1
EXHIBIT 99.5
================================================================================
SALE AGREEMENT
by and among
--------------------
FORD CREDIT AUTO OWNER TRUST - ,
------ -
as Issuer,
and
--------------------
FORD CREDIT AUTO RECEIVABLES TWO L.P.,
as Seller
Dated as of ,
------------ ----
================================================================================
2
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS AND USAGE .................................................... 1
ARTICLE II
TRUST PROPERTY ........................................................... 2
SECTION 2.1. Conveyance of Trust Property ............................. 2
SECTION 2.2. Representations and Warranties of
the Seller as to the Receivables ........................ 2
SECTION 2.3. Repurchase upon Breach ................................... 7
SECTION 2.4. Custody of Receivable Files .............................. 8
SECTION 2.5. Duties of Servicer as Custodian .......................... 8
SECTION 2.6. Instructions; Authority to Act ........................... 10
SECTION 2.7. Custodian's Indemnification .............................. 10
SECTION 2.8. Effective Period and Termination ......................... 10
ARTICLE III
[RESERVED]...........................................................
i
3
Page
----
ARTICLE IV
DISTRIBUTIONS; RESERVE ACCOUNT; STATEMENTS TO
NOTEHOLDERS AND CERTIFICATEHOLDERS ...................................
SECTION 4.1. Accounts .................................................... 19
SECTION 4.2. Collections ................................................. 23
SECTION 4.3. Application of Collections .................................. 24
SECTION 4.4. Advances .................................................... 24
SECTION 4.5. Additional Deposits ......................................... 25
SECTION 4.6. Distributions ............................................... 26
SECTION 4.7. Reserve Account ............................................. 28
SECTION 4.8. Net Deposits ................................................ 31
SECTION 4.9. Statements to Noteholders and
Certificateholders ........................................ 31
ARTICLE V
YIELD SUPPLEMENT LETTER OF CREDIT; YIELD SUPPLEMENT ACCOUNT
SECTION 5.1. Yield Supplement Letter of Credit
and the Yield Supplement Account .......................... 34
ARTICLE VI
THE SELLER ................................................................
SECTION 6.1. Representations and Warranties of Seller .................... 38
SECTION 6.2. Liability of Seller; Indemnities ............................ 40
SECTION 6.3. Merger or Consolidation of, or
Assumption of the Obligations
of, Seller ................................................ 41
SECTION 6.4. Limitation on Liability of
Seller and Others ......................................... 42
SECTION 6.5. Seller May Own Notes or Certificates ........................ 42
ARTICLE VII
[RESERVED] ..............................................................
ii
4
Page
----
ARTICLE VIII
[RESERVED] ................................................................
ARTICLE IX
TERMINATION ................................................................
SECTION 9.1. Optional Purchase of All Receivables ........................ 56
SECTION 9.2. Succession Upon Satisfaction and
Discharge of Indenture ................................... 56
ARTICLE X
MISCELLANEOUS PROVISIONS ...................................................
SECTION 10.1. Amendment ................................................... 57
SECTION 10.2. Protection of Title to Trust ................................ 58
SECTION 10.3. Governing Law ............................................... 62
SECTION 10.4. Notices ..................................................... 62
SECTION 10.5. Severability of Provisions .................................. 62
SECTION 10.6. Assignment .................................................. 63
SECTION 10.7. Further Assurances .......................................... 63
SECTION 10.8. No Waiver; Cumulative Remedies .............................. 63
SECTION 10.9. Third-Party Beneficiaries ................................... 63
SECTION 10.10. Actions by Noteholders or
Certificateholders ........................................ 64
SECTION 10.11. Agent for Service ........................................... 64
SECTION 10.12. No Bankruptcy Petition. ..................................... 64
SECTION 10.13. Limitation of Liability of
Owner Trustee and Indenture Trustee ...................... 64
iii
5
SALE AGREEMENT, dated as of _______ __, ____ (as from time
to time amended, supplemented or otherwise modified and in effect, this
"Agreement"), by and among FORD CREDIT AUTO OWNER TRUST ____-_ (the "Issuer"),
a Delaware business trust, and FORD CREDIT AUTO RECEIVABLES TWO L.P., a Delaware
limited partnership, as seller (the "Seller").
WHEREAS, the Issuer desires to purchase Intermediary Trust Certificates
representing 100% of the beneficial interests of an intermediary trust, the
property of which consists of a portfolio of receivables arising in connection
with motor vehicle retail installment sale contracts generated by Ford Motor
Credit Company in the ordinary course of its business and sold to the Seller;
and
WHEREAS, the Seller is willing to sell such Intermediary Trust
Certificates to the Issuer;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I
DEFINITIONS AND USAGE
Except as otherwise specified herein or as the context may otherwise
require, capitalized terms used but not otherwise defined herein are defined in
Appendix A hereto, which also contains rules as to usage that shall be
applicable herein.
6
ARTICLE II
TRUST PROPERTY
SECTION 2.1. Conveyance of Trust Property. In consideration of the
Issuer's delivery to, or upon the order of, the Seller of Notes and
Certificates, in aggregate principal amounts equal to the initial principal
amount of the Notes and the Initial Certificate Balance, respectively, the
Seller does hereby irrevocably sell, transfer, assign and otherwise convey to
the Issuer without recourse (subject to the obligations herein) all right,
title and interest of the Seller, whether now owned or hereafter acquired, in
and to the Trust Property. The sale, transfer, assignment and conveyance made
hereunder shall not constitute and is not intended to result in an assumption
by the Issuer of any obligation of the Seller to the Obligors, the Dealers or
any other Person in connection with the Receivables and the other Trust
Property or any agreement, document or instrument related thereto.
It is the intention of the Seller and the Issuer that the transfer of the
Trust Property contemplated herein constitute a sale of the Trust Property,
conveying good title to the Trust Property from the Seller to the Issuer.
However, in the event that such transfer is deemed to be a pledge to secure the
payment of the Notes and the Certificates, the Seller hereby grants to the
Issuer a first priority security interest in all of the Seller's right, title
and interest in, to and under the Trust Property, and all proceeds thereof, to
secure the payment of the Notes and the Certificates, and in such event, this
Agreement shall constitute a security agreement under applicable law.
SECTION 2.2. Representations and Warranties of the Seller as to the
Receivables. The Seller makes the following representations and warranties as
to the Receivables on which the Issuer shall be deemed to have relied in
accepting the Receivables. Such representations and warranties speak as of the
execution and delivery of this Agreement, but shall survive the sale, transfer,
assignment and conveyance of the Receivables to the Issuer and the pledge
thereof to the Indenture Trustee pursuant to the Indenture.
2
7
(i) Characteristics of Receivables. Each Receivable (a) shall have
been originated in the United States of America by a Dealer for the retail sale
of a Financed Vehicle in the ordinary course of such Dealer's business, shall
have been fully and properly executed by the parties thereto, shall have been
purchased by the Seller from Ford Credit, which in turn shall have purchased
such Receivable from such Dealer under an existing dealer agreement with Ford
Credit, and shall have been validly assigned by such Dealer to Ford Credit,
which in turn shall have been validly assigned by Ford Credit to the Seller in
accordance with its terms, (b) shall have created or shall create a valid,
subsisting, and enforceable first priority security interest in favor of Ford
Credit in the Financed Vehicle, which security interest has been assigned by
Ford Credit to the Seller, which in turn shall be assignable by the Seller to
the Indenture Trustee, (c) shall contain customary and enforceable provisions
such that the rights and remedies of the holder thereof shall be adequate for
realization against the collateral of the benefits of the security, (d) shall
provide for level monthly payments (provided that the payment in the first or
last month in the life of the Receivable may be minimally different from the
level payment) that fully amortize the Amount Financed by maturity and yield
interest at the Annual Percentage Rate, (e) shall provide for, in the event
that such contract is prepaid, a prepayment that fully pays the Principal
Balance, and (f) is a Precomputed Receivable or a Simple Interest Receivable.
(ii) Schedule of Receivables. The information set forth in the Schedule
of Receivables shall be true and correct in all material respects as of the
opening of business on the Cutoff Date, and no selection procedures believed to
be adverse to the Noteholders or the Certificateholders shall have been
utilized in selecting the Receivables from those receivables which meet the
criteria contained herein. The computer tape or other listing regarding the
Receivables made available to the Issuer and its assigns (which computer tape
or other listing is required to be delivered as specified herein) is true and
correct in all respects.
(iii) Compliance with Law. Each Receivable and the sale of the Financed
Vehicle shall have complied at the time it was originated or made and at the
execu-
3
8
tion of this Agreement shall comply in all material respects with all
requirements of applicable federal, State, and local laws, and regulations
thereunder, including, without limitation, usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit
Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade
Commission Act, the ▇▇▇▇▇▇▇▇-▇▇▇▇ Warranty Act, the Federal Reserve Board's
Regulations B and Z, and State adaptations of the National Consumer Act and of
the Uniform Consumer Credit Code, and other consumer credit laws and equal
credit opportunity and disclosure laws.
(iv) Binding Obligation. Each Receivable shall represent the genuine,
legal, valid, and binding payment obligation in writing of the Obligor,
enforceable by the holder thereof in accordance with its terms subject to the
effect of bankruptcy, insolvency, reorganization, or other similar laws
affecting the enforcement of creditors' rights generally.
(v) No Government Obligor. None of the Receivables shall be due from the
United States of America or any State or from any agency, department, or
instrumentality of the United States of America or any State.
(vi) Security Interest in Financed Vehicle. Immediately prior to the
sale, transfer, assignment, and conveyance thereof, each Receivable shall be
secured by a validly perfected first security interest in the Financed Vehicle
in favor of Ford Credit as secured party or all necessary and appropriate
actions shall have been commenced that would result in the valid perfection of
a first security interest in the Financed Vehicle in favor of Ford Credit as
secured party.
(vii) Receivables in Force. No Receivable shall have been satisfied,
subordinated, or rescinded, nor shall any Financed Vehicle have been released
from the lien granted by the related Receivable in whole or in part.
(viii) No Waiver. No provision of a Receivable shall have been waived.
4
9
(ix) No Defenses. No right of rescission, setoff, counterclaim, or
defense shall have been asserted or threatened with respect to any Receivable.
(x) No Liens. To the best of the Seller's knowledge, no liens or claims
shall have been filed for work, labor, or materials relating to a Financed
Vehicle that shall be liens prior to, or equal or coordinate with, the security
interest in the Financed Vehicle granted by the Receivable.
(xi) No Default. Except for payment defaults continuing for a period of
not more than [thirty (30)] days as of the Cutoff Date, no default, breach,
violation, or event permitting acceleration under the terms of any Receivable
shall have occurred; and no continuing condition that with notice or the lapse
of time would constitute a default, breach, violation, or event permitting
acceleration under the terms of any Receivable shall have arisen; and the
Seller shall not waive any of the foregoing.
(xii) Insurance. Ford Credit, in accordance with its customary
procedures, shall have determined that the Obligor has obtained or agreed to
obtain physical damage insurance covering the Financed Vehicle.
(xiii) Title. It is the intention of the Seller that the transfer and
assignment herein contemplated constitute a sale of the Receivables from the
Seller to the Issuer and that the beneficial interest in and title to the
Receivables not be part of the Seller's estate in the event of the filing of a
bankruptcy petition by or against the Seller under any bankruptcy law. No
Receivable has been sold, transferred, assigned, or pledged by the Seller to
any Person other than the Issuer. Immediately prior to the transfer and
assignment herein contemplated, the Seller had good and marketable title to
each Receivable free and clear of all Liens, encumbrances, security interests,
and rights of others and, immediately upon the transfer thereof, the Issuer
shall have good and marketable title to each Receivable, free and clear of all
Liens, encumbrances, security interests, and rights of others; and the transfer
has been perfected under the UCC.
5
10
(xiv) Valid Assignment. No Receivable shall have been originated in,
or shall be subject to the laws of, any jurisdiction under which the sale,
transfer, assignment and conveyance of such Receivable under this Agreement or
pursuant to transfers of the Notes or the Certificates shall be unlawful, void,
or voidable. The Seller has not entered into any agreement with any account
debtor that prohibits, restricts or conditions the assignment of any portion of
the Receivables.
(xv) All Filings Made. All filings (including, without limitation, UCC
filings) necessary in any jurisdiction to give the Issuer a first perfected
ownership interest in the Receivables, and to give the Indenture Trustee a
first perfected security interest therein, shall have been made.
(xvi) Chattel Paper. Each Receivable constitutes "chattel paper" as
defined in the UCC.
(xvii) One Original. There shall be only one original executed copy of
each Receivable.
(xviii) New and Used Vehicles. Approximately ___% of the aggregate
Principal Balance of the Receivables, constituting ___% of the number of
Receivables, as of the Cutoff Date, represent vehicles financed at new vehicle
rates, and the remainder of the Receivables represent vehicles financed at used
vehicle rates.
[(xix)Amortization Type. Approximately ____% of the aggregate Principal
Balance of the Receivables as of the Cutoff Date constitute Precomputed
Receivables, and the remainder of the Receivables constitute Simple Interest
Receivables.]
(xx) Origination. Each Receivable shall have an origination date on or
after ______ __, ____.
(xxi) Maturity of Receivables. Each Receivable shall have an original
maturity of not greater than sixty (60) months.
(xxii) Minimum Annual Percentage Rate. Each Receivable shall have an
Annual Percentage Rate equal to or greater than ___%.
6
11
(xxiii) Scheduled Payments. Each Receivable shall have a first Scheduled
Payment due[, in the case of Precomputed Receivables, or a scheduled due date,
in the case of Simple Interest Receivables,] on or prior to ______ __, ____ and
no Receivable shall have a payment that is more than [thirty (30)] days overdue
as of the Cutoff Date.
(xxiv) Location of Receivable Files. The Receivable Files shall be kept
at one or more of the locations listed in Schedule B hereto.
(xxv) No Extensions. The number of Scheduled Payments shall not have
been extended on any Receivable on or before the Cutoff Date.
(xxvi) Rating Agencies. The rating agencies rating the Notes and the
Certificates are Moody's and Standard & Poor's.
(xxvii) Agreement. The representations and warranties of the Seller in
Section 6.1 are true and correct.
[(xxviii) No Receivables Originated in Alabama or Pennsylvania. No
Receivable shall have been originated in Alabama or Pennsylvania.]
SECTION 2.3. Repurchase upon Breach. The Seller, the Servicer, the
Issuer or the Owner Trustee, as the case may be, shall inform the other parties
to this Agreement, the Indenture Trustee and Ford Credit promptly, in writing,
upon the discovery of any breach of the Seller's representations and warranties
made by the Seller pursuant to Section 2.2. Unless the breach shall have been
cured by the last day of the second Collection Period following the discovery,
the Indenture Trustee shall enforce the obligation of the Seller under this
Section 2.3, and, if necessary, the Seller shall enforce the obligation of Ford
Credit under the Purchase Agreement, to repurchase any Receivable materially
and adversely affected by the breach as of such last day (or, at the Seller's
option, the last day of the first Collection Period following the discovery).
In consideration of the purchase of the Receivable, the Seller shall remit the
Purchase Amount, in the manner specified in Section 4.5. The sole remedy of
the Issuer, the Owner Trustee,
7
12
the Indenture Trustee, the Noteholders or the Certificateholders with
respect to a breach of the Seller's representations and warranties pursuant to
Section 2.2 shall be to require the Seller to repurchase Receivables pursuant
to this Section 2.3 or to enforce the obligation of Ford Credit to the Seller
to repurchase such Receivables pursuant to the Purchase Agreement. Neither the
Owner Trustee nor the Indenture Trustee shall have any duty to conduct an
affirmative investigation as to the occurrence of any condition requiring the
repurchase of any Receivable pursuant to this Section 2.3 or the eligibility of
any Receivable for purposes of this Agreement.
SECTION 2.4. Custody of Receivable Files. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Issuer, upon
the execution and delivery of this Agreement, hereby revocably appoints the
Servicer, and the Servicer hereby accepts such appointment, to act as the agent
of the Issuer and the Indenture Trustee as custodian of the following documents
or instruments, which are hereby constructively delivered to the Indenture
Trustee, as pledgee of the Issuer pursuant to the Indenture, with respect to
each Receivable:
(i) The original of the Receivable.
(ii) The original credit application fully executed by the Obligor or a
photocopy thereof or a record thereof on a computer file or disc or on
microfiche.
(iii) The original certificate of title or such documents that the
Servicer or Ford Credit shall keep on file, in accordance with its customary
procedures, evidencing the security interest of Ford Credit in the Financed
Vehicle.
(iv) Any and all other documents (including any computer file or disc or
microfiche) that the Servicer or the Seller shall keep on file, in accordance
with its customary procedures, relating to a Receivable, an Obligor, or a
Financed Vehicle.
The Servicer shall provide an Officer's Certificate to the Issuer and the
Indenture Trustee confirming that the Servicer has received on behalf of the
Issuer
8
13
and the Indenture Trustee all the documents and instruments necessary
for the Servicer to act as the agent of the Issuer and the Indenture Trustee
for the purposes set forth in this Section 2.4, including the documents
referred to herein, and the Issuer, the Owner Trustee and the Indenture Trustee
are hereby authorized to rely on such Officer's Certificate.
SECTION 2.5. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer shall hold the Receivable Files for the
benefit of the Issuer and the Indenture Trustee and maintain such accurate and
complete accounts, records, and computer systems pertaining to each Receivable
File as shall enable the Servicer and the Issuer to comply with the terms and
conditions of this Agreement, and the Indenture Trustee to comply with the
terms and conditions of the Indenture. In performing its duties as custodian
the Servicer shall act with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to the receivable files
relating to all comparable automotive receivables that the Servicer services
for itself or others. In accordance with its customary practices with respect
to its retail installment sale contracts, the Servicer shall conduct, or cause
to be conducted, periodic audits of the Receivable Files held by it under this
Agreement, and of the related accounts, records, and computer systems, in such
a manner as shall enable the Issuer or the Indenture Trustee to verify the
accuracy of the Servicer's record keeping. The Servicer shall promptly report
to the Owner Trustee and the Indenture Trustee any failure on its part to hold
the Receivable Files and maintain its accounts, records, and computer systems
as herein provided and promptly take appropriate action to remedy any such
failure. Nothing herein shall be deemed to require an initial review or any
periodic review by the Issuer, the Owner Trustee or the Indenture Trustee of
the Receivable Files.
(b) Maintenance of and Access to Records. The Servicer shall maintain
each Receivable File at one of its offices specified in Schedule B to this
Agreement, or at such other office as shall be specified to the Issuer and the
Indenture Trustee by written notice not later than ninety (90) days after any
change in location. The Servicer shall make available to the Issuer and the
9
14
Indenture Trustee or their duly authorized representatives, attorneys,
or auditors a list of locations of the Receivable Files, the Receivable Files,
and the related accounts, records, and computer systems maintained by the
Servicer at such times as the Issuer or the Indenture Trustee shall instruct.
(c) Release of Documents. Upon written instructions from the Indenture
Trustee, the Servicer shall release any document in the Receivable Files to the
Indenture Trustee, the Indenture Trustee's agent, or the Indenture Trustee's
designee, as the case may be, at such place or places as the Indenture Trustee
may designate, as soon thereafter as is practicable. Any document so released
shall be handled by the Indenture Trustee with due care and returned to the
Servicer for safekeeping as soon as the Indenture Trustee or its agent or
designee, as the case may be, shall have no further need therefor.
SECTION 2.6. Instructions; Authority to Act. All instructions from the
Indenture Trustee shall be in writing and signed by an Authorized Officer of
the Indenture Trustee, and the Servicer shall be deemed to have received proper
instructions with respect to the Receivable Files upon its receipt of such
written instructions.
SECTION 2.7. Custodian's Indemnification. The Servicer as custodian
shall indemnify the Issuer, the Owner Trustee and the Indenture Trustee for any
and all liabilities, obligations, losses, compensatory damages, payments,
costs, or expenses of any kind whatsoever that may be imposed on, incurred, or
asserted against the Issuer, the Owner Trustee or the Indenture Trustee as the
result of any improper act or omission in any way relating to the maintenance
and custody by the Servicer as custodian of the Receivable Files; provided,
however, that the Servicer shall not be liable to the Owner Trustee for any
portion of any such amount resulting from the willful misfeasance, bad faith,
or negligence of the Indenture Trustee or the Owner Trustee and shall not be
liable to the Indenture Trustee for any portion of any such amount resulting
from the willful misfeasance, bad faith, or negligence of the Indenture Trustee
or the Owner Trustee.
SECTION 2.8. Effective Period and Termination. The Servicer's appointment
as custodian shall become
10
15
effective as of the Cutoff Date and shall continue in full force and
effect until terminated pursuant to this Section 2.8. If Ford Credit shall
resign as Servicer in accordance with the provisions of this Agreement or if
all of the rights and obligations of the Servicer shall have been terminated
under Section 8.1, the appointment of the Servicer as custodian hereunder may
be terminated by the Indenture Trustee, or by the Noteholders of Notes
evidencing not less than 25% of the principal amount of the Notes Outstanding
or, with the consent of Noteholders of Notes evidencing not less than 25% of
the principal amount of the Notes Outstanding, by the Owner Trustee or by
Certificateholders of Certificates evidencing not less than 25% of the
Certificate Balance, in the same manner as the Indenture Trustee or such
Securityholders may terminate the rights and obligations of the Servicer under
Section 8.1. As soon as practicable after any termination of such appointment,
the Servicer shall deliver the Receivable Files and the related accounts and
records maintained by the Servicer to the Indenture Trustee or the Indenture
Trustee's agent at such place or places as the Indenture Trustee may reasonably
designate.
11
16
ARTICLE III
[RESERVED]
12
17
ARTICLE IV
DISTRIBUTIONS; RESERVE ACCOUNT;
STATEMENTS TO NOTEHOLDERS AND CERTIFICATEHOLDERS
SECTION 4.1. Accounts. (a) The Servicer shall, prior to the Closing
Date, establish and maintain a segregated trust account in the name of the
Indenture Trustee, at a Qualified Institution or Qualified Trust Institution
(which shall initially be ), which shall be designated as the
"Collection Account". The Collection Account shall be held in trust for the
benefit of the Noteholders and the Certificateholders. The Collection Account
shall be under the sole dominion and control of the Indenture Trustee;
provided, that the Servicer may make deposits to and direct the Indenture
Trustee in writing to make withdrawals from the Collection Account in
accordance with the terms of the Basic Documents. All monies deposited from
time to time in the Collection Account shall be held by the Indenture Trustee
as part of the Trust Property and all deposits to and withdrawals therefrom
shall be made only upon the terms and conditions of the Basic Documents.
If the Servicer is required to remit collections pursuant to the first
sentence of Section 4.2, all amounts held in the Collection Account shall, to
the extent permitted by applicable law, rules and regulations, be invested, as
directed in writing by the Servicer, by the bank or trust company then
maintaining the Collection Account in Permitted Investments that mature not
later than the Business Day immediately prior to the Distribution Date for the
Collection Period to which such amounts relate and such Permitted Investments
shall be held to maturity. All interest and other income (net of losses and
investment expenses) on funds on deposit in the Collection Account shall be
withdrawn from the Collection Account at the written direction of the Servicer
and shall be paid to the . In the event that the Collection Account
is no longer to be maintained at , the Servicer
shall, with the Indenture Trustee's or Owner Trustee's assistance as necessary,
cause the Collection Account to be moved to a Qualified Institution or a
Qualified Trust Institution within ten (10) Business Days (or such longer
period not to exceed thirty (30) calendar days as to which each Rating Agency
may consent).
19
18
(b) The Servicer shall, prior to the Closing Date, establish and maintain
a segregated trust account in the name of the Indenture Trustee at a Qualified
Institution or Qualified Trust Institution (which shall initially be ),
which shall be designated as the "Note Payment Account". The Note
Payment Account shall be held in trust for the benefit of the Noteholders. The
Note Payment Account shall be under the sole dominion and control of the
Indenture Trustee. All monies deposited from time to time in the Note Payment
Account pursuant to this Agreement and the Indenture shall be held by the
Indenture Trustee as part of the Trust Property and shall be applied as
provided in the Basic Documents. In the event that the Note Payment Account is
no longer to be maintained at , the Servicer shall,
with the Indenture Trustee's assistance as necessary, cause the Note Payment
Account to be moved to a Qualified Institution or a Qualified Trust Institution
within ten (10) Business Days (or such longer period not to exceed thirty (30)
calendar days as to which each Rating Agency may consent).
(c) The Servicer shall, prior to the Closing Date, establish and maintain
a segregated trust account in the name of the Owner Trustee at a Qualified
Institution or Qualified Trust Institution (which shall initially be ),
which shall be designated as the "Certificate Distribution Account".
Except as provided in the Trust Agreement, the Certificate Distribution Account
shall be held in trust for the benefit of the Certificateholders. The
Certificate Distribution Account shall be under the sole dominion and control
of the Owner Trustee. All monies deposited from time to time in the
Certificate Distribution Account pursuant to this Agreement and the Indenture
shall be held by the Owner Trustee as part of the Trust Property and shall be
applied as provided in the Basic Documents. In the event that the Certificate
Distribution Account is no longer to be maintained at , the
Servicer shall, with the Owner Trustee's assistance as necessary, cause the
Certificate Distribution Account to be moved to a Qualified Institution or a
Qualified Trust Institution within ten (10) Business Days (or such longer
period not to exceed thirty (30) calendar days as to which each Rating Agency
may consent).
20
19
(d) The Servicer shall, prior to the Closing Date, establish and maintain
a segregated trust account in the name of the Indenture Trustee at a Qualified
Institution or Qualified Trust Institution (which shall initially be ),
which shall be designated as the "Payahead Account" (the Payahead
Account, together with the Collection Account and the Note Payment Account, the
"Trust Accounts"). The Payahead Account shall be held in trust for the benefit
of the Securityholders. The Payahead Account shall be under the sole dominion
and control of the Indenture Trustee provided, that the Servicer may make
deposits to and direct the Indenture Trustee in writing to make withdrawals
from the Payahead Account in accordance with the Basic Documents. All monies
deposited from time to time in the Payahead Account shall be held by the
Indenture Trustee as part of the Trust Property and all deposits to and
withdrawals therefrom shall be made only upon the terms and conditions of the
Basic Documents.
If the Servicer is required to remit collections pursuant to the first
sentence of Section 4.2, all amounts held in the Payahead Account shall, to the
extent permitted by applicable law, rules and regulations, be invested, as
directed in writing by the Servicer, by the bank or trust company then
maintaining the Payahead Account in Permitted Investments that mature not later
than the Business Day immediately prior to the Distribution Date for the
Collection Period to which such amounts relate and such Permitted Investments
shall be held to maturity. All interest and other income (net of losses and
investment expenses) on funds on deposit in the Payahead Account shall be
withdrawn from the Payahead Account at the direction of the Servicer and shall
be paid to . In the event that the Payahead Account is no
longer to be maintained at , the Servicer shall, with the
Indenture Trustee's or Owner Trustee's assistance as necessary, cause the
Payahead Account to be moved to a Qualified Institution or a Qualified Trust
Institution within ten (10) Business Days (or such longer period not to exceed
thirty (30) calendar days as to which each Rating Agency may consent).
(e) Notwithstanding the provisions of clause (d) above and of Section
4.6(a)(ii), for so long as (i) Ford Credit is the Servicer, (ii) the rating of
Ford Credit's short-term unsecured debt is at least P-1 by
21
20
Moody's and is at least A-1 by Standard & Poor's and (iii) no Event of
Servicing Termination shall have occurred (each, a "Monthly Remittance
Condition"), Payaheads need not be remitted to and deposited in the Payahead
Account but instead may be remitted to and held by the Servicer. So long as
each Monthly Remittance Condition is satisfied, the Servicer shall not be
required to segregate or otherwise hold separate any Payaheads remitted to the
Servicer as aforesaid but shall be required to remit Payaheads to the
Collection Account in accordance with Section 4.6(a)(i). At any time as any
Monthly Remittance Condition is not satisfied, the Servicer shall deposit in
the Payahead Account the amount of any Payaheads then held or received by it
(which amount shall be at least equal to the Payahead Balance as of the close
of business on the last day of the immediately preceding Collection Period).
Notwithstanding the foregoing, if a Monthly Remittance Condition is not
satisfied the Servicer may utilize, with respect to Payaheads, an alternative
remittance schedule (which may include the remittance schedule utilized by the
Servicer before the Monthly Remittance Condition became unsatisfied), if the
Servicer provides to the Owner Trustee and the Indenture Trustee written
confirmation from each Rating Agency that such alternative remittance schedule
will not result in the downgrading or withdrawal by such Rating Agency of the
ratings then assigned to the Notes and the Certificates. The Owner Trustee and
the Indenture Trustee shall not be deemed to have knowledge of any event or
circumstance under clause (iii) of the first sentence of this Section 4.1(e)
that would require remittance of the Payaheads to the Payahead Account unless
the Owner Trustee or the Indenture Trustee has received notice of such event or
circumstance from the Seller or the Servicer in an Officer's Certificate or
from the Noteholders of Notes evidencing not less than 25% of the principal
amount of the Notes Outstanding or from the Certificateholders of Certificates
evidencing not less than 25% of the Certificate Balance or unless a Trustee
Officer in the Corporate Trust Office with knowledge hereof and familiarity
herewith has actual knowledge of such event or circumstance.
SECTION 4.2. Collections. The Servicer shall remit daily to the
Collection Account (i) all payments by or on behalf of the Obligors (including
Payaheads on the Receivables and Rule of 78's Payments, but excluding Pur-
22
21
chased Receivables) and (ii) all Liquidation Proceeds, both as
collected during the Collection Period. Ford Credit, so long as it is acting
as the Servicer, may 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 4.2 and only for so long as such
terms and conditions are fulfilled. Accordingly, notwithstanding the
provisions of the first sentence of this Section 4.2, the Servicer shall remit
collections received during a Collection Period to the Collection Account in
immediately available funds on the related Distribution Date but only for so
long as each Monthly Remittance Condition is satisfied. Notwithstanding the
foregoing, if a Monthly Remittance Condition is not satisfied the Servicer may
utilize an alternative remittance schedule (which may include the remittance
schedule utilized by the Servicer before the Monthly Remittance Condition
became unsatisfied), if the Servicer provides to the Owner Trustee and the
Indenture Trustee written confirmation from each Rating Agency that such
alternative remittance schedule will not result in the downgrading or
withdrawal by such Rating Agency of the ratings then assigned to the Notes and
the Certificates. The Owner Trustee or the Indenture Trustee shall not be
deemed to have knowledge of any event or circumstance under clause (iii) of the
definition of Monthly Remittance Condition that would require daily remittance
by the Servicer to the Collection Account unless the Owner Trustee or the
Indenture Trustee has received notice of such event or circumstance from the
Seller or the Servicer in an Officer's Certificate or from the Noteholders of
Notes evidencing not less than 25% of the principal amount of the Notes
Outstanding or from the Certificateholders of Certificates evidencing not less
than 25% of the Certificate Balance or a Trustee Officer in the Corporate Trust
Office with knowledge hereof or familiarity herewith has actual knowledge of
such event or circumstance. For purposes of this Article IV the phrase
"payments by or on behalf of Obligors" shall mean payments made by Persons
other than the Servicer or by other means.
SECTION 4.3. Application of Collections. For the purposes of this
Agreement, as of the close of business on the last day of each Collection
Period, all col-
23
22
lections for the Collection Period with respect to each Receivable
(other than a Purchased Receivable) shall be applied by the Servicer as
follows:
Payments by or on behalf of the Obligor which are not late fees,
prepayment charges, or other administrative fees and expenses, or
similar charges which constitute the Supplemental Servicing Fee shall
be applied first to reduce Outstanding Advances made with respect to
such Receivable, as described in Section 4.4(a) below. Next, any
excess shall be applied (i) in the case of Simple Interest
Receivables, to interest and principal on the Receivable in
accordance with the Simple Interest Method and (ii) in the case of
Precomputed Receivables, to the Scheduled Payment with respect to
such Receivable and any remaining excess (except for partial
prepayments which cause a reduction in the Obligor's periodic payment
to below the Scheduled Payment as of the Cutoff Date) shall be added
to the Payahead Balance, and shall be applied to prepay the
Precomputed Receivable but only if the sum of such excess and the
previous Payahead Balance shall be sufficient to prepay the
Precomputed Receivable in full, otherwise such excess shall
constitute a Payahead, and shall increase the Payahead Balance.
SECTION 4.4. Advances. (a) As of the close of business on the last day
of each Collection Period, if the payments by or on behalf of the Obligor on a
Precomputed Receivable (other than a Purchased Receivable) after application
under Section 4.3 shall be less than the Scheduled Payment, whether as a result
of any extension granted to the Obligor or otherwise, the Payahead Balance, if
any, with respect to such Receivables shall be applied by the Indenture Trustee
to the extent of the shortfall, and such Payahead Balance shall be reduced
accordingly. Next, subject to the following sentence, the Servicer shall make
an Advance of any remaining shortfall. The Servicer will be obligated to make
an Advance in respect of a Receivable only to the extent that the Servicer, in
its sole discretion, shall determine that the Advance shall be recoverable from
subsequent collections or recoveries on any Receivable.
24
23
With respect to each Receivable, the Advance shall increase Outstanding
Advances. Outstanding Advances shall be reduced by subsequent payments by or
on behalf of the Obligor, collections of Liquidation Proceeds and payments of
the Purchase Amount.
If the Servicer shall determine that an Outstanding Advance with respect
to any Receivable shall not be recoverable, the Servicer shall be reimbursed
from any collections made on other Receivables in the Trust, and Outstanding
Advances with respect to such Receivable shall be reduced accordingly.
(b) In the event that an Obligor shall prepay a Receivable in full, if
the related contract did not require such Obligor to pay a full month's
interest, for the month of prepayment, at the Annual Percentage Rate, the
Servicer shall make an unreimbursable advance of the amount of such interest.
SECTION 4.5. Additional Deposits. (a) The Servicer shall deposit in the
Collection Account the aggregate Advances pursuant to Section 4.4(a) and the
aggregate advances pursuant to Section 4.4(b). To the extent that the Servicer
fails to make an advance pursuant to Section 4.4(b) on the date required, the
Indenture Trustee shall withdraw such amount from the Reserve Account and
deposit such amount in the Collection Account. The Servicer and the Seller
shall deposit in the Collection Account the aggregate Purchase Amounts with
respect to Purchased Receivables and the Servicer shall deposit therein all
amounts to be paid under Sections 9.1 and 3.7(b). The Indenture Trustee shall
deposit in the Collection Account the aggregate of amounts received pursuant to
the Yield Supplement Agreement, if any, and amounts received from the Letter of
Credit Bank or the Yield Supplement Account, if any, pursuant to Article V.
All such deposits with respect to a Collection Period shall be made, in
immediately available funds, on the Distribution Date related to such
Collection Period.
(b) The Indenture Trustee shall on the Distribution Date relating to
each Collection Period make a withdrawal from the Reserve Account in an amount
equal to the amount (if positive) calculated by the Servicer pursuant to the
second sentence of Section 4.6(b) and shall deposit such funds into the
Collection Account.
25
24
SECTION 4.6. Distributions. (a) On each Distribution Date, the
Indenture Trustee shall cause to be made the following transfers and
distributions in the amounts set forth in the Servicer's Certificate for such
Distribution Date:
(i) From the Payahead Account, or from the Servicer in the event
the provisions of Section 4.1(e) above are applicable, to the Collection
Account, in immediately available funds, (x)Ethe portion of Payaheads
constituting Scheduled Payments or prepayments in full, required by
Sections 4.3 and 4.4(a), and (y) the Payahead Balance, if any, relating
to any Purchased Receivable.
(ii) From the Collection Account to the Payahead Account, or to the
Servicer in the event the provisions of Section 4.1(e) above are
applicable, in immediately available funds, the aggregate Payaheads
required by Section 4.3 for the Collection Period related to such
Distribution Date.
(iii) From the Collection Account to the Servicer, in immediately
available funds, repayment of Outstanding Advances pursuant to Section
4.4(a).
(b) Prior to each Distribution Date, the Servicer shall on each
Determination Date calculate the Available Funds, the Available Interest, the
Available Principal, the Scheduled Principal, the Servicing Fee, the Accrued
Note Interest, the Noteholders' Regular Principal, the Noteholders' Accelerated
Principal, the Principal Distribution Amount, the Accrued Certificate Interest,
the Certificateholders' Regular Principal and the Yield Supplement Amount, if
any. In addition, the Servicer shall calculate on each Determination Date the
difference between the Total Required Payment (together with, after the Notes
have been paid in full, the Certificateholders' Regular Principal) and
Available Funds.
(c) On each Distribution Date, the Servicer shall instruct the Indenture
Trustee (based on the information contained in the Servicer's Certificate
delivered on the related Determination Date pursuant to Section 3.9), to make
the following withdrawals from the Collec-
26
25
tion Account and make deposits, distributions and payments, to the extent of
funds on deposit in the Collection Account, in the following order of priority:
(i) first, to the Servicer, the Servicing Fee and all unpaid
Servicing Fees from prior Collection Periods;
(ii) second, to the Note Payment Account, the Accrued Note
Interest;
(iii) third, to the Note Payment Account, the Noteholders'
Regular Principal;
(iv) fourth, to the Certificate Distribution Account, the
Accrued Certificate Interest;
(v) fifth, on or after the Distribution Date on which the
outstanding principal amount of all the Notes is reduced to zero,
to the Certificate Distribution Account, the Certificateholders'
Regular Principal;
(vi) sixth, to the Reserve Account, the amount, if any,
necessary to reinstate the balance in the Reserve Account up to
the Specified Reserve Balance;
(vii) seventh, to the Note Payment Account, the Noteholders'
Accelerated Principal; and
(viii) eighth, to the Seller, any remaining portion of funds
on deposit in the Collection Account.
Notwithstanding the foregoing, following the occurrence and during the
continuation of an Event of Default which has resulted in an acceleration of
the Notes or following an Insolvency Event or a dissolution with respect to the
Seller or the General Partner, the Available Funds remaining after the
application of clauses (i) and (ii) above will be deposited in the Note Payment
Account to the extent necessary to reduce the principal amount of all the Notes
to zero, and the Certificateholders will not receive any distributions until
the principal amount
27
26
and accrued interest on all the Notes have been paid in full.
SECTION 4.7. Reserve Account. (a) (i) The Seller shall, prior to the
Closing Date, establish and maintain an account in the name of the Indenture
Trustee at a Qualified Institution or Qualified Trust Institution (which shall
initially be ), which shall be designated as the "Reserve Account".
The Reserve Account shall be under the sole dominion and control of the
Indenture Trustee; provided, that the Servicer may make deposits to the Reserve
Account in accordance with the Basic Documents. On the Closing Date, the
Seller shall deposit the Reserve Initial Deposit into the Reserve Account from
the net proceeds of the sale of the Notes and the Certificates. All amounts on
deposit in and credited to the Reserve Account, including the Reserve Initial
Deposit and any Permitted Investments (whether in the form of deposit accounts,
Physical Property, book-entry securities, uncertificated securities or
otherwise), and all proceeds thereof (such amounts, the "Reserve Account
Property") shall hereby be sold, conveyed and transferred by the Seller to the
Trust. Pursuant to the Indenture, the Trust will pledge all of its right,
title and interest in, to and under the Reserve Account and the Reserve Account
Property to the Indenture Trustee on behalf of the Noteholders to secure the
Trust's obligations under the Notes and the Indenture.
The Reserve Account Property shall, to the extent permitted by applicable
law, rules and regulations, be invested, as directed in writing by the
Servicer, by the bank or trust company then maintaining the Reserve Account in
Permitted Investments that mature not later than the next Distribution Date,
and such Permitted Investments shall be held to maturity. All interest and
other income (net of losses and investment expenses) on funds on deposit in the
Reserve Account shall, upon the written direction of the Servicer, be paid to
the Seller on any Distribution Date to the extent funds on deposit therein, as
certified by the Servicer, exceed the Specified Reserve Balance. In the event
the Reserve Account is no longer to be maintained at ,
the Servicer shall, with the Indenture Trustee's or Owner Trustee's
assistance as necessary, cause the Reserve Account to be moved to a Qualified
Institution or a Qualified Trust Institution within ten
28
27
(10) Business Days (or such longer period not to exceed thirty (30) calendar
days as to which each Rating Agency may consent).
(ii) With respect to Reserve Account Property:
(A) any Reserve Account Property that is held in
deposit accounts shall be held solely in the name of the
Indenture Trustee at one or more depository institutions
having the Required Rating. Each such deposit account
shall be subject to the exclusive custody and control of
the Indenture Trustee, and the Indenture Trustee shall have
sole signature authority with respect thereto.
(B) any Reserve Account Property that constitutes
Physical Property shall be delivered to the Indenture
Trustee in accordance with paragraph (a) of the definition
of "Delivery" and shall be held, pending maturity or
disposition, solely by the Indenture Trustee or a financial
intermediary (as such term is defined in Section 8-313(4)
of the UCC) acting solely for the Indenture Trustee.
(C) any Reserve Account Property that is a book-entry
security held through the Federal Reserve System pursuant
to federal book-entry regulations shall be delivered in
accordance with paragraph (b) of the definition of
"Delivery" and shall be maintained by the Indenture
Trustee, pending maturity or disposition, through continued
book-entry registration of such Reserve Account Property
as described in such paragraph.
(D) any Reserve Account Property that is an
"uncertificated security" under Article 8 of the UCC shall
be delivered to the Indenture Trustee in accordance with
paragraph (c) of the definition of "Delivery" and shall be
maintained by the Indenture Trustee, pending maturity or
disposi-
29
28
tion, through continued registration of the
Indenture Trustee's (or its nominee's) ownership of such
security;
(E) Property of a type which is not capable of being
delivered to the Indenture Trustee in accordance with the
definition of "Delivery" shall not constitute Reserve
Account Property.
Effective upon Delivery of any Reserve Account Property in the form of
Physical Property, uncertified securities or book-entry securities, the
Indenture Trustee shall be deemed to have represented that it has purchased
such Reserve Account Property for value, in good faith, and without notice of
any adverse claim thereto.
(b) If the Servicer pursuant to Section 4.4 determines on any
Determination Date that it is required to make an Advance and does not do so
from its own funds, the Servicer shall promptly instruct the Indenture Trustee
in writing to withdraw funds, in an amount specified by the Servicer, from the
Reserve Account and deposit them in the Collection Account to cover any
shortfall. Such payment shall be deemed to have been made by the Servicer
pursuant to Section 4.4 for purposes of making distributions pursuant to this
Agreement, but shall not otherwise satisfy the Servicer's obligation to deliver
the amount of the Advances to the Indenture Trustee, and the Servicer shall
within two Business Days replace any funds in the Reserve Account so used.
(c) If the amount on deposit in the Reserve Account on any Distribution
Date (after giving effect to all deposits thereto or withdrawals therefrom on
such Distribution Date) is greater than the Specified Reserve Balance for such
Distribution Date, the Servicer shall instruct the Indenture Trustee to
distribute the amount of such excess to the Seller; provided that the Indenture
Trustee and the Owner Trustee hereby release, on each Distribution Date, their
security interest in, to and under Reserve Account Property distributed to the
Seller; and provided further, that any portion of such excess attributable to
investment income (net of losses and investment expenses) shall be paid to the
Seller.
30
29
(d) Following the payment in full of the aggregate principal amount of the
Notes and the Certificate Balance and of all other amounts owing or to be
distributed hereunder or under the Indenture or the Trust Agreement to
Noteholders and Certificateholders and the termination of the Trust, any
remaining Reserve Account Property shall be distributed to the Seller.
SECTION 4.8. Net Deposits. For so long as (i) Ford Credit shall be the
Servicer, (ii) the Servicer shall be entitled pursuant to Section 4.2 to remit
collections on a monthly rather than daily basis, and (iii) the Servicer shall
be entitled pursuant to Section 4.1(e) to retain Payaheads rather than deposit
them in the Payahead Account, Ford Credit may make the remittances pursuant to
Sections 4.2 and 4.5 above, net of amounts to be distributed to Ford Credit
pursuant to Section 4.6(c). Nonetheless, the Servicer shall account for all of
the above described remittances and distributions except for the Supplemental
Servicing Fee in the Servicer's Certificate as if the amounts were deposited
and/or transferred separately. The Seller may make the remittances pursuant to
Sections 4.2 and 4.5 above, net of amounts to be distributed to the Seller
pursuant to Sections 4.6(c) and 4.7(c). Nonetheless, the Seller shall account
for all of the above described remittances and distributions as if the amounts
were deposited and/or transferred separately.
SECTION 4.9. Statements to Noteholders and Certificateholders. On each
Distribution Date, the Servicer shall provide to the Indenture Trustee (with
copies to the Rating Agencies and each Note Paying Agent) for the Indenture
Trustee to forward to each Noteholder of record as of the most recent Record
Date and to the Owner Trustee (with copies to the Rating Agencies and to each
Certificate Paying Agent) for the Owner Trustee to forward to each
Certificateholder of record as of the most recent Record Date a statement based
on information in the Servicer's Certificate furnished pursuant to Section 3.9,
setting forth for the Collection Period relating to such Distribution Date the
following information as to the Notes and the Certificates to the extent
applicable:
(i) the amount of such distribution allocable to principal
allocable to the Notes and to the Certificates;
31
30
(ii) the amount of such distribution allocable to interest
allocable to the Notes and the Certificates;
(iii) the amount of such distribution allocable to the Yield
Supplement Amount;
(iv) the Pool Balance as of the close of business on the last day
of the preceding Collection Period;
(v) the amount of the Servicing Fee paid to the Servicer with
respect to the related Collection Period and the amount of any unpaid
Servicing Fees and the change in such amount from that of the prior
Distribution Date;
(vi) the amounts of the Noteholders' Interest Carryover Shortfall,
the Noteholders' Principal Carryover Shortfall, the Certificateholders'
Interest Carryover Shortfall and the Certificateholders' Principal
Carryover Shortfall, if any, on such Distribution Date and the change in
such amounts from the preceding Distribution Date;
(vii) the aggregate outstanding principal amount of each Class of
Notes, the Note Pool Factor for each Class of Notes, the Certificate
Balance and the Certificate Pool Factor as of such Distribution Date;
(viii) the balance of the Reserve Account on such Distribution
Date, after giving effect to distributions made on such Distribution Date
and the change in such balance from the preceding Distribution Date;
(ix) the amount of the aggregate Realized Losses, if any, with
respect to the related Collection Period;
(x) the aggregate Purchase Amount of Receivables repurchased by the
Seller or purchased by the Servicer, if any, with respect to the related
Collection Period; and
32
31
(xi) the amount of Advances, if any, on such Distribution Date.
Each amount set forth on the Distribution Date statement pursuant to
clauses (i), (ii), (v) or (vi) above shall be expressed as a dollar amount per
$1,000 of original principal amount or original Certificate Balance of a Note
or a Certificate, as applicable.
33
32
ARTICLE V
YIELD SUPPLEMENT LETTER OF CREDIT
SECTION 5.1. Yield Supplement Letter of Credit and the Yield Supplement
Account.
(a) The Servicer shall, prior to the Closing Date, establish and maintain
an account in the name of the Indenture Trustee at a Qualified Institution or
Qualified Trust Institution (which shall initially be ),
which shall be designated as the "Yield Supplement Account". Amounts on
deposit in the Yield Supplement Account will be used for the payment of any
Yield Supplement Amounts required to be paid on any Distribution Date pursuant
to the Yield Supplement Agreement which Ford Credit has not paid as of such
Distribution Date. The Yield Supplement Account shall be under the sole
dominion and control of the Indenture Trustee; provided that the Servicer may
make deposits to and direct the Indenture Trustee to make withdrawals from the
Yield Supplement Account in accordance with the Basic Documents. On the
Closing Date, the Seller will deposit the Yield Supplement Initial Deposit into
the Yield Supplement Account from the net proceeds of the sale of the Notes and
the Certificates. To the extent, on any Distribution Date, the amount on
deposit in the Yield Supplement Account (after giving effect to any withdrawals
to be made on such Distribution Date, but exclusive of net investment income)
is greater than the Specified Yield Supplement Balance, then, in such event,
the Servicer shall instruct the Indenture Trustee in writing to pay such excess
amount to the Seller. In the event that the Yield Supplement Account is no
longer to be maintained at ,
the Servicer shall, with the Indenture Trustee's assistance as necessary,
cause the Yield Supplement Account to be moved to a Qualified Institution or a
Qualified Trust Institution within ten (10) Business Days (or such longer
period not to exceed thirty (30) calendar days as to which each Rating Agency
may consent).
The Seller hereby sells, conveys and transfers to the Trust the Yield
Supplement Account, all funds and investments on deposit therein or credited
thereto and
34
33
all proceeds thereof, subject, however, to the limitations set forth below.
Pursuant to the Indenture, the Trust will pledge its rights under the
Yield Supplement Agreement (including its rights to amounts on deposit in the
Yield Supplement Account) to the Indenture Trustee to secure its obligations
under the Notes and the Indenture. Such sale, conveyance and transfer of the
Yield Supplement Account by the Seller to the Trust, and such pledge by the
Trust of its rights to amounts in the Yield Supplement Account to the Indenture
Trustee, shall be subject to the following limitations:
(i) All or a portion of the Yield Supplement Account may be
invested and reinvested in the manner specified in Section 4.1(a) in
accordance with written instructions from the Servicer. All such
investments shall be made in the name of the Indenture Trustee and
all income and gain realized thereon shall be solely for the benefit
of and shall be payable by the Indenture Trustee to
upon written direction of the Servicer in the manner specified in
Section 4.1(a);
(ii) If, with respect to any Collection Period, Ford Credit
shall have failed to make or cause to be made in full the remittance
of the Yield Supplement Amount on the date required by the Yield
Supplement Agreement, the Indenture Trustee on the related
Distribution Date, shall, upon the written direction of the Servicer,
withdraw from the Yield Supplement Account and deposit into the
Collection Account the amount of the shortfall between the amount of
funds that are required to be remitted by Ford Credit with respect to
the Yield Supplement Agreement as set forth in the Servicer's
Certificate and the amount of funds actually so remitted and to the
extent of any remaining shortfall, the Indenture Trustee shall
withdraw an amount equal thereto from the Reserve Account and deposit
such amount in the Collection Account; and
35
34
(iii) Upon termination of this Agreement in accordance with
Section 9.1 or (a) in the event that the Seller obtains a Yield
Supplement Letter of Credit or (b) the Seller otherwise satisfies the
requirements with respect to the Yield Supplement Agreement
established by the Rating Agencies, in either case as evidenced by
satisfaction of the Rating Agency Condition and, in either case,
delivers to the Indenture Trustee an Opinion of Counsel to the effect
that the contemplated action will not adversely affect the status of
the Trust as a partnership for federal income and Applicable Tax
State income and franchise tax purposes and an Officer's Certificate
of the Seller that all conditions precedent to the liquidation of the
Yield Supplement Account have been satisfied, any amounts on deposit
in the Yield Supplement Account shall, upon written request of the
Seller, be paid to the Seller.
(b) If a Yield Supplement Letter of Credit has been obtained by Ford
Credit, and if, with respect to any Collection Period, Ford Credit shall have
failed to make or cause to be made in full the remittance of the Yield
Supplement Amount, upon written notice by the Servicer of such failure (which
notice shall be given on the Distribution Date for such Collection Period), the
Indenture Trustee shall draw on the Yield Supplement Letter of Credit in
accordance with the terms thereof, in the amount of the shortfall between the
amount of funds with respect to the Yield Supplement Amount that are required
to be remitted by Ford Credit with respect to the Yield Supplement Agreement as
set forth in the Servicer's Certificate and the amount of funds actually so
remitted as set forth in the Servicer's Certificate. Any such draw on the
Yield Supplement Letter of Credit shall be made after receipt of the related
Servicer's Certificate on the Distribution Date for such Collection Period.
Upon receipt of a request for a draw by the Indenture Trustee under the Yield
Supplement Letter of Credit, the Letter of Credit Bank is to promptly make a
payment to the Indenture Trustee in an amount equal to the Yield Supplement
Amount (minus payments made on the Yield Supplement Agreement), and the
Indenture Trustee shall deposit into the Collection Account pursuant to Section
4.5 the amount received from the Letter of Credit Bank in
36
35
respect of such drawing. The Servicer shall include in each Servicer's
Certificate, or in an Officer's Certificate provided to the Indenture Trustee
with each Servicer's Certificate, the Stated Amount (as defined in the Yield
Supplement Letter of Credit) of the Yield Supplement Letter of Credit as of the
close of business on the last day of the Collection Period preceding the date
of such Servicer's Certificate. In the event that the rating of the Letter of
Credit Bank declines below the Required Rating, the Servicer shall promptly
notify the Indenture Trustee in writing of such decline, and upon receipt of
such notification, the Indenture Trustee shall, unless a suitable replacement
letter of credit shall have been delivered, promptly draw the full amount
available under the Yield Supplement Letter of Credit and deposit such amount
in the Yield Supplement Account.
37
36
ARTICLE VI
THE SELLER
SECTION 6.1. Representations and Warranties of Seller. The Seller makes
the following representations and warranties on which the Issuer is deemed to
have relied in acquiring the Trust Property. The representations and
warranties speak as of the execution and delivery of this Agreement and shall
survive the sale of the Trust Property to the Issuer and the pledge thereof by
the Issuer to the Indenture Trustee pursuant to the Indenture:
(a) Organization and Good Standing. The Seller shall have been duly
organized and shall be validly existing as a limited partnership in good
standing under the laws of the State of Delaware, with power and authority to
own its properties and to conduct its business as such properties shall be
currently owned and such business is presently conducted, and had at all
relevant times, and shall have, power, authority, and legal right to acquire
and own the Receivables.
(b) Due Qualification. The Seller shall be duly qualified to do business
as a foreign limited partnership in good standing, and shall have obtained all
necessary licenses and approvals in all jurisdictions in which the ownership or
lease of property or the conduct of its business shall require such
qualifications.
(c) Power and Authority. The Seller shall have the power and authority
to execute and deliver this Agreement and the other Basic Documents to which it
is a party and to carry out their terms. The Seller shall have full power and
authority to sell and assign the property to be sold and assigned to and
deposited with the Issuer and has duly authorized such sale and assignment to
the Issuer by all necessary action; and the execution, delivery, and
performance of this Agreement and the other Basic Documents to which it is a
party shall have been duly authorized by the Seller by all necessary action.
(d) Valid Sale; Binding Obligation. This Agreement shall evidence a
valid sale, transfer, and assignment of the Receivables and the other Trust
Property
38
37
conveyed by the Seller to the Issuer hereunder, enforceable against
creditors of and purchasers from the Seller; and this Agreement and the other
Basic Documents to which the Seller is a party constitute legal, valid, and
binding obligations of the Seller, enforceable against the Seller in accordance
with their terms, subject, as to enforceability, to applicable bankruptcy,
insolvency, reorganization, conservatorship, receivership, liquidation and
other similar laws and to general equitable principles.
(e) No Violation. The consummation of the transactions contemplated
by this Agreement and the other Basic Documents to which the Seller is a party
and the fulfillment of the terms hereof and thereof will 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 or both) a default under, the
Certificate of Limited Partnership or Limited Partnership Agreement, any
indenture, agreement, or other instrument to which the Seller is a party or by
which the Seller 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 federal or State regulatory body, administrative agency, or other
governmental instrumentality having jurisdiction over the Seller or its
properties.
(f) No Proceedings. To the Seller's best knowledge, there are no
proceedings or investigations pending, or threatened, before any court,
regulatory body, administrative agency, or other governmental instrumentality
having jurisdiction over the Seller or its properties: (i) asserting the
invalidity of this Agreement, the Indenture, any of the other Basic Documents,
the Notes or the Certificates, (ii) seeking to prevent the issuance of the
Notes or the Certificates or the consummation of any of the transactions
contemplated by this Agreement, the Indenture or any of the other Basic
Documents, (iii) seeking any determination or ruling that might materially and
adversely affect the performance by the Seller of its obligations under, or the
validity or enforceability of, this Agreement, the Indenture, any of the other
Basic Documents, the Notes or the Certificates, or (iv) relating to the Seller
and which might adversely
39
38
affect the federal or Applicable Tax State income, excise, franchise or similar
tax attributes of the Notes or the Certificates.
SECTION 6.2. Liability of Seller; Indemnities. The Seller shall be liable
in accordance herewith only to the extent of the obligations specifically
undertaken by the Seller under this Agreement, and hereby agrees to the
following:
(a) The Seller shall indemnify, defend, and hold harmless the Issuer, the
Owner Trustee and the Indenture Trustee from and against any taxes that may at
any time be asserted against any such Person with respect to, and as of the
date of, the sale of the Receivables to the Issuer or the issuance and original
sale of the Notes and the Certificates, including any sales, gross receipts,
general corporation, tangible personal property, privilege, or license taxes
(but, in the case of the Issuer, not including any taxes asserted with respect
to ownership of the Receivables or federal or other Applicable Tax State income
taxes arising out of the transactions contemplated by this Agreement and the
other Basic Documents) and costs and expenses in defending against the same.
(b) The Seller shall indemnify, defend, and hold harmless the Issuer, the
Owner Trustee, the Indenture Trustee, the Noteholders and the
Certificateholders from and against any loss, liability or expense incurred by
reason of (i) the Seller's willful misfeasance, bad faith, or negligence (other
than errors in judgment) in the performance of its duties under this
Agreement, or by reason of reckless disregard of its obligations and duties
under this Agreement and (ii) the Seller's violation of federal or State
securities laws in connection with the registration or the sale of the Notes or
the Certificates.
(c) The Seller shall indemnify, defend and hold harmless the Owner
Trustee and the Indenture Trustee and their respective officers, directors,
employees and agents from and against all costs, expenses, losses, claims,
damages and liabilities arising out of or incurred in connection with the
acceptance or performance of the trusts and duties contained herein and in the
Trust Agreement, in the case of the Owner Trustee, and in
40
39
the Indenture, in the case of the Indenture Trustee, except to the
extent that such cost, expense, loss, claim, damage or liability: (i) in the
case of the Owner Trustee, shall be due to the willful misfeasance, bad faith
or negligence (except for errors in judgment) of the Owner Trustee or, in the
case of the Indenture Trustee, shall be due to the willful misfeasance, bad
faith or negligence (except for errors in judgment) of the Indenture Trustee;
or (ii) in the case of the Owner Trustee shall arise from the breach by the
Owner Trustee of any of its representations or warranties set forth in Section
7.3 of the Trust Agreement or (iii) in the case of the Indenture Trustee shall
arise from the breach by the Indenture Trustee of any of its representations
and warranties set forth in the Indenture.
(d) The Seller shall pay any and all taxes levied or assessed upon all or
any part of the Owner Trust Estate.
(e) Indemnification under this Section 6.2 shall survive the resignation
or removal of the Owner Trustee or the Indenture Trustee and the termination of
this Agreement and shall include, without limitation, reasonable fees and
expenses of counsel and expenses of litigation. If the Seller shall have made
any indemnity payments pursuant to this Section 6.2 and the Person to or on
behalf of whom such payments are made thereafter shall collect any of such
amounts from others, such Person shall repay such amounts to the Seller,
without interest.
SECTION 6.3. Merger or Consolidation of, or Assumption of the Obligations
of, Seller. Any Person (i) into which the Seller may be merged or
consolidated, (ii) resulting from any merger, conversion, or consolidation to
which the Seller shall be a party, (iii) succeeding to the business of the
Seller, or (iv) more than 50% of the voting stock of which is owned directly or
indirectly by Ford Motor Company, which Person in any of the foregoing cases
executes an agreement of assumption to perform every obligation of the Seller
under this Agreement, will be the successor to the Seller 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; provided, however, that (x) the Seller
shall have delivered to the Owner Trustee and the Indenture
41
40
Trustee an Officer's Certificate and an Opinion of Counsel each stating
that such merger, conversion, consolidation or succession and such agreement of
assumption comply with this Section 6.3 and that all conditions precedent, if
any, provided for in this Agreement relating to such transaction have been
complied with and (y) the Seller shall have delivered to the Owner Trustee and
the Indenture Trustee an Opinion of Counsel either (A) stating that, in the
opinion of such counsel, all financing statements and continuation statements
and amendments thereto have been executed and filed that are necessary fully to
preserve and protect the interest of the Issuer and the Indenture Trustee,
respectively, in the Receivables and the other Trust Property, and reciting the
details of such filings, or (B) stating that, in the opinion of such counsel,
no such action shall be necessary to preserve and protect such interest. The
Seller shall provide notice of any merger, conversion, consolidation, or
succession pursuant to this Section 6.3 to the Rating Agencies.
Notwithstanding anything herein to the contrary, the execution of the foregoing
agreement of assumption and compliance with clauses (x) or (y) above shall be
conditions to the consummation of the transactions referred to in clauses (i),
(ii) or (iii) above.
SECTION 6.4. Limitation on Liability of Seller and Others. The Seller
and any officer or 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 to appear in, prosecute, or defend
any legal action that shall not be incidental to its obligations under this
Agreement, and that in its opinion may involve it in any expense or liability.
SECTION 6.5. Seller May Own Notes or Certificates. The Seller, and any
Affiliate of the Seller, may in its individual or any other capacity become the
owner or pledgee of Notes or Certificates with the same rights as it would have
if it were not the Seller or an Affiliate thereof, except as otherwise
expressly provided herein or in the other Basic Documents. Except as set forth
herein or in the other Basic Documents, Notes and Certificates so owned by or
pledged to the Seller or any such Affiliate shall have an equal and
proportionate benefit under the provisions of this Agreement and the
42
41
other Basic Documents, without preference, priority, or distinction as among
all of the Notes and Certificates.
43
42
ARTICLE VII
[RESERVED]
44
43
ARTICLE VIII
[RESERVED]
52
44
ARTICLE IX
TERMINATION
SECTION 9.1. Optional Purchase of All Receivables. (a) On the last day
of any Collection Period as of which the Pool Factor shall be 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 deposit
pursuant to Section 4.5 in the Collection Account an amount equal to the
aggregate Purchase Amount for the Receivables, plus the appraised value of any
other property held by the Trust, such value to be determined by an appraiser
mutually agreed upon by the Servicer, the Owner Trustee and the Indenture
Trustee, and shall succeed to all interests in and to the Trust.
Notwithstanding the foregoing, the Servicer shall not be permitted to exercise
such option unless the amount to be deposited in the Collection Account
pursuant to the preceding sentence is greater than or equal to the sum of the
outstanding principal amount of the Notes and the Certificate Balance and all
accrued but unpaid interest (including any overdue interest) thereon. The
amount deposited in the Collection Account pursuant to this Section 9.1 shall
be used on the next Distribution Date to make payments in full to Noteholders
and Certificateholders in the manner set forth in Article IV.
SECTION 9.2. Succession Upon Satisfaction and Discharge of Indenture.
Following the satisfaction and discharge of the Indenture and the payment in
full of the principal of and interest on the Notes, the Certificateholders will
succeed to the rights of the Noteholders hereunder, and the Indenture Trustee
will, continue to carry out its obligations hereunder with respect to the
Certificateholders, including without limitation making distributions from the
Payahead Account and the Collection Account in accordance with Section 4.6 and
making withdrawals from the Reserve Account in accordance with Section 4.5(b)
and Section 4.7.
57
45
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Amendment. (a) This Agreement may be amended by the
Seller, the Servicer and the Issuer, with the consent of the Indenture Trustee
and the Owner Trustee to the extent that their respective rights or obligations
may be affected thereby (which consent may not be unreasonably withheld), but
without the consent of any of the Noteholders or the Certificateholders, to
cure any ambiguity, to correct or supplement any provisions in this Agreement,
or 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, as evidenced by an
Opinion of Counsel delivered to the Owner Trustee and the Indenture Trustee,
adversely affect in any material respect the interests of any Noteholder or
Certificateholder.
(b) This Agreement may also be amended from time to time by the Seller,
the Servicer and the Issuer, with the consent of the Indenture Trustee and the
Owner Trustee to the extent that their respective rights or obligations may be
affected thereby (which consent may not be unreasonably withheld) and with the
consent of (i) the Noteholders of Notes evidencing not less than a majority of
the principal amount of the Notes Outstanding and (ii) the Certificateholders
of Certificates evidencing not less than a majority of the Certificate Balance
(which consent of any Noteholder of a Note or Certificateholder of a
Certificate given pursuant to this Section 10.1 or pursuant to any other
provision of this Agreement shall be conclusive and binding on such Note or
Certificate, as the case may be, and on all future Noteholders of such Note or
Certificateholders of such Certificate, as the case may be, and of any Note or
Certificate, as applicable, issued upon the transfer thereof or in exchange
thereof or in lieu thereof whether or not notation of such consent is made upon
such Note or the Certificate), for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement,
or of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that no such amendment shall (a)
increase or reduce in any manner the amount of, or
58
46
accelerate or delay the timing of, or change the allocation or priority
of, collections of payments on Receivables or distributions that shall be
required to be made on any Note or Certificate or change any Note Interest Rate
or the Certificate Rate or the Specified Reserve Balance, without the consent
of all adversely affected Noteholders or Certificateholders or (b) reduce the
aforesaid percentage required to consent to any such amendment, without the
consent of the Noteholders of all Notes and Certificateholders of all
Certificates affected thereby.
(c) Prior to the execution of any such amendment or consent the Servicer
will provide and the Owner Trustee shall distribute written notification of the
substance of such amendment or consent to each Rating Agency.
(d) Promptly after the execution of any such amendment or consent, the
Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder, the Indenture Trustee and each
Rating Agency. It shall not be necessary for the consent of Noteholders or the
Certificateholders pursuant to this Section 10.1 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 any other consents of Noteholders and Certificateholders provided
for in this Agreement) and of evidencing the authorization of the execution
thereof by Noteholders and Certificateholders shall be subject to such
reasonable requirements as the Owner Trustee and the Indenture Trustee may
prescribe, including the establishment of record dates pursuant to paragraph
number 2 of the Depository Agreements.
(e) Prior to the execution of any amendment to this Agreement, the Owner
Trustee and the Indenture Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that the execution of such amendment is authorized
or permitted by this Agreement and the Opinion of Counsel referred to in
Section 10.2(i)(1). The Owner Trustee or the Indenture Trustee may, but shall
not be obligated to, enter into any such amendment which affects such Owner
Trustee's or Indenture
59
47
Trustee's own rights, duties or immunities under this Agreement or otherwise.
SECTION 10.2. 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 interest of the
Issuer and the Indenture Trustee for the benefit of the Noteholders in the
Receivables and in the proceeds thereof. The Seller shall deliver (or cause to
be delivered) to the Owner Trustee and the Indenture Trustee file-stamped
copies of, or filing receipts for, any document filed as provided above, as
soon as available following such filing.
(b) Neither the 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 in accordance
with paragraph (a) above seriously misleading within the meaning of Section
9-402(7) of the UCC, unless it shall have given the Owner Trustee and the
Indenture Trustee at least five (5) days' prior written notice thereof and
shall have promptly filed appropriate amendments to all previously filed
financing statements or continuation statements.
(c) The Seller and the Servicer shall give the Owner Trustee and the
Indenture Trustee at least sixty (60) days' prior written notice of any
relocation of its principal executive office if, as a result of such
relocation, the applicable provisions of the UCC would require the filing of
any amendment of any previously filed financing or continuation statement
or of any new financing statement and shall promptly file any such amendment or
new financing statement. The Servicer shall at all times maintain each office
from which it shall service Receivables, and its principal executive office,
within the United States of America.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit (i) the reader thereof
to know at any time the status of such Receivable, including payments and
recoveries made and payments owing (and the nature of each) and (ii)
reconciliation between payments
60
48
or recoveries on (or with respect to) each Receivable and the amounts from time
to time deposited in the Collection Account, Payahead Account, the Yield
Supplement Account and the Reserve Account in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that, from and
after the time of sale under this Agreement of the Receivables to the Issuer,
the Servicer's master computer records (including any back-up archives) that
refer to a Receivable shall indicate clearly the interest of the Issuer and the
Indenture Trustee in such Receivable and that such Receivable is owned by the
Issuer and has been pledged to the Indenture Trustee pursuant to the Indenture.
Indication of the Issuer's and the Indenture Trustee's interest in a
Receivable shall be deleted from or modified on the Servicer's computer systems
when, and only when, the Receivable shall have been paid in full or
repurchased.
(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 automotive
receivables to any prospective purchaser, lender, or other transferee, the
Servicer shall give to such prospective purchaser, lender, or other transferee
computer tapes, records, or print-outs (including any restored from back-up
archives) that, if they shall refer in any manner whatsoever to any Receivable,
shall indicate clearly that such Receivable has been sold and is owned by the
Issuer and has been pledged to the Indenture Trustee.
(g) The Servicer shall permit the Owner Trustee, the Indenture Trustee
and their respective agents at any time during normal business hours to
inspect, audit, and make copies of and abstracts from the Servicer's records
regarding any Receivable.
(h) Upon request, the Servicer shall furnish to the Owner Trustee and the
Indenture Trustee, within twenty (20) Business Days, a list of all Receivables
(by contract number and name of Obligor) then held as part of the Trust,
together with a reconciliation of such list to the Schedule of Receivables and
to each of the Servicer's Certificates furnished before such request indicating
removal of Receivables from the Trust.
61
49
(i) The Servicer shall deliver to the Owner Trustee and the Indenture
Trustee:
(1) promptly after the execution and delivery of this Agreement
and of each amendment thereto, 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
Issuer and the Indenture Trustee in the Receivables, and reciting the
details of such filings or referring to prior Opinions of Counsel in
which such details are given, or (B) stating that, in the opinion of
such Counsel, no such action shall be necessary to preserve and
protect such interest; and
(2) within 120 days after the beginning of each calendar year
beginning with the first calendar year beginning more than three
months after the Cutoff Date, an Opinion of Counsel, dated as of a
date during such 120-day period, 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 Issuer and the Indenture
Trustee in the Receivables, and reciting the details of such filings
or referring to prior Opinions of Counsel in which such details are
given, or (B) stating that, in the opinion of such Counsel, no such
action shall be necessary to preserve and protect such interest.
Each Opinion of Counsel referred to in clause (i)(1) or (i)(2) above shall
specify any action necessary (as of the date of such opinion) to be taken in
the following year to preserve and protect such interest.
(j) The Seller shall, to the extent required by applicable law, cause the
Notes and the Certificates to be registered with the Securities and Exchange
Commission pursuant to Section 12(b) or Section 12(g) of the Securities
Exchange Act of 1934 within the time periods specified in such sections.
62
50
(k) For the purpose of facilitating the execution of this Agreement and
for other purposes, this Agreement may be executed 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 10.3. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York and the obligations, rights,
and remedies of the parties under this Agreement shall be determined in
accordance with such laws.
SECTION 10.4. Notices. All demands, notices, and communications under
this Agreement shall be in writing, personally delivered, sent by telecopier,
overnight courier 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 or the Servicer, to the agent for service as specified in Section 10.11
hereof, or at such other address as shall be designated by the Seller or the
Servicer in a written notice to the Owner Trustee and the Indenture Trustee,
(b) in the case of the Owner Trustee, at the Corporate Trust Office of the
Owner Trustee, (c) in the case of the Indenture Trustee, at the Corporate Trust
Office of the Indenture Trustee, (d) in the case of ▇▇▇▇▇'▇ Investors Service,
Inc., at the following address: ▇▇▇▇▇'▇ Investors Service, Inc., ABS
Monitoring Department, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and (e) in
the case of Standard & Poor's Ratings Group, at the following address:
Standard & Poor's Ratings Group, ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Asset Backed Surveillance Department. Any notice required
or permitted to be mailed to a Noteholder or Certificateholder shall be given
by first class mail, postage prepaid, at the address of such Person as shown in
the Note Register or the Certificate Register, as applicable. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Noteholder or
Certificateholder shall receive such notice.
SECTION 10.5. 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,
63
51
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 Notes,
the Certificates or the rights of the holders thereof.
SECTION 10.6. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 7.3 and 8.2 and as provided in
the provisions of this Agreement concerning the resignation of the Servicer,
this Agreement may not be assigned by the Seller or the Servicer without the
prior written consent of the Owner Trustee, the Indenture Trustee, the
Noteholders of Notes evidencing not less than 66-2/3% of the principal amount
of the Notes Outstanding and the Certificateholders of Certificates evidencing
not less than 66-2/3% of the Certificate Balance.
SECTION 10.7. Further Assurances. The Seller and the Servicer agree to
do and perform, from time to time, any and all acts and to execute any and all
further instruments required or reasonably requested by the Owner Trustee or
the Indenture Trustee more fully to effect the purposes of this Agreement,
including, without limitation, the execution of any financing statements or
continuation statements relating to the Receivables for filing under the
provisions of the UCC of any applicable jurisdiction.
SECTION 10.8. No Waiver; Cumulative Remedies. No failure to exercise and
no delay in exercising, on the part of the Owner Trustee, the Indenture
Trustee, the Noteholders or the Certificateholders, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege. The rights, remedies, powers and privileges
therein provided are cumulative and not exhaustive of any rights, remedies,
powers and privileges provided by law.
SECTION 10.9. Third-Party Beneficiaries. This Agreement will inure to
the benefit of and be binding upon the parties hereto, the Noteholders, the
Certificateholders, and their respective successors and permit-
64
52
▇▇▇ assigns. Except as otherwise provided in this Article X, no other
Person will have any right or obligation hereunder. The parties hereto hereby
acknowledge and consent to the pledge of this Agreement by the Issuer to the
Indenture Trustee for the benefit of the Noteholders pursuant to the Indenture.
SECTION 10.10. Actions by Noteholders or Certificateholders. (a)
Wherever in this Agreement a provision is made that an action may be taken or a
notice, demand, or instruction given by Noteholders or Certificateholders, such
action, notice, or instruction may be taken or given by any Noteholder or
Certificateholder, as applicable, unless such provision requires a specific
percentage of Noteholders or Certificateholders.
(b) Any request, demand, authorization, direction, notice, consent,
waiver, or other act by a Noteholder or Certificateholder shall bind such
Noteholder or Certificateholder and every subsequent holder of such Note or
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 Owner Trustee, the Indenture Trustee or the Servicer in reliance
thereon, whether or not notation of such action is made upon such Note or
Certificate.
SECTION 10.11. Agent for Service. The agent for service of the Seller
and the Servicer in respect of this Agreement shall be ▇.▇. ▇▇▇▇▇▇▇▇, Esq.,
Ford Motor Credit Company, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
SECTION 10.12. No Bankruptcy Petition. The Owner Trustee, the Indenture
Trustee, the Issuer and the Servicer each covenants and agrees that, prior to
the date which is one year and one day after the payment in full of all
securities issued by the Seller or by a trust for which the Seller was the
depositor which securities were rated by any nationally recognized statistical
rating organization it will not institute against, or join any other Person in
instituting against, the Seller or the General Partner any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any federal or State bankruptcy or similar law. This Section
10.12 shall survive the resignation or removal of the Owner Trustee under the
65
53
Trust Agreement or the Indenture Trustee under the Indenture or the termination
of this Agreement.
SECTION 10.13. Limitation of Liability of Owner Trustee and Indenture
Trustee. (a) Notwithstanding anything contained herein to the contrary, this
Agreement has been countersigned by _____ not in its individual capacity but
solely in its capacity as Owner Trustee of the Issuer and in no event shall
_____ in its individual capacity or, except as expressly provided in the Trust
Agreement, as beneficial owner of the Issuer have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Issuer. For all purposes of this Agreement, in the performance of its
duties or obligations hereunder or in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Articles VI, VII and
VIII of the Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been accepted by _____, not in its individual capacity but solely
as Indenture Trustee, and in no event shall _____ have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Issuer.
66
54
IN WITNESS WHEREOF, the parties have caused this Sale and Servicing
Agreement to be duly executed by their respective officers thereunto duly
authorized as of the day and year first above written.
FORD CREDIT AUTO RECEIVABLES
TWO L.P.,
as Seller
By: FORD CREDIT AUTO
RECEIVABLES TWO L.P.,
as General Partner
By:
---------------------------------
Name:
Title:
FORD CREDIT AUTO OWNER TRUST
- ;
----- --
as Issuer
By:
----------------------,
as Owner Trustee
By:
-----------------------------------
Name:
Title:
67
55
Accepted and agreed:
,
-------------------------
as Indenture Trustee
By:
-----------------------------
Name:
Title:
,
-------------------------
as Owner Trustee
By:
-----------------------------
Name:
Title:
68
56
SCHEDULE A
[SCHEDULE OF RECEIVABLES]
Delivered to Indenture Trustee at Closing
57
SCHEDULE B
LOCATION OF RECEIVABLES
Indianapolis
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇. ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Detroit-North
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Chicago-North
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ohio South
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Detroit/West
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Chicago South
The Office of Waterfall ▇▇▇▇ I
Suite 310
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Grand Rapids
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Chicago - East
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
58
Akron
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Louisville
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Milwaukee
▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Chicago West
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Saginaw
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Findlay
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Cleveland
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Philadelphia
Bay Colony Executive Park
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
New Jersey South
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Baltimore-West
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇-▇
▇▇
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Washington, D.C.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
New Haven
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇ #▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Norfolk
Greenbrier Pointe
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
New Jersey North
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Pittsburgh
▇▇▇▇▇▇ ▇▇▇▇▇ ▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Richmond
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Syracuse
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Westchester
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
B-3
60
Mobile
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Birmingham
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Orlando
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Memphis
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Atlanta - North
North Park Town Center
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇. ▇.▇.
▇▇▇▇. ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Greensboro
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Charlotte
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Jacksonville
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Jackson
Highland Village Center
▇▇▇▇ ▇-▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
B-4
61
Columbia
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Miami
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dothan
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Nashville
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Raleigh
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tampa
Lincoln Pointe, Suite 800
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Lubbock
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dallas
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
B-5
62
Austin
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fort Worth
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Beaumont
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Houston-West
▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Harlingen
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Corpus Christi
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Little Rock
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Amarillo
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇. ▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
El Paso
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
B-6
63
Albuquerque
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Houston-North
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇. ▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
San Antonio
▇▇▇▇ ▇.▇. ▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tulsa
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Minneapolis
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, One ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Wichita
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
St. Louis
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Jefferson City
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Kansas City
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇. #▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇-▇
▇▇
▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Omaha
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Davenport
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ Exch. Bldg.
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Denver
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fargo
▇▇▇▇ ▇▇▇▇ ▇▇▇. ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Springfield
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Waterloo
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
San Bernadino
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Salt Lake City
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
B-8
65
Honolulu
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇, Ala Moano ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Spokane
North ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Grand Junction
▇▇▇ ▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
San Francisco
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Portland
▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Sacramento
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
San Diego
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phoenix
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
San ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
B-9
66
Seattle
▇▇▇▇▇ ▇.▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Orange
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Anchorage
▇▇▇▇ ▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Appleton
▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
South Bend
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Columbus
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Henderson
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Lansing
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
New Jersey-Central
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
B-10
67
Huntington
▇▇▇▇ ▇.▇. ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Buffalo
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Manchester
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Harrisburg
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Boston North
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Portland
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Albany
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Roanoke
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Falls Church
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
B-11
▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇▇ ▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Chattanooga
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Decatur
▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fayetteville
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Athens
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Knoxville
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Macon
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Pensacola
▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Savannah
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
B-12
69
Tyler
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Oklahoma City
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Baltimore-East
▇▇▇▇▇▇▇▇ Corporate Center One
4940 Campell Blvd., Suite ▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Billings
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Cheyenne
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Cape Girardeau
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Atlanta -South
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Pasadena
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Colorado Springs
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇-▇▇
▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ventura
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Las Vegas
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Eugene
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tupelo
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Charleston
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Western Carolina
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
B-14
71
New Orleans
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Shreveport
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
B-15
72
EXHIBIT A
[FORM OF YIELD SUPPLEMENT AGREEMENT]
________, _____
Ford Credit Auto Receivables Two L.P.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Ford Credit Auto Owner Trust -
Ladies and Gentlemen:
We hereby confirm arrangements made as of the date hereof with you to be
effective upon (i) receipt by us of the enclosed copy of this letter agreement
(as from time to time amended, supplemented or otherwise modified and in
effect, the "Yield Supplement Agreement"), executed by you, and (ii) execution
of the Purchase Agreement referred to below and payment of the purchase price
specified thereunder. Capitalized terms used and not otherwise defined herein
shall have the meanings assigned to such terms in the Purchase Agreement, dated
as of _______, ____ (as from time to time amended, supplemented or otherwise
modified and in effect, the "Purchase Agreement"), between Ford Motor Credit
Company, as seller (the "Seller"), and Ford Credit Auto Receivables Two L.P. as
purchaser (the "Purchaser").
1. On or prior to the Determination Date preceding each Distribution Date,
the Servicer shall notify the Purchaser and the Seller of the Yield Supplement
Amount for such Distribution Date.
2. In consideration for the Purchaser entering into the Purchase Agreement
and the purchase price paid to the Seller for the Receivables under the
Purchase Agreement, we agree to make a payment of the Yield Supplement Amount
to the Purchaser, or to the pledgee of the assignee of the Purchaser referred
to in Section 5 hereof, on the Business Day prior to each Distribution Date.
3. All payments pursuant hereto shall be made by federal wire transfer
(same day) funds or in immediately available funds, to such account as the
Purchaser
A-1
73
Ford Credit Auto Receivables Two L.P.
______, ____
Page 2
or the pledgee of the assignee of the Purchaser referred to in Section 5
hereof, may designate in writing to the Seller, prior to the relevant
Distribution Date.
4. Our agreements set forth in this Yield Supplement Agreement are our
primary obligations and such obligations are irrevocable, absolute and
unconditional, shall not be subject to any counterclaim, setoff or defense and
shall remain in full force and effect without regard to, and shall not be
released, discharged or in any way affected by, any circumstances or condition
whatsoever.
5. Pursuant to the Sale and Servicing Agreement, the Purchaser will sell,
transfer, assign and convey its interest in this Yield Supplement Agreement to
Ford Credit Auto Owner Trust ____-__ (the "Trust"), and the Seller hereby
acknowledges and consents to such sale, transfer, assignment and conveyance.
Concurrent with such sale, transfer, assignment and conveyance, pursuant to the
Indenture, the Trust will pledge its rights under this Yield Supplement
Agreement, along with certain other assets of the Trust, to __________, as
Indenture Trustee, to secure its obligations under the Notes and the Indenture,
and the Seller hereby acknowledges and consents to such pledge. The Seller
hereby agrees, for the benefit of the Trust, that following such sale,
transfer, assignment, conveyance and pledge, this Yield Supplement Agreement
shall not be amended, modified or terminated without the consent of _________,
as Owner Trustee on behalf of the Trust, and, prior to the payment in full of
the Notes, the Indenture Trustee.
6. This Yield Supplement Agreement will be governed by, and construed in
accordance with, the laws of the State of New York.
7. Except as otherwise provided herein, all notices pursuant to this Yield
Supplement Agreement shall be in writing and shall be effective upon receipt
thereof. All notices shall be directed as set forth below, or to such other
address or to the attention of such other person as the relevant party shall
have designated for such purpose in a written notice.
A-2
74
Ford Credit Auto Receivables Two L.P.
______, ____
Page 3
If to the Purchaser:
Ford Credit Auto Receivables Two L.P.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Seller:
Ford Motor Credit Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
8. This Yield Supplement Agreement may be executed in one or more
counterparts and by the different parties hereto on separate counterparts, all
of which shall be deemed to be one and the same document.
A-3
75
Ford Credit Auto Receivables Two L.P.
,
------ ----
Page 4
If the foregoing satisfactorily sets forth the terms and conditions of our
agreement, please indicate your acceptance thereof by signing in the space
provided below and returning to us the enclosed duplicate original of this
letter.
Very truly yours,
FORD MOTOR CREDIT COMPANY,
as Seller
By:
-----------------------------
Name:
Title:
Agreed and accepted as of
the date first above written:
FORD CREDIT AUTO RECEIVABLES TWO L.P.,
as Purchaser
By:
----------------------------
Name:
Title:
A-4