accounts" mean, collectively, the Collection Account and the
Distribution Accounts.
"Accrued Interest" on a Receivable, as of any date of determination,
means that amount of interest accrued on the Principal Balance at the Contract
Rate but not paid by or on behalf of the Obligor.
"Advance" as of a Record Date means any payment made by the Servicer
pursuant to Section 5.3.
"Affiliate" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified
Person. For purposes of this definition, "control" when used with respect to
any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. A Person shall not be
deemed to be an Affiliate of any specified Person solely because such other
Person has the contractual right or obligation to manage such specified Person
unless such other Person controls such specified Person through equity
ownership or otherwise.
"Aggregate Net Losses" means, for any Distribution Date, the amount equal
to (i) the aggregate Principal Balance of the Receivables that became
Defaulted Receivables during the related Collection Period minus (ii) the
Liquidation Proceeds allocable to principal collected during such Collection
Period with respect to any Defaulted Receivables.
"Amount Financed" in respect of a Receivable means the amount advanced
under the Receivable toward the purchase price of the Financed Vehicle and
related costs.
"Assertion" has the meaning specified in Section 4.11.
"Authenticating Agent" has the meaning specified in Section 6.12 and
shall initially be the corporate trust office of Chase, and its successors and
assigns in such capacity.
"Authorized Officer" means any officer of the Trustee who is authorized
to act on behalf of the Trustee and who is identified as such on the list of
authorized officers delivered by the Trustee to the Seller and the Servicer.
"Available Interest" means, for any Distribution Date, (i) that portion
of Collections on the Receivables received during the related Collection
Period allocated to interest, (ii) all Advances made by the Servicer with
respect to such Distribution Date and (iii) that portion of the Repurchase
Amounts received with respect to the Repurchased Receivables repurchased by
the Seller or purchased by the Servicer during the related Collection Period
that would have been treated as Available Interest if the Obligor thereof had
prepaid such Receivables in full on the date as of which such Receivables were
repurchased or purchased.
"Available Principal" means, for any Distribution Date, (i) that portion
of Collections on the Receivables received during the related Collection
Period allocated to the principal balance of the Receivables, and (ii) that
portion of the Repurchase Amounts received with respect to the Repurchased
Receivables repurchased by the Seller or purchased by the Servicer that would
have been treated as Available Principal if the Obligor thereof had prepaid
such Receivables in full on the date as of which such Receivables were
repurchased or purchased.
"Available Reserve Account Amount" shall mean, for each Distribution
Date, an amount equal to the lesser of (i) the amount on deposit in the
Reserve Account (exclusive of Investment Earnings thereon) and (ii) the
Specified Reserve Account Balance with respect to such Distribution Date.
"Average Delinquency Percentage" means, for any Distribution Date, the
average of the Delinquency Percentages for such Distribution Date and the
preceding two (2) Distribution Dates.
"Average Net Loss Ratio" means, for any Distribution Date, the average of
the Net Loss Ratios for such Distribution Date and the preceding two (2)
Distribution Dates.
"Base Rate" means, with respect to each Receivable, the weighted average
interest rate on the Receivable equal to (i) the Class A Percentage multiplied
by the sum of the Class A Pass-Through Rate and the Servicing Fee Rate, plus
(ii) the Class B Percentage multiplied by the sum of the Class B Pass-Through
Rate and the Servicing Fee Rate.
"Book-Entry Certificates" means beneficial interests in the Certificates
described in Section 6.8, the ownership and transfers of which shall be made
through book entries by a Clearing Agency or Foreign Clearing Agency as
described in Section 6.8.
2
"Business Day" means a day, other than a Saturday or a Sunday, on which
the Trustee and banks located in New York, New York, Wilmington, Delaware and
[_________________] are open for the purpose of conducting a commercial
banking business.
"Certificate Owner" means, with respect to a Book-Entry Certificate, the
Person who is the owner of such Book-Entry Certificate, as reflected on the
books of the Clearing Agency or Foreign Clearing Agency or on the books of a
direct or indirect Clearing Agency Participant.
"Certificate Register" means the register maintained pursuant to Section
6.3.
"Certificateholders" or "Holders" means, collectively, the Class A
Certificateholders and the Class B Certificateholders.
"Certificates" means, collectively, the Class A Certificates and the
Class B Certificates.
"Chase" means The Chase Manhattan Bank, a New York banking corporation.
"Chase Direct Receivable" means a Receivable originated by Chase directly
with an Obligor without the involvement of a Dealer.
"Class A Certificate" means a certificate executed on behalf of the Trust
and authenticated by the Trustee substantially in the form of Exhibit A-1
attached hereto.
"Class A Certificate Balance" means, at any date of determination, the
Original Class A Certificate Balance, as reduced by all amounts allocable to
principal on the Class A Certificates distributed to Class A
Certificateholders prior to such date.
"Class A Certificateholder" or "Class A Holder" means the Person in whose
name a Class A Certificate is registered in the Certificate Register, except
that, solely for the purpose of giving any consent, request, waiver or demand
pursuant to this Agreement, the interest evidenced by any Class A Certificate
registered in the name of the Seller, the Servicer, or any Person actually
known to an Authorized Officer of the Trustee to be an Affiliate of the Seller
or the Servicer, shall not be taken into account in determining whether the
requisite percentage necessary to effect any such consent, request, waiver or
demand shall have been obtained.
"Class A Distribution Account" means the account established and
maintained as such pursuant to Section 5.1(a).
"Class A Interest Carryover Shortfall" means, (a) for the initial
Distribution Date, zero, and (b) for any other Distribution Date, the excess
of Class A Interest Distributable Amount for the preceding Distribution Date
over the amount in respect of interest that is actually deposited in the Class
A Distribution Account on such preceding Distribution Date, plus 30 days of
interest on such excess, to the extent permitted by law, at the Class A
Pass-Through Rate.
"Class A Interest Distributable Amount" means, for any Distribution Date,
the sum of Class A Monthly Interest for such Distribution Date and the Class A
Interest Carryover Shortfall for such Distribution Date.
3
"Class A Monthly Interest" means, for any Distribution Date, one-twelfth
of the Class A Pass-Through Rate multiplied by the Class A Certificate Balance
as of the preceding Distribution Date (after giving effect to any payments
made on such preceding Distribution Date) or, in the case of the first
Distribution Date, as of the Closing Date.
"Class A Monthly Principal" means, for any Distribution Date, the sum of
(a) the Class A Percentage of the Available Principal for such Distribution
Date and (b) the Class A Percentage of Aggregate Net Losses for such
Distribution Date.
"Class A Pass-Through Rate" means ____% per annum.
"Class A Percentage" means, a fraction (expressed as a percentage with
eight decimal places), the numerator if which is the Original Class A
Certificate Balance and the denominator of which is the Original Certificate
Balance.
"Class A Pool Factor" means, with respect to any Distribution Date, the
Class A Certificate Balance as of such Distribution Date (after giving effect
to any payments to be made on such Distribution Date), divided by the Original
Class A Certificate Balance, expressed as a eight-digit decimal.
"Class A Principal Carryover Shortfall" means, for any Distribution Date,
the excess of Class A Principal Distributable Amount for the preceding
Distribution Date over the amount in respect of principal that is actually
deposited in the Class A Distribution Account on such preceding Distribution
Date.
"Class A Principal Distributable Amount" means, for any Distribution
Date, the sum of Class A Monthly Principal for such Distribution Date and, in
the case of any Distribution Date other than the initial Distribution Date,
the Class A Principal Carryover Shortfall for such Distribution Date. In
addition, on the Final Scheduled Distribution Date, the Class A Principal
Distributable Amount shall include any additional amount required to reduce
the outstanding aggregate principal balance of the Class A Certificates to
zero.
"Class B Certificate" means a certificate executed on behalf of the Trust
and authenticated by the Trustee substantially in the form of Exhibit A-2
hereto.
"Class B Certificate Balance" means, at any time, the Original Class B
Certificate Balance, as reduced by all amounts allocable to principal on the
Class B Certificates distributed to Class B Certificateholders prior to such
time.
"Class B Certificateholder" or "Class B Holder" means the Person in whose
name a Class B Certificate shall be registered in the Certificate Register,
except that, solely for the purpose of giving any consent, request or waiver
pursuant to this Agreement, the interest evidenced by any Class B Certificate
registered in the name of the Seller, the Servicer, or any Person actually
known to an Authorized Officer of the Trustee to be an Affiliate of the Seller
or the Servicer, shall not be taken into account in determining whether the
requisite percentage necessary to effect any such consent, request or waiver
shall have been obtained.
4
"Class B Distribution Account" means the account established and
maintained as such pursuant to Section 5.1(a).
"Class B Interest Carryover Shortfall" means, (a) for the initial
Distribution Date, zero, and (b) for any other Distribution Date, the excess
of Class B Interest Distributable Amount for the preceding Distribution Date
over the amount in respect of interest actually deposited in the Class B
Distribution Account on such preceding Distribution Date, plus 30 days of
interest on such excess, to the extent permitted by law, at the Class B
Pass-Through Rate.
"Class B Interest Distributable Amount" means, with respect to any
Distribution Date, the sum of Class B Monthly Interest for such Distribution
Date and the Class B Interest Carryover Shortfall for such Distribution Date.
"Class B Monthly Interest" means, for any Distribution Date, one-twelfth
of the Class B Pass-Through Rate multiplied by the Class B Certificate Balance
as of the preceding Distribution Date (after giving effect to any payments
made on such preceding Distribution Date) or, in the case of the first
Distribution Date, as of the Closing Date[, which amount includes any amounts
due with respect to the Class B Stripped Coupon.]
"Class B Monthly Principal" means, with respect to any Distribution Date,
the sum of (a) the Class B Percentage of the Available Principal for such
Distribution Date and (b) the Class B Percentage of Aggregate Net Losses for
such Distribution Date.
"Class B Pass-Through Rate" means ____% per annum.
"Class B Percentage" means, a fraction (expressed as a percentage with
eight decimal places), the numerator of which is the Original Class B
Certificate Balance and the denominator of which is the Original Certificate
Balance.
"Class B Pool Factor" means, with respect to any Distribution Date, the
Class B Principal Balance as of such (after giving effect to any payments to
be made on such Distribution Date), divided by the Original Class B
Certificate Balance, expressed as a eight-digit decimal.
"Class B Principal Carryover Shortfall" means, for any Distribution Date,
the excess of Class B Principal Distributable Amount for the preceding
Distribution Date over the amount in respect of principal actually deposited
in the Class B Distribution Account for such preceding Distribution Date.
"Class B Principal Distributable Amount" means, for any Distribution
Date, the sum of Class B Monthly Principal for such Distribution Date and, in
the case of any Distribution Date other than the initial Distribution Date,
the Class B Principal Carryover Shortfall for such Distribution Date. In
addition, on the Final Scheduled Distribution Date, the Class B Principal
Distributable Amount will include any additional amount required to reduce the
outstanding aggregate principal balance of the Class B Certificates to zero.
"Class B Stripped Coupon" means, with respect to each Receivable, the
amount of interest allocable to a Class B Certificateholder in excess of such
Class B Certificateholder's pro rata percentage interest in the interest
payable on the Receivable at the Base Rate.
5
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act. The initial Clearing Agency shall
be The Depository Trust Company.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other person for whom from time to time a Clearing
Agency effects book-entry transfers of securities deposited with the Clearing
Agency (including a Foreign Clearing Agency).
"Clearstream" means Clearstream Banking, societe anonyme.
"Closing Date" means _________________, ________.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral Agent" means [_______________________], a national banking
association, in its capacity as collateral agent for the benefit of the
Certificateholders with respect to the Reserve Account and the Retained Yield.
"Collection Account" means securities account no. __________ entitled
"__________, __________, as Trustee, Securities Account of Chase Auto Grantor
Trust 200_-_" maintained by the Collection Account Securities Intermediary
pursuant to the Collection Account Control Agreement or any successor
securities account maintained pursuant to the Collection Account Control
Agreement.
"Collection Account Control Agreement" means the agreement among the
Seller, Chase, as securities intermediary, and the Trustee, dated as of
__________ __, 200_, relating to the Collection Account, substantially in the
form attached as Exhibit F, as the same may be amended and supplemented from
time to time.
"Collection Account Securities Intermediary" means Chase or any other
securities intermediary that maintains the Collection Account pursuant to the
Collection Account Control Agreement.
"Collection Period" means each calendar month beginning until the Trust
shall terminate pursuant to Article XI.
"Collections" means all collections in respect of Receivables.
"Contract Rate" of a Receivable means the annual rate of interest stated
in such Receivable.
"Cutoff Date" means __________ __, _____.
"Dealer" means the dealer which sold a Financed Vehicle related to a
Dealer Receivable and which originated or assisted in the origination of such
Dealer Receivable relating to such Financed Vehicle under a Dealer Agreement.
6
"Dealer Agreement" means any agreement and, if applicable, assignment
under which Dealer Receivables were originated by or through a Dealer and sold
to the Seller or an Affiliate of the Seller.
"Dealer Receivable" means each Receivable which was originated by the
Seller or an Affiliate of the Seller with the involvement of a Dealer.
"Defaulted Receivable" means a Receivable (other than a Repurchased
Receivable) as to which the Servicer has determined based on its usual
collection practices and procedures, during any Collection Period, that
eventual payment in full of the Amount Financed (including accrued interest
thereon) is unlikely; provided that a Receivable shall become a Defaulted
Receivable during the calendar month in which more than 10% of any scheduled
payment becomes 240 days delinquent, regardless of whether any such
determination has been made.
"Definitive Certificates" has the meaning specified in Section 6.8.
"Delinquency Percentage" means, for any Distribution Date, the sum of the
outstanding Principal Balances of all Receivables which were 60 days or more
delinquent (including Receivables, which are not Defaulted Receivables,
relating to Financed Vehicles that have been repossessed), as of the close of
business on the last day of the Collection Period immediately preceding such
Distribution Date, determined in accordance with the Servicer's normal
practices, such sum expressed as a percentage of the Pool Balance as of the
close of business on the last day of such Collection Period.
"Deposit Date" means the Business Day immediately preceding each
Distribution Date.
"Depository Agreement" means the agreement among the Seller, the Trustee
and the initial Clearing Agency, in the form attached hereto as Exhibit B, as
the same may be amended, supplemented or otherwise modified and in effect from
time to time.
"Determination Date" means the __th calendar day of the month (or, if
such __th calendar day is not a Business Day, the Business Day preceding the
__th calendar day of the month) immediately succeeding the related Collection
Period.
"Direct Receivable" means either a Chase Direct Receivable or a
Receivable originated by the Seller or an Affiliate of the Seller directly
with an Obligor without the involvement of a Dealer.
"Distribution Date" means, in the case of the first Collection Period,
___________, ___ 200_, and in the case of every Collection Period thereafter,
the __th day of the following month, or if the __th day is not a Business Day.
"Eligible Deposit Account" means (a) a segregated identifiable trust
account established in the trust department of a Qualified Trust Institution,
which shall, except in the case of the Reserve Account, initially be Chase,
and may be maintained with Chase so long as Chase is a Qualified Trust
Institution; or (b) a separately identifiable deposit account established in
7
the deposit taking department of a Qualified Institution which may be Chase so
long as Chase is a Qualified Institution.
"Euroclear Operator" means ▇▇▇▇▇▇ Guaranty Trust Company of New York,
Brussels, Belgium office, in its capacity as the operator of the Euroclear
system.
"Event of Servicing Termination" means an event specified in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"FDIC" means the Federal Deposit Insurance Corporation or any successor
thereto.
"FHLMC" means the Federal Home Loan Mortgage Corporation or any successor
thereto.
"Final Scheduled Distribution Date" shall be __________, ____, or, if
such day is not a Business Day, the next succeeding Business Day.
"Financed Vehicle" means, with respect to a Receivable, the new or used
automobile or light-duty truck, together with all accessions thereto, securing
an Obligor's indebtedness under such Receivable.
"Fitch" means Fitch, Inc. and its successors and assigns.
"FNMA" means the Federal National Mortgage Association or any successor
thereto.
"Foreign Clearing Agency" means, collectively, Clearstream and the
Euroclear Operator.
"Investment Earnings" means, with respect to any Distribution Date,
investment earnings on funds deposited into the Reserve Account or the
Collection Account, as applicable, in each case, net of losses and investment
expenses.
"Late Fees" means any late charges, credit related extension fees,
non-credit related extension fees or other administrative fees or similar
charges allowed by applicable law with respect to the Receivables.
"Lien" means a security interest, lien, charge, pledge or encumbrance of
any kind other than tax liens, mechanics' liens or any other liens that attach
by operation of law.
"Liquidation Proceeds" means, with respect to any Receivable, (i)
insurance proceeds, (ii) the monies collected during a Collection Period from
whatever source on a Defaulted Receivable and (iii) proceeds of a Financed
Vehicle sold after repossession, in each case net of any liquidation expenses
and payments required by law to be remitted to the Obligor.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its successors and
assigns.
8
"Net Loss Ratio" means, for any Distribution Date, an amount, expressed
as a percentage, equal to (i) the Aggregate Net Losses for such Distribution
Date, divided by (ii) the average of the Pool Balances on each of the related
Settlement Dates and the last day of the related Collection Period.
"Obligor" on a Receivable means the purchaser or the co-purchasers of the
Financed Vehicle purchased in part or in whole by the execution and delivery
of such Receivable or any other Person who owes or may be liable for payments
under such Receivable.
"Officer's Certificate" means a certificate signed by the chairman of the
board, the president, the treasurer, the controller, any executive or senior
vice president or any vice president of the Seller or Servicer, as
appropriate.
"Opinion of Counsel" means a written opinion of counsel (who may be
counsel to the Seller or the Servicer) reasonably acceptable in form and
substance to the Trustee.
"Optional Purchase Percentage" shall be ____%.
"Original Certificate Balance" means the sum of the Original Class A
Certificate Balance and the Original Class B Certificate Balance.
"Original Class A Certificate Balance" means $_______________.
"Original Class B Certificate Balance" means $_________________.
"Original Pool Balance" shall be $______________.
"Pass-Through Rate" means either the Class A Pass-Through Rate or the
Class B Pass-Through Rate, as applicable.
"Paying Agent" has the meaning specified in Section 6.11 and shall
initially be the corporate trust office of Chase.
"Permitted Investments" means, at any time, any one or more of the
following obligations, securities (certificated or uncertificated) or
instruments (excluding any security with the "r" symbol attached to its
rating):
(i) obligations of the United States of America or any agency
thereof; provided such obligations are backed by the full faith and
credit of the United States of America;
(ii) general obligations of or obligations guaranteed as to the
timely payment of interest and principal by any state of the United
States of America or the District of Columbia then rated "A-1+" or "AAA"
by Standard & Poor's, "F1+" and "AAA" by Fitch (if rated by Fitch) and
"P-1" or "Aaa" by Moody's;
(iii) commercial paper, other than commercial paper issued by Chase
or any of its Affiliates, which is then rated "P-1" by Moody's, "F1+" by
Fitch (if rated by Fitch) and "A-1+" by Standard & Poor's;
9
(iv) certificates of deposit, demand or time deposits, federal funds
or banker's acceptances issued by any depository institution or trust
company (including the Trustee acting in its commercial banking capacity)
incorporated under the laws of the United States or of any state thereof
or incorporated under the laws of a foreign jurisdiction with a branch or
agency located in the United States of America and subject to supervision
and examination by federal or state banking authorities which short term
unsecured deposit obligations of such depository institution or trust
company are then rated "P-1" by Moody's, "F1+" by Fitch (if rated by
Fitch) and "A-1+" by Standard & Poor's;
(v) demand or time deposits of, or certificates of deposit issued
by, any bank, trust company, savings bank or other savings institution,
provided such deposits or certificates of deposit are fully insured by
the FDIC;
(vi) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation the short term unsecured debt or
deposits of which are rated "P-1" by Moody's, "F1+" by Fitch (if rated by
Fitch) and "A-1+" by Standard & Poor's or the long-term unsecured debt of
which are rated "Aaa" by Moody's, "AAA" by Fitch (if rated by Fitch) and
"AAA" by Standard & Poor's;
(vii) repurchase obligations with respect to any security described
in clause (i) or (ii) herein or any other security issued or guaranteed
by the FHLMC, FNMA or any other agency or instrumentality of the United
States of America which is backed by the full faith and credit of the
United States of America, in either case entered into with a federal
agency or a depository institution or trust company (acting as principal)
described in (iv) above;
(viii) investments in money market funds, which funds (A) are not
subject to any sales, load or other similar charge; and (B) are rated at
least "AAAM" or "AAAM-G" by Standard & Poor's, "AAAV"-1+" by Fitch (if
rated by Fitch) and "Aaa" by Moody's; and
(ix) such other investments, other than investments in Chase or any
of its affiliates, where the short-term unsecured debt or deposits of the
obligor on such investments are rated "A-1+" by Standard & Poor's, "F1+"
by Fitch (if rated by Fitch) and "P-1" by Moody's;
provided, however, that with respect to the obligations or securities
described in (i) through (x) above which are considered an asset (i.e.,
property) of the Trust, such obligations or securities must mature not later
than the Deposit Date next succeeding the date the trust invested in such
obligation or security, except if the Collection Account is maintained with
the Trustee, for investments in obligations or securities on which the Trustee
is to obligor (including repurchase agreements on which the Trustee in its
commercial capacity is liable as principal) which investments may mature on
the Distribution Date next succeeding the date the Trust may invest in such
obligation or security. Permitted Investments may include money market mutual
funds (so long as such fund has the ratings specified in clause (viii)
hereof), including, without limitation, the VISTA U.S. Government Money Market
Fund or any other fund for which Chase, the Trustee or an Affiliate thereof
serves as an investment advisor, administrator, shareholder servicing agent,
and/or custodian or subcustodian, notwithstanding that (i) Chase,
10
[__________________________] or an Affiliate thereof charges and collects fees
and expenses from such funds for services rendered, (ii) Chase,
[____________________________] or an Affiliate thereof charges and collects
fees and expenses for services rendered pursuant to this Agreement, and (iii)
services performed for such funds and pursuant to this Agreement may converge
at any time. The Trustee specifically authorizes Chase,
[_______________________] or an Affiliate thereof to charge and collect all
fees and expenses from such funds for services rendered to such funds (but not
to exceed investment earnings), in addition to any fees and expenses Chase or
[_________________________], as applicable, may charge and collect for
services rendered pursuant to this Agreement.
"Person" means a legal person, including any individual, corporation,
limited liability company, estate, partnership, joint venture, association,
joint stock company, trust, unincorporated organization, or government or any
agency or political subdivision thereof, or any other entity of whatever
nature.
"Pool Balance" as of any date of determination means the aggregate
Principal Balance of the Receivables, as of the close of business on such
date.
"Principal Balance" of a Receivable, as of any date of determination,
means the Amount Financed minus that portion of all payments received on or
prior to such date allocable to principal. The Principal Balance of a
Defaulted Receivable or a Repurchased Receivable shall be deemed to be zero,
in each case, as of such date.
"Qualified Institution" means a depository institution organized under
the laws of the United States of America or any State thereof or incorporated
under the laws of a foreign jurisdiction with a branch or agency located in
the United States of America or any State thereof and subject to supervision
and examination by federal or state banking authorities which at all times has
the Required Deposit Rating and, in the case of any such institution organized
under the laws of the United States of America, whose deposits are insured by
the FDIC.
"Qualified Trust Institution" means an institution organized under the
laws of the United States of America or any State thereof or incorporated
under the laws of a foreign jurisdiction with a branch or agency located in
the United States of America or any State thereof and subject to supervision
and examination by federal or state banking authorities which at all times (i)
is authorized under such laws to act as a trustee or in any other fiduciary
capacity, (ii) has not less than one billion dollars in assets under fiduciary
management, and (iii) has a long term deposits rating of not less than "BBB-"
by Standard & Poor's, "BBB-" by Fitch (if rated by Fitch) and "Baa3" by
▇▇▇▇▇'▇.
"Rating Agency" means any of Standard & Poor's, Moody's or Fitch.
"Rating Agency Condition" means, with respect to any action or event,
that each Rating Agency shall have notified the Seller, the Servicer and the
Trustee, in writing, that such action or event will not result in reduction or
withdrawal of the rating of any outstanding Certificate with respect to which
it is the Rating Agency.
"Receivable" means a retail installment sale contract or purchase money
promissory note or other promissory note and security agreement executed by an
11
Obligor in respect of a Financed Vehicle, and all proceeds thereof and
payments thereunder (other than interest accrued and unpaid as of the opening
of business on the Cutoff Date), which Receivable shall be identified on
Schedule A to this Agreement.
"Receivable Files" means the documents specified in Section 3.3.
"Receivables Pool" means the pool of Receivables included in the Trust.
"Record Date" means, with respect to any Distribution Date, the Business
Day prior to such Distribution Date unless Definitive Certificates are issued,
in which case such Record Date, with respect to such Definitive Certificates,
shall mean the last day of the immediately preceding calendar month.
"Relevant UCC" means the Uniform Commercial Code as in effect in the
applicable jurisdiction.
"Repurchase Amount" of a Repurchased Receivable or any Receivable
purchased by the Servicer pursuant to Sections 3.2, 4.7 or 11.2 means the sum,
as of the last day of the Collection Period on which such Receivable becomes
such, of the Principal Balance thereof plus the Accrued Interest thereon; of a
Defaulted Receivable means the sum, as of the Settlement Date on which such
Receivable is to be purchased, of the principal balance thereof plus the
Accrued Interest thereon (the accrued interest for the Collection Period in
which such Receivable became a Defaulted Receivable to be calculated at a rate
equal to one-twelfth of the sum of (A) the Weighted Average Pass-Through Rate
and (B) the Servicing Fee Rate).
"Repurchased Receivable" means a Receivable repurchased by the Seller
pursuant to Section 3.2 or purchased by the Servicer pursuant to Section 4.7.
"Required Deposit Rating" shall be a short-term certificate of deposit
rating from Moody's of "P-1," from Fitch of "F1+" (if rated by Fitch) and from
Standard & Poor's of "A-l+", and a long-term unsecured debt rating of not less
than "AA-" by Standard & Poor's, "AA" by Fitch (if rated by Fitch) and "Aa3"
by Moody's.
"Reserve Account" means securities account no. __________ entitled
"__________, __________, as Collateral Agent, Securities Account of Chase Auto
Grantor Trust 200_-_" maintained by the Reserve Account Securities
Intermediary pursuant to the Reserve Account Control Agreement or any
successor securities account maintained pursuant to the Reserve Account
Control Agreement.
"Reserve Account Control Agreement" means the agreement among the Seller,
__________, as securities intermediary, and the Collateral Agent, dated as of
__________ __, 200_, relating to the Reserve Account, substantially in the
form attached as Exhibit F, as the same may be amended and supplemented from
time to time.
"Reserve Account Initial Deposit" means an amount equal to $__________.
"Reserve Account Securities Intermediary" means __________ or any other
securities intermediary that maintains the Reserve Account pursuant to the
Reserve Account Control Agreement.
12
"Retained Yield" means, with respect to each Receivable, a fixed portion
of the interest due on such Receivable equal to the difference between the
Contract Rate of such Receivable and the Base Rate of such Receivable.
"SFAS 140" means the Statement of Financial Accounting Standard No. 140,
Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities.
"Securities Act" means the Securities Act of 1933, as amended.
"Seller" means Chase Manhattan Bank USA, National Association, a national
banking association with its principal executive offices in Wilmington,
Delaware, in its capacity as the seller of the Receivables under this
Agreement, and each successor to Chase Manhattan Bank USA, National
Association (in the same capacity) pursuant to Section 7.3.
"Servicer" means Chase Manhattan Bank USA, National Association, a
national banking association with its principal executive offices in
Wilmington, Delaware, in its capacity as the servicer of the Receivables under
this Agreement, each successor to Chase Manhattan Bank USA, National
Association (in the same capacity) pursuant to Section 8.3, and each successor
Servicer pursuant to Section 9.2.
"Servicer's Certificate" means a certificate, substantially in the form
of Exhibit D attached hereto, completed and executed by the Servicer by its
chairman of the board, the president, treasurer, controller or any executive,
senior vice president or vice president pursuant to Section 4.9.
"Servicing Fee" with regard to a Collection Period means the fee payable
to the Servicer for services rendered during such Collection Period,
determined pursuant to Section 4.8.
"Servicing Fee Rate" means ____% per annum.
"Settlement Date" means, with respect to any Collection Period, the last
day of the Collection Period immediately preceding such Collection Period, and
with respect to any Distribution Date, the last day of the second Collection
Period preceding the Collection Period in which such Distribution Date occurs.
"Specified Reserve Account Balance", with respect to any Distribution
Date, means _____% of the Pool Balance as of the related Settlement Date, but
in any, event will not be less than the lesser of (i) $__________ and (ii) the
sum of (A) such Pool Balance plus (B) an amount sufficient to pay interest on
such Pool Balance through the Final Scheduled Distribution Date at a rate
equal to the sum of (x) the weighted average of the Class A Pass-Through Rate
and the Class B Pass-Through Rate (based on their respective certificate
balances) plus (y) the Servicing Fee Rate; provided that the Specified Reserve
Account Balance will be calculated using a percentage of _____% for any
Distribution Date (beginning with the ____________________ Distribution Date)
for which the Average Net Loss Ratio exceeds ____% or the Average Delinquency
Percentage exceeds _____%. Upon written notification to the Trustee by the
Seller, the Specified Reserve Account Balance may be reduced to a lesser
amount as determined by the Seller so long as such reduction satisfies the
Rating Agency Condition.
13
"Standard & Poor's" means Standard & Poor's Ratings Services, and its
successors and assigns.
"Total Distribution Amount" means, for any Distribution Date, the sum of
Available Interest and Available Principal for such Distribution Date. The
Total Distribution Amount on any Distribution Date shall exclude all payments
and proceeds (including any Liquidation Proceeds and any amounts received from
Dealers with respect to Receivables) of (i) any Receivables the Repurchase
Amount of which has been included in the Total Distribution Amount for a prior
Distribution Date and (ii) Investment Earnings and any Late Fees.
"Transfer Agent and Certificate Registrar" has the meaning specified in
Section 6.3 and shall initially be the corporate trust office of Chase.
"Treasury Regulations" means the treasury regulations promulgated under
the Code.
"Trust" means the Chase Manhattan Auto Grantor Trust 200_-_, the estate
of which shall consist of the property transferred thereto pursuant to this
Agreement; funds deposited in the Collection Account and the Distribution
Accounts (other than any funds in respect of the Retained Yield) and proceeds
of the foregoing.
"Trustee" means, initially, [__________________________________
___________________________], its successor in interest pursuant to Section
10.11, and any successor Trustee pursuant to Section 10.10.
"Trustee's Certificate" means a certificate completed and executed by an
Authorized Officer pursuant to Section 10.2 and substantially in the forms
attached hereto as Exhibits C-1 or C-2.
"Weighted Average Pass-Through Rate" means the weighted average of the
Class A Pass-Through Rate and the Class B Pass-Through Rate (based on their
respective Certificate balances).
SECTION 1.2. Usage of Terms. With respect to all terms in this Agreement,
the singular includes the plural and the plural the singular; words importing
any gender include the other gender; references to "writing" include printing,
typing, lithography, and other means of reproducing words in a visible form;
references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance
with their respective terms and not prohibited by this Agreement; references
to Persons include their permitted successors and assigns; and the term
"including" means "including without limitation." All references herein to
Articles, Sections, Subsections and Exhibits are references to Articles,
Sections, Subsections and Exhibits contained in or attached to this Agreement
unless otherwise specified, and each such Exhibit is part of the terms of this
Agreement.
SECTION 1.3. Simple Interest Method; Allocations. All allocations of
payments to principal and interest and determinations of periodic charges and
the like on the Receivables shall be based on a year with the actual number of
days in such year and twelve months with the actual number of days in each
14
such month. Each payment on a Receivable shall be applied first, to the
payment of accrued and unpaid interest on such Receivable, second, to reduce
the scheduled principal amount outstanding on the Receivable to the extent of
the remaining scheduled payment, third, to any outstanding fees and Late Fees
under the terms of the Receivable and fourth, to reduce the principal amount
outstanding on the Receivable. Amounts paid by the Seller or the Servicer in
respect of Repurchased Receivables shall be allocated as if the Obligor
thereof had prepaid such Receivable in full on the date as of which such
Receivable was repurchased by the Seller or purchased by the Servicer.
ARTICLE II
THE TRUST CONVEYANCE OF THE RECEIVABLES
SECTION 2.1. Creation of the Trust. Upon the execution of this Agreement
by the parties hereto, there is hereby created the Chase Manhattan Auto
Grantor Trust 200_-_.
SECTION 2.2. Conveyance of Receivables. In consideration of the Trustee's
delivery to, and upon the order of the Seller of authenticated Certificates,
in authorized denominations, in an aggregate amount equal to the Original Pool
Balance, the Seller does hereby sell, transfer, assign, and otherwise convey
to the Trustee on behalf of the Trust, without recourse (subject to the
Seller's obligations herein):
(i) all right, title, and interest of the Seller in, to and under
the Receivables listed in Schedule A hereto, all proceeds thereof and all
amounts and monies received thereon on and after the Cutoff Date
(including proceeds of the repurchase of Receivables by the Seller
pursuant to Section 3.2 or the purchase of Receivables by the Servicer
pursuant to Section 4.7 or 11.2), together with the interest of the
Seller in the security interests in the Financed Vehicles granted by the
Obligors pursuant to the Receivables and in any repossessed Financed
Vehicles;
(ii) all right, title and interest of the Seller in any Liquidation
Proceeds and in any proceeds of any extended warranties, theft and
physical damage, credit life or credit disability policies relating to
the Financed Vehicles or the Obligors;
(iii) all right, title and interest of the Seller in any proceeds
from Dealer repurchase obligations relating to the Receivables;
(iv) all right, title and interest of the Seller in the Collection
Account; and
(v) all proceeds (as defined in the Relevant UCC) of the foregoing.
Simultaneously with the sale, transfer, assignment and conveyance by the
Seller pursuant to this Section 2.1, the Trustee on behalf of the Trust does
hereby transfer, assign and otherwise convey to the Seller all of its right,
title and interest in the Retained Yield.
Notwithstanding anything herein to the contrary, the property of the
Trust shall not include, and the Trust shall not have any right to, the
15
Retained Yield or the Reserve Account, any funds actually or deemed to be
deposited in such account or any investments therein except to the extent
provided in Sections 5.2, 5.5 and 5.6.
In connection with such sale, the Seller agrees to record and file, at
its own expense, financing statements (and continuation statements with
respect to such financing statements when applicable) with respect to the
Receivables for the sale of accounts and chattel paper meeting the
requirements of applicable state law in such manner and in such jurisdictions
as are necessary to perfect the sale and assignment of the Receivables to the
Trust.
It is the intention of the Seller and the Trustee that the assignment and
transfer herein contemplated constitute a sale of the Receivables, conveying
good title thereto free and clear of any liens and encumbrances, from the
Seller to the Trust and the Receivables not be part of the Seller's estate in
the event of an insolvency. In the event that such conveyance is deemed to be
a pledge to secure a loan, the Seller hereby grants to the Trustee on behalf
of the Trust for the benefit of the Certificateholders a first priority
perfected security interest in all of the Seller's right, title and interest
in, to and under the items of property listed in clauses (i) through (iv)
above, and in all proceeds (as defined in the Relevant UCC) of the foregoing,
to secure the loan deemed to be made in connection with such pledge and, in
such event, this Agreement shall constitute a security agreement under
applicable law.
The parties hereto intend that the Trust be treated as a "qualifying
special purpose entity" as such term is used in SFAS 140 and any successor
rule thereto.
ARTICLE III
THE RECEIVABLES
SECTION 3.1. Representations and Warranties of Seller; Conditions
Relating to Receivables. (a) The Seller makes the following representations
and warranties as to the Receivables on which the Trustee shall rely in
accepting the Receivables in trust and authenticating the Certificates. Such
representations and warranties shall speak as of the Cutoff Date unless
otherwise specified, but shall survive the sale, transfer, and assignment of
the Receivables to the Trustee.
(i) Schedule of Receivables. The information set forth in Schedule A
hereto with respect to each Receivable is true and correct in all
material respects, and no selection procedures materially adverse to the
Certificateholders has been utilized in selecting the Receivables from
all receivables owned by the Seller which meet the selection criteria
specified herein.
(ii) No Sale or Transfer. No Receivable has been sold, transferred,
assigned or pledged by the Seller to any Person other than the Trustee.
(iii) Good Title. Immediately prior to the transfer and assignment
of the Receivables to the Trust herein contemplated, the Seller has good
and marketable title to each Receivable free and clear of all Liens and
rights of others; and, immediately upon the transfer thereof, the
Trustee, for the benefit of the Certificateholders, has either (i) good
and marketable title to each Receivable, free and clear of all Liens and
rights of others, and the transfer has been perfected under applicable
16
law or (ii) a first priority perfected security interest in each
Receivable and the proceeds thereof.
(b) Each Receivable satisfies the following conditions as of the Cutoff
Date unless otherwise specified and such conditions shall survive the sale,
transfer and assignment of the Receivables to the Trustee pursuant to this
Agreement.
(i) Acquisition. Each Receivable is either a Dealer Receivable
acquired directly or indirectly from or made through a Dealer located in
the United States (including the District of Columbia) or is a Direct
Receivable;
(ii) Security. Each Receivable is secured by a new or used
automobile or light-duty truck;
(iii) Maturity of Receivables. Each Receivable had a remaining
maturity of not less than ____ months nor greater than ____ months, and
(A) in the case of each Receivable secured by a new Financed Vehicle, had
an original maturity of at least _____ months and not more than ____
months; and (B) in the case of each Receivable secured by used Financed
Vehicle, had an original maturity of at least _____ months and not more
than ____.
(iv) Contract Rate. Each Receivable is a fully-amortizing fixed rate
simple interest contract that provides for level scheduled monthly
payments over its remaining term, and has a Contract Rate of at least
_____% and not more than ____ %;
(v) No Repossessions. Each Receivable is secured by a Financed
Vehicle that had not been repossessed without reinstatement of such
Receivable;
(vi) Obligor Not Subject to Bankruptcy Proceedings. Each Receivable
has been entered into by an Obligor who had not been identified on the
computer files of the Seller as in bankruptcy proceedings;
(vii) No Overdue Payments. Each Receivable had no payment that was
more than 30 days past due;
(viii) [Reserved];
(ix) Remaining Principal Balance. Each Receivable had a remaining
Principal Balance of at least $______ and not greater than $_______;
(x) No Force Placed Insurance. Each Receivable was secured by a
Financed Vehicle that was not insured by a force placed insurance policy
or any vendor's single interest and non-filing insurance policy;
(xi) Receivable Files. The Receivable Files shall be kept at one or
more of the locations specified in Schedule B hereto;
(xii) Characteristics of Receivables. Each Receivable (a)(i) in the
case of a Dealer Receivable, has been originated in the form of a credit
17
sales transaction by a Dealer or a purchase money loan or other note
through a Dealer located in one of the States of the United States
(including the District of Columbia) for the retail financing of a
Financed Vehicle or (ii) in the case of a Direct Receivable, has been
originated by Chase or an Affiliate thereof in the form of a secured loan
for the retail financing of a Financed Vehicle, and, in each case, has
been fully and properly executed by the parties thereto, (b)(i) in the
case of a Dealer Receivable, if a retail installment sales contract, has
been purchased by the Seller from the originating Dealer or an Affiliate
of the Seller, and has been validly assigned by such Dealer or an
Affiliate of the Seller to the Seller in accordance with its terms or
(ii) in the case of a Chase Direct Receivable has been purchased by the
Seller from Chase, and has been validly assigned by Chase to the Seller;
(c) contains customary and enforceable provisions such that the rights
and remedies of the holder thereof are adequate for realization against
the collateral of the benefits of the security; and (d) provides for
fully amortizing level scheduled monthly payments (provided that the
payment in the last month in the life of the Receivable may be different
from the level scheduled payment) and for accrual of interest at a fixed
rate according to the simple interest method;
(xiii) Compliance with Laws. Each Receivable and each sale of the
related Financed Vehicle complied at the time it was originated or made,
and complied on and after the Cutoff Date, in all material respects with
all requirements of applicable federal, state, and local laws, and
regulations thereunder, including usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit
Reporting Act, the Federal Trade Commission Act, the ▇▇▇▇▇▇▇▇-▇▇▇▇
Warranty Act, Federal Reserve Board Regulations B and Z, state
adaptations of the National Consumer Act and of the Uniform Consumer
Credit Code, and any other consumer credit, equal opportunity, and
disclosure laws applicable to such Receivable and sale thereof;
(xiv) Binding Obligation. Each Receivable constitutes the legal,
valid, and binding payment obligation in writing of the Obligor,
enforceable by the holder thereof in all material respects in accordance
with its terms, subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization, liquidation and other similar laws and
equitable principles relating to or affecting the enforcement of
creditors' rights;
(xv) No Government Obligor. Each Receivable is not due from the
United States of America or any State or from any agency, department,
instrumentality or political subdivision of the United States of America
or any State or local municipality, and each Receivable is not due from a
business except to the extent that such Receivable has a personal
guaranty;
(xvi) Security Interest in Financed Vehicle. Immediately prior to
the sale and assignment thereof to the Trustee as herein contemplated,
each Receivable was secured by a validly perfected first priority
security interest in the related Financed Vehicle in favor of or for the
benefit of the Seller as secured party (subject to administrative delays
and clerical errors on the part of the applicable governmental agency and
to any statutory or other lien arising by operation of law after the
Closing Date which is prior to such security interest), the Seller's
security interest (or beneficial interest therein) is assignable, and has
been so assigned by the Seller to the Trust, and at such time as
enforcement of such security interest is sought, each Receivable shall be
secured by a validly perfected first priority security interest in the
18
related Financed Vehicle for the benefit of the Trust (subject to
administrative delays and clerical errors on the part of the applicable
governmental agency and to any statutory or other lien arising by
operation of law after the Closing Date which is prior to such security
interest);
(xvii) Receivables in Force. No Receivable has been satisfied,
subordinated, or rescinded, nor has any Financed Vehicle been released
from the Lien granted by the related Receivable, in whole or in part;
(xviii) No Waiver. No provision of a Receivable has been waived in
such a manner that such Receivable fails either to meet all of the
representations and warranties made by the Seller herein with respect
thereto or to meet all of the conditions with respect thereto pursuant to
this Section 3.1(b);
(xix) No Amendments. No Receivable has been amended except pursuant
to either instruments included in the Receivable Files or instruments to
be included in the Receivables Files pursuant to Sections 4.2 and 4.4 (or
otherwise maintained by the Seller in the ordinary course of its
business), and no such amendment has caused such Receivable either to
fail to meet all of the representations and warranties made by the Seller
herein with respect thereto or to fail to meet all of the conditions with
respect thereto pursuant to this Section 3.1(b);
(xx) No Defenses. The Seller had no knowledge either of any facts
which would give rise to any right of rescission, setoff, counterclaim,
or defense, or of the same being asserted or threatened, with respect to
any Receivable;
(xxi) No Liens. The Seller had no knowledge of any Liens or claims
that have been filed, including liens for work, labor, materials or
unpaid taxes relating to a Financed Vehicle, that would be liens prior
to, or equal or coordinate with, the lien granted by the Receivable;
(xxii) No Default. Except for payment defaults continuing for a
period of not more than 30 days as of the Cutoff Date, the Seller has no
knowledge that a default, breach, violation, or event permitting
acceleration under the terms of any Receivable exists; the Seller has no
knowledge that a continuing condition that with notice or lapse of time
would constitute a default, breach, violation, or event permitting
acceleration under the terms of any Receivable exists; and the Seller has
not waived any of the foregoing;
(xxiii) Insurance. Each Receivable requires that the obligor
thereunder maintain comprehensive, liability, theft and physical damage
insurance covering the related Financed Vehicle;
(xxiv) Lawful Assignment. No Receivable has been originated in, or
is subject to the laws of, any jurisdiction under which the sale,
transfer, and assignment of such Receivable under this Agreement or
pursuant to transfers of the Certificates is unlawful, void or voidable;
19
(xxv) All Filings Made. No filings (other than filings under the
Relevant UCC which have been made) or other actions are necessary in any
jurisdiction to give the Trustee a first perfected security interest in
the Receivables.
(xxvi) One Original. There is no more than one original executed
copy of each Receivable which, immediately prior to the delivery thereof
to the Servicer (as custodian for the Trustee) was in the possession of
the Seller; and
[(xxvii) Excluded Loans. Each Receivable (A) is not a Receivable
whose related Obligor resides in the State of Alabama (in the case of a
Direct Receivable) or a Receivable originated by or through a Dealer
located in the State of Alabama (in the case of a Dealer Receivable), and
(B) has not been the subject of a previous securitization.]
SECTION 3.2. Repurchase Upon Breach or Failure of a Condition. The
Seller, the Servicer, or the Trustee, as the case may be, shall inform the
other parties promptly, in writing, upon the discovery by the Seller, the
Servicer or an Authorized Officer of the Trustee of either any breach of the
Seller's representations and warranties set forth in Section 3.1(a) or the
failure of any Receivable to satisfy any of the conditions set forth in
Section 3.1(b) which materially and adversely affects the Trust's interest in
any Receivable. Unless the breach or failed condition shall have been cured by
the last day of the Collection Period following the Collection Period in which
such discovery occurred (or, at the Seller's option, the last day of the
Collection Period in which such discovery occurred), the Seller shall
repurchase any Receivable the Holder's interest in which was materially and
adversely affected by the breach or failed condition, as of such last day. In
consideration of the repurchase of a Receivable, the Seller shall remit the
Repurchase Amount of such Receivable as of such last day (less any Liquidation
Proceeds deposited, or to be deposited, by the Servicer in the Collection
Account with respect to such Receivable pursuant to Section 4.3) in the manner
specified in Section 5.4. In the event that, as of the Cutoff Date, any
Receivable shall have a Contract Rate which is lower than the sum of the
Weighted Average Pass-Through Rate and the Servicing Fee Rate, the Seller
shall repurchase such Receivable on the terms and in the manner specified
above; provided, however, that notwithstanding anything to the contrary
contained herein, the Seller shall repurchase such Receivable as of the last
day of the Collection Period immediately succeeding the discovery thereof by
the Seller or the Servicer or the receipt by the Seller of notice thereof from
the Trustee. The sole remedy of the Trust, the Trustee or the
Certificateholders with respect either to a breach of the Seller's
representations and warranties set forth in Section 3.1(a) or to a failure of
any of the conditions set forth in Section 3.1(b) shall be to require the
Seller to repurchase Receivables pursuant to this Section 3.2. The obligation
of the Seller to repurchase under this Section 3.2 shall not be dependent upon
the actual knowledge of the Seller of any breached representation or warranty
and shall exist without regard to any limitation set forth in any
representation or warranty concerning the knowledge of the Seller as to the
facts stated therein. The Trustee shall have no duty to conduct any
affirmative investigation as to the occurrence of any condition requiring the
repurchase of any Receivable pursuant to this Section 3.2 or the eligibility
of any Receivable for purposes of this Agreement.
SECTION 3.3. Custody of Receivable Files. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Trustee,
upon the execution and delivery of this Agreement, agrees to have the Servicer
20
act as custodian of the following documents or instruments (the "Receivable
Files") which are hereby constructively delivered to the Trustee with respect
to each Receivable:
(i) The original executed Receivable; and
(ii) Any and all other documents or records that the Seller or the
Servicer, as the case may be, shall keep on file, in accordance with its
customary procedures, relating to a Receivable, an Obligor, or a Financed
Vehicle.
The Servicer hereby agrees to act as custodian and as agent for the
Trustee hereunder. The Servicer acknowledges that it holds the documents and
instruments relating to the Receivables for the benefit of the Trustee and the
Certificateholders. The Trustee shall have no responsibility to monitor the
Servicer's performance as custodian and shall have no liability in connection
with the Servicer's performance of such duties hereunder.
SECTION 3.4. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer, in its capacity as custodian, shall hold
the Receivable Files on behalf of the Trustee for the use and benefit of all
present and future Certificateholders and maintain such accurate and complete
accounts, records (either original execution documents or copies of such
originally executed documents shall be sufficient), and computer systems
pertaining to the Receivables as shall enable the Trustee to comply with its
obligations pursuant to this Agreement. In performing its duties as custodian,
the Servicer shall act with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to the receivable files of
comparable new or used automobile receivables that the Servicer services for
itself or others. The Servicer shall conduct, or cause to be conducted,
periodic audits of the files of all receivables owned or serviced by the
Servicer which shall include the Receivable Files held by it under this
Agreement and the related accounts, records, and computer systems, in such a
manner as shall enable the Trustee to identify all Receivable Files and such
related accounts, records and computer systems and to verify, if the Trustee
so elects, the accuracy of the Servicer's recordkeeping. The Servicer shall
promptly report to the Trustee any failure on its part to hold the Receivable
Files and maintain its accounts, records, and computer systems as herein
provided, and promptly take appropriate action to remedy any such failure.
(b) Maintenance of and Access to Records. The Servicer shall maintain
each Receivable File at one of the locations specified in Schedule B to this
Agreement, or at such other location as shall be specified to the Trustee by
30 days' prior written notice. The Servicer shall make available to the
Trustee or its duly authorized representatives, attorneys, or auditors the
Receivable Files and the related accounts, records, and computer systems
maintained by the Servicer at such times during normal operating hours as the
Trustee shall reasonably instruct which does not unreasonably interfere with
the Servicer's normal operations or customer or employee relations.
(c) Release of Documents. Upon instruction from the Trustee, the Servicer
shall release any document in the Receivable Files to the Trustee, the
Trustee's agent, or the Trustee's designee, as the case may be, at such place
or places as such Person may reasonably designate as soon as reasonably
21
practicable to the extent it does not unreasonably interfere with the
Servicer's normal operations or customer or employee relations. The Servicer
shall not be responsible for any loss occasioned by the failure of the
Trustee, its agent or its designee to return any document or any delay in
doing so.
(d) Title to Receivables. The Servicer agrees that, in respect of any
Receivable held by it as custodian hereunder, (i) the Servicer will not at any
time have or in any way attempt to assert any interest in such Receivable or
the related Receivable File, other than solely for the purpose of collecting
or enforcing the Receivable for the benefit of the Trust and (ii) the related
Receivable File shall at all times be property of the Trust.
SECTION 3.5. Instructions; Authority to Act. The Servicer shall be deemed
to have received proper instructions with respect to the Receivable Files upon
its receipt of written instructions signed by an Authorized Officer. A
certified copy of a by-law or of a resolution of the Board of Directors of the
Trustee shall constitute conclusive evidence of the authority of any such
Authorized Officer to act and shall be considered in full force and effect
until receipt by the Servicer of written notice to the contrary given by the
Trustee.
SECTION 3.6. Custodian's Indemnification. The Servicer, as custodian,
shall indemnify the Trustee for any and all liabilities, obligations, losses,
damages, payments, costs, or expenses of any kind whatsoever that may be
imposed on, incurred, or asserted against the Trustee as the result of any act
or omission in any way relating to the maintenance and custody by the
Servicer, as custodian, of the Receivable Files; provided, however, that the
Servicer shall not be liable for any portion of any such amount resulting from
the wilful misfeasance, bad faith, or negligence of the Trustee.
SECTION 3.7. Effective Period and Termination. The Servicer's appointment
as custodian shall become effective as of the Cutoff Date and shall continue
in full force and effect until terminated pursuant to this Section 3.7 or
until this Agreement shall be terminated. If the Servicer shall resign as
Servicer under Section 8.5 or if all of the rights and obligations of the
Servicer shall have been terminated under Section 9.1, the appointment of the
Servicer as custodian may be terminated by the Trustee or by the Holders of
Certificates evidencing not less than 50% of the sum of the Class A
Certificate Balance and the Class B Certificate Balance voting as a single
class, in the same manner as the Trustee or such Holders may terminate the
rights and obligations of the Servicer under Section 9.1. As soon as
practicable after any termination of such appointment, the Servicer shall, at
its expense, deliver the Receivable Files to the Trustee or the Trustee's
agent at such place or places as the Trustee may reasonably designate.
Notwithstanding the termination of the Servicer as custodian, the Trustee
agrees that upon any such termination, the Trustee shall provide, or cause its
agent to provide, access to the Receivables Files to the Servicer for the
purpose of carrying out its duties and responsibilities with respect to the
servicing of the Receivables hereunder.
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1. Duties of Servicer. The Servicer shall manage, service,
administer and make collections on the Receivables (other than Repurchased
Receivables) with reasonable care, using that degree of skill and attention
22
that the Servicer exercises with respect to comparable new or used automobile
receivables that it services for itself. The Servicer's duties shall include
collection and posting of all payments, responding to inquiries by obligors or
by federal, state, or local governmental authorities with respect to the
Receivables, investigating delinquencies, reporting tax information to
Obligors in accordance with its customary practices, advancing costs of
disposition of defaults, monitoring the Receivables in cases of obligor
defaults, accounting for collections, furnishing monthly and annual statements
to the Trustee with respect to distributions, and, if it elects to do so,
making Advances pursuant to Section 5.3. The Servicer shall follow its
customary standards, policies, and procedures in performing its duties as
Servicer hereunder; provided that the Servicer shall be permitted to take or
to refrain from taking any action not specified in this Agreement with respect
to servicing the Receivables if such action or inaction would not contravene
any material term of this Agreement or materially adversely affect the
interests of Certificateholders and is not outside customary or normal
servicing procedures. Without limiting the generality of the foregoing, the
Servicer shall be authorized and empowered by the Trustee to execute and
deliver, on behalf of itself, the Trust, the Trustee, the Certificateholders,
or any of them, any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge, and all other comparable instruments,
without recourse to the Trustee with respect to the Receivables or with
respect to the Financed Vehicles. If the Servicer shall commence a legal
proceeding to enforce a Receivable or a Defaulted Receivable, the Trustee
shall thereupon be deemed to have automatically assigned such Receivable and
the related property conveyed to the Trust pursuant to Section 2.1 with
respect to such Receivable to the Servicer, solely for the purpose of
collection. The Trustee shall furnish the Servicer with such documents as have
been prepared by the Servicer for execution by the Trustee and as are
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
SECTION 4.2. Collection of Receivable Payments; Refinancing. (a) The
Servicer shall make reasonable efforts to collect all payments called for
under the terms and provisions of the Receivables and of this Agreement as and
when the same shall become due, and shall follow such collection procedures as
it follows with respect to comparable new or used automobile receivables that
it services for itself and that are consistent with prudent industry
standards. The Servicer shall not change the Principal Aamount of (except with
respect to a prepayment of a scheduled payment that does not result in a
deferral of any other scheduled payment) or reschedule the due date of any
scheduled payment to a date more than 30 days from the original due date of
such scheduled payment, change the Contract Rate of, or extend any Receivable
(except as provided in Section 4.4) or change any material term of a
Receivable, except with respect to certain unilateral changes as provided by
the terms of the Receivable or of this Agreement or as required by law or
court order; provided, however, that the Servicer may grant extensions of the
due date for a payment on a Receivable that is in default or with respect to
which, absent such extension, default is reasonably foreseeable, and the
Servicer would grant such extension with respect to comparable new or used
automobile receivables that it services for itself, but such extension would
be granted only if (i) the Available Reserve Account Amount is greater than
zero at the time of such extension, (ii) the extension is for no more than
three months, (iii) the total period of all credit related extensions granted
on the Receivable will not exceed the number of months equal to the number of
whole years comprising the original term of the Receivable, (iv) the maturity
of such Receivable would not be extended beyond the Collection Period
immediately preceding the Final Scheduled Distribution Date and (v) the
rescheduling or extension would not modify the terms of such Receivable in
23
such a manner as to constitute a cancellation of such Receivable and the
creation of a new receivable for federal income tax purposes. If, as a result
of inadvertently rescheduling or extending of payments, such rescheduling or
extension breaches any of the terms of the proviso to the preceding sentence,
then the Servicer shall be obligated to purchase such Receivable pursuant to
Section 4.7. For the purpose of such purchases pursuant to Section 4.7, notice
shall be deemed to have been received by the Servicer at such time as shall
make any such purchase mandatory as of the last day of the Collection Period
during which the discovery of such breach shall have occurred. The Servicer
may, in its discretion, in accordance with its customary standards, policies
and procedures, waive any Late Fees that may be collected in the ordinary
course of servicing a Receivable.
(b) Notwithstanding anything in this Agreement to the contrary, the
Servicer may refinance any Receivable by accepting a new promissory note from
the related Obligor and applying the proceeds of such refinancing to pay all
obligations in full of such Obligor under such Receivable; provided, however,
that the Servicer shall not refinance a Receivable unless at least one
material term of the Receivable is substantively changed. The receivable
created by the refinancing shall not be property of the Trust.
SECTION 4.3. Realization Upon Receivables. On behalf of the Trust, the
Servicer shall use reasonable efforts, consistent with its customary servicing
procedures, to repossess or otherwise take possession of the Financed Vehicle
securing any Receivable during the calendar month in which more than 10% of
any scheduled payment thereunder becomes 90 days delinquent; provided, however
that the Servicer may repossess or otherwise take possession of the Financed
Vehicle securing a Receivable (i) earlier if (A) such Receivable becomes a
Defaulted Receivable, (B) the Servicer determines that such Financed Vehicle
is in danger of being damaged, destroyed or otherwise made unavailable for
repossession or (C) the related Obligor voluntarily surrenders such Financed
Vehicle or (ii) later if (A) the Servicer is unable to locate such Financed
Vehicle, (B) the related Obligor is the subject of a bankruptcy proceeding or
(C) the Servicer otherwise defers repossession of such Financed Vehicle in
accordance with its normal and customary servicing practices and procedures.
After repossession of a Financed Vehicle, the Servicer shall in accordance
with its customary and usual practices and procedures sell such Financed
Vehicle in an auction or consign such Financed Vehicle to a Dealer for resale
as soon as is practicable after repossession, subject to any applicable laws.
The Servicer shall follow such customary and usual practices and procedures as
it shall deem necessary or advisable in determining when and if to exercise
reasonable efforts to realize upon any recourse to Dealers. The Servicer shall
be entitled to recover from proceeds all reasonable expenses incurred by it in
the course of converting the Financed Vehicle into cash proceeds. The
Liquidation Proceeds with respect to a Receivable shall be deposited by the
Servicer in the Collection Account in the manner specified in Section 5.2 and
shall be applied to reduce (or to satisfy, as the case may be) the Repurchase
Amount of the Receivable, if such Receivable is to be repurchased by the
Seller pursuant to Section 3.2, or is to be purchased by the Servicer pursuant
to Section 4.7. The foregoing shall be subject to the provision that, in any
case in which a Financed Vehicle shall have suffered damage, the Servicer
shall not expend funds in connection with the repair or the repossession of
such Financed Vehicle unless it shall determine in its sole discretion that
such repair and/or repossession will increase the Liquidation Proceeds of the
related Receivable by an amount equal to or greater than the amount of such
expenses.
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[SECTION 4.4. Non-Credit Related Extensions to Obligors. Prior to the
Closing Date, the Servicer shall notify each Obligor in writing that if such
obligor satisfies certain conditions, as fully set forth in clauses (i)
through (vii) below, as, of a date selected by the Servicer within five (5)
months prior to the proposed extension, such obligor shall be entitled to a
non-credit related extension of any regularly scheduled payment due under a
Receivable that satisfies clauses (w) through (z) below:
(i) either (A) if the original term to maturity of the Receivable is
less than or equal to 48 months, at least eight (8), or (B) if the
original term to maturity of the Receivable exceeds 48 months but is not
greater than 60 months, at least ten, regular monthly payments shall have
been made on the related Receivable, and the remaining outstanding
Principal Balance of the related Receivable shall be greater than $500;
(ii) the payment status is current;
(iii) such Obligor shall not within the previous six months have
been delinquent for thirty days or more in making a payment under the
related Receivable;
(iv) no information has been furnished to the Servicer which
indicates that, based upon its current underwriting guidelines and credit
standards relating to advancing funds under comparable retail installment
sales contracts and purchase money loans for new or used automobiles, the
Obligor is not a Person to whom the Servicer would advance funds;
(v) at least four (4) monthly payments are scheduled to be made by
the Obligor prior to final maturity of the related Receivable;
(vi) the Receivable related to such optional extension shall not
have previously been the subject of more than two credit-related
extensions or the subject of any collection or bankruptcy-related
rewrites; and
(vii) after giving effect to such extension and the Obligor's
projected payments given the Obligor's payment history, the final payment
with respect to such Receivable would not exceed two (2) times the
original scheduled final payment amount of such Receivable.
In addition, any such extensions selected by an Obligor shall satisfy the
following criteria:
(w) a Receivable shall be extended for only the calendar month of
December;
(x) during the term of a Receivable, it shall be extended only for
the number of months equal to the number of whole years comprising the
initial term of such Receivable;
(y) no Receivable shall be extended such that its maturity will be
later than the Collection Period immediately preceding the Final
Scheduled Distribution Date; and
25
(z) the Obligor (or the related Receivable) shall have satisfied
conditions (i) through (vii) above.
If, as an inadvertent result of any extension granted pursuant to this
Section 4.4, such extension breaches any of the terms of the preceding
criteria (w) through (z), then the Servicer shall be obligated to purchase
such Receivable pursuant to Section 4.7. For the purpose of such purchases
pursuant to Section 4.7, notice shall be deemed to have been received by the
Servicer at such time as shall make purchase mandatory as of the last day of
the Collection Period during which the discovery of such breach shall have
occurred.]
SECTION 4.5. Maintenance of Security Interests in Financed Vehicles. The
Servicer, in accordance with its customary servicing procedures, shall take
such steps as are necessary to maintain perfection of the first priority
security interest of the Seller created in any Financed Vehicle which secures
a Receivable. On behalf of the Trust, the Servicer hereby agrees to take such
steps as are necessary to re-perfect such security interest in the event of
the relocation of a Financed Vehicle or for any other reason, in either case,
when the Servicer has knowledge of the need for such re-perfection. In the
event that the assignment of a Receivable to the Trust is insufficient without
a notation on the related Financed Vehicle's certificate of title, or without
fulfilling any additional administrative requirements under the laws of the
State in which the Financed Vehicle is located, to grant to the Trust a
perfected security interest in the related Financed Vehicle, the Servicer
hereby agrees that the Seller's listing as the secured party on the
certificate of title is deemed to be in its capacity as agent of the Trust and
further agrees to hold such certificate of title as the Trustee's agent and
custodian; provided, however, that the Servicer shall not, nor shall the
Trustee or Certificateholders have the right to require that the Servicer,
make any such notation on the related Financed Vehicles' certificate of title
or fulfill any such additional administrative requirement of the laws of the
State in which a Financed Vehicle is located.
SECTION 4.6. Covenants of Servicer. The Servicer hereby makes the
following covenants on which the Trustee will rely in accepting the
Receivables in trust and authenticating the Certificates:
(i) Security Interest to Remain in Force. The Financed Vehicle
securing each Receivable shall not be released from the security interest
granted by the Receivable in whole or in part except if such Financed
Vehicle is substituted in whole by the manufacturer, dealer or seller as
a result of mechanical defects or a total loss of the Financed Vehicle
because of accident or theft or as otherwise contemplated herein;
(ii) No Impairment. The Servicer shall not impair the rights of the
Trust in the Receivables; and
(iii) Extensions; Defaulted Receivables. The Servicer shall not
increase the number of payments under a Receivable, nor increase the
Amount Financed under a Receivable, nor extend or forgive payments on a
Receivable, except as provided in Sections 4.2 and 4.4. In the event that
at the end of the scheduled term of any Receivable, the outstanding
principal amount thereof is such that the final payment to be made by the
related Obligor is larger than the regularly scheduled payment of
principal and interest made by such Obligor, the Servicer may permit such
Obligor to pay such remaining principal amount in more than one payment
26
of principal and interest; provided, however, that the last such payment
shall be due on or prior to the Collection Period immediately preceding
the Final Scheduled Distribution Date.
SECTION 4.7. Purchase of Receivables Upon Breach. The Seller, the
Servicer or the Trustee, as the case may be, shall inform the other parties
promptly, in writing, upon the discovery by the Seller, the Servicer or an
Authorized Officer of the Trustee, as the case may be, of any breach by the
Servicer of its covenants under Section 4.6 which materially and adversely
affects the interest of the Trust in any Receivable (for this purpose, any
breach of the covenant set forth in Section 4.6(iii) shall be deemed to
materially and adversely affect the interest of the Trust in a Receivable).
Except as otherwise specified in Section 4.2 or 4.4, unless the breach shall
have been cured by the last day of the Collection Period following the
Collection Period in which such discovery occurred (or, at the Servicer's
election, the last day of the Collection Period in which such discovery
occurred), the Servicer shall purchase any Receivable materially and adversely
affected by such breach, as of such last day. In consideration of the purchase
of such Receivable, the Servicer shall remit the Repurchase Amount (less any
Liquidation Proceeds deposited, or to be deposited, by the Servicer in the
Collection Account with respect to such Receivable pursuant to Section 4.3) in
the manner specified in Section 5.4. The sole remedy of the Trust, the
Trustee, or the Certificateholders against the Servicer with respect to a
breach pursuant to Section 4.2 or 4.6 shall be to require the Servicer to
purchase Receivables pursuant to this Section 4.7. The Trustee shall have no
duty to conduct any affirmative investigation as to the occurrence of any
condition requiring the repurchase of any Receivable pursuant to this Section
4.7 or the eligibility of any Receivable for purposes of this Agreement.
SECTION 4.8. Servicing Fee. The Servicing Fee for a Collection Period
shall be payable on the related Distribution Date pursuant to Section 5.5 and
shall equal the sum of (i) the product of one-twelfth of the Servicing Fee
Rate and the Pool Balance as of the related Settlement Date and (ii) Late Fees
received from obligors during such Collection Period. In addition, as part of
the Servicing Fee, the Servicer shall be entitled to receive on each
Distribution Date Investment Earnings when and as paid on amounts on deposit
in the Collection Account or earned on collections pending deposit in the
Collection Account; provided, however, that, beginning with the Collection
Period for which the Trustee is notified in writing that the Servicer has
failed to deposit an Advance with respect to a Receivable (other than because
such Receivable has been designated a Defaulted Receivable) and continuing
until the Final Scheduled Distribution Date, such Investment Earnings shall
not be paid to the Servicer, but shall be deposited by the Trustee or the
Paying Agent on its behalf into the Reserve Account on each Distribution Date.
The Servicer shall be required to pay from its own account all expenses
incurred by it in connection with its activities hereunder (including fees and
disbursements of independent accountants and auditors, taxes imposed on the
Servicer, and other costs incurred in connection with administering and
servicing the Receivables) and the fees and disbursements of the Trustee, the
Collateral Agent, the Trustee's and the Collateral Agent's counsel, the Paying
Agent, the Transfer Agent and Certificate Registrar except for United States
federal, state and local income and franchise taxes, if any, imposed on the
Trust or any Certificateholder or any expenses in connection with realizing
upon Receivables under Section 4.3.
SECTION 4.9. Servicer's Certificate. On or before each Determination
Date, the Servicer shall, deliver to the Trustee, the Collateral Agent, the
27
Paying Agent and the Rating Agencies a Servicer's Certificate substantially in
the form of Exhibit D hereto, for the Collection Period preceding such
Determination Date, containing all information necessary to make the
distributions pursuant to Section 5.5, and all information necessary for the
Paying Agent to send statements to Certificateholders pursuant to Section 5.8.
The Servicer shall deliver to the Rating Agencies any information, to the
extent it is available to the Servicer, that the Rating Agencies reasonably
request in order to monitor the Trust. The Servicer shall also specify each
Receivable which the Seller or the Servicer is required to repurchase or
purchase, as the case may be, as of the last day of the preceding Collection
Period, each Receivable which the Servicer shall have determined to be a
Defaulted Receivable during the preceding Collection Period, and each
Receivable for which the Servicer has failed to deposit an Advance pursuant to
Section 5.3 other than because such Receivable has been designated a Defaulted
Receivable. Subsequent to the Closing Date, the form of Servicer's Certificate
may be revised or modified to cure any ambiguities or inconsistencies between
such form and this Agreement; provided, however, that no material information
shall be deleted from the form of Servicer's Certificate. In the event that
the form of Servicer's Certificate is revised or modified in accordance with
the preceding sentence, a form thereof, as so revised or modified, shall be
provided to the Trustee, the Collateral Agent, the Paying Agent and each
Rating Agency.
SECTION 4.10. Annual Statement as to Compliance. (a) The Servicer shall
deliver to a firm of independent certified public accountants, on or before
March 31 of each year commencing March 31, ___, a certificate signed by the
chairman of the board, the president, the treasurer, the controller, any
executive or senior vice president or any vice president of the Servicer,
stating that (a) a review of the activities of the Servicer during the year
ended the preceding December 31 (or period since the Cutoff Date in the case
of the first such certificate) and of its performance under this Agreement has
been made under such officer's supervision and (b) to the best of such
officer's knowledge, based on such review, the Servicer has fulfilled all its
obligations in all material respects under this Agreement throughout such year
(or shorter period in the case of the first such certificate), or, if there
has been a default in the fulfillment of any such obligation, specifying each
such default known to such officer and the nature and status thereof.
(b) The Servicer shall deliver to the Trustee and each Rating Agency
promptly after having obtained knowledge thereof, but in no event later than
five Business Days thereafter, an Officer's Certificate specifying any event
which with the giving of notice or lapse of time, or both, would become an
Event of Servicing Termination under Section 9.1. The Seller shall deliver to
the Trustee, promptly after having obtained knowledge thereof, but in no event
later than five Business Days thereafter, an Officer's Certificate specifying
any event which with the giving of notice or lapse of time, or both, would
become an Event of Servicing Termination under Section 9.1.
SECTION 4.11. Annual Audit Report. The Servicer shall cause a firm of
independent public accountants (which may provide other services to the
Servicer or the Seller) to prepare a report (with a copy of the certificate
described in Section 4.10(a) attached) addressed to the Board of Directors of
the Servicer, for the information and use of the Trustee and the Rating
Agencies on or before March 31 of each year, beginning March 31, _____, to the
effect that, with respect to the twelve months (or period since the Cutoff
Date in the case of the first such report) ended the preceding December 31,
such firm has either (A) examined a written assertion by the Servicer about
28
the effectiveness of the Servicer's internal control structure over the
processing and reporting of transactions relating to securitized automobile
loans with respect to the criteria set forth by the Servicer (the "Assertion")
and that, on the basis of such examination, such firm is of the opinion that
the Servicer's Assertion is fairly stated in all material respects except for
such exceptions as shall be set forth in such firm's report, or (B) such firm
has performed the following procedures:
1. For a sample of daily cash receipts during the preceding calendar year:
a. Trace total cash receipts to deposits on bank statements.
b. Agree cash receipts for securitized loans to computer reports.
c. Trace cash receipts for securitized loans to disbursements to the
Trustee.
2. For a sample of monthly cash receipt reports:
a. Agree total cash receipts per the cash receipt reports to "Total
Payments From Obligors Applied to Collection Period" per monthly
Servicer Certificates.
b. Agree total principal payments per the cash receipt reports to
"Principal Payments" per monthly Servicer Certificates.
3. For a sample of loans delinquent 30 days or more and for a sample of loans
in repossession status, selected from the loan delinquency report or a new
repossession report, as applicable, at a point in time, trace loan number to
inclusion in the loan collection system.
The determination of which of the two alternative reports to be prepared and
delivered, and the size of each sample to be tested, shall be decided in the
sole discretion of the Servicer. The report of the independent certified
public accountants shall also indicate that such accounting firm is
independent of the Servicer within the meaning of the Code of Professional
Ethics of the American Institute of Certified Public Accountants.
SECTION 4.12. Access by Certificateholders to Certain Documentation and
Information Regarding Receivables. The Servicer shall provide to the
Certificateholders access to the Receivable Files in such cases where the
Certificateholders shall be required by applicable statutes or regulations to
have access to such documentation. Access by the Certificateholders shall be
afforded without charge, but only upon reasonable request and during normal
business hours which does not unreasonably interfere with the Servicer's
normal operations or customer or employee relations. Nothing in this Section
4.12 shall affect the obligation of the Servicer to observe any applicable law
prohibiting disclosure of information regarding the Obligors, and the failure
of the Servicer to provide access to information as a result of such
obligation shall not constitute a breach of this Section 4.12.
SECTION 4.13. Reports to Certificateholders and the Rating Agencies. (a)
The Trustee shall provide to any Certificateholder who so requests in writing
(addressed to the Corporate Trust Office) a copy of any Servicer's Certificate
described in Section 4.9, of the annual statement described in Section
4.10(a), or the annual report described in Section 4.11. The Trustee may
29
require the Certificateholder to pay a reasonable sum to cover the cost of the
Trustee's complying with such request.
(b) The Trustee shall forward to the Rating Agencies the statement to
Certificateholders described in Section 5.8 and any other reports it may
receive pursuant to this Agreement (i) to Standard & Poor's Ratings Services,
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, (ii) to ▇▇▇▇▇'▇ Investors Service,
Inc., ABS Monitoring Dept., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ and (iii) to Fitch Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
SECTION 4.14. Reports to the Securities and Exchange Commission. The
Servicer shall, on behalf of the Trust, cause to be filed with the Commission
any periodic reports required to be filed under the provisions of the Exchange
Act and the rules and regulations of the Securities and Exchange Commission
thereunder.
ARTICLE V
ACCOUNTS; DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
SECTION 5.1. Establishment of the Accounts. (a) On or prior to the
Closing Date, the Seller, the Collection Account Securities Intermediary and
the Trustee shall have entered into the Collection Account Control Agreement
pursuant to which the Collection Account shall be established and maintained
for the benefit of the Certificateholders. If the depositary of the Collection
Account ceases to be either a Qualified Institution or a Qualified Trust
Institution, as applicable, the Servicer shall cause the Collection Account to
be moved to a Qualified Institution or a Qualified Trust Institution and the
Trustee shall cause the depositary maintaining the new Collection Account to
assume the obligations of the existing Collection Account Securities
Intermediary under the Collection Account Control Agreement unless the Rating
Agency Condition is satisfied in connection with such depositary's ceasing to
be a Qualified Institution or a Qualified Trust Institution, as the case may
be. All amounts held in the Collection Account shall be invested in accordance
with the Collection Account Control Agreement at the written direction of the
Servicer or, if Investment Earnings on amounts on deposit in the Collection
Account are not being paid to the Servicer, by the Seller in Permitted
Investments that mature not later than the Deposit Date next succeeding the
date of investment except, if the Collection Account Securities Intermediary
and the Trustee are the same Person, investments on which the Trustee is the
obligor (including repurchase agreements on which the Trustee, in its
commercial capacity, is liable as principal) may mature on the next succeeding
Distribution Date; provided, however, that once such amounts have been
invested in Permitted Investments, such Permitted Investments must be held or
maintained until they mature on or before the dates described above.
(b) The Servicer shall establish and maintain:
(i) the Class A Distribution Account in the name of the Trustee
bearing a designation clearly indicating that the funds deposited therein
are held for the benefit of the Class A Certificateholders; and
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(ii) the Class B Distribution Account in the name of the Trustee
bearing a designation clearly indicating that the funds deposited therein
are held for the benefit of the Class B Certificateholders.
The Class A Distribution Account and the Class B Distribution Account
shall each be an Eligible Deposit Account established initially at Chase.
(c) The Trustee shall possess all right, title and interest in all funds
on deposit from time to time in the Class A Distribution Account and the Class
B Distribution Account and in all proceeds thereof and all such funds shall be
part of the property of the Trust. The Class A Distribution Account and the
Class B Distribution Account shall be under the sole dominion and control of
the Trustee. Should any depositary of a Class A Distribution Account or the
Class B Distribution Account (including Chase (or an Affiliate thereof)) cease
to be either a Qualified Institution or a Qualified Trust Institution, as
applicable, then the Servicer shall, with the Seller's assistance as
necessary, cause the Class A Distribution Account or the Class B Distribution
Account, as the case may be, to be moved to a Qualified Institution or a
Qualified Trust Institution, unless the Rating Agency Condition is satisfied
in connection with such depositary's ceasing to be a Qualified Institution or
a Qualified Trust Institution, as the case may be.
SECTION 5.2. Collections. (a) The Servicer shall remit daily within
forty-eight hours of receipt to the Collection Account all payments by or on
behalf of the Obligors on the Receivables and all Liquidation Proceeds
(including any Retained Yield), both as collected during the Collection
Period. Chase USA has requested that, so long as it is acting as the Servicer,
the Servicer be permitted to make remittances of collections on a less
frequent basis than that specified in the immediately preceding sentence. It
is understood that such less frequent remittances may be made only on the
specific terms and conditions set forth below in this Section 5.2 and only for
so long as such terms and conditions are fulfilled. Accordingly,
notwithstanding the provisions of the first sentence of this Section 5.2, the
Servicer shall remit such collections to the Collection Account in Automated
Clearinghouse Corporation next-day funds or immediately available funds no
later than 11:00 a.m., New York City time, on the Deposit Date but only for so
long as (i) the short-term certificate of deposit or debt ratings of the
Servicer are at least "P-1" by Moody's, "F1" by Fitch (if rated by Fitch) and
"A-1" by Standard & Poor's or the Rating Agency Condition is satisfied as a
result of Collections being remitted on a monthly, rather than daily, basis
and (ii) the Servicer shall be Chase USA or Chase. Upon remittance by the
Servicer of Collections to the Collection Account pursuant to the preceding
sentence, the Paying Agent shall provide written notice to the Trustee no
later than 11 a.m., New York City time, on each Deposit Date setting forth the
amounts remitted by the Servicer on such date and, if the Paying Agent fails
to provide the Trustee with such written notice by 12 noon, New York City
time, on such Deposit Date, then the Trustee shall assume that no deposits
were made to the Collection Account pursuant to this Section 5.2 and shall
withdraw any amount required from the Reserve Account for deposit into the
Collection Account pursuant to Section 5.6. For purposes of this Section 5.2
the phrase "payments made on behalf of the Obligors" shall mean payments made
by Persons other than the Seller or the Servicer. Investment Earnings on
amounts on deposit in the Collection Account will be paid to the Servicer or
deposited into the Reserve Account in accordance, with Section 4.8.
(b) Notwithstanding anything in this Agreement to the contrary, if the
Servicer inadvertently deposits amounts that it mistakenly believes are
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Collections resulting in the payment in full of a Receivable into the
Collection Account and (i) the Servicer discovers its error prior to the
Distribution Date following such deposit, the Trustee, at the written
direction of the Servicer, shall withdraw such amounts and pay them to the
Servicer or (ii) if the Servicer discovers its error on or after the
Distribution Date following such deposit, the Servicer shall be deemed to have
purchased such Receivable pursuant to Section 4.7 as of the last day of the
Collection Period during which such error shall have occurred.
SECTION 5.3. Advances. (a) As of the Business Day preceding the related
Distribution Date, the Servicer shall make a payment with respect to each
Receivable (other than a Defaulted Receivable) equal to the excess, if any, of
(x) the product of the Principal Balance of such Receivable as of the related
Settlement Date and one-twelfth of the Contract Rate for such Receivable, over
(y) the interest actually received by the Servicer with respect to such
Receivable from the Obligor or from payments of the Repurchase Amount during
or with respect to such Collection Period; provided, however, that the
Servicer may elect not to make any Advance with respect to a Receivable to the
extent that the Servicer, in its sole discretion, shall determine that such
Advance is not recoverable from subsequent payments on such Receivable or from
funds in the Reserve Account. The Servicer shall deposit all such Advances
into the Collection Account in Automated Clearinghouse Corporation next-day
funds or immediately available funds no later than 11 a.m., New York City
time, on the Deposit Date. To the extent that the amount set forth in clause
(y) above with respect to a Receivable during or with respect to a Collection
Period is greater than the amount set forth in clause (x) above with respect
thereto, such amount shall be distributed to the Servicer on the related
Distribution Date pursuant to Section 5.5(a).
(b) On each Deposit Date, the Trustee shall demand a withdrawal from the
Reserve Account in an amount, not to exceed the Available Reserve Account
Amount for such Distribution Date, equal to the amount of all outstanding
Advances with respect to all Receivables that become Defaulted Receivables
during the immediately preceding Collection Period (to the extent not
recovered from Liquidation Proceeds) and shall deposit such amount into the
Collection Account, in Automated Clearinghouse Corporation next-day funds or
immediately available funds, no later than 11 a.m., New York City time, on
such Deposit Date. Such amounts shall be distributed to the Servicer on the
related Distribution Date pursuant to Section 5.5(a).
(c) On each Deposit Date, the Paying Agent shall provide written notice
to the Trustee setting forth the amount, if any, of Advances deposited by the
Servicer in the Collection Account no later than 11 a.m., New York City time,
on such Deposit Date and, if the Paying Agent fails to provide the Trustee
with such written notice by 12 noon, New York City time, on such Deposit Date,
then the Trustee shall assume that no Advances were deposited to the
Collection Account pursuant to this Section 5.3.
SECTION 5.4. Additional Deposits. The Servicer, or the Seller, as the
case may be, shall deposit into the Collection Account the aggregate
Repurchase Amount pursuant to Sections 3.2, 4.7 and 11.2, as applicable. All
remittances shall be made to the Collection Account, in Automated
Clearinghouse Corporation next-day funds or immediately available funds, no
later than 11 a.m., New York City time, on the Deposit Date.
32
SECTION 5.5. Distributions. Not later than 11:00 a.m., New York City
time, on each Distribution Date, at the Servicer's direction, the Trustee, or
the Paying Agent on behalf of the Trustee, shall cause to be made the
following distributions, to the extent of the Total Distribution Amount then
on deposit in the Collection Account and amounts withdrawn from the Reserve
Account and deposited in the Collection Account by wire transfer of
immediately available funds, in the following order of priority and in the
amounts set forth in the Servicer's Certificate for such Distribution Date:
(a) to the Servicer, by wire transfer of immediately available funds, in
reimbursement of Advances from Available Interest or from withdrawals from the
Reserve Account (including an amount equal to the accrued interest on
Defaulted Receivables and Repurchased Receivables to the extent available in
the Collection Account), the amount payable to the Servicer pursuant to
Section 5.3;
(b) to the extent of the sum of Available Interest (after reimbursement
of Advances pursuant to Section 5.5(a)) and any Available Reserve Account
Amount remaining after any withdrawal from the Reserve Account in respect of
Advances pursuant to Section 5.3(b) on the related Deposit Date (and, in the
case of shortfalls occurring under clause (ii) below in the Class A Interest
Distributable Amount, the Class B Percentage of Available Principal to the
extent of such shortfalls), in the following priority:
(i) to the Servicer, any unpaid Servicing Fee for the preceding
Collection Period, plus the amount of any Servicing Fee previously due
but not paid, if any, to the extent such amounts are not deducted from
the Servicer's remittance to the Collection Account pursuant to Section
5.7;
(ii) to the Class A Distribution Account, the Class A Interest
Distributable Amount for such Distribution Date; and
(iii) to the Class B Distribution Account, the Class B Interest
Distributable Amount for such Distribution Date.
(c) to the extent of the portion of Available Principal, Available
Interest (after reimbursement of Advances pursuant to Section 5.5(a)) and any
Available Reserve Account Amount (after any withdrawal pursuant to Section
5.3(b) on the related Deposit Date) remaining after the application of clause
(b) above, in the following priority:
(i) to the Class A Distribution Account, the Class A Principal
Distributable Amount for such Distribution Date;
(ii) to the Class B Distribution Account, the Class B Principal
Distributable Amount for such Distribution Date; and
(iii) to the Collateral Agent for deposit in the Reserve Account,
any remaining amounts.
(d) on each Distribution Date, the Trustee or the Paying Agent, as the
case may be, will distribute all amounts on deposit in the Class A
33
Distribution Account to the Class A Certificateholders as of the Record Date
and all amounts on deposit in the Class B Distribution Account to the Class B
Certificateholders as of the Record Date. Amounts distributed from the
Distribution Accounts shall be paid to the related Certificateholders of
record, as of the related Record Date, by check mailed by the Paying Agent
(or, if directed by the Seller in the case of the certificates registered in
the name of the Clearing Agency, by wire transfer of immediately available
funds). To the extent that the Paying Agent wires funds to a Clearing Agency
from the Collection Account, the Paying Agent will request the Seller, the
Qualified Institution or the Qualified Trust Institution then maintaining the
Collection Account to make such wire distribution and the Seller, the
Qualified Institution or the Qualified Trust Institution then maintaining the
Collection Account shall promptly deliver to the Paying Agent a confirmation
of such wire distribution. The Paying Agent shall have no liability in
connection with any failure by the Seller, the Qualified Institution or the
Qualified Trust Institution to make such distribution.
SECTION 5.6. Reserve Account; Assignment of Retained Yield to Collateral
Agent. (a) On or prior to the Closing Date, the Seller, the Reserve Account
Securities Intermediary and the Collateral Agent shall have entered into the
Reserve Account Control Agreement pursuant to which the Reserve Account shall
be established and maintained for the benefit of the Certificateholders. On
the Closing Date, the Seller shall deposit the Reserve Account Initial Deposit
into the Reserve Account. The Reserve Account shall not be property of the
Trust.
(b) The Seller hereby grants to the Collateral Agent for the benefit of
the Certificateholders all of its right, title and interest in and to the
Retained Yield and the Reserve Account and any and all property credited
thereto from time to time, including, but not limited to, Permitted
Investments, to secure the payment of all amounts due and owing to the
Certificateholders hereunder. By acceptance of their Certificates,
Certificateholders shall be deemed to have appointed
[______________________________], as Collateral Agent with respect to the
Reserve Account and the Retained Yield. [_________________________] hereby
accepts such appointment as Collateral Agent with respect to the Reserve
Account and the Retained Yield.
(c) If the depositary of the Reserve Account ceases to be either a
Qualified Institution or a Qualified Trust Institution, as applicable, the
Seller shall cause the Reserve Account to be moved to a Qualified Institution
or a Qualified Trust Institution and the Collateral Agent shall cause the
depositary maintaining the new Reserve Account to assume the obligations of
the existing Reserve Account Securities Intermediary under the Reserve Account
Control Agreement unless the Rating Agency Condition is satisfied in
connection with such depositary's ceasing to be a Qualified Institution or a
Qualified Trust Institution, as the case may be.
(d) All amounts held in the Reserve Account shall be invested in
accordance with the Reserve Account Control Agreement at the written direction
of the Seller in Permitted Investments that mature not later than the Deposit
Date next succeeding the date of investment except, if the Reserve Account
Securities Intermediary and the Trustee are the same Person, investments on
which the Trustee is the obligor (including repurchase agreements on which the
Trustee, in its commercial capacity, is liable as principal) may mature on the
next succeeding Distribution Date; provided, however, that amounts on deposit
in the Reserve Account may be invested in Permitted Investments that mature
later than the next succeeding Deposit Date, but in no event that mature later
34
than 90 days after the date of investment, if the Rating Agency Condition is
satisfied. Once amounts on deposit in the Reserve Account are invested in
Permitted Investments, such Permitted Investments must be held or maintained
until they mature on or before the dates described above.
(e) On each Distribution Date, the Collateral Agent shall withdraw from
the Reserve Account and pay to the Seller any Investment Earnings with respect
to amounts on deposit in the Reserve Account and, subject to Sections 8.4 and
10.7, an amount equal to the excess, if any, of the amount on deposit in the
Reserve Account over the Specified Reserve Account Balance with respect to
such Distribution Date (after giving effect to all deposits therein or
withdrawals therefrom on such Distribution Date). Upon any distribution to the
Seller of amounts from the Reserve Account, neither the Holders nor the
Collateral Agent will have any rights in, or claims, to, such amounts. Amounts
properly distributed to the Seller from the Reserve Account shall not be
available under any circumstances to the Trustee, the Collateral Agent, and
the Seller shall not in any event thereafter be required to refund any such
distributed amounts.
(f) On each Deposit Date, the Trustee shall demand a withdrawal from the
Reserve Account, in an amount not to exceed the Available Reserve Account
Amount (after withdrawals from the Reserve Account on the related Deposit Date
pursuant to Section 5.3(b)), equal to the sum of the excess, if any, of the
sum of (i) the Class A Interest Distributable Amount, Class A Principal
Distributable Amount, Class B Interest Distributable Amount and Class B
Principal Distributable Amount, in each case for the Distribution Date, and
the Servicing Fee payable to the Servicer on such Distribution Date, over (ii)
the sum of the Available Interest (after reimbursement of Advances pursuant to
Section 5.5(a)) and Available Principal, in each case for such Distribution
Date. The Trustee shall deposit the amount withdrawn from the Reserve Account
in the Collection Account for application pursuant to Section 5.5.
SECTION 5.7. Net Deposits. Chase USA (in its capacity as the Seller or
the Servicer) may make the remittances pursuant to Section 5.2 and Section 5.4
above, net of amounts to be retained by it or distributed to it (also in any
such capacity) pursuant to Section 4.8 (if applicable) and Section 5.5, if (a)
it shall be the Servicer and (b) it is entitled, pursuant to Section 5.2, to
make deposits on a monthly basis, rather than a daily basis. Nonetheless, the
Servicer shall account for all of the above described amounts as if such
amounts were deposited and distributed separately.
SECTION 5.8. Statements to Certificateholders. On each Distribution Date,
the Servicer shall prepare and furnish to the Trustee and the Paying Agent,
and the Paying Agent shall include with the distribution to each
Certificateholder a statement substantially in the form of Exhibit E, based on
information in the certificate furnished pursuant to Section 4.9, setting
forth for the Collection Period the following information (which in the case
of items (i), (ii) and (iii) shall be expressed in the aggregate and as a
dollar amount per $1,000 of the original principal balance of a Certificate);
(i) the amount of such distribution allocable to principal on the
Class A Certificates and the Class B Certificates;
35
(ii) the amount of such distribution allocable to interest on the
Class A Certificates and the Class B Certificates (specifying
specifically the amount of any Class B Stripped Coupon included therein);
(iii) the amount of the Servicing Fee paid to the Servicer pursuant
to Section 5.5(c);
(iv) the Class A Certificate Balance, the Class A Pool Factor, the
Class B Certificate Balance and the Class B Pool Factor as of such
Distribution Date, in each case after giving effect to payments allocated
to principal reported pursuant to clause (i);
(v) the Pool Balance as of the last day of the preceding Collection
Period;
(vi) the amount of the Aggregate Net Losses, if any, for such
Distribution Date.
(vii) the Class A Interest Carryover Shortfall, the Class B Interest
Carryover Shortfall, the Class A Principal Carryover Shortfall and the
Class B Principal Carryover Shortfall, if any, for such Distribution
Date;
(viii) the balance of the Reserve Account on such Distribution Date,
after giving effect to changes therein on such Distribution Date and the
amounts deposited into and withdrawn from the Reserve Account on such
Distribution Date;
(ix) the Specified Reserve Account Balance as of such Distribution
Date;
(x) the aggregate Repurchase Amount of Receivables repurchased by
the Seller or purchased by the Servicer during such Collection Period;
and
(xi) the aggregate unreimbursed Advances as of such Distribution
Date and the change in such amount from the previous Distribution Date
and the amount of Advances reimbursed on such Distribution Date from
collections and Liquidation Proceeds and from withdrawals from the
Reserve Account.
Within a reasonable period of time after the end of each calendar year,
but not later than the latest date permitted by law, the Servicer shall
prepare and furnish to the Trustee and the Paying Agent, and the Paying Agent
shall furnish, to each Person who at any time during such calendar year shall
have been a Certificateholder for the purposes of such Certificateholder's
preparation of federal income tax returns, a statement setting forth the sum
of the amounts determined in clauses (i) through (iii) for such calendar year.
ARTICLE VI
THE CERTIFICATES
SECTION 6.1. The Certificates. Unless otherwise specified in this
Agreement, the Certificates of each class shall be issued in denominations of
$1,000 and integral multiples thereof; provided, however, that one Class A
Certificate and one Class B Certificate may be issued in a denomination that
36
represents a residual portion of the Original Class A Certificate Balance and
the Original Class B Certificate Balance, respectively. Upon initial issuance
on the Closing Date, the Class A Certificates and the Class B Certificates
shall be in the form of Exhibit A-1 and Exhibit A-2, respectively, which are
incorporated by reference, and shall be issued as provided in Section 6.8 in
an aggregate amount equal to the Original Class A Certificate Balance and the
Original Class B Certificate Balance, respectively. The Certificates shall be
executed on behalf of the Trust by manual or facsimile signature of an
Authorized Officer or other authorized signatory of the Trustee. Certificates
bearing the manual or facsimile signatures of individuals who were, at the
time when such signatures shall have been affixed, authorized to sign on
behalf of the Trust, shall be valid and binding obligations of the Trust,
notwithstanding that such individuals shall have ceased to be so authorized
prior to the execution, authentication and delivery of such Certificates or
did not hold such offices or positions at the date of such Certificates. No
Certificate shall entitle the Holder to any benefit under this Agreement, or
shall be valid for any purpose, unless there shall appear on such Certificate
an authentication substantially in the form set forth in Exhibit A-1 or A-2
hereto as applicable, executed by the Trustee by manual or facsimile
signature; such authentication shall constitute conclusive evidence that such
Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication. A transferee of
a Certificate shall become a Certificateholder, and shall be entitled to the
rights and subject to the obligations of a Certificateholder hereunder, upon
due presentment of such Certificate in such transferee's name pursuant to
Section 6.5.
SECTION 6.2. Execution, Authentication and Delivery of Certificates. The
Trustee shall deliver to, or upon the order of, the Seller, in exchange for
the Receivables, the other assets of the Trust and the pledge of the Reserve
Account and amounts on deposit therein and the Retained Yield, simultaneously
with the sale, assignment and transfer to the Trustee of the Receivables, the
constructive delivery to the Trustee of the Receivable Files and the delivery
to the Trustee of the other components of the Trust, Certificates duly
executed by the Trustee, on behalf of the Trust, and authenticated by the
Trustee in authorized denominations equaling in the aggregate the Original
Pool Balance, and evidencing the entire ownership of the Trust.
SECTION 6.3. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at the office or agency to be
maintained by a transfer agent and certificate registrar (the "Transfer Agent
and Certificate Registrar"), in accordance with the provisions of Section 6.7,
a register (the "Certificate Register") in which, subject to such reasonable
regulations as it may prescribe, the Transfer Agent and Certificate Registrar
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. The corporate trust office of
Chase is hereby initially appointed Transfer Agent and Certificate Registrar
for the purpose of registering Certificates and transfers and exchanges of
Certificates as herein provided. In the event that, subsequent to the date of
issuance of the Certificates, Chase notifies the Trustee that it is unable to
act as Transfer Agent and Certificate Registrar, the Trustee shall act, or the
Trustee shall, with the consent of the Seller, appoint another bank or trust
company, having an office or agency located in The City of New York and which
agrees to act in accordance with the provisions of this Agreement applicable
to it, to act, as successor Transfer Agent and Certificate Registrar under
this Agreement.
(b) The Trustee may revoke such appointment and remove Chase as Transfer
Agent and Certificate Registrar if the Trustee determines in its sole
37
discretion that Chase failed to perform its obligations under this Agreement
in any material respect. Chase shall be permitted to resign as Transfer Agent
and Certificate Registrar upon 30 days' written notice to the Trustee, the
Seller and the Servicer; provided, however, that such resignation shall not be
effective and Chase shall continue to perform its duties as Transfer Agent and
Certificate Registrar until the Trustee has appointed a successor Transfer
Agent and Certificate Registrar with the consent of the Seller.
(c) Upon surrender for registration of transfer of any Certificate at the
office or agency of the Transfer Agent and Certificate Registrar maintained
pursuant to Section 6.7, the Trustee shall execute, authenticate and (if the
Transfer Agent and Certificate Registrar is different than the Trustee, then
the Transfer Agent and Certificate Registrar shall) deliver (or shall cause
Chase as its authenticating agent to authenticate and deliver), in the name of
the designated transferee or transferees, one or more new Class A Certificates
or Class B Certificates, as the case may be, in authorized denominations of a
like aggregate amount dated the date of authentication by the Trustee or any
authenticating agent. At the option of a Certificateholder, Certificates may
be exchanged for other Certificates of authorized denominations of a like
aggregate amount upon surrender of the Certificates to be exchanged at the
office or agency maintained pursuant to Section 6.7.
(d) Whenever any Certificate is surrendered for exchange, the Trustee
shall execute, authenticate and (if the Transfer Agent and Certificate
Registrar is different than the Trustee, then the Transfer Agent and
Certificate Registrar shall) deliver the Certificates which the
Certificateholder making the exchange is entitled to receive. Every
Certificate presented or surrendered for registration of transfer or exchange
shall be accompanied by a written instrument of transfer in form satisfactory
to the Trustee and the Transfer Agent and Certificate Registrar duly executed
by the Holder, which signature on such assignment must be guaranteed by a
member of the New York Stock Exchange or a commercial bank or trust company.
Each Certificate surrendered for registration of transfer or exchange
shall be cancelled by the Transfer Agent and Certificate Registrar and
disposed of by the Trustee or Transfer Agent and Certificate Registrar in
accordance with its customary practice.
(e) No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Transfer Agent and Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of
Certificates.
(f) An institution succeeding to the corporate agency business of the
Transfer Agent and Certificate Registrar shall continue to be the Transfer
Agent and Certificate Registrar without the execution or filing of any paper
or any further act on the part of the Trustee or such Transfer Agent and
Certificate Registrar.
SECTION 6.4. Mutilated, Destroyed, Lost, or Stolen Certificates. If (a)
any mutilated Class A Certificate or Class B Certificate shall be surrendered
to the Transfer Agent and Certificate Registrar, or if the Transfer Agent and
Certificate Registrar shall receive evidence to its satisfaction of the
destruction, loss, or theft of any Class A Certificate or Class B Certificate
and (b) there shall be delivered to the Trustee and the Transfer Agent and
Certificate Registrar such security or indemnity as may be required to save
38
each of them harmless then, in the absence of notice to the Trustee that such
Class A Certificate or Class B Certificate shall have been acquired by a
protected purchaser, the Trustee on behalf of the Trust shall execute,
authenticate and (if the Transfer Agent and Certificate Registrar is different
from the Trustee, the Transfer Agent and Certificate Registrar shall) deliver,
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Class A Certificate or Class B Certificate, a new Class A Certificate or Class
B Certificate, as the case may be, of like tenor and denomination but bearing
a number not contemporaneously outstanding. In connection with the issuance of
any new Certificate under this Section 6.4, the Trustee or the Transfer Agent
and Certificate Registrar, as the case may be, may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith. Any duplicate Certificate issued pursuant to
this Section 6.4 shall constitute conclusive evidence of ownership in the
Trust, as if originally issued, whether or not a lost, stolen, or destroyed
Certificate shall be found at any time.
SECTION 6.5. Persons Deemed Owners. Prior to due presentation of a
Certificate for registration of transfer, the Trustee, the Paying Agent, the
Transfer Agent and Certificate Registrar or any agent of any of them may treat
the Person in whose name any Certificate shall be registered as the owner of
such Certificate for the purpose of receiving distributions pursuant to
Section 5.5(d) and for all other purposes whatsoever, and none of the Trustee,
the Paying Agent, the Transfer Agent and Certificate Registrar or any agent of
any of them shall be bound by any notice to the contrary.
SECTION 6.6. Access to List of Certificateholders' Names and Addresses.
The Transfer Agent and Certificate Registrar shall furnish or cause to be
furnished to the Servicer or the Paying Agent (or to the Trustee if the
Trustee is not the Transfer Agent and Certificate Registrar), within 15 days
after receipt by the Transfer Agent and Certificate Registrar of a request
therefor from the Servicer, the Trustee or the Paying Agent in writing, in
such form as the Servicer, the Trustee or the Paying Agent may reasonably
require, a list of the names and addresses of the Certificateholders as of the
most recent Record Date. If, at such time, if any, as Definitive Certificates
have been issued, three or more Certificateholders, or one or more Holders of
Certificates aggregating not less than 25% of the sum of the Class A
Certificate Balance and the Class B Certificate Balance as a single class
apply in writing to the Transfer Agent and Certificate Registrar (or the
Trustee if the Trustee is acting as the Transfer Agent and Certificate
Registrar), and such application states that the applicants desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and such application is accompanied
by a copy of the communication that such applicants propose to transmit, then
the Transfer Agent and Certificate Registrar shall, within five (5) Business
Days after the receipt of such application, afford such applicants access
during normal business hours to the current list of Certificateholders. Each
Certificateholder, by receiving and holding a Certificate, shall be deemed to
have agreed to hold neither the Servicer, the Trustee, the Transfer Agent and
Certificate Registrar nor any of their respective agents accountable by reason
of the disclosure of its name and address, regardless of the source from which
such information was derived.
SECTION 6.7. Maintenance of Office or Agency. The Transfer Agent and
Certificate Registrar shall maintain in The City of New York an office or
offices or agency or agencies where Certificates may be surrendered for
39
registration of transfer or exchange. The Transfer Agent and Certificate
Registrar initially designates its corporate trust office located at ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ as its office for such purposes.
The Transfer Agent and Certificate Registrar shall give prompt written notice
to the Trustee, the Servicer and to Certificateholders of any change in the
location of such office or agency.
SECTION 6.8. Book-Entry Certificates. Upon original issuance, the Class A
Certificates and the Class B Certificates, other than the Class A Certificate
representing the residual amount of the Original Class A Certificate Balance,
shall be issued in the form of typewritten Certificates representing the
Book-Entry Certificates, to be delivered to The Depository Trust Company, the
initial Clearing Agency, by or on behalf of the Seller. The Certificates shall
initially be registered on the Certificate Register in the name of Cede & Co.,
the nominee of the initial Clearing Agency, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's
interest in the Class A Certificates or the Class B Certificates, as the case
may be, except as provided in Section 6.10. Unless and until definitive, fully
registered Certificates ("Definitive Certificates") have been issued to Class
A Certificateholders or Class B Certificateholders pursuant to Section 6.10:
(i) the provisions of this Section 6.8 shall be in full force and
effect;
(ii) the Seller, the Servicer, the Paying Agent, the Transfer Agent
and Certificate Registrar and the Trustee may deal with the Clearing
Agency, and the Clearing Agency Participants for all purposes of this
Agreement (including the making of distributions on the Certificates and
the taking of actions by the Certificateholders) as the authorized
representatives of the Certificate Owners;
(iii) to the extent that the provisions of this Section 6.8 conflict
with any other provisions of this Agreement, the provisions of this
Section 6.8 shall control;
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency (or to the extent Certificate Owners are not
Clearing Agency Participants through the Clearing Agency Participants
through which such Certificate Owners own Book-Entry Certificates), and
shall be limited to those established by law and agreements between such
Certificate Owners and the Clearing Agency and/or the Clearing Agency
Participants and all references in this Agreement to actions by
Certificateholders shall refer to actions taken by the Clearing Agency
upon instructions from the Clearing Agency Participants, and all
references in this Agreement to distributions, notices, reports and
statements to Certificateholders shall refer to distributions, notices,
reports and statements to the Clearing Agency, as registered holder of
the Certificates, as the case may be, for distribution to Certificate
Owners in accordance with the procedures of the Clearing Agency; and
(v) pursuant to the Depository Agreement, and unless Definitive
Certificates are issued pursuant to Section 6.10, the initial Clearing
Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit distributions of principal and
interest on the Certificates to the Clearing Agency Participants, for
distribution by such Clearing Agency Participants to the Certificate
Owners or their nominees.
40
SECTION 6.9. Notices to Clearing Agency. Whenever notice or other
communication to the Certificateholders is required under this Agreement,
unless and until Definitive Certificates shall have been issued to Certificate
Owners pursuant to Section 6.10, the Trustee and the Paying Agent shall give
all such notices and communications specified herein to be given by it to
Certificateholders to the Clearing Agency.
SECTION 6.10. Definitive Certificates. If (i) the Servicer advises the
Trustee in writing that the Clearing Agency is no longer willing or able to
properly discharge its responsibilities under the Depository Agreement, and
the Servicer is unable to locate a qualified successor, (ii) the Servicer, at
its option, elects to terminate the book-entry system through the Clearing
Agency or (iii) after the occurrence of an Event of Servicing Termination,
Class A Certificate Owners representing in the aggregate not less than a
majority of the Class A Certificate Balance or Class B Certificate Owners
representing in the aggregate not less than a majority of the Class B
Certificate Balance, as the case may be, advise the Trustee and the Clearing
Agency through the Clearing Agency Participants in writing, that the
continuation of a book-entry system through the Clearing Agency is no longer
in the related Certificate Owners' best interests, the Trustee shall notify
the Clearing Agency of the occurrence of any event described above, which
shall be responsible to notify the Certificate Owners with respect to Class A
Certificates or Class B Certificates or both, as the case may be, of the
occurrence of any such event and of the availability of Definitive
Certificates to Certificate Owners with respect to Class A Certificates or
Class B Certificates or both, as the case may be, requesting the same. Upon
surrender to the Transfer Agent and Certificate Registrar by the Clearing
Agency of the Class A Certificates or the Class B Certificates or both, as the
case may be, registered in the name of such Clearing Agency, or its nominee,
accompanied by re-registration instructions from the Clearing Agency for
registration of the Definitive Certificates, the Trustee shall execute,
authenticate and (if the Transfer Agent and Certificate Registrar is different
than the Trustee, then the Transfer Agent and Certificate Registrar shall)
deliver Definitive Certificates in accordance with the instructions of the
Clearing Agency. The Servicer shall arrange for, and will bear all costs of,
the printing and issuance of such Definitive Certificates. None of the Seller,
the Servicer, the Transfer Agent and Certificate Registrar or the Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying upon such instruction.
Upon the issuance of Definitive Certificates, all references herein to
obligations imposed upon or to be performed by the Clearing Agency shall be
deemed to be imposed upon and performed by the Transfer Agent and Certificate
Registrar, to the extent applicable with respect to such Definitive
Certificates and the Trustee, the Paying Agent and the Transfer Agent and
Certificate Registrar shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.
SECTION 6.11. Appointment of Paying Agent.
(a) The Paying Agent shall have the revocable power to withdraw funds
from the Accounts and make distributions to the Certificateholders, the
Servicer and the Collateral Agent pursuant to Section 5.5. The Trustee may
revoke such power and remove the Paying Agent, if the Trustee determines in
its sole discretion that the Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect or for other good
cause. The Paying Agent shall initially be the corporate trust office of
Chase. Chase shall be permitted to resign as Paying Agent upon 30 days'
written notice to the Servicer and the Trustee. In the event that Chase shall
41
no longer be the Paying Agent, the Trustee shall appoint a successor to act as
Paying Agent (which shall be a bank or trust company and may be the Trustee)
with the consent of the Seller, which consent shall not be unreasonably
withheld. If at any time the Trustee shall be acting as the Paying Agent, the
provisions of Sections 10.1, 10.3 and 10.4 shall apply to the Trustee in its
role as Paying Agent.
(b) The Trustee shall cause the Paying Agent (other than itself and
Chase) to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee that such Paying Agent will hold all
sums, if any, held by it for payment to the Certificateholders in trust for
the benefit of the Certificateholders entitled thereto until such sums shall
be paid to such Certificateholders and shall agree, and if the Trustee is the
Paying Agent it hereby agrees, that it shall comply with all requirements of
the Code regarding the withholding by the Trustee of payments in respect of
federal income taxes due from Certificate Owners.
(c) Chase in its capacity as initial Paying Agent hereunder agrees that
it (i) will hold all sums held by it hereunder for payment to the
Certificateholders in trust for the benefit of the Certificateholders entitled
thereto until such sums shall be paid to such Certificateholders and (ii)
shall comply with all requirements of the Code regarding the withholding by
the Trustee of payments in respect of federal income taxes due from
Certificate Owners.
(d) An institution succeeding to the corporate agency business of the
Paying Agent shall continue to be the Paying Agent without the execution or
filing of any paper or any further act on the part of the Trustee or such
Paying Agent.
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SECTION 6.12. Authenticating Agent.
(a) The Trustee may appoint one or more authenticating agents with
respect to the Certificates which shall be authorized to act on behalf of the
Trustee in authenticating the Certificates in connection with the issuance,
delivery, registration of transfer, exchange or repayment of the Certificates.
The Trustee hereby appoints the corporate trust office of Chase as
Authenticating Agent for the authentication of Certificates upon any
registration of transfer or exchange of such Certificates. Whenever reference
is made in this Agreement to the authentication of Certificates by the Trustee
or the Trustee's certificate of authentication, such reference shall be deemed
to include authentication on behalf of the Trustee by an authenticating agent
and a certificate of authentication executed on behalf of the Trustee by an
authenticating agent. Each authenticating agent (other than Chase) shall be
acceptable to the Seller.
(b) Any institution succeeding to the corporate agency business of an
authenticating agent shall continue to be an authenticating agent without the
execution or filing of any paper or any further act on the part of the Trustee
or such authenticating agent.
(c) An authenticating agent may at any time resign by giving written
notice of resignation to the Trustee and the Seller. The Trustee may at any
time terminate the agency of an authenticating agent by giving notice of
termination to such authenticating agent and to the Seller. Upon receiving
such a notice of resignation or upon such a termination, or in case at any
time an authenticating agent shall cease to be acceptable to the Trustee or
the Seller, the Trustee promptly may appoint a successor authenticating agent
with the consent of the Seller. Any successor authenticating agent upon
acceptance of its appointment hereunder shall become vested with all the
rights, powers and duties of its predecessor hereunder, with like effect as if
originally named as an authenticating agent. No successor authenticating agent
shall be appointed unless acceptable to the Seller.
(d) The Servicer shall pay the Authenticating Agent from time to time
reasonable compensation for its services under this Section 6.12.
(e) The provisions of Sections 10.1, 10.3 and 10.4 shall be applicable to
any authenticating agent.
(f) Pursuant to an appointment made under this Section 6.12, the
Certificates may have endorsed thereon, in lieu of the Trustee's certificate
of authentication, an alternate certificate of authentication in substantially
the following form:
43
This is one of the certificates referred to in the within mentioned
Agreement.
_________________________,
as Trustee
By:_____________________________
Authorized Officer
or
________________________________________
as Authenticating Agent for the Trustee,
________________________________________
Authorized Officer
SECTION 6.13. Actions of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or
by an agent duly appointed in writing; and except as herein otherwise
expressly provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, when required, to the Seller or
the Servicer. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this
Agreement and conclusive in favor of the Trustee, the Seller and the Servicer,
if made in the manner provided in this Section 6.13.
(b) The fact and date of the execution by any Certificateholder of any
such instrument or writing may be proved in any reasonable manner which the
Trustee deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Certificateholder shall bind every Holder of every
Certificate issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done, or omitted to be
done, by the Trustee, the Seller or the Servicer in reliance thereon, whether
or not notation of such action is made upon such Certificate.
(d) The Trustee may require such additional proof of any matter referred
to in this Section 6.13 as it shall deem necessary.
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ARTICLE VII
THE SELLER
SECTION 7.1. Representations of Seller. The Seller makes the following
representations on which the Trustee shall rely in accepting the Receivables
in trust and authenticating the Certificates. The representations shall speak
as of the execution and delivery of this Agreement, and shall survive the sale
of the Receivables to the Trustee.
(i) Organization and Good Standing. The Seller has been duly
organized and is validly existing as a national banking association in
good standing under the laws of the United States of America, with power
and authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted,
and had at all relevant times, and has, power, authority, and legal right
to acquire and own the Receivables.
(ii) Power and Authority. The Seller has the power and authority to
execute and deliver this Agreement and to carry out its terms, the Seller
has full power and authority to sell and assign the property to be sold
and assigned to the Trustee as part of the Trust and has duly authorized
such sale and assignment to this Trustee by all necessary corporate
action; and the execution, delivery, and performance of this Agreement
has been duly authorized by the Seller by all necessary corporate action.
(iii) Valid Sale; Binding Obligations. This Agreement effects a
valid sale, transfer, and assignment of the Receivables, enforceable
against creditors of and purchasers from the Seller; and constitutes a
legal, valid, and binding obligation of the Seller enforceable in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, or other similar laws affecting
the enforcement of creditors' rights in general and by general principles
of equity, regardless of whether such enforceability is considered in a
proceeding in equity or at law.
(iv) No Violation. The consummation of the transactions contemplated
by this Agreement and the fulfillment of the terms hereof do not conflict
with, result in any breach of any of the terms and provisions of, nor
constitute (with or without notice or lapse of time) a default under, the
articles of association or bylaws of the Seller, or conflict with or
breach any of the material terms or provisions of, or constitute (with or
without notice or lapse of time) a default under, any indenture,
agreement, or other instrument to which the Seller is a party or by which
it is bound; nor result in the creation or imposition of any Lien upon
any of its properties pursuant to the terms of any such indenture,
agreement, or other instrument; nor violate any law or, to the best of
the Seller's knowledge, any order, rule, or regulation applicable to the
Seller of any court or of any federal or state regulatory body,
administrative agency, or other governmental instrumentality having
jurisdiction over the Seller or its properties.
(v) No Proceedings. There are no proceedings or investigations
pending, or, to the Seller's best knowledge, threatened, before any
court, regulatory body, administrative agency, or other governmental
instrumentality having jurisdiction over the Seller or its properties:
(a) asserting the invalidity of this Agreement or the Certificates, (b)
seeking to prevent the issuance of the Certificates or the consummation
of any of the transactions contemplated by this Agreement, (c) seeking
45
any determination or ruling that might materially and adversely affect
the performance by the Seller of its obligations under, or the validity
or enforceability of, this Agreement or the Certificates, or (d) relating
to the Seller and which might adversely affect the federal income tax
attributes of the Certificates.
SECTION 7.2. Liability of Seller; Indemnities. The Seller shall be liable
in accordance herewith only to the extent of the obligations specifically
undertaken by the Seller in such capacity under this Agreement and shall have
no other obligations or liabilities hereunder.
The Seller shall indemnify, defend and hold harmless the Trustee and the
Trust from and against any taxes that may at any time be asserted against the
Trust with respect to, and as of the date of, the sale of the Receivables to
the Trust or the issuance and original sale of the Certificates, including any
sales, gross receipts, general corporation, tangible or intangible personal
property, privilege, or license taxes (but not including any taxes asserted
with respect to ownership of the Receivables or federal or other income taxes,
including franchise taxes measured by net income), arising out of the
transactions contemplated by this Agreement, and costs and expenses in
defending against the same.
The Seller shall indemnify, defend, and hold harmless the Trustee or the
Trust from and against any loss, liability or expense incurred by reason of
(i) the Seller's wilful misfeasance, bad faith, or gross negligence in the
performance of its duties hereunder, or by reason of reckless disregard of the
obligations and duties hereunder and (ii) the Seller's violation of federal or
state securities laws in connection with the registration of the sale of the
Certificates.
Indemnification under this Section 7.2 shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Seller shall have made
any indemnity payments to the Trust pursuant to this Section 7.2 and the Trust
thereafter shall collect any of such amounts from others, the Trust shall
repay such amounts to the Seller, without interest.
SECTION 7.3. Merger or Consolidation of Seller. Any corporation or other
entity (i) into which the Seller may be merged or consolidated, (ii) which may
result from any merger, conversion, or consolidation to which the Seller shall
be a party, or (iii) which may succeed to all or substantially all of the
business of the Seller, which corporation or other entity shall be bound to
perform every obligation of the Seller under this Agreement, shall be the
successor to the Seller hereunder without the execution or filing of any
document or any further act by any of the parties to this Agreement. The
Seller shall give prompt written notice of any merger or consolidation to the
Trustee, the Servicer, the Collateral Agent and the Rating Agencies.
SECTION 7.4. Limitation on Liability of Seller and Others. The Seller and
any director, officer, employee or agent of the Seller may rely in good faith
on the advice of counsel or on any document of any kind, prima facie properly
executed and submitted by any Person respecting any matters arising hereunder.
The Seller shall not be under any obligation under this Agreement to appear
in, prosecute, or defend any legal action that shall be unrelated to its
obligations under this Agreement, and that in its opinion may involve it in
any expense or liability.
46
SECTION 7.5. Seller May Own Certificates. The Seller and any of its
Affiliates may in its individual or any other capacity become the owner or
pledgee of Certificates with the same rights as it would have if it were not
the Seller or an Affiliate thereof, except as otherwise provided in the
definition of "Class A Certificateholder" and "Class, B Certificateholder"
specified in Section 1.1. Certificates so owned by or pledged to the Seller or
any Affiliates shall have an equal and proportionate benefit under the
provisions of this Agreement, without preference, priority, or distinction as
among all of the Certificates.
ARTICLE VIII
THE SERVICER
SECTION 8.1. Representations of Servicer. The Servicer makes the
following representations on which the Trustee shall rely in accepting the
Receivables in trust and authenticating the Certificates. The representations
shall speak as of the execution and delivery of this Agreement (or as of a
date a Person (other than the Trustee) becomes a Servicer pursuant to Section
8.3 or 9.2), and shall survive the sale of the Receivables to the Trustee.
(i) Organization and Good Standing. The Servicer has been duly
organized and is validly existing as a national banking association or
corporation and is in good standing under the laws of the United States
of America or the jurisdiction of its incorporation, with power and
authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted,
and had at all relevant times, and has, power, authority, and legal right
to acquire, own, sell, and service the Receivables and to hold the
Receivable Files as custodian on behalf of the Trustee.
(ii) Power and Authority. The Servicer has the power and authority
to execute and deliver this Agreement and to carry out its terms; and the
execution, delivery, and performance of this Agreement has been duly
authorized by the Servicer by all necessary corporate action.
(iii) Binding Obligations. This Agreement constitutes a legal,
valid, and binding obligation of the Servicer enforceable in accordance
with its terms subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization, liquidation or other similar laws and
equitable principles relating to or affecting the enforcement of
creditors, rights, whether considered in a proceeding at law or in
equity.
(iv) No Violation. The consummation of the transactions contemplated
by this Agreement and the fulfillment of the terms hereof do not conflict
with, result in any breach of any of the terms and provisions of, nor
constitute (with or without notice or lapse of time) a default under, the
articles of association or bylaws of the Servicer, or conflict with or
breach any of the material terms or provisions of, or constitute (with or
without notice or lapse of time) a default under, any indenture,
agreement, or other instrument to which the Servicer is a party or by
which it is bound; nor result in the creation or imposition of any lien
upon any of its properties pursuant to the terms of any such indenture,
agreement, or other instrument; nor violate any law or, to the best of
the Servicer's knowledge, any order, rule, or regulation applicable to
the Servicer of any court or of any federal or state regulatory body,
administrative agency, or other governmental instrumentality having
47
jurisdiction over the Servicer or its properties.
(v) No Proceedings. There are no proceedings or investigations
pending, or to the Servicer's best knowledge, threatened, before any
court, regulatory body, administrative agency, or other governmental
instrumentality having jurisdiction over the Servicer or its properties:
(a) asserting the invalidity of this Agreement or the Certificates, (b)
seeking to prevent the issuance of the Certificates or the consummation
of any of the transactions contemplated by this Agreement, (c) seeking
any determination or ruling that might materially and adversely affect
the performance by the Servicer of its obligations under, or the validity
or enforceability of, this Agreement or the Certificates, or (d) relating
to the Servicer and which might adversely affect the federal income tax
attributes of the Certificates.
(vi) Fidelity Bond. The Servicer maintains a fidelity bond in such
form and amount as is customary for banks acting as custodian of funds
and documents in respect of retail automotive installment sales
contracts.
SECTION 8.2. Liability of Servicer; Indemnities. The Servicer shall be
liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Servicer under this Agreement and shall have no
other obligations or liabilities hereunder.
(i) The Servicer shall defend, indemnify, and hold harmless the
Trustee, the Trust and the Certificateholders from and against any and
all costs, expenses, losses, damages, claims, and liabilities, arising
out of or resulting from the use, ownership, or operation by the Servicer
or any Affiliate thereof of a Financed Vehicle.
(ii) The Servicer shall indemnify, defend, and hold harmless the
Trustee and the Trust from and against any taxes that may at any time be
asserted against the Trust with respect to the transactions contemplated
in this Agreement, including, without limitation, any sales, gross
receipts, general corporation, tangible or intangible personal property,
privilege, or license taxes (but not including any taxes asserted with
respect to, and as of the date of, the sale of the Receivables to the
Trust or the issuance and original sale of the Certificates, or asserted
with respect to ownership of the Receivables or federal or other income
taxes, including franchise taxes measured by net income) arising out of
distributions on the Certificates and costs and expenses in defending
against the same.
(iii) The Servicer shall indemnify, defend, and hold harmless the
Trustee and the Trust and the Certificateholders from and against any and
all costs, expenses, losses, claims, damages, and liabilities to the
extent that such cost, expense, loss, claim, damage, or liability arose
out of, or was imposed upon the Trustee and the Trust or the
Certificateholders through the wilful misfeasance, gross negligence, or
bad faith of the Servicer in the performance of its duties under this
Agreement or by reason of reckless disregard of its obligations and
duties under this Agreement.
Indemnification under this Section 8.2 shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Servicer shall have
made any indemnity payments pursuant to this Section 8.2 and the recipient
thereafter collects any of such amounts from others, the recipient shall
48
promptly repay such amounts to the Servicer, without interest. The
indemnification obligations of the Servicer set forth in this Section 8.2
shall survive the termination of such Servicer with respect to any act or
failure to act which occurs prior to such Servicer's termination.
SECTION 8.3. Merger or Consolidation of Servicer. Any corporation or
other entity (i) into which the Servicer may be merged or-consolidated, (ii)
which may result from any merger, conversion, or consolidation to which the
Servicer shall be a party, or (iii) which may succeed to all or substantially
all of the business of the Servicer, which corporation or other entity shall
be bound to perform every obligation of the Servicer hereunder, shall be the
successor to the Servicer under this Agreement without the execution or filing
of any document or any further act on the part of any of the parties to this
Agreement. The Servicer shall promptly inform the Trustee, the Seller, the
Collateral Agent and the Rating Agencies in writing of any such merger or
consolidation.
SECTION 8.4. Limitation on Liability of Servicer and Others.
(a) Neither the Servicer nor any of the directors, officers, or employees
or agents of the Servicer shall be under any liability to the Trust, the
Trustee, or the Certificateholders, except as provided under this Agreement,
for any action taken or for refraining from the taking of any action pursuant
to this Agreement; provided, however, that this provision shall not protect
the Servicer or any such person against any liability that would otherwise be
imposed by reason of wilful misfeasance, gross negligence, or bad faith in the
performance of duties or by reason of reckless disregard of obligations and
duties under this Agreement. The Servicer and any director, officer, or
employee or agent of the Servicer may rely in good faith on the advice of
counsel or on any document of any kind prima facie properly executed and
submitted by any Person respecting any matters arising under this Agreement.
(b) The Servicer, and any director, officer, employee or agent of the
Servicer, shall be indemnified by the Trust and held harmless against any
loss, liability, or expense (including reasonable attorneys, fees and
expenses) incurred in connection with any legal action relating to the
performance of the Servicer's duties under this Agreement, other than (i) any
loss or liability otherwise reimbursable pursuant to this Agreement; (ii) any
loss, liability, or expense incurred solely by reason of the Servicer's wilful
misfeasance, negligence, or bad faith in the performance of its duties
hereunder or by reason of reckless disregard of its obligations and duties
under this Agreement; and (iii) any loss, liability, or expense for which the
Trust is to be indemnified by the Servicer under this Agreement. Any amounts
due the Servicer pursuant to this Section 8.4 shall be payable on a
Distribution Date from amounts distributable to the Seller from the Reserve
Account pursuant to Section 5.6(e) (other than Investment Earnings) after all
payments required to be made on such date to the Certificateholders and the
Servicer, and amounts, if any, distributable therefrom to the Trustee pursuant
to Section 10.7, have been paid and any amounts required to be retained on
deposit in the Reserve Account pursuant to Section 5.6(e) to maintain the
amount on deposit therein (exclusive of Investment Earnings) in an amount
equal to the Specified Reserve Account Balance on such date shall have been
made.
(c) Except as provided in this Agreement, the Servicer shall not be under
any obligation to appear in, prosecute, or defend any legal action that shall
not be incidental to its obligations under this Agreement, and that in its
opinion may involve it in any expense or liability; provided, however, that
the Servicer may undertake any reasonable action that it may deem necessary or
49
desirable in respect of this Agreement and the rights and duties of the
parties to this Agreement and the interests of the Certificateholders under
this Agreement. In such event, the legal expenses and costs of such action and
any liability resulting therefrom shall be expenses, costs, and liabilities of
the Trust, and the Servicer shall be entitled to be reimbursed therefor. Any
amounts due the Servicer pursuant to this Section 8.4 shall be payable on a
Distribution Date from amounts distributable to the Seller from the Reserve
Account pursuant to Section 5.6(e) (other than Investment Earnings) after all
payments required to be made on such date to the Certificateholders and the
Servicer, and amounts, if any, distributable therefrom to the Trustee pursuant
to Section 10.7, have been paid and any amounts required to be retained on
deposit in the Reserve Account pursuant to Section 5.6(e) to maintain the
amount on deposit therein (exclusive of Investment Earnings) in an amount
equal to the Specified Reserve Account Balance on such date shall have been
made.
The Person to be indemnified shall provide the Trustee with a certificate
and accompanying Opinion of Counsel requesting indemnification and setting
forth the basis for such request.
SECTION 8.5. Servicer Not To Resign. Except as permitted by Section 8.3,
the Servicer shall not resign from its obligations and duties under this
Agreement except (i) upon determination that the performance of its duties
shall no longer be permissible under applicable law or (ii) in the event of
the appointment of a successor Servicer, upon satisfaction of the Rating
Agency Condition. Notice of any such determination permitting the resignation
of Chase USA shall be communicated to the Trustee and the Rating Agencies at
the earliest practicable time (and, if such communication is not in writing,
shall be confirmed in writing at the earliest practicable time) and any such
determination permitting the resignation of the Servicer shall be evidenced by
an Opinion of Counsel to such effect delivered to the Trustee concurrently
with such notice. No such resignation shall become effective until the Trustee
(which shall not be obligated to act as successor Servicer if the Servicer has
resigned for a reason other than that the performance of its duties are no
longer permissible under applicable law) or a successor Servicer shall have
assumed the responsibilities and obligations of the Servicer hereunder in
accordance with Section 9.2.
SECTION 8.6. Delegation of Duties. So long as Chase USA (or any successor
thereto in accordance with Section 8.3) or the Trustee acts as Servicer, the
Servicer shall have the right, in the ordinary course of its business, to
delegate any of its duties under this Agreement to any Person. Any
compensation payable to such Person shall be paid by the Servicer from its own
funds and none of the Trust, the Trustee (if not the Servicer), the Collateral
Agent or the Certificateholders shall have any liability to such Person with
respect thereto. Notwithstanding any delegation of duties by the Servicer
pursuant to this Section 8.6, the Servicer shall not be relieved of its
liability and responsibility with respect to such duties, and any such
delegation shall not constitute a resignation within the meaning of Section
8.5 hereof. Any agreement that may be entered into by the Servicer and a
Person that provides for any delegation of the Servicer's duties hereunder
shall be deemed to be between the Servicer and such Person alone, and the
Trustee and Certificateholders shall not be deemed parties thereto and shall
have no claims, rights, obligations, duties or liabilities with respect
thereto.
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ARTICLE IX
DEFAULT
SECTION 9.1. Events of Servicing Termination. Any one of the following
events which shall occur and be continuing shall constitute an event of
servicing termination hereunder (each, an "Event of Servicing Termination"):
(i) Any failure by the Servicer to deliver to the Trustee the
Servicer's Certificate for the related Collection Period, or any failure
by the Servicer to deliver to the Trustee, for distribution to
Certificateholders, any proceeds or payment required to be so delivered
under the terms of the Certificates and this Agreement (or, in the case
of a payment or deposit to be made not later than the Deposit Date, the
failure to make such payment or deposit on such Deposit Date), which
failure continues unremedied for a period of five Business Days after (A)
discovery by an officer of the Servicer or (B) written notice (1) to the
Servicer by the Trustee or (2) to the Trustee and the Servicer by the
Holders of Certificates evidencing not less than 25% of the sum of the
Class A Certificate Balance and the Class B Certificate Balance voting as
a single class;
(ii) Failure on the part of the Servicer, duly to observe or to
perform in any material respect any other covenants or agreements of the
Servicer set forth in the Certificates or in this Agreement, which
failure shall (a) materially and adversely affect the rights of the Trust
or the Certificateholders (which determination shall be made without
regard to the Available Reserve Account Amount) and (b) continues
unremedied for a period of 60 days after the date on which written notice
of such failure, requiring the same to be remedied, shall have been given
(1) to the Servicer by the Trustee or (2) to the Trustee and the Servicer
by the Holders of Certificates evidencing not less than 25% of the sum of
the Class A Certificate and the Class B Certificate Balance voting as a
single class;
(iii) The entry of a decree or order by a court or agency or
supervisory authority having jurisdiction in the premises for the
appointment of a conservator, receiver, or liquidator for the Servicer in
any insolvency, readjustment of debt, marshalling of assets and
liabilities, or similar proceedings, or for the winding up or liquidation
of its affairs, and the continuance of any such decree or order unstayed
and in effect for a period of 60 consecutive days; or
(iv) The consent by the Servicer to the appointment of a conservator
or receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities, or similar proceedings of or
relating to the Servicer or of or relating to substantially all of its
property; or 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 or reorganization statute, make an assignment
for the benefit of its creditors, or voluntarily suspend payment of its
obligations.
Upon the occurrence of an Event of Servicing Termination described above, and
in each and every case and for so long as such Event of Servicing Termination
shall not have been remedied, either the Trustee, or the Holders of
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Certificates evidencing not less than a majority of the sum of the Class A
Certificate Balance and the Class B Certificate Balance voting as a single
class, by notice given in writing to the Servicer (and to the Trustee if given
by the Certificateholders) may terminate all of the rights and obligations of
the Servicer under this Agreement. On or after the receipt by the Servicer of
such written notice, all authority and power of the Servicer under this
Agreement, whether with respect to the Certificates or the Receivables or
otherwise, shall pass to and be vested in the Trustee pursuant to this Section
9.1; and, without limitation, the Trustee shall be hereby authorized and
empowered to execute and deliver, on behalf of the predecessor Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments,
and to do or accomplish all other acts or things necessary or appropriate to
effect the purposes of such notice of termination, whether to complete the
transfer and endorsement of the Receivable Files, or otherwise. The
predecessor Servicer shall cooperate with the successor Servicer and the
Trustee in effecting the termination of the responsibilities and rights of the
predecessor Servicer under this Agreement, including the transfer to the
successor Servicer for administration by it of all cash amounts that shall at
the time be held by the predecessor Servicer for deposit, shall have been
deposited by the Servicer in the Collection Account, or shall thereafter be
received with respect to a Receivable. All reasonable costs and expenses
(including attorneys' fees and disbursements) incurred in connection with
transferring the Receivable Files to the successor Servicer and amending this
Agreement to reflect such succession as Servicer pursuant to this Section 9.1
shall be paid by the predecessor Servicer upon presentation of reasonable
documentation of such costs and expenses. The Trustee shall give written
notice of any termination of the Servicer to the Certificateholders and the
Rating Agencies.
SECTION 9.2. Trustee to Act; Appointment of Successor Servicer. Upon the
Servicer's receipt of notice of termination pursuant to Section 9.1 or
resignation pursuant to Section 8.5, the Trustee shall be the successor in all
respects to the Servicer in its capacity as Servicer under this Agreement, and
shall be subject to all the responsibilities, duties and liabilities arising
thereafter relating thereto placed on the Servicer by the terms and provisions
of this Agreement. As compensation therefor, the Trustee shall be entitled to
such compensation (whether payable out of the Collection Account or otherwise)
as the Servicer would have been entitled to under this Agreement if no such
notice of termination or resignation had been given. Notwithstanding the
above, the Trustee may, if it shall be unwilling so to act, or shall, if it
shall be legally unable so to act, appoint, or petition a court of competent
jurisdiction to appoint, any established financial institution (x) having a
net worth of not less than $100,000,000 as of the last day of the most recent
fiscal quarter for such institution and (y) whose regular business shall
include the servicing of automobile receivables, as successor Servicer under
this Agreement; provided, that the appointment of any such successor Servicer
is required to satisfy the Rating Agency Condition. In connection with such
appointment, the Trustee may make such arrangements for the compensation of
such successor Servicer out of payments on Receivables as it and such
successor Servicer shall agree; provided, however, that no such compensation
shall be in excess of that permitted the Servicer under this Agreement. The
Trustee and such successor Servicer shall take such action, consistent with
this Agreement, as shall be necessary to effectuate any such succession.
Unless the Trustee shall be prohibited by law from so acting, the Trustee
shall not be relieved of its duties as successor Servicer under this Section
9.2 until the newly appointed successor Servicer shall have assumed the
responsibilities and obligations of the Servicer under this Agreement.
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SECTION 9.3. Notification to Certificateholders. Upon delivery of written
notice by the Trustee to the Servicer or receipt by the Trustee of written
notice of an Event of Servicing Termination from Holders of Class A
Certificates and Class B Certificates evidencing not less than 25% of the sum
of the Class A Certificate Balance and the Class B Certificate Balance voting
as a single class or upon any Servicer termination, or appointment of a
successor Servicer pursuant to this Article IX, the Trustee shall give prompt
written notice thereof to Certificateholders at their respective addresses of
record, to the Seller and to the Rating Agencies.
SECTION 9.4. Waiver of Past Defaults. The Holders of Certificates
evidencing not less than a majority of the sum of the Class A Certificate
Balance and the Class B Certificate Balance voting as a single class, may, on
behalf of all Holders of Certificates, waive any default by the Servicer in
the performance of its obligations hereunder and its consequences, except a
default in the failure to make any required deposits to or payments from the
Collection Account in accordance with this Agreement. Upon any such waiver of
a past default, such default shall cease to exist, and any Event of Servicing
Termination 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. The Servicer shall give prompt written notice of any
waiver to the Rating Agencies.
ARTICLE X
THE TRUSTEE
SECTION 10.1. Duties of Trustee. The Trustee, both prior to and after the
occurrence of an Event of Servicing Termination, shall undertake to perform
such duties and only such duties as are specifically set forth in this
Agreement. If an Event of Servicing Termination known to the Trustee shall
have occurred and shall not have been cured, the Trustee shall exercise such
of the rights and powers vested in it by this Agreement, and shall use the
same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs;
provided, however, that if the Trustee shall assume the duties of the Servicer
pursuant to Sections 8.5 and 9.2, the Trustee in performing such duties shall
use the degree of skill and attention customarily exercised by a servicer with
respect to automobile receivables that it services for itself.
The Trustee, upon receipt of any resolutions, certificates, statements,
opinions, reports, documents, orders, or other instruments furnished to the
Trustee that shall be specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement; provided, however, that the
Trustee shall not be responsible for the accuracy or content of any such
resolution, certificate, statement, opinion, report, document, order or other
instrument furnished by the Servicer to the Trustee pursuant to this
Agreement.
No provision of this Agreement shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act,
or its own bad faith or wilful misfeasance; provided, however, that:
53
(i) Prior to the occurrence of an Event of Servicing Termination,
and after the curing of all such Events of Servicing Termination that may
have occurred, the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Agreement, the
Trustee shall not be liable except for the performance of such duties and
obligations as shall be specifically set forth in this Agreement, no
implied covenants or obligations shall be read into this Agreement
against the Trustee, the permissible right of the Trustee to do things
enumerated in this Agreement shall not be construed as a duty and, in the
absence of bad faith on the part of the Trustee, or manifest error, the
Trustee may conclusively rely upon any certificates or opinions furnished
to the Trustee and conforming to the requirements of this Agreement as to
the truth of the statements made and the correctness of the opinions
expressed therein;
(ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by an Authorized Officer of the Trustee,
unless it shall be proved that the Trustee shall have been negligent in
ascertaining the pertinent facts; and
(iii) The Trustee shall not be personally liable with respect to any
action taken, suffered, or omitted to be taken in good faith in
accordance with this Agreement or at the direction of the Holders of
Certificates evidencing not less than 25% of the sum of the Class A
Certificate Balance and the Class B Certificate Balance voting as a
single class, relating to the time, method, and place of conducting any
proceeding or any remedy available to the Trustee, or exercising any
trust or power conferred upon the Trustee, under this Agreement.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there shall
be reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability shall not be reasonably
assured to it, and none of the provisions contained in this Agreement shall in
any event require the Trustee to perform, or be responsible for the manner of
performance of, any of the obligations of the Servicer (including its
obligations as custodian) under this Agreement except during such time, if
any, as the Trustee shall be the successor to, and be vested with the rights,
duties, powers and privileges of, the Servicer in accordance with the terms of
this Agreement.
The Trustee shall not be charged with knowledge of an Event of Servicing
Termination until such time as an Authorized Officer shall have actual
knowledge or have received written notice thereof.
Except for actions expressly authorized by this Agreement or, based upon
an Opinion of Counsel, in the best interests of Certificateholders, the
Trustee shall take no action reasonably likely to impair the security
interests created or existing under any Receivable or to impair the value of
any Receivable.
All information obtained by the Trustee regarding the Obligors and the
Receivables, whether upon the exercise of its rights under this Agreement or
otherwise, shall be maintained by the Trustee in confidence and shall not be
disclosed to any other Person, other than its counsel, unless such disclosure
is pursuant to the terms of this Agreement or required by any applicable law
or regulation.
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In the event that the Paying Agent or the Transfer Agent and Certificate
Registrar shall fail to perform any obligation, duty or agreement in the
manner or on the day required to be performed by the Paying Agent or the
Transfer Agent and Certificate Registrar, as the case may be, under this
Agreement, the Trustee shall be obligated promptly upon an Authorized Officer
obtaining knowledge thereof to perform such obligation, duty or agreement in
the manner so required to the extent the information necessary to such
performance is reasonably available to the Trustee after the Trustee has made
a reasonable effort to obtain such information. The Trustee shall not be
liable for the acts or omissions of any Paying Agent, any Authenticating Agent
or the Transfer Agent and Certificate Registrar appointed hereunder with due
care by the Trustee hereunder.
SECTION 10.2. Trustee's Assignment of Repurchased Receivables and
Trustee's Certificate. With respect to all Receivables repurchased by the
Seller pursuant to Section 3.2 or purchased by the Servicer pursuant to
Section 4.7 or 11.2, the Trustee shall (i) assign, without recourse,
representation, or warranty, to the Seller or the Servicer, as the case may
be, all the Trust's right, title, and interest in and to such Receivable and
the other property conveyed to the Trust pursuant to Section 2.1 with respect
to such Receivable, and all security and documents relating thereto, such
assignment being an assignment outright and not for security and (ii) as soon
as practicable after each date as of which a Receivable shall be assigned to
the Seller or the Servicer, as the case may be, execute a Trustee's
Certificate, including the date of execution of such Trustee's Certificate and
the date of the related Agreement, and accompanied by a copy of the Servicer's
Certificate specified for the related Collection Period. If, in any
enforcement suit or legal proceeding, it shall be held that the Servicer may
not enforce a Receivable on the ground that it shall not be a real party in
interest or a holder entitled to enforce the Receivable, the Trustee shall, at
the Servicer's expense, take such steps as the Trustee or the Servicer deems
necessary to enforce the Receivable, including bringing suit in the Trustee's
name or the names of the Trust or the Certificateholders.
SECTION 10.3. Certain Matters Affecting the Trustee. Except as otherwise
provided in Section 10.1:
(i) The Trustee may request, and may rely and shall be protected in
acting or refraining from acting upon any resolution, certificate of
auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, appraisal, bond, or other paper
or document (including the annual auditor's report and the letter of
independent certified public accountants described in Section 4.11, the
Servicer's Certificate described in Section 4.9, and the annual
compliance statement described in Section 4.10) believed by it to be
genuine and to have been signed or presented by the proper party or
parties.
(ii) The Trustee may consult with counsel and any written advice or
Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it
under this Agreement in good faith and in accordance with such written
advice or Opinion of Counsel. A copy of such written advice or Opinion of
Counsel shall be provided to the Seller, the Servicer and the Rating
Agencies.
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(iii) The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement, or to institute,
conduct or defend any litigation under this Agreement or in relation to
this Agreement, at the request, order or direction of any of the
Certificateholders pursuant to the provisions of this Agreement, unless
such Certificateholders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses, and liabilities that
may be incurred therein or thereby; provided, however, that the Trustee
shall have the right to decline to follow any such request, order or
direction if the Trustee, in accordance with an Opinion of Counsel,
determines that the action or proceeding may not lawfully be taken or if
the Trustee in good faith determines that the action or proceeding so
directed would involve it in personal liability or be unjustly
prejudicial to the non-assenting Certificateholders; provided, further,
that nothing contained in this Agreement shall relieve the Trustee of the
obligations, upon the occurrence of an Event of Servicing Termination
(that shall not have been cured), to exercise such of the rights and
powers vested in it by this Agreement, and to use the same degree of care
and skill in their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
(iv) The Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by this Agreement.
(v) The Trustee may execute any of the trusts or powers hereunder or
perform any duties under this Agreement either directly or by or through
agents or attorneys or a custodian, which agents or attorneys shall have
any or all of the rights, powers, duties and obligations of the Trustee
conferred on them by such appointment.
SECTION 10.4. Trustee Not Liable for Certificates or Receivables. The
recitals contained in this Agreement and in the Certificates shall be taken as
the statements of the Seller or the Servicer, as the case may be, and the
Trustee assumes no responsibility for the correctness thereof. The Trustee
shall make no representations as to the validity or sufficiency of this
Agreement or of the Certificates (other than execution by the Trustee on
behalf of the Trust of, or the authentication on, the Certificates), or of any
Receivable or related document. The Trustee shall have no obligation to
perform any of the duties of the Seller or Servicer unless explicitly set
forth in this Agreement. The Trustee shall at no time have any responsibility
or liability for or with respect to the legality, validity, and enforceability
of any security interest in any Financed Vehicle or any Receivable, or the
perfection and priority of such a security interest or the maintenance of any
such perfection and priority; the filing of any financing or continuation
statement in any public office; the preparation or filing of-any report or
statement with the Securities and Exchange Commission; the efficacy of the
Trust or its ability to generate the payments to be distributed to
Certificateholders under this Agreement; the existence, condition, location,
and ownership of any Financed Vehicle; the existence and enforceability of any
theft and physical damage insurance or credit life or credit disability
insurance; the existence and contents of any Receivable or any computer or
other record thereof; the validity of the assignment of any Receivable to the
Trust or of any intervening assignment; the completeness of any Receivable;
any claim or default asserted against a Receivable; the performance or
enforcement of any Receivable; the compliance by the Seller with any warranty
or representation made under this Agreement or in any related document and the
56
accuracy of any such warranty or representation (except after the Trustee's
receipt of notice or other discovery of any noncompliance therewith or any
breach thereof or as otherwise provided herein); the satisfaction of any
conditions relating to the Receivables; any investment of monies by the
Servicer or any loss resulting therefrom (it being understood that the Trustee
shall remain responsible for any Trust property that it may hold); the acts or
omissions of the Seller, the Servicer (including in its capacity as custodian
hereunder), or any obligor; an action of the Servicer taken in the name of the
Trustee; or any action by the Trustee taken at the instruction of the
Servicer; provided, however, that the foregoing shall not relieve the Trustee
of its obligation to perform its duties under this Agreement. Except with
respect to a claim based on the failure of the Trustee to perform its duties
under this Agreement or based on the Trustee's wilful misconduct, negligence,
or bad faith, or based on the Trustee's breach of a representation and
warranty specified in Section 10.13, no recourse shall be had for any claim or
defense based on any provision of this Agreement, the Certificates, or any
Receivable or assignment thereof against the Trustee in its individual
capacity. The Trustee shall not have any personal obligation, liability, or
duty whatsoever to any Certificateholder or any other Person with respect to
any such claim or defense, and any such claim or defense shall be asserted
solely against the Trust or any indemnitor who shall furnish indemnity as
provided in this Agreement. The Trustee shall not be accountable for the use
or application by the Seller of any of the Certificates or of the proceeds of
such Certificates, or for the use or application of any funds paid to the
Servicer in respect of the Receivables.
SECTION 10.5. Trustee May Own Certificates. The Trustee in its individual
or any other capacity may become the owner or pledgee of Certificates and may
deal with the Seller and the Servicer in banking transactions with the same
rights as it would have if it were not Trustee.
SECTION 10.6. Trustee's Fees and Expenses. The Servicer shall covenant
and agree to pay to the Trustee, and the Trustee shall be entitled to,
reasonable compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) for all services
rendered by it in the execution of the trusts created by this Agreement and in
the exercise and performance of any of the powers and duties under this
Agreement of the Trustee, and the Servicer shall pay or reimburse the Trustee
upon its request for all reasonable expenses, disbursements, and advances
(including the reasonable compensation and the expenses and disbursements of
its counsel and of all persons not regularly in its employ) incurred or made
by the Trustee under this Agreement (including expenses, disbursements, and
advances incurred in defense of any action brought against it in connection
with this Agreement) except any such expense, disbursement, or advance as may
arise from its negligence, wilful misfeasance, or bad faith or that is the
responsibility of Certificateholders under this Agreement. The Servicer's
obligation to pay such compensation and expenses shall survive the termination
of such Servicer to the extent that such obligation is a result of services
rendered prior to such Servicer's termination. Additionally, the Servicer,
pursuant to Section 10.7, shall indemnify the Trustee with respect to certain
matters, and Certificateholders, pursuant to Section 12.3, shall upon the
circumstances therein set forth, indemnify the Trustee under certain
circumstances. The provisions of this Section 10.6 shall survive the
termination of this Agreement and the resignation or removal of the Trustee.
57
SECTION 10.7. Indemnity of Trustee. The Trustee and it agents and
employees shall be indemnified by the Servicer and held harmless against any
loss, liability, or expense (including reasonable attorneys, fees and expenses
and expenses of litigation) arising out of or incurred in connection with the
acceptance or performance of the trusts and duties contained in this Agreement
to the extent that (i) such loss, liability, or expense shall not have been
incurred by reason of the Trustee's wilful misfeasance, bad faith, or
negligence, and (ii) such loss, liability, or expense shall not have been
incurred by reason of the Trustee's breach of its representations and
warranties pursuant to Section 10.13; provided, however, that the obligations
of the Servicer in this Section 10.7 shall survive such Servicer's termination
with respect to the performance of such Servicer prior to such Servicer's
termination; provided, further, that if the Servicer fails to indemnify the
Trustee and its agents and employees pursuant to this Section 10.7, then such
indemnity shall be provided from amounts distributable to the Seller from the
Reserve Account pursuant to Section 5.6(e) (other than Investment Earnings)
after all payments required to be made on such date to the Servicer and the
Certificateholders shall have been made and any amounts required to be
retained therein to maintain the amount on deposit in the Reserve Account
(exclusive of Investment Earnings) in an amount equal to the Specified Reserve
Account Balance on such date shall have been retained. The provisions of this
Section 10.7 shall survive the termination of this Agreement and the
resignation or removal of the Trustee.
SECTION 10.8. Eligibility Requirements for Trustee. The Trustee under
this Agreement shall at all times be a state banking corporation or national
banking association organized and doing business under the laws of such state
or the United States of America; authorized under such laws to exercise
corporate trust powers; and having a combined capital and surplus of at least
$100,000,000 as of the last day of the most recent fiscal quarter for such
institution and subject to supervision or examination by federal or state
authorities. If such corporation or national banking association shall publish
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purpose of
this Section 10.8, the combined capital and surplus of such corporation shall
be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. The long-term unsecured debt of the
Trustee shall at all times be rated not lower than "BBB-" by Standard & Poor's
and Fitch (if rated by Fitch) and "Baa3" by ▇▇▇▇▇'▇ or such other ratings as
are acceptable to the Rating Agencies. In case at any time the Trustee shall
cease to be eligible in accordance with the provisions of this Section 10.8,
the Trustee shall resign immediately in the manner and with the effect
specified in Section 10.9.
SECTION 10.9. Resignation or Removal of Trustee. The Trustee may at any
time resign and be discharged from the trusts hereby created by giving written
notice thereof to the Servicer. Upon receiving such notice of resignation, the
Servicer shall promptly appoint a successor Trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor Trustee. If no successor Trustee shall
have been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
The Servicer shall provide notice to the Rating Agencies of any resignation of
the Trustee.
If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 10.8 and shall fail to resign after written request
58
therefor by the Servicer, or if at any time the Trustee shall be legally
unable to act, or shall be adjudged a bankrupt or insolvent, or a receiver of
the Trustee or of its property shall be appointed, or any public officer shall
take charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation, or liquidation, then the Servicer may
remove the Trustee. If it shall remove the Trustee under the authority of the
immediately preceding sentence, the Servicer shall promptly appoint a
successor Trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor Trustee.
Any resignation or removal of the Trustee and appointment of a successor
Trustee pursuant to any of the provisions of this Section 10.9 shall not
become effective until acceptance of appointment by the successor Trustee
pursuant to Section 10.10.
SECTION 10.10. Successor Trustee. Any successor Trustee appointed
pursuant to Section 10.9 shall execute, acknowledge, and deliver to the
Servicer and to its predecessor Trustee an instrument accepting such
appointment under this Agreement, and thereupon the resignation or removal of
the predecessor Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become fully vested with
all the rights, powers, duties, and obligations of its predecessor under this
Agreement, with like effect as if originally named as Trustee. The predecessor
Trustee shall deliver to the successor Trustee all documents and statements
held by it under this Agreement and the Servicer and the predecessor Trustee
shall execute and deliver such instruments and do such other things as may
reasonably be required for fully and certainly vesting and confirming in the
successor Trustee all such rights, powers, duties, and obligations.
No successor Trustee shall accept appointment as provided in this Section
10.10 unless at the time of such acceptance such successor Trustee shall be
eligible pursuant to Section 10.8.
Upon acceptance of appointment by a successor Trustee pursuant to this
Section 10.10, the Servicer shall mail notice of the successor of such Trustee
under this Agreement to all Certificateholders at their respective addresses
of record, to the Rating Agencies. If the Servicer shall fail to mail such
notice within 10 days after acceptance of appointment by successor Trustee,
the successor Trustee shall cause such notice to be mailed at the expense of
the Servicer.
SECTION 10.11. Merger or Consolidation of Trustee. Any corporation or
other entity (i) into which the Trustee may be, merged or consolidated, (ii)
which may result from any merger, conversion, or consolidation to which the
Trustee shall be a party, or (iii) which may succeed to all or substantially
all of the corporate trust business of the Trustee, which corporation or other
entity executes an agreement of assumption to perform every obligation of the
Trustee under this Agreement, shall be the successor of the Trustee hereunder,
provided such corporation or other entity shall be eligible pursuant to
Section 10.8, without the execution or filing of any instrument or any further
act on the part of any of the parties hereto. The Trustee shall provide prompt
written notice of any merger or consolidation to the Seller, the Servicer, the
Collateral Agent and the Rating Agencies.
SECTION 10.12. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any
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part of the Trust or any Financed Vehicle may at the time be located, the
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee, jointly with the Trustee, or separate trustee or
separate trustees, of all or any part of the Trust, and to vest in such
Person, in such capacity and for the benefit of the Certificateholders, such
title to the Trust, or any part thereof, and, subject to the other provisions
of this Section 10.12, such powers, duties, obligations, rights, and trusts as
the Servicer and the Trustee may consider necessary or desirable. The Servicer
will pay all reasonable fees and expenses of any co-trustee or separate
trustee or separate trustees. The appointment of any separate trustee or
co-trustee shall not absolve the Trustee of its obligations under this
Agreement. If the Servicer shall not have joined in such appointment within 15
days after the receipt by it of a request so to do, or in the case an Event of
Servicing Termination shall have occurred and be continuing, the Trustee alone
shall have the power to make such appointment. No co-trustee or separate
trustee or separate trustees under this Agreement shall be required to meet
the terms of eligibility as a successor trustee pursuant to Section 10.8, and
no notice to Certificateholders of the appointment of any co-trustee or
separate trustee or separate trustees shall be required pursuant to Section
10.10.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) All rights, powers, duties, and obligations conferred or imposed
upon the Trustee shall be conferred upon and exercised or performed by
the Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to
act separately without the Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular act
or acts are to be performed (whether as Trustee under this Agreement or
as successor to the Servicer under this Agreement), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties, and obligations (including the holding of
title to the Trust or any portion thereof in any such jurisdiction) shall
be exercised and performed singly by such separate trustee or co-trustee,
but solely at the direction of the Trustee.
(ii) No trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement.
(iii) The Servicer and the Trustee acting jointly may at any time
accept the resignation of or remove any separate trustee or co-trustee,
except that, following the occurrence of an Event of Servicing
Termination which has not been cured, the Trustee acting alone may accept
the resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be deemed
to have been given to each of the then separate trustees and co-trustees, as
effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the
conditions of this Article X. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or
properties specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
60
protection to, the Trustee. Each such instrument shall be filed with the
Trustee and a copy thereof given to the Servicer.
Any separate trustee or co-trustee may at any time appoint the Trustee,
its agent or attorney-in-fact with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement
on its behalf and in its name. If any separate trustee or co-trustee shall
die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor Trustee.
SECTION 10.13. Representations and Warranties of Trustee. The Trustee
makes the following representations and warranties on which the Seller, the
Servicer and the Certificateholders may rely:
(i) Organization and Good Standing. The Trustee is a banking
association duly organized, validly existing, and in good standing under
the laws of the United States of America.
(ii) Power and Authority. The Trustee has full power, authority and
legal right to execute, deliver, and perform this Agreement, and has
taken all necessary action to authorize the execution, delivery, and
performance by it of this Agreement.
(iii) No Violation. The execution, delivery and performance by the
Trustee of this Agreement (a) does not violate any provision of any law
governing the trust powers of the Trustee or, to the best of the
Trustee's knowledge, any order, writ, judgment, or decree of any court,
arbitrator, or governmental authority applicable to the Trustee or any of
its assets, (b) does not violate any provision of the articles of
association or bylaws of the Trustee and (c) does not conflict with,
result in any breach of any of the terms or provisions of, or constitute
(with or without notice or lapse of time) a default under, any indenture,
agreement or other instrument to which the Trustee is a party or by which
it is bound to the extent such conflict, breach or default would impair
the Trustee's obligation or ability to perform under this Agreement.
(iv) No Governmental Authorization Required. The execution, delivery
and performance by the Trustee of this Agreement does not require the
authorization, consent, or approval of, the giving of notice to, the
filing or registration with, or the taking of any other action in respect
of, any governmental authority or agency regulating the corporate trust
activities of the Trustee.
(v) Due Authorization, Execution and Delivery. This Agreement has
been duly authorized, executed and delivered by the Trustee and shall
constitute the legal, valid, and binding agreement of the Trustee,
enforceable in accordance with its terms.
SECTION 10.14. Tax Returns. The Servicer shall prepare or shall cause to
be prepared any tax returns required to be filed by the Trust and furnish to
Certificateholders any information required by the Code or the regulations
thereunder and shall remit such returns to the Trustee for signature at least
five days before such returns are due to be filed. The Trustee, upon request,
will furnish the Servicer with all such information known to the Trustee as
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may be reasonably required in connection with the preparation of all tax
returns of the Trust, and shall, upon request, execute such returns.
SECTION 10.15. Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name or in its capacity as Trustee. Any recovery
of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Certificateholders in respect
of which such judgment has been recovered.
SECTION 10.16. Suits for Enforcement. In case an Event of Servicing
Termination or other default by the Servicer or the Seller hereunder shall
occur and be continuing, the Trustee, in its discretion, may proceed to
protect and enforce its rights and the rights of the Certificateholders under
this Agreement by a suit, action or proceeding in equity or at law or
otherwise whether for the specific performance of any covenant or agreement
contained in this Agreement or in aid of the execution of any power granted in
this Agreement or the enforcement of any other legal, equitable or other
remedy, as the Trustee, being advised by counsel, shall deem most effectual to
protect and enforce any of the rights of the Trustee or the
Certificateholders.
SECTION 10.17. Maintenance of Office or Agency. The Trustee shall
maintain at its expense in The City of New York an office or offices or agency
or agencies where notices and demands to or upon the Trustee in respect of the
Certificates and this Agreement may be served. The Trustee initially
designates ________________________ as its office for such purposes. The
Trustee will give prompt written notice to the Servicer, the Paying Agent, the
Transfer Agent and Certificate Registrar and to Certificateholders of any
change in the location of such office or agency.
SECTION 10.18. [_______________________], as Collateral Agent.
Notwithstanding anything in this Agreement to the contrary, references in this
Article X to the Trustee shall also refer to
[___________________________________], in its capacity as Collateral Agent
hereunder.
ARTICLE XI
TERMINATION
SECTION 11.1. Termination of the Trust. The Trust, and the respective
obligations and responsibilities of the Seller, the Servicer and the Trustee
shall terminate with respect to the Certificateholders upon the first to occur
of (i) the Distribution Date next succeeding the Collection Period which is
six months after the maturity or other liquidation of the last Receivable and
the disposition of any amounts received upon liquidation of any property
remaining in the Trust and (ii) the payment to Certificateholders of all
amounts required to be paid to them pursuant to this Agreement; provided,
however, that in no event shall the Trust created by this Agreement continue
beyond the expiration of 21 years from the death of the last survivor of the
descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late ambassador to the Court of St.
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James's, living on the date of this Agreement. The Servicer shall promptly
(but in any event not later than the first day of the month of the specified
Distribution Date) notify the Trustee, the Paying Agent, the Transfer Agent
and Certificate Registrar and the Rating Agencies in writing of any
prospective termination pursuant to this Section 11.1.
Notice of any termination, specifying the Distribution Date upon which
the Certificateholders may surrender their Certificates to the Transfer Agent
and Certificate Registrar for payment of the final distribution and
cancellation, shall be given promptly by the Trustee by letter to
Certificateholders mailed not earlier than the 15th day and not later than the
25th day of the Collection Period related to the specified Distribution Date
stating that the Record Date otherwise applicable to such Distribution Date is
not applicable, payments being made only upon presentation and surrender of
the Certificates at the office of the Transfer Agent and Certificate Registrar
therein specified. The Trustee shall give such notice to the Transfer Agent
and Certificate Registrar, the Paying Agent and the Rating Agencies at the
time such notice is given to Certificateholders. Upon presentation and
surrender of the Certificates, the Paying Agent shall cause to be distributed
to Certificateholders amounts distributable on such Distribution Date pursuant
to Section 5.5. Upon notification by the Seller, any funds in the Collection
Account after the payment of all amounts owing to the Certificateholders shall
be paid to the Seller.
In the event that all of the Certificateholders shall not surrender their
Certificates for cancellation within six months after the date specified in
the above-mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders upon receipt of the appropriate
records from the Transfer Agent and Certificate Registrar to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within one year after the second notice all the Certificates shall
not have been surrendered for cancellation, the Trustee may take appropriate
steps, or may appoint an agent to take appropriate steps, to contact the
remaining Certificateholders concerning surrender of their Certificates, and
the cost thereof shall be paid out of the funds and other assets that shall
remain subject to this Agreement. Any funds remaining in the Trust after
exhaustion of such remedies shall be distributed by the Trustee or the Trustee
shall cause to be distributed to the United Way or a similar charitable
organization located or operating in the New York metropolitan area, as
specified by the Servicer; provided, however, that such funds shall be
distributed by the Trustee or the Trustee shall cause to be distributed no
later than three years after the final Distribution Date specified in the
notice referred to in the preceding paragraph.
All Certificates surrendered for payment of the final distribution with
respect to such Certificates and cancellation shall be cancelled by the
Transfer Agent and Certificate Registrar and shall be disposed of in a manner
satisfactory to the Trustee and the Seller.
SECTION 11.2. Optional Purchase of All Receivables. As of the last day of
any Collection Period on which the Pool Balance shall be equal to or less than
the Optional Purchase Percentage, the Servicer shall have the option to
purchase the corpus of the Trust. To exercise such option, the Servicer shall
notify the Trustee, the Paying Agent, the Transfer Agent and Certificate
Registrar in writing, no later than the 25th day of such Collection Period,
shall pay the aggregate Repurchase Amount for the Receivables (including
Defaulted Receivables) as of such last day and shall succeed to all interests
in, to and under the Trust property. The payment shall be made in the manner
specified in Section 5.4, and shall be distributed pursuant to Section 5.5.
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The Trustee shall not permit the purchase of the corpus of the Trust pursuant
to this Section unless (i) the Servicer's long-term unsecured debt is rated at
the time of such purchase at least "BBB-" by Standard & Poor's and Fitch (if
rated by Fitch) and "Baa3" by Moody's or (ii) the Servicer provides to the
Trustee an Opinion of Counsel in form reasonably satisfactory to the Trustee
and in form and substance satisfactory to the Rating Agencies to the effect
that such purchase will not constitute a fraudulent transfer under applicable
state and federal law.
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.1. Amendment. This Agreement may be amended by the Seller, the
Servicer, the Trustee and the Collateral Agent, with prior notice to the
Rating Agencies but without prior notice to or the consent of any of the
Certificateholders, (i) to cure any ambiguity, to correct or supplement any
provisions in this Agreement or the Certificates which may be inconsistent
with any other provisions herein or therein, to evidence a succession to the
Servicer or the Seller pursuant to this Agreement or to add any other
provisions with respect to matters or questions arising under this Agreement
that shall not be inconsistent with the provisions of this Agreement;
provided, however, that such action shall not (i) significantly change the
purposes and powers of the Issuer or (ii) as evidenced by an Officer's
Certificate and/or an Opinion of Counsel reasonably acceptable and delivered
to the Trustee, adversely and materially affect the interests of the Trust or
any of the Certificateholders and provided, further, that the Servicer shall
deliver written notice of such changes to each Rating Agency prior to the
execution of any such amendment, or (ii) to effect a transfer or assignment in
compliance with Section 12.7(a). Notwithstanding the foregoing, no amendment
modifying the provisions of Section 5.5 or Article VI shall become effective
without satisfaction of the Rating Agency Condition.
This Agreement may also be amended from time to time by the Seller, the
Servicer, the Trustee and the Collateral Agent, with the consent of the
Holders of Certificates evidencing not less than a majority of the sum of the
Class A Certificate Balance and the Class B Certificate Balance voting as a
single class, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement, or of modifying
in any manner the rights of the Certificateholders (including effecting a
transfer or assignment in compliance with Section 12.7(a) of this Agreement);
provided, however, that no such amendment, except with the consent of the
Holders of all Certificates then outstanding, shall (a) increase or reduce in
any manner the amount of, or accelerate or delay the timing of, collections of
payments of Receivables, or distributions that shall be required to be made on
any Certificate, (b) reduce the aforesaid percentage of the sum of the Class A
Certificate Balance and the Class B Certificate Balance, the Holders of which
are required to consent to any such amendment or (c) materially and adversely
affect the interests of either the Class A Certificateholders or the Class B
Certificateholders without the consent of the Holders of Class A Certificates
or Class B Certificates, as the case may be, evidencing not less than a
majority of the Class A Certificate Balance or the Class B Certificate
Balance, as the case may be.
Promptly after the execution of any amendment or consent referred to in
this Section 12.1, the Trustee shall furnish a copy of such amendment or
consent to each Certificateholder and to the Rating Agencies.
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It shall not be necessary for the consent of Certificateholders pursuant
to this Section 12.1 to approve the particular form of any proposed amendment
or consent, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject
to such reasonable requirements as the Trustee may prescribe.
Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel stating that
the execution of such amendment is authorized or permitted by this Agreement.
The Trustee shall not be obligated to enter into any such amendment which
affects the Trustee's own rights, duties or immunities under this Agreement.
Prior to the execution of any amendment to this Agreement, other than an
amendment permitted pursuant to clause (i) of the first paragraph of this
Section 12.1, such amendment is required to satisfy the Rating Agency
Condition.
SECTION 12.2. Protection of Title to Trust.
(a) The Seller shall execute and file such financing statements and cause
to be executed and filed such continuation statements, all in such manner and
in such places as may be required by law fully to preserve, maintain, and
protect the interests of the Trustee and the Collateral Agent under this
Agreement in the Receivables and in the proceeds thereof. The Seller shall
deliver (or cause to be delivered) to the Trustee or the Collateral Agent, as
applicable, file-stamped copies of, or filing receipts for, any document filed
as provided above, as soon as available following such filing.
(b) Neither the Seller nor the Servicer shall change its name, identity,
or corporate structure in any manner that would, could, or might make any
financing statement or continuation statement filed by the Seller on behalf of
the Trustee or the Collateral Agent in accordance with paragraph (a) above
seriously misleading within the meaning of ss. 9-402(7) (or any comparable
section) of the Relevant UCC, unless it shall have given the Trustee or the
Collateral Agent, as applicable, at least 30 days prior written notice
thereof.
(c) The Seller and the Servicer shall give the Trustee and the Collateral
Agent at least 60 days prior written notice of any relocation of its principal
executive office if, as a result of such relocation, the applicable provisions
of the Relevant UCC would require the filing of any amendment of any
previously filed financing or continuation statement or of any new financing
statement. The Servicer shall at all times maintain each office from which it
shall service Receivables, and its principal executive office, within the
United States of America.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit (i) the reader
thereof to know at any time the status of such Receivable, including payments
and recoveries made and payments owing (and the nature of each) and (ii)
reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Collection
Account in respect of such Receivable.
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(e) The Servicer shall maintain its computer systems so that, from and
after the time of sale under this Agreement of the Receivables to the Trustee,
the Servicer's master computer records (including archives) that shall refer
to a Receivable indicate clearly, by numerical code or otherwise, that such
Receivable is owned by the Trust. Indication of the Trust's ownership of a
Receivable shall be deleted from or modified on the Servicer's computer
systems when, and only when, the Receivable shall have been paid in full,
repurchased or assigned pursuant hereto.
(f) If at any time the Seller or the Servicer shall propose to sell,
grant a security interest in, or otherwise transfer any interest in a new or
used automobile to any prospective purchaser, creditor, or other transferee,
the Seller or the Servicer, as the case may be, shall give to such prospective
purchaser, creditor, or other transferee computer tapes, records, or
print-outs (including any restored from archives) that, if they shall refer in
any manner whatsoever to any Receivable, shall indicate clearly that such
Receivable has been sold and is owned by the Trust.
(g) The Servicer shall permit the Trustee and its agents upon reasonable
notice at any time during normal business hours which does not unreasonably
interfere with the Servicer's normal operations or customer or employee
relations to inspect, audit, and make copies of and abstracts from the
Servicer's records regarding the Receivables.
(h) Upon request, the Servicer shall furnish to the Trustee, within five
Business Days, a list of all Receivables by contract number and name of
Obligor then held as part of the Trust, together with a reconciliation of such
list to the Schedule of Receivables attached as Schedule A to this Agreement
and to each of the Servicer Certificates indicating removal of Receivables
from the Trust.
(i) The Servicer shall deliver to the Trustee and the Collateral Agent:
(1) upon the execution and delivery of this Agreement, an Opinion of
Counsel either (a) stating that, in the opinion of such counsel, all
financing statements and continuation statements have been executed and
filed that are necessary fully to preserve and protect the interest of
the Trust in the Receivables and of the Collateral Agent in the Reserve
Account, and reciting the details of such filings or referring to prior
Opinions of Counsel in which such details are given, or (b) stating that,
in the opinion of such counsel, no such action shall be necessary to
preserve and protect such interest; and
(2) on or before March 31 of each year, commencing with March
31, _____, an Opinion of Counsel, dated as of such date, either (a)
stating that, in the opinion of such counsel, all financing statements
and continuation statements have been executed and filed that are
necessary fully to preserve and protect the interest of the Trustee in
the Receivables, and reciting the details of such filings or referring to
prior opinions of Counsel in which such details are given, or (b) stating
that, in the opinion of such counsel, no such action shall be necessary
to preserve and protect such interest. Notwithstanding the provisions of
Section 12.5, such Opinion of Counsel may be sent by regular
non-certified mail, and such mailed opinion shall be deemed delivered
when so mailed.
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(j) The Servicer shall, to the extent required by applicable law, cause
the Certificates to be registered with the Securities and Exchange Commission
pursuant to Section 12(b) or Section 12(g) of the Exchange Act within the time
periods specified in such sections.
(k) For the purpose of facilitating the execution of this Agreement and
for other purposes, this Agreement may be executed simultaneously in any
number of counterparts, each of which counterparts shall be deemed to be an
original, and all of which counterparts shall constitute but one and the same
instrument.
SECTION 12.3. Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle the Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the
Trust, nor otherwise affect the rights, obligations, and liabilities of the
parties to this Agreement or any of them.
No Certificateholder shall have any right to vote (except as provided in
Section 9.1, Section 9.4, Section 12.1 and this Section 12.3) or in any manner
otherwise control the operation and management of the Trust, or the
obligations of the parties to this Agreement, nor shall anything set forth in
this Agreement or contained in the terms of the Certificates, be construed so
as to constitute the Holders as partners or members of an association; nor
shall any Certificateholder be under any liability to any third person by
reason of any action taken pursuant to any provision of this Agreement.
No Certificateholder shall have any right by virtue or by availing itself
of any provisions of this Agreement to institute any suit, action, or
proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of default and of the continuance thereof, as hereinbefore
provided, and unless also the Holders of Certificates evidencing not less than
25% of the sum of the Class A Certificate Balance and the Class B Certificate
Balance voting as a single class, shall have made written request upon the
Trustee to institute such action, suit, or proceeding in its own name as
Trustee under this Agreement and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses, and
liabilities to be incurred therein or thereby, and the Trustee, for 30 days
after its receipt of such notice, request, and offer of indemnity, shall have
either neglected or refused to institute any such action, suit or proceeding;
no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions of
this Agreement to affect, disturb, or prejudice the rights of the Holders of
any other of the Certificates, or to obtain or seek to obtain priority over or
preference to any other such Holder, or to enforce any right, under this
Agreement, except in the manner provided in this Agreement and for the equal,
ratable, and common benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section 12.3, each Certificateholder and
the Trustee shall be entitled to such relief as can be given either at law or
in equity.
SECTION 12.4. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.
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SECTION 12.5. Notices. All demands, notices, and communications under
this Agreement shall be in writing, personally delivered or mailed by
certified mail, return receipt requested, and shall be deemed to have been
duly given upon receipt (a) in the case of the Seller, c/o Chase Automotive
Finance Corporation, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Financial Controller, or at such other address as shall be
designated by the Seller in a written notice to the Trustee, (b) in the case
of the Servicer, c/o Chase Automotive Finance Corporation, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Financial Controller, or at such other
address as shall be designated by the Servicer in a written notice to the
Trustee, (c) in the case of the Trustee, at __________________
__________________ Attention: ____________________ and (d) in the case of the
Collateral Agent, at _________________ _________________ Attention:
_________________. Any notice required or permitted to be mailed to a
Certificateholder shall be given by first class mail, postage prepaid, at the
address of record of such Holder. Any notice to a Certificateholder so mailed
within the time prescribed in this Agreement shall be conclusively presumed to
have been duly given, whether or not the Certificateholder shall receive such
notice. Notices to Obligors pursuant to Section 4.4 herein may be given by
first class mail or by third-class mail, postage prepaid, at the address of
record of such Obligor and shall be deemed received when mailed by the
Servicer.
SECTION 12.6. Severability of Provisions. If any one or more of the
covenants, agreements, provisions, or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions,
or terms shall be deemed severable from the remaining covenants, agreements,
provisions, or terms of this Agreement and shall in no way affect the validity
or enforceability of the other provisions of this Agreement or of the
Certificates or the rights of the Holders thereof.
SECTION 12.7. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 7.3, 8.3, 8.5 and 9.2 neither
the Seller nor the Servicer may assign all, or a portion of, its rights,
obligations and duties under this Agreement unless such transfer or assignment
satisfies the Rating Agency Condition. Any transfer or assignment with respect
to the Servicer of all of its rights, obligations and duties will not become
effective until a successor Servicer has assumed the Servicer's rights, duties
and obligations under this Agreement.
SECTION 12.8. Certificates Nonassessable and Fully Paid. The interests
represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust or for any reason whatsoever, and, upon authentication
thereof by the Trustee pursuant to Section 6.2, each Certificate shall be
deemed fully paid.
SECTION 12.9. Third-Party Beneficiaries. This Agreement will inure to the
benefit of and be binding upon the parties hereto, the Certificateholders and
the Certificate Owners and their respective successors and permitted assigns.
Except as otherwise provided in this Agreement, no other person will have any
right or obligation hereunder.
SECTION 12.10. Counterparts. This Agreement may be executed in one or
more counterparts and by the different parties hereto 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.
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SECTION 12.11. Tax Matters. It is intended that the Trust shall be a
grantor trust for federal income tax purposes. All provisions hereof shall be
construed so as to effectuate such intent. In addition, the Seller and the
Certificateholders (by accepting a beneficial interest in a Certificate) agree
to treat the Certificates as representing undivided beneficial ownership
interests in the Receivables (other than the Retained Yield). Moreover, if the
Class B Pass-Through Rate exceeds the Class A Pass-Through Rate, the Seller
and the Certificateholders (by accepting a beneficial interest in a
Certificate) agree to (i) treat the Certificates as representing undivided
beneficial ownership interests in the Receivables (other than the Retained
Yield), and (ii) treat the Class A Certificateholders as having sold, and the
Class B Certificateholders as having purchased, the Class B Stripped Coupon.
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IN WITNESS WHEREOF, the parties have caused this Pooling and Servicing
Agreement to be duly executed by their respective officers as of the day and
year first above written.
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION,
as Seller and Servicer
By______________________________________
Name:
Title:
[________________________________________]
not in its individual capacity but solely as Trustee
By_______________________________________
Name:
Title:
[________________________________________]
not in its individual capacity but solely as
Collateral Agent
By_______________________________________
Name:
Title:
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SCHEDULE A
[LIST OF RECEIVABLES]
Delivered to the Trustee on the Closing Date.
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SCHEDULE B
Location of Receivable Files
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EXHIBIT A-1
[FORM OF CLASS A CERTIFICATE]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, TO ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE, OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN].
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CHASE
MANHATTAN BANK USA, NATIONAL ASSOCIATION OR ANY AFFILIATE THEREOF. THIS
CERTIFICATE AND THE RECEIVABLES ARE NOT DEPOSITS AND ARE NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.
CHASE MANHATTAN AUTO GRANTOR TRUST 200_-_
____% AUTOMOBILE LOAN PASS-THROUGH CERTIFICATE, CLASS A
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of simple interest
retail installment sales contracts, purchase money loans and
promissory notes secured by new and used automobiles financed thereby
and sold to the Trustee, as defined below, on behalf of the Trust by
Chase Manhattan Bank USA, National Association.
NUMBER CUSIP
A-1
$___________
THIS CERTIFIES THAT ____________________ is the registered owner of a
nonassessable, fully paid, fractional undivided interest, in the amount set
forth above, in the Chase Manhattan Auto Grantor Trust 200_-_ (the "Trust")
formed by Chase Manhattan Bank USA, National Association (the "Seller"). The
Trust was created pursuant to a Pooling and Servicing Agreement dated as of
________ __, _____ (as amended, supplemented or otherwise modified and in
effect from time to time, the "Agreement") between the Seller, acting as
Seller and Servicer, and [_________________________ ____________________], as
trustee (the "Trustee") and as collateral agent, a summary of certain of the
A-1-1
pertinent provisions of which is set forth on the reverse hereof. This
Certificate is one of the duly authorized Certificates designated as "______%
Automobile Loan Pass-Through Certificates, Class A" (herein called "Class A
Certificates" and together with the "Class B Certificates", issued
concurrently herewith the "Certificates"). This Certificate is issued under
and is subject to the terms, provisions, and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound. The property of the Trust
includes a pool of simple interest retail installment sales contracts,
purchase money notes and promissory notes (the "Receivables") for the purchase
of new and used automobiles financed thereby, all monies due thereunder on or
after the Cutoff Date (other than the Retained Yield), security interests in
the vehicles securing the Receivables (the "Financed Vehicles"), such amounts
as from time to time may be held in the Collection Account and the
Distribution Accounts established and maintained by the Servicer in the name
of the Trustee, the rights to proceeds as a result of the Seller's exercise of
its recourse rights against Dealers with respect to the Receivables, and
assignment of the rights of the Seller to receive proceeds from any
Liquidation Proceeds and from any extended warranties, theft and physical
damage, credit life and credit disability insurance policies relating to the
Financed Vehicles or the Obligors, as the case may be, the rights with respect
to any Financed Vehicle that has been repossessed by the Servicer, on behalf
of the Trustee, and the right to receive payments under certain circumstances
from the Reserve Account and the Retained Yield and all proceeds of the
foregoing.
Subject to the terms and conditions of the Agreement (including the
availability of funds for distributions) and until the obligations created by
the Agreement shall have terminated in accordance therewith, there will be
distributed on the __th day of each month or, if such __th day is not a
Business Day, the next succeeding Business Day (the "Distribution Date"),
commencing on ____________ ___, _____, to the Person in whose name this
Certificate is registered at the close of business on the related Record Date,
such Certificateholder's fractional undivided interest in the amounts
distributable to Class A Certificateholders on such Distribution Date.
Distributions on this Class A Certificate will be made by the Paying
Agent by check mailed to the Class A Certificateholder of record in the
Certificate Register without the presentation or surrender of this Class A
Certificate or the making of any notation hereon, except that if directed by
the Seller in the case of Class A Certificates registered in the name of a
Clearing Agency or Foreign Clearing Agency, as applicable, distributions will
be made in the form of immediately available funds. Except as otherwise
provided in the Agreement and notwithstanding the above, the final
distribution on this Class A Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Class A Certificate at the office or agency maintained for
that purpose by the Transfer Agent and Certificate Registrar in The City of
New York.
Reference is hereby made to the further provisions of this Class A
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
All capitalized terms used herein not otherwise defined shall have the
meaning assigned thereto in the Agreement.
A-1-2
Unless the authentication hereon shall have been executed by an
authorized officer of the Trustee or an authenticating agent acting on behalf
of the Trustee, by manual signature, this Class A Certificate shall not
entitle the holder hereof to any benefit under the Agreement or be valid for
any purpose.
A-1-3
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust, and not in its
individual capacity, has caused this Certificate to be duly executed.
CHASE MANHATTAN AUTO GRANTOR TRUST 200_-_
By: [___________________________________],
_____________________________________
By:____________________________________
Authorized Officer
This is one of the Certificates referred to in the within-mentioned
Agreement.
[________________________________________],
not in its individual capacity but solely as Trustee
By:______________________________________
Authorized Officer
or
_________________________________________
as Authenticating Agent for the Trustee
By:_______________________________________
Authorized Officer
A-1-4
CHASE MANHATTAN AUTO GRANTOR TRUST _____-__
________% AUTOMOBILE LOAN PASS-THROUGH CERTIFICATE, CLASS A
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights of the Certificateholders
under the Agreement at any time by the Seller, the Servicer and the Trustee
with the consent of the Holders of Certificates evidencing not less than a
majority of the sum of the Class A Certificate Balance and the Class B
Certificate Balance voting as a single class. Any such consent by the Holder
of this Class A Certificate shall be conclusive and binding on such Holder and
on all future Holders of this Class A Certificate and of any Class A
Certificate issued upon registration of transfer hereof or in exchange hereof
or in lieu hereof whether or not notation of such consent is made upon this
Class A Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances and with certain exceptions provided therein,
without prior notice to or the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Class A Certificate is registerable in the
Certificate Register upon surrender of this Class A Certificate for
registration of transfer at the office or agency maintained by the Transfer
Agent and Certificate Registrar, in The City of New York, accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Transfer Agent and Certificate Registrar duly executed by the Holder hereof,
which signature to such assignment has been guaranteed by a member of the New
York Stock Exchange or a commercial bank or trust company, and thereupon one
or more new Class A Certificates of authorized denominations evidencing the
same aggregate interest in the Trust will be issued to the designated
transferee.
The Class A Certificates are issuable only as registered Certificates
without coupons in denominations of $1,000 and integral multiples thereof
(except for a single Class A Certificate in a smaller minimum denomination
representing any residual portion of the original Class A Certificate
Balance). As provided in the Agreement and subject to certain limitations
therein set forth, Class A Certificates are exchangeable for new Class A
Certificates of authorized denominations evidencing the same aggregate
denomination, as requested by the Holder surrendering the same. No service
charge will be made for any such registration of transfer or exchange, but the
Transfer Agent and Certificate Agent may require payment of a sum sufficient
to cover any tax or governmental charges payable in connection therewith.
In the event that the Holder of this Class A Certificate does not
surrender this Class A Certificate for cancellation within six months after
the date specified in the notice regarding the pendency of the final
distribution described on the face hereof, the Trustee shall give a second
notice with respect thereto. If within one year after such second notice this
Class A Certificate shall not have been surrendered for cancellation, the
Trustee may take appropriate steps to contact the Holder hereof. As provided
in the Agreement, any funds remaining in the Trust after exhaustion of such
steps shall be distributed to a charitable organization, such distribution to
occur not later than three years from the date of the final Distribution Date.
The Trustee, the Paying Agent and the Transfer Agent and Certificate
Registrar may treat the Person in whose name this Class A Certificate is
A-1-5
registered as the owner hereof for all purposes, and none of the Trustee, the
Paying Agent or the Transfer Agent and Certificate Registrar shall be affected
by any notice to the contrary.
The obligations and responsibilities created by the Agreement and the
Trust created thereby with respect to the Certificateholders shall terminate
upon the payment to Certificateholders of all amounts required to be paid to
them pursuant to the Agreement on the Distribution Date next succeeding the
month which is six months after the maturity or liquidation of the last
Receivable and the disposition of all property held as part of the Trust. The
Servicer may, at its option, purchase the corpus of the Trust at a price
specified in the Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement of the Certificates;
however, such right of purchase is exercisable only as of the last day of a
Collection Period immediately preceding any Distribution Date as of which the
Pool Balance is equal to or less than __% of the Original Pool Balance.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
[FORM OF CLASS B CERTIFICATE]
THIS CLASS B CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS DESCRIBED HEREIN).
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, TO ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE, OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.].
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION OF CHASE
MANHATTAN BANK USA, NATIONAL ASSOCIATION OR ANY AFFILIATE THEREOF. THIS
CERTIFICATE AND THE RECEIVABLES ARE NOT DEPOSITS AND ARE NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.
A-2-1
CHASE MANHATTAN AUTO GRANTOR TRUST 200_-_
_____% AUTOMOBILE LOAN PASS-THROUGH CERTIFICATE, CLASS B
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of simple interest
retail installment sales contracts, purchase money loans and
promissory notes, secured by new and used automobiles financed
thereby and sold to the Trustee, as defined below, on behalf of the
Trust by Chase Manhattan Bank USA, National Association.
NUMBER CUSIP
B-1
$___________
THIS CERTIFIES THAT ________________is the registered owner of a
nonassessable, fully paid, fractional undivided interest, in the amount set
forth above, in the Chase Manhattan Auto Grantor Trust 200_-_ (the "Trust")
formed by Chase Manhattan Bank USA, National Association (the "Seller"). The
Trust was created pursuant to a Pooling and Servicing Agreement dated as of
____________ __, ____ (as amended, supplemented or otherwise modified and in
effect from time to time, the "Agreement") between the Seller, acting as
Seller and Servicer, and [___________________ _____________], as trustee (the
"Trustee") and as collateral agent, a summary of certain of the pertinent
provisions of which is set forth on the reverse hereof. This Certificate is
one of the duly authorized Certificates designated as "______% Automobile Loan
Pass-Through Certificates, Class B" (herein called the Class B Certificates,
and, together with the Class A Certificates issued concurrently herewith, the
"Certificates"). This Certificate is issued under and is subject to the terms,
provisions, and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound. The property of the Trust includes a pool of simple interest
retail installment sales contracts, purchase money notes and promissory notes
(the "Receivables") for the purchase of new and used automobiles financed
thereby, all monies due thereunder on or after the Cutoff Date (other than the
Retained Yield), security interests in the vehicles securing the Receivables
(the "Financed Vehicles"), such amounts as from time to time may be held in
the Collection Account and the Distribution Accounts established and
maintained by the Servicer in the name of the Trustee, the rights to proceeds
as a result of the Seller's exercise of its recourse rights against Dealers
with respect to the Receivables, and assignment of the rights of the Seller to
receive proceeds from any Liquidation Proceeds and from any extended
warranties, theft and physical damage, credit life and credit disability
insurance policies relating to the Financed Vehicles or the Obligors, as the
case may be, the rights with respect to any Financed Vehicle that has been
repossessed by the Servicer, on behalf of the Trustee, and the right to
receive payments under certain circumstances from the Reserve Account and the
Retained Yield and all proceeds of the foregoing.
Subject to the terms and conditions of the Agreement (including the
availability of funds for distribution) and until the obligations created by
A-2-2
the Agreement shall have terminated in accordance therewith, there will be
distributed on the __th day of each month or, if such __th day is not a
Business Day, the next succeeding Business Day (the "Distribution Date"),
commencing on _____________ __, ____, to the Person in whose name this
Certificate is registered at the close of business on the related Record Date,
such Certificateholder's fractional undivided interest in the amounts
distributable to the Class B Certificateholders on such Distribution Date.
Pursuant to the Agreement distributions of interest and principal on the
Class B Certificates will be subordinated in priority of payment to interest
and principal due on the Class A Certificates in the event of defaults and
delinquencies on the Receivables. The Class B Certificateholders will not
receive any distributions of interest with respect to a Collection Period
until the full amount of interest on the Class A Certificates relating to such
Collection Period has been deposited in the Class A Distribution Account, and
the Class B Certificateholders will not receive any distributions of principal
with respect to such Collection Period until the full amount of interest on
and principal of the Class A Certificates relating to such Collection Period
has been deposited in the Class A Distribution Account as set forth in the
Agreement.
Distributions on this Class B Certificate will be made by the Paying
Agent by check mailed to the Class B Certificateholder of record in the Class
B Certificate Register without the presentation or surrender of this Class B
Certificate or the making of any notation hereon, except that if directed by
the Seller in the case of Class B Certificates registered in the name of a
Clearing Agency or Foreign Clearing Agency, as applicable, distributions will
be made in the form of immediately available funds. Except as otherwise
provided in the Agreement and notwithstanding the above, the final
distribution on this Class B Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon presentation and
surrender of this Class B Certificate at the office or agency maintained for
that purpose by the Transfer Agent and Certificate Registrar in The City of
New York.
Reference is hereby made to the further provisions of this Class B
Certificate set forth on the reverse hereof, which further provisions shall
for all purposes have the same effect as if set forth at this place.
All capitalized terms used herein not otherwise defined shall have the
meaning assigned thereto in the Agreement.
Unless the authentication hereon shall have been executed by an
authorized officer of the Trustee or an authenticating agent acting on behalf
of the Trustee, by manual signature, this Class B Certificate shall not
entitle the holder hereof to any benefit under the Agreement or be valid for
any purpose.
A-2-3
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust, and
not in its individual capacity, has caused this Certificate to be duly
executed.
CHASE MANHATTAN AUTO GRANTOR TRUST 200_-_
By: [________________________________]
By: __________________________________
Authorized Officer
This is one of the Certificates referred to in the within-mentioned
Agreement.
[_________________________________]
not in its individual capacity but solely
as Trustee
By: ____________________________________
Authorized Officer
or
_________________________________________
as Authenticating Agent
for the Trustee
By: ______________________________________
Authorized Officer
A-2-4
CHASE MANHATTAN AUTO GRANTOR TRUST 200_-_
______% AUTOMOBILE LOAN PASS-THROUGH CERTIFICATE, CLASS B
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights of the Certificateholders
under the Agreement at any time by the Seller, the Servicer and the Trustee
with the consent of the Holders of Certificates evidencing not less than a
majority of the sum of the Class A Certificate Balance and the Class B
Certificate Balance voting as a single class. Any such consent by the Holder
of this Class B Certificate shall be conclusive and binding on such Holder and
on all future Holders of this Class B Certificate and of any Class B
Certificate issued upon registration of transfer hereof or in exchange herefor
or in lieu hereof whether or not notation of such consent is made upon this
Class B Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances and with certain exceptions provided therein,
without prior notice to or the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Class B Certificate is registerable in the
Certificate Register upon surrender of this Class B Certificate for
registration of transfer at the office or agency maintained by the Transfer
Agent and Certificate Registrar, in The City of New York, accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Transfer Agent and Certificate Registrar duly executed by the Holder hereof,
which signature to such assignment has been guaranteed by a member of the New
York Stock Exchange or a commercial bank or trust company, and thereupon one
or more new Class B Certificates of authorized denominations evidencing the
same aggregate interest in the Trust will be issued to the designated
transferee.
The Class B Certificates are issuable only as registered Class B
Certificates without coupons in denominations of $1,000 and integral multiples
thereof. As provided in the Agreement and subject to certain limitations
therein set forth, Class B Certificates are exchangeable for new Class B
Certificates of authorized denominations evidencing the same aggregate
denomination, as requested by the Holder surrendering the same. No service
charge will be made for any such registration of transfer or exchange, but the
Transfer Agent and Certificate Agent may require payment of a sum sufficient
to cover any tax or governmental charges payable in connection therewith.
In the event that the Holder of this Class B Certificate does not
surrender this Certificate for cancellation within six months after the date
specified in the notice regarding the pendency of the final distribution
described on the face hereof, the Trustee shall give a second notice with
respect thereto. If within one year after such second notice this Class B
Certificate shall not have been surrendered for cancellation, the Trustee may
take appropriate steps to contact the Holder hereof. As provided in the
Agreement, any funds remaining in the Trust after exhaustion of such steps
shall be distributed to a charitable organization, such distribution to occur
not later than three years from the date of the final Distribution Date.
The Trustee, the Paying Agent and the Transfer Agent and Certificate
Registrar may treat the Person in whose name this Class B Certificate is
registered as the owner hereof for all purposes, and none of the Trustee, the
Paying Agent or the Transfer Agent and Certificate Registrar shall be affected
by any notice to the contrary.
A-2-5
The obligations and responsibilities created by the Agreement and the
Trust created thereby with respect to the Certificateholders shall terminate
upon the payment to Certificateholders of all amounts required to be paid to
them pursuant to the Agreement on the Distribution Date next succeeding the
month which is six months after the maturity or liquidation of the last
Receivable and the disposition of all property held as part of the Trust. The
Servicer may, at its option, purchase the corpus of the Trust at a price
specified in the Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement of the Certificates;
however, such right of purchase is exercisable only as of the last day of a
Collection Period immediately preceding any Distribution Date as of which the
Pool Balance is equal to or less than __% of the Original Pool Balance.
A-2-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
___________________________________________________________________________
(Please print or typewrite name and address, including postal zip code, of
assignee)
___________________________________________________________________________
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
____________________________________________________ Attorney to transfer said
Certificate on the books of the Transfer Agent and Certificate Registrar, with
full power of substitution in the premises.
Dated:
__________________________________*
Signature Guaranteed:
___________________________________*
* NOTICE: The signature to this assignment must correspond with the name as
it appears upon the face of the within Certificate in every particular,
without alteration, enlargement or any change whatever. Such signature must
be guaranteed by a member of the New York Stock Exchange or a commercial bank
or trust company.
A-2-7
EXHIBIT B
[FORM OF DEPOSITORY AGREEMENT]
B-1
EXHIBIT C-1
Trustee's Certificate
pursuant to Section 10.2
of the Pooling and Servicing Agreement
[____________________________________], as trustee (the "Trustee") and as
collateral agent of the Chase Manhattan Auto Grantor Trust 2000_-_ created
pursuant to the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of ____________ ___, _____, between Chase Manhattan Bank
USA, National Association, as Seller (the "Seller") and Servicer, and the
Trustee does hereby sell, transfer, assign, and otherwise convey to the
Seller, without recourse, representation, or warranty, all of the Trustee's
right, title, and interest it and to all of the Receivables (as defined in the
Pooling and Servicing Agreement) identified in the attached Servicer's
Certificate as "Repurchased Receivables," which are to be repurchased by the
Seller pursuant to Section 3.2 of the Pooling and Servicing Agreement and all
security and documents relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this ____ day of
___________, 200_.
_______________________________
Authorized Signatory
C-1
EXHIBIT C-2
Trustee's Certificate
pursuant to Section 10.2
of the Pooling and Servicing Agreement
[___________________________________], as trustee (the "Trustee") and as
collateral agent of the Chase Manhattan Auto Grantor Trust 200_-_ created
pursuant to the Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of _________ ___, ____, between Chase Manhattan Bank
USA, National Association, as Seller and Servicer (the "Servicer"), and the
Trustee, does hereby sell, transfer, assign, and otherwise convey to the
Servicer, without recourse, representation, or warranty, all of the Trustee's
right, title, and interest in and to all of the Receivables (as defined in the
Pooling and Servicing Agreement) identified in the attached Servicer's
Certificate as "Repurchased Receivables," which are to be purchased by the
Servicer pursuant to Section 4.7 or 11.2 of the Pooling and Servicing
Agreement, and all security and documents relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this day ___ of _________,
200_.
_______________________________
Authorized Signatory
C-2
EXHIBIT D
FORM OF SERVICER'S CERTIFICATE
D-1
EXHIBIT E
CERTIFICATEHOLDER REPORT
E-1
EXHIBIT F
FORM OF COLLECTION ACCOUNT CONTROL AGREEMENT
F-1
EXHIBIT G
FORM OF RESERVE ACCOUNT CONTROL AGREEMENT
G-1