EXHIBIT 4.1
FORM OF POOLING AND SERVICING
AGREEMENT
among
MELLON AUTO RECEIVABLES CORPORATION,
as Depositor,
MELLON BANK, N.A.,
as Servicer and Seller,
and
--------------------------,
as Trustee,
On behalf of the Certificateholders,
and as Collateral Agent
Dated as of ________ __, 199_
Mellon Auto Trust 199_-_
$_____________ Class A ____% Asset Backed Certificates
$_____________ Class B ____% Asset Backed Certificates
TABLE OF CONTENTS
PAGE
ARTICLE I
Definitions
SECTION 1.1. Definitions............................................... 1
SECTION 1.2. Other Definitional Provisions.............................19
SECTION 1.3. Calculations..............................................20
SECTION 1.4. References................................................20
SECTION 1.5. References to the Trust...................................20
SECTION 1.6. Action by or Consent of Certificateholders................20
ARTICLE II
The Trust Property
SECTION 2.1. Conveyance of Trust Property..............................20
SECTION 2.2. A. Representations and Warranties of the Seller...........21
SECTION 2.2. B. Representations and Warranties of Depositor............25
SECTION 2.3. Repurchase upon Breach....................................26
SECTION 2.4. Custody of Receivable Files...............................26
SECTION 2.5. Duties of Servicer as Custodian...........................27
SECTION 2.6. Instructions; Authority To Act............................27
SECTION 2.7. Custodian's Indemnification...............................27
SECTION 2.8. Effective Period and Termination..........................28
ARTICLE III
Administration and Servicing of the Trust Property
SECTION 3.1. Duties of Servicer........................................28
SECTION 3.2. Collection and Allocation of Receivable Payments..........29
SECTION 3.3. Realization upon Receivables..............................29
SECTION 3.4. Physical Damage Insurance; Other Insurance................30
SECTION 3.5. Maintenance of Security Interests in Financed Vehicles....30
SECTION 3.6. Covenants of Servicer.....................................31
SECTION 3.7. Purchase of Receivables upon Breach.......................31
SECTION 3.8. Servicing Fee.............................................31
SECTION 3.9. Servicer's Certificate....................................31
SECTION 3.10. Annual Statement as to Compliance; Notice of Default......32
SECTION 3.11. Annual Independent Certified Public Accountants' Report...32
SECTION 3.12. Access to Certain Documentation and Information
Regarding Receivables.....................................33
SECTION 3.13. Servicer Expenses.........................................33
SECTION 3.14. Appointment of Subservicers...............................33
ARTICLE IV
Distributions; Reserve Fund; Statements to Certificateholders
SECTION 4.1. Establishment of Accounts.................................33
SECTION 4.2. Collections...............................................37
SECTION 4.3. Additional Deposits.......................................37
SECTION 4.4. Net Deposits..............................................38
SECTION 4.5. Distributions.............................................38
SECTION 4.6. Reserve Fund..............................................39
SECTION 4.7. Statements to Certificateholders..........................41
SECTION 4.8. Advances..................................................42
ARTICLE V
[Intentionally Omitted]
ARTICLE VI
The Certificates
SECTION 6.1. The Certificates..........................................43
SECTION 6.2. Authentication and Delivery of Certificates...............43
SECTION 6.3. Registration of Transfer and Exchange of Certificates.....44
SECTION 6.4. Mutilated, Destroyed, Lost or Stolen Certificates.........45
SECTION 6.5. Persons Deemed Owners.....................................45
SECTION 6.6. Access to List of Certificateholders' Names
and Addresses.............................................45
SECTION 6.7. Maintenance of Office or Agency...........................45
SECTION 6.8. Book-Entry Certificates...................................46
SECTION 6.9. Notices to Clearing Agency................................47
SECTION 6.10. Definitive Certificates...................................47
ARTICLE VII
The Depositor
SECTION 7.1. Representations of Depositor..............................48
SECTION 7.2. Special Purpose Entity....................................49
SECTION 7.3. Corporate Existence.......................................49
SECTION 7.4. Liability of Depositor; Indemnities.......................50
SECTION 7.5. Merger or Consolidation of, or Assumption of
the Obligations of Depositor..............................51
SECTION 7.6. Limitation on Liability of Depositor and Others...........52
SECTION 7.7. Depositor May Own Certificates............................52
SECTION 7.8. Security Interest.........................................52
ARTICLE VIII
The Servicer and the Seller
SECTION 8.1. Representations of the Bank...............................52
SECTION 8.2. Indemnities of the Bank...................................54
SECTION 8.3. Merger or Consolidation of, or Assumption of
the Obligations of, the Bank..............................55
SECTION 8.4. Limitation on Liability of the Bank and Others............56
SECTION 8.5. The Bank Not To Resign as Servicer........................56
SECTION 8.6. Corporate Existence.......................................56
SECTION 8.7. Tax Accounting............................................57
ARTICLE IX
Servicing Termination
SECTION 9.1. Events of Servicing Termination...........................58
SECTION 9.2. Appointment of Successor..................................59
SECTION 9.3. Payment of Servicing Fee; Repayment of Advances...........59
SECTION 9.4. Notification to Certificateholders........................60
SECTION 9.5. Waiver of Past Events of Servicing Termination............60
ARTICLE X
The Trustee
SECTION 10.1. Acceptance by Trustee.....................................60
SECTION 10.2. Duties of Trustee.........................................60
SECTION 10.3. Trustee's Certificate.....................................62
SECTION 10.4. Trustee's Assignment of Purchased Receivables.............62
SECTION 10.5. Certain Matters Affecting the Trustee.....................62
SECTION 10.6. Trustee Not Liable for Certificates or Receivables........64
SECTION 10.7. Trustee May Own Certificates..............................65
SECTION 10.8. Trustee's Fees and Expenses...............................65
SECTION 10.9. Eligibility Requirements for Trustee......................65
SECTION 10.10. Resignation or Removal of Trustee.........................66
SECTION 10.11. Successor Trustee.........................................66
SECTION 10.12. Merger or Consolidation of Trustee........................67
SECTION 10.13. Appointment of Co-Trustee or Separate Trustee.............67
SECTION 10.14. Representations and Warranties of Trustee.................68
SECTION 10.15. Reports by Trustee........................................69
SECTION 10.16. Tax Accounting............................................69
SECTION 10.17. Trustee May Enforce Claims Without Possession
of Certificates..........................................69
ARTICLE XI
Termination
SECTION 11.1. Termination of the Trust..................................70
SECTION 11.2. Optional Purchase of All Receivables......................71
SECTION 11.3. Mandatory Sale of all Contracts...........................71
ARTICLE XII
Miscellaneous Provisions
SECTION 12.1. Amendment.................................................72
SECTION 12.2. Protection of Title to Trust..............................73
SECTION 12.3. Limitation on Rights of Certificateholders................75
SECTION 12.4. GOVERNING LAW.............................................76
SECTION 12.5. Notices...................................................76
SECTION 12.6. Severability of Provisions................................76
SECTION 12.7. Assignment................................................77
SECTION 12.8. Certificates Nonassessable and Fully Paid.................77
SECTION 12.9. Intention of Parties......................................77
SECTION 12.10. Counterparts..............................................77
SECTION 12.11. Collateral Agent Protection...............................78
SECTION 12.12. Limitation of Liability of Trustee and Collateral Agent...78
SECTION 12.13. Independence of the Servicer..............................78
SECTION 12.14. No Joint Venture..........................................78
SECTION 12.15. Headings..................................................78
SECTION 12.16. Limitations on Rights of Others...........................78
SCHEDULES
Schedule A - Schedule of Receivables
Schedule B - Location of Receivables
EXHIBITS
Exhibit A - Form of Class A Certificate
Exhibit B - Form of Class B Certificate
Exhibit C - Form of Monthly Statement to Certificateholders
Exhibit D - Form of Benefit Plan Affidavit
Exhibit E - Form of Trustee's Certificate
Exhibit F -Termination - Auction Procedures
POOLING AND SERVICING AGREEMENT dated as of _________, 199 _
(the "Agreement"), among Mellon Auto Receivables Corporation, a
Delaware corporation, as depositor (the "Depositor"), Mellon Bank,
N.A., a national banking association (the "Bank"), as servicer (the
"Servicer") and seller (the "Seller") and _____________, as trustee
hereunder (the "Trustee") and as collateral agent with respect to the
Reserve Fund (the "Collateral Agent").
In consideration of the premises and of the mutual agreements herein
contained, and other good and valuable consideration, the receipt of which is
acknowledged, the parties hereto, intending to be legally bound, agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITIONS. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, whenever
capitalized shall have the following meanings:
"ACCOUNTS" has the meaning specified in Section 4.1(a)(ii).
"ACCOUNT PROPERTY" means all amounts and investments held from time to
time in any Account, the Reserve Fund or the Payahead Account, as the case may
be (whether in the form of deposit accounts, Physical Property, book-entry
securities, uncertificated securities or otherwise), and all proceeds of the
foregoing.
"ACTUARIAL RECEIVABLE" means any Receivable under which the portion of
a payment allocable to principal and the portion of a payment allocable to
interest is determined in accordance with the Scheduled Payment.
"ADVANCE" means the amount, as of the close of business on the last
day of a Collection Period, which the Servicer is required to advance on the
related Actuarial Receivable pursuant to Section 4.8(a).
"ADVISOR" has the meaning specified in Section 11.3.
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGGREGATE NET LOSSES" means, with respect to a Collection Period, the
aggregate principal balance of all Receivables newly designated during such
Collection Period as Liquidated Receivables minus Liquidation Proceeds collected
during such Collection Period with respect to all Liquidated Receivables.
"AGREEMENT" means this Pooling and Servicing Agreement, as the same
may be amended and supplemented from time to time.
"AMOUNT FINANCED" means, with respect to any Receivable, the amount
advanced under such Receivable toward the purchase price of the related Financed
Vehicle and any related costs.
"ANNUAL PERCENTAGE RATE" or "APR" of a Receivable means the annual
rate of finance charges stated in the related Contract expressed as a
percentage.
"AUCTION" has the meaning specified in Section 11.3.
"AUCTION PROCEDURES" has the meaning specified in Section 11.3.
"AUCTION PROPERTY" has the meaning specified in Section 11.3.
"AUTHORIZED OFFICER" means, (i) with respect to the Trustee, any
officer within the Corporate Trust Office of the Trustee, including any vice
president, assistant vice president, managing director, secretary, assistant
secretary, assistant treasurer or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject and (ii) with respect to the Servicer,
any officer of the Servicer who is authorized to act for the Servicer in matters
relating to the Trust and who is identified on the list of Authorized Officers
delivered by the Servicer to the Trustee on the Closing Date (as such list may
be modified or supplemented from time to time thereafter).
"BALLOON LOAN" means a Receivable originated with a stated maturity of
less than the period of time of the corresponding amortization schedule.
"BALLOON PAYMENT" means the final payment required to be made under a
Balloon Loan.
"BANK" has the meaning specified in the preamble.
"BASIC DOCUMENTS" means the Depository Agreement and other documents
and certificates delivered in connection therewith.
"BOOK-ENTRY CERTIFICATES" mean beneficial interests in the definitive
Certificates described in Section 6.10, the ownership of which shall be
evidenced, and transfers of which shall be made, through book entries by a
Clearing Agency as described in Section 6.10.
"BUSINESS DAY" means a day other than a Saturday, a Sunday or a day on
which banking institutions or trust companies in New York, New York,
________________ or the city in which the Corporate Trust Office is located are
authorized by law, regulation, executive order or governmental decree to be
closed.
"CERTIFICATE" means any Class A Certificate or Class B Certificate.
"CERTIFICATE OWNER" means, with respect to a Book-Entry Certificate,
the Person who is the owner of such Book-Entry Certificate, as reflected on the
books of the Clearing Agency, or on the books of a Person maintaining an account
with such Clearing Agency (directly or as an indirect participant, in accordance
with the rules, regulations and procedures of such Clearing Agency).
"CERTIFICATE REGISTER" means the register maintained by the Trustee
for the registration of Certificates and of transfers and exchanges of
Certificates as provided in Section 6.3.
"CERTIFICATEHOLDER" or "HOLDER" means the Person in whose name a
Certificate shall be registered in the Certificate Register, EXCEPT THAT, solely
for the purpose of giving any consent, request or waiver pursuant to this
Agreement, the interest evidenced by any Certificate registered in the name of
the Depositor, the Servicer or any Person actually known to an Authorized
Officer of the Trustee to be an Affiliate of the Depositor or the Servicer,
shall not be taken into account in determining whether the requisite percentage
necessary to effect any such consent, request or waiver shall have been
obtained.
"CLASS A CERTIFICATE" means a certificate executed by the Trustee on
behalf of the Trust and authenticated by the Trustee, substantially in the form
of Exhibit A hereto.
"CLASS A CERTIFICATEHOLDER" or "CLASS A HOLDER" means the Person in
whose name a Class A Certificate shall be registered in the Certificate
Register, EXCEPT THAT, solely for the purpose of giving any consent, request or
waiver pursuant to this Agreement, the interest evidenced by any Class A
Certificate registered in the name of the Depositor, the Servicer or any Person
actually known to an Authorized Officer of the Trustee to be an Affiliate of the
Depositor or the Servicer, shall not be taken into account in determining
whether the requisite percentage necessary to effect any such consent, request
or waiver shall have been obtained.
"CLASS A DISTRIBUTION ACCOUNT" means the account established and
maintained as such pursuant to Section 4.1.
"CLASS A INTEREST CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess of Class A Monthly Interest for the preceding
Distribution Date and any outstanding Class A Interest Carryover Shortfall on
such preceding Distribution Date, over the amount in respect of interest that is
actually deposited in the Class A Distribution Account on such preceding
Distribution Date, plus 30 days of interest on such excess, to the extent
permitted by law, at the Class A Pass-Through Rate.
"CLASS A INTEREST DISTRIBUTION" means, with respect to any
Distribution Date, the sum of Class A Monthly Interest for such Distribution
Date and the Class A Interest Carryover Shortfall for such Distribution Date.
"CLASS A MONTHLY INTEREST" means, with respect to any Distribution
Date, one-twelfth (or, in the case of the first Distribution Date, a fraction,
the numerator of which is __ and the denominator of which is 360) of the product
of the Class A Pass-Through Rate and the Class A Principal Balance as of the
Distribution Date occurring in the preceding Collection Period (after giving
effect to any payments made on such Distribution Date) or, in the case of the
first Distribution Date, the Original Class A Principal Balance.
"CLASS A MONTHLY PRINCIPAL" means, with respect to any Distribution
Date, the Class A Percentage of Principal Collections for such Distribution Date
plus the Class A Percentage of Realized Losses with respect to Receivables which
became Liquidated Receivables during the related Collection Period.
"CLASS A PASS-THROUGH RATE" means ___% per annum, calculated on the
basis of a 360-day year consisting of twelve 30-day months.
"CLASS A PERCENTAGE" means __%.
"CLASS A POOL FACTOR" as of the close of business on a Distribution
Date means a seven-digit decimal figure equal to the Class A Principal Balance
(after giving effect to any distributions made on such Distribution Date)
divided by the Original Class A Principal Balance.
"CLASS A PRINCIPAL BALANCE" equals the Original Class A Principal
Balance, as reduced by all amounts allocable to principal on the Class A
Certificates previously distributed to Class A Certificateholders.
"CLASS A PRINCIPAL CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess of Class A Monthly Principal for the preceding
Distribution Date and any outstanding Class A Principal Carryover Shortfall on
such preceding Distribution Date over the amount in respect of principal that is
actually deposited in the Class A Distribution Account on such preceding
Distribution Date.
"CLASS A PRINCIPAL DISTRIBUTION" means, with respect to any
Distribution Date (including the Final Scheduled Distribution Date), the sum of
Class A Monthly Principal for such Distribution Date and the Class A Principal
Carryover Shortfall for such Distribution Date; PROVIDED, HOWEVER, that the
Class A Principal Distribution shall not exceed the Class A Principal Balance
immediately prior to such Distribution Date. In addition, on the Final Scheduled
Distribution Date, the principal required to be deposited in the Class A
Distribution Account will include the lesser of (a) any principal due and
remaining unpaid on each Receivable in the Trust as of the Final Scheduled
Maturity Date or (b) the portion of the amount required to be deposited under
clause (a) above that is necessary (after giving effect to the other amounts to
be deposited in the Class A Distribution Account on such Distribution Date and
allocable to principal) to reduce the Class A Principal Balance to zero.
"CLASS B CERTIFICATE" means a certificate executed by the Trustee on
behalf of the Trust and authenticated by the Trustee, substantially in the form
of Exhibit B hereto.
"CLASS B CERTIFICATEHOLDER" or "CLASS B HOLDER" means the Person in
whose name a Class B Certificate shall be registered in the Certificate
Register, EXCEPT THAT, solely for the purpose of giving any consent, request or
waiver pursuant to this Agreement, the interest evidenced by any Class B
Certificate registered in the name of the Depositor, the Servicer or any Person
actually known to an Authorized Officer of the Trustee to be an Affiliate of the
Depositor or the Servicer, shall not be taken into account in determining
whether the requisite percentage necessary to effect any such consent, request
or waiver shall have been obtained.
"CLASS B DISTRIBUTION ACCOUNT" means the account established and
maintained as such pursuant to Section 4.1.
"CLASS B INTEREST CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess of Class B Monthly Interest for the preceding
Distribution Date and any outstanding Class B Interest Carryover Shortfall on
such preceding Distribution Date, over the amount in respect of interest that is
actually deposited in the Class B Distribution Account on such preceding
Distribution Date, plus 30 days of interest on such excess, to the extent
permitted by law, at the Class B Pass-Through Rate.
"CLASS B INTEREST DISTRIBUTION" means, with respect to any
Distribution Date, the sum of Class B Monthly Interest for such Distribution
Date and the Class B Interest Carryover Shortfall for such Distribution Date.
"CLASS B MONTHLY INTEREST" means, with respect to any Distribution
Date, one-twelfth (or, in the case of the first Distribution Date, a fraction,
the numerator of which is __ and the denominator of which is 360) of the product
of the Class B Pass-Through Rate and the Class B Principal Balance as of the
Distribution Date occurring in the preceding Collection Period (after giving
effect to any payments made on such Distribution Date) or, in the case of the
first Distribution Date, the Original Class B Principal Balance.
"CLASS B MONTHLY PRINCIPAL" means, with respect to any Distribution
Date, the Class B Percentage of Principal Collections for such Distribution Date
plus the Class B Percentage of Realized Losses with respect to Receivables which
became Liquidated Receivables during the related Collection Period.
"CLASS B PASS-THROUGH RATE" means ___% per annum, calculated on the
basis of a 360-day year consisting of twelve 30-day months.
"CLASS B PERCENTAGE" means __%.
"CLASS B POOL FACTOR" as of the close of business on a Distribution
Date means a seven-digit decimal figure equal to the Class B Principal Balance
(after giving effect to any distributions made on such Distribution Date)
divided by the Original Class B Principal Balance.
"CLASS B PRINCIPAL BALANCE" equals the Original Class B Principal
Balance, as reduced by all amounts allocable to principal on the Class B
Certificates previously distributed to Class B Certificateholders.
"CLASS B PRINCIPAL CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess of Class B Monthly Principal for the preceding
Distribution Date and any outstanding Class B Principal Carryover Shortfall on
such preceding Distribution Date over the amount in respect of principal that is
actually deposited in the Class B Distribution Account on such preceding
Distribution Date.
"CLASS B PRINCIPAL DISTRIBUTION" means, with respect to any
Distribution Date (including the Final Scheduled Distribution Date), the sum of
Class B Monthly Principal for such Distribution Date and the Class B Principal
Carryover Shortfall for such Distribution Date; PROVIDED, HOWEVER, that the
Class B Principal Distribution shall not exceed the Class B Principal Balance
immediately prior to such Distribution Date. In addition, on the Final Scheduled
Distribution Date, the principal required to be distributed to Class B
Certificate-holders will include the lesser of (a) any principal due and
remaining unpaid on each Receivable in the Trust as of the Final Scheduled
Maturity Date or (b) the portion of the amount required to be deposited under
clause (a) above that is necessary (after giving effect to the other amounts to
be deposited in the Class B Distribution Account on such Distribution Date and
allocable to principal) to reduce the Class B Principal Balance to zero, and, in
the case of clauses (a) and (b), remaining after any required distribution of
the amount described in clause (a) to the Class A Distribution Account.
"CLEARING AGENCY" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended. The initial Clearing Agency shall be DTC.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"CLOSING DATE" means ____________, 199_.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL AGENT" means __________________, a _____________ banking
corporation, in its capacity as collateral agent with respect to the Reserve
Fund and the Payahead Account for the Certificateholders.
"COLLECTION ACCOUNT" means the account or accounts established and
maintained as such pursuant to Section 4.1.
"COLLECTION PERIOD" means, a calendar month, except with respect to
the first Collection Period, which shall be the period from the Cutoff Date to
_________ __, 199_. Any amount stated "as of the close of business on the last
day of a Collection Period" shall give effect to the following calculations as
determined as of the end of the day on such last day: (1) all applications of
collections, (2) all current and previous Payaheads, (3) all applications of
Payahead Balances, (4) all Advances and reductions of Outstanding Advances and
(5) all distributions to be made on the immediately following Distribution Date.
"COLLECTIONS" mean, for a Distribution Date, the sum of the Interest
Collections and Principal Collections for such Distribution Date.
"COMPUTER TAPE" means the computer tape furnished to the Trustee
describing certain characteristics of the Receivables as of the Cutoff Date.
"CONTRACT" means a motor vehicle retail installment sale contract.
"CORPORATE TRUST OFFICE" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of execution of this Agreement is located at
_____________________ or at such other address as the Trustee may designate from
time to time by notice to the Certificateholders, the Depositor and the
Servicer, or the principal corporate trust office of any successor Trustee (the
address of which the successor Trustee will notify the Certificateholders, the
Depositor and the Servicer).
"CRAM DOWN LOSS" means, with respect to a Receivable if a court of
appropriate jurisdiction in a bankruptcy or insolvency proceeding shall have
issued an order reducing the amount owed on such Receivable or otherwise
modifying or restructuring the scheduled payments to be made on such Receivable,
an amount equal to (i) the excess of the principal balance of such Receivable
immediately prior to such order over the principal balance of such Receivable as
so reduced and/or (ii) if such court shall have issued an order reducing the
effective rate of interest on such Receivable, the net present value (using as
the discount rate the higher of the APR on such Receivable or the rate of
interest, if any, specified by the court in such order) of the scheduled
payments as so modified or restructured. A "Cram Down Loss" shall be deemed to
have occurred on the date of issuance of such order.
"CUMULATIVE NET LOSS RATIO" means, with respect to any Distribution
Date, a fraction, expressed as a percentage, the numerator of which is an amount
equal to the excess of (i) the cumulative amount of Realized Losses and Cram
Down Losses from the Cutoff Date through the last day of the related Collection
Period over (ii) the cumulative amount of Recoveries from the Cutoff Date
through the last day of the related Collection Period and the denominator of
which is the Initial Pool Balance.
"CUTOFF DATE" means ____________, 199_.
"CUTOFF DATE PRINCIPAL BALANCE" means, with respect to a Receivable,
the Principal Balance of such Receivable as of the Cutoff Date.
"DEALER" means a motor vehicle dealer who sold a Financed Vehicle and
who originated and assigned the respective Receivable to the Seller under an
existing agreement between such Dealer and the Seller.
"DEALER AGREEMENT" means any agreement between a Dealer and the Seller
relating to the acquisition of Receivables from a Dealer by the Seller.
"DEFINITIVE CERTIFICATES" shall have the meaning specified in Section
6.10.
"DELINQUENCY PERCENTAGE" means, with respect to a Collection Period
the ratio of (a) the outstanding principal balance of all outstanding
Receivables 60 days or more delinquent (which amount shall include Receivables
in respect of Financed Vehicles that have been repossessed but not yet sold or
otherwise liquidated) as of the last day of such Collection Period, determined
in accordance with the Servicer's normal practices, divided by (b) the
outstanding principal balance of all Receivables on the last day of such
Collection Period.
"DELIVERY" when used with respect to Account Property means:
(a) with respect to bankers' acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute instruments and
are susceptible of physical delivery ("Physical Property"):
(i) transfer of possession thereof to the Trustee or
Collateral Agent (all references to the Collateral Agent, in
this definition relate to the Reserve Fund), as applicable,
endorsed to, or registered in the name of, the Trustee or
Collateral Agent as applicable, or their respective nominee or
endorsed in blank;
(b) with respect to a certificated security:
(i) delivery thereof in bearer form to the Trustee
or Collateral Agent, as applicable, or their respective
nominee or custodian; or
(ii) delivery thereof in registered form to the
Trustee or Collateral Agent, as applicable, or their
respective nominee or custodian and
(A) the certificate is endorsed to the
Trustee or Collateral Agent, as applicable, or their
respective nominee or custodian or in blank by effective
endorsement; or
(B) the certificate is registered in the
name of the Trustee or Collateral Agent, as applicable, or
their respective nominee or custodian, upon original issue or
registration of transfer by the Trust;
(c) with respect to an uncertificated security:
(i) the delivery of the uncertificated security to
the Trustee or Collateral Agent, as applicable, or their
respective nominee or custodian; or
(ii) the issuer has agreed that it will comply with
instructions originated by the Trustee or Collateral Agent, as
applicable, or their respective nominee or custodian without
further consent by the registered owner;
(d) with respect to any security issued by the U.S. Treasury that is a
book-entry security held through the Federal Reserve System pursuant to Federal
book-entry regulations:
(i) a Federal Reserve Bank by book entry credits the
book-entry security to the securities account (as defined in
31 CFR Part 357) of a participant (as defined in 31 CFR Part
357) which is also a securities intermediary; and
(ii) the participant indicates by book entry that the
book-entry security has been credited to the Trustee or
Collateral Agent, as applicable, or their respective nominee
or custodian securities account;
(e) with respect to a security entitlement:
(i) the Trustee or the Collateral Agent, as
applicable, or their respective nominee or custodian becomes
the entitlement holder; or
(ii) the securities intermediary has agreed that it
will comply with entitlement orders originated by the Trustee
or the Collateral Agent, as applicable, or their respective
nominee or custodian without further consent by the
entitlement holder;
(f) for the purpose of clauses (b) and (c) hereof "delivery" means:
(i) with respect to a certificated security:
(A) the Trustee or the Collateral Agent, as
applicable, or their respective nominee or custodian acquires
possession thereof;
(B) another person (other than a securities
intermediary) either acquires possession thereof on behalf of
the Trustee or the Collateral Agent, as applicable, or their
respective nominee or custodian or, having previously acquired
possession thereof, acknowledges that it holds for the Trustee
or the Collateral Agent, as applicable, or their respective
nominee or custodian; or
(C) a securities intermediary acting on
behalf of the Trustee or the Collateral Agent, as applicable,
or their respective nominee or custodian acquires possession
of thereof, only if the certificate is in registered form and
has been specially endorsed to the Trustee or the Collateral
Agent, as applicable, or their respective nominee or custodian
by an effective endorsement;
(ii) with respect to an uncertificated security:
(A) the issuer registers the Trustee or the
Collateral Agent, as applicable, or their respective nominee
or custodian as the registered owner, upon original issue or
registration of transfer; or
(B) another person (other than a securities
intermediary) either becomes the registered owner thereof on
behalf of the Trustee or the Collateral Agent, as applicable,
or their respective nominee or custodian or, having previously
become the registered owner, acknowledges that it holds for
the Trustee or the Collateral Agent, as applicable, or their
respective nominee or custodian;
(g) for purposes of this definition, except as otherwise indicated,
the following terms shall have the meaning assigned to each such term in the
UCC:
(i) "certificated security"
(ii) "effective endorsement"
(iii) "entitlement holder"
(iv) "instrument"
(v) "securities account"
(vi) "securities entitlement"
(vii) "securities intermediary"
(viii) "uncertificated security"
(h) in each case of Delivery contemplated herein, the Trustee or the
Collateral Agent, as applicable, or their respective nominee or custodian shall
make appropriate notations on its records, and shall cause same to be made on
the records of their respective nominees, indicating that securities are held in
trust pursuant to and as provided in this Agreement.
"DEPOSITOR" means Mellon Auto Receivables Corporation, as the
depositor of the Receivables, and each successor to Mellon Auto Receivables
Corporation (in the same capacity) to the extent permitted hereunder.
"DEPOSITORY AGREEMENT" means the agreement among the Depositor, the
Servicer, the Trustee and DTC, dated __________, 199_.
"DETERMINATION DATE" means, with respect to any Distribution Date, the
earlier of the eighth Business Day of the month in which a Distribution Date
occurs and the fourth Business Day preceding such Distribution Date.
"DISTRIBUTION DATE" means, with respect to each Collection Period, the
fifteenth day of the following month, or if such day is not a Business Day, the
immediately following Business Day, commencing in _________.
"DISTRIBUTION DATE STATEMENT" means, the statement described in
Section 4.7
"DTC" means The Depository Trust Company.
"ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated account with
an Eligible Institution or (b) a segregated trust account with the corporate
trust department of a depository institution (other than the Depositor or any
affiliate of the Depositor) organized under the laws of the United States of
America or any one of the states thereof or the District of Columbia (or any
domestic branch of a foreign bank), having corporate trust powers and acting as
trustee for funds deposited in such account, so long as any of the securities of
such depository institution shall have a credit rating from each Rating Agency
in one of its generic rating categories which signifies investment grade.
"ELIGIBLE INSTITUTION" means (a) the corporate trust department of the
Trustee, or (b) a depository institution organized under the laws of the United
States of America or any one of the states thereof or the District of Columbia
(or any domestic branch of a foreign bank), which (i) has either (A) a long-term
senior unsecured debt rating acceptable to the Rating Agencies or (B) a
short-term senior unsecured debt rating or certificate of deposit rating
acceptable to the Rating Agencies and (ii) whose deposits are insured by the
Federal Deposit Insurance Corporation.
"ELIGIBLE INVESTMENTS" mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:
(a) direct obligations of, and obligations fully guaranteed as to
timely payment by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit of any
depository institution (including the Depositor or any Affiliate of the
Depositor) or trust company incorporated under the laws of the United States of
America or any state thereof or the District of Columbia (or any domestic branch
of a foreign bank) and subject to supervision and examination by federal or
state banking or depository institution authorities (including depository
receipts issued by any such institution or trust company as custodian with
respect to any obligation referred to in clause (a) above or portion of such
obligation for the benefit of the holders of such depository receipts);
PROVIDED, HOWEVER, that at the time of the investment or contractual commitment
to invest therein (which shall be deemed to be made again each time funds are
reinvested following each Distribution Date), the commercial paper or other
short-term senior unsecured debt obligations (other than such obligations the
rating of which is based on the credit of a Person other than such depository
institution or trust company) of such depository institution or trust company
shall have a credit rating from Standard & Poor's of A-1+ and from Moody's of
P-1;
(c) commercial paper (including commercial paper of the Depositor or
any Affiliate of the Depositor) having, at the time of the investment or
contractual commitment to invest therein, a rating from Standard & Poor's of
A-1+ and from Moody's of P-1;
(d) investments in money market funds (including funds for which the
Depositor or the Trustee or any of their respective Affiliates is investment
manager or advisor) having a rating from Standard & Poor's of AAA-m or AAAm-G
and from Moody's of Aaa;
(e) bankers' acceptances issued by any depository institution or trust
company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that is a
direct obligation of, or fully guaranteed by, the United States of America or
any agency or instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either case entered
into with a depository institution or trust company (acting as principal)
referred to in clause (b) above; and
(g) any other investment which would not cause either Rating Agency to
downgrade or withdraw its then current rating of either the Class A Certificates
or the Class B Certificates.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA ENTITY" means (i) an employee benefit plan, retirement
arrangement, individual retirement account or ▇▇▇▇▇ subject to either Title I of
ERISA or Section 4975 of the Code, or (ii) an entity whose source of funds to be
used for the purchase of a Class B Certificate includes the assets of any such
plan, arrangement or account.
"EVENT OF SERVICING TERMINATION" means an event specified in Section
9.1.
"EXCHANGE ACT" means the Securities and Exchange Act of 1934, as
amended.
"FINAL SCHEDULED DISTRIBUTION DATE" means the ______________
Distribution Date.
"FINAL SCHEDULED MATURITY DATE" means ___________.
"FINANCED VEHICLE" means a new or used automobile, (including
passenger car, minivan, sport/utility vehicle or light truck) together with all
accessions thereto, securing an Obligor's indebtedness under the respective
Receivable.
"INDEPENDENT COUNSEL" means, when used with respect to any specified
Person, that the Person (a) is in fact independent of the Servicer, the Trust,
the Depositor, the Seller and any Affiliate of any of the foregoing Persons and
(b) is not an officer or employee of the Servicer, the Trust, the Depositor, the
Seller or any Affiliate of any of the foregoing Persons.
"INSOLVENCY EVENT" means, with respect to a specified Person, (a) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property in an
involuntary case under any applicable federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver
(including any receiver appointed under the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, as amended), liquidator, assignee,
custodian, trustee, sequestrator or similar official for such Person or for any
substantial part of its property, or ordering the winding-up or liquidation of
such Person's affairs, and such decree or order shall remain unstayed and in
effect for a period of 60 consecutive days; or (b) the commencement by such
Person of a voluntary case under any applicable federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or the consent by
such Person to the entry of an order for relief in an involuntary case under any
such law, or the consent by such Person to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
or similar official for such Person or for any substantial part of its property,
or the making by such Person of any general assignment for the benefit of
creditors, or the failure by such Person generally to pay its debts as such
debts become due, or the taking of action by such Person in furtherance of any
of the foregoing.
"INTEREST COLLECTIONS" means, with respect to any Distribution Date,
the sum of the following amounts without duplication: (a) that portion of all
collections on the Receivables allocable to interest in respect of the preceding
Collection Period using (x) in the case of a Simple Interest Receivable, the
Simple Interest Method and (y) in the case of an Actuarial Receivable, the
actuarial method (including, with respect to Actuarial Receivables, amounts
withdrawn from the Payahead Account and allocable to interest, and excluding
amounts deposited into the Payahead Account and allocable to interest, in each
case in respect of the preceding Collection Period); (b) Liquidation Proceeds
attributable to interest on the Receivables which became Liquidated Receivables
during the preceding Collection Period in accordance with the Servicer's
customary servicing procedures; (c) all Advances made by the Servicer of
interest due on the Actuarial Receivables; (d) the Purchase Amount of each
Receivable repurchased by the Seller or purchased by the Servicer as of the
close of business on the last day of the preceding Collection Period to the
extent attributable to accrued interest on such Receivable; (e) Recoveries for
such Collection Period and (f) Investment Earnings for such Distribution Date;
PROVIDED, HOWEVER, that in calculating the Interest Collections (i) all payments
and proceeds (including Liquidation Proceeds) of any Receivables repurchased by
the Seller or purchased by the Servicer the Purchase Amount of which has been
included in the Interest Collections on a prior Distribution Date, and (ii)
distributed to the Servicer with respect to such Distribution Date, as
reimbursement for Outstanding Advances in accordance with Section 4.8 shall all
be excluded.
"INVESTMENT EARNINGS" means, with respect to any Distribution Date,
the investment earnings (net of losses and investment expenses) on amounts on
deposit in the Accounts and the Reserve Fund to be deposited into the Collection
Account on such Distribution Date pursuant to Section 4.1.
"LIEN" means a security interest, lien, charge, pledge or encumbrance
of any kind, other than tax liens, mechanics' liens and any liens which attach
to the respective Receivable by operation of law as a result of any act or
omission by the related Obligor.
"LIQUIDATED RECEIVABLES" means, Receivables (i) which have been
liquidated by the Servicer through the sale of the related Financed Vehicle,
(ii) as to which all or a portion representing 10% or more of a scheduled
payment due is 150 or more days delinquent or (iii) with respect to which
proceeds have been received which, in the Servicer's judgment, constitute the
final amounts recoverable in respect of such Receivable.
"LIQUIDATION DISTRIBUTION DATE" has the meaning specified in Section
11.3.
"LIQUIDATION PROCEEDS" means, with respect to any Liquidated
Receivable, the moneys collected in respect thereof, from whatever source (other
than any proceeds from any Dealer commission) on a Liquidated Receivable during
the Collection Period in which such Receivable became a Liquidated Receivable,
net of the sum of any amounts expended by the Servicer in connection with such
liquidation and any amounts required by law to be remitted to the Obligor on
such Liquidated Receivable.
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc., or its successors in
interest.
"NET LOSSES" means the sum of Realized Losses and Cram Down Losses
minus Recoveries for any Collection Period.
"OBLIGOR" on a Receivable means the purchaser or co-purchasers of the
Financed Vehicle and any other Person who owes payments under the Receivable.
"OFFICERS' CERTIFICATE" means a certificate signed by (a) the
president, any senior vice president or any vice president and (b) a secretary
or assistant secretary of the Depositor, the Seller or the Servicer, as
appropriate, provided that no one person may sign in a capacity fulfilling both
clause (a) and clause (b).
"OPINION OF COUNSEL" means one or more written opinions of counsel who
may, except as otherwise expressly provided in this Agreement, be employees of
or counsel to the Depositor, the Seller or the Servicer, and which opinion or
opinions shall be addressed to the Trustee as Trustee; provided, however, that
any opinion regarding the status of the Trust as a grantor trust for federal
income tax purposes shall be delivered by Independent Counsel.
"ORIGINAL CLASS A PRINCIPAL BALANCE" means $-------------.
"ORIGINAL CLASS B PRINCIPAL BALANCE" means $-------------.
"ORIGINAL POOL BALANCE" means the aggregate Cutoff Date Principal
Balance of the Receivables, which is $-------------.
"ORIGINAL PRINCIPAL BALANCE" means the sum of the Original Class A
Principal Balance and the Original Class B Principal Balance.
"OUTSTANDING ADVANCES" on the Actuarial Receivables means the sum, as
of the close of business on the last day of a Collection Period, of all Advances
as reduced as provided in Section 4.8(a).
"PAYAHEAD" on an Actuarial Receivable means the amount, as of the
close of business on the last day of a Collection Period, computed in accordance
with Section 4.2(b) with respect to such Receivable.
"PAYAHEAD ACCOUNT" means the account designated as such, established
and maintained pursuant to Section 4.1(b)(i).
"PAYAHEAD BALANCE" on an Actuarial Receivable means the sum, as of the
close of business on the last day of a Collection Period, of all Payaheads made
by or on behalf of the Obligor with respect to such Actuarial Receivable, as
reduced by applications of previous Payaheads with respect to such Actuarial
Receivable, pursuant to Sections 4.1 and 4.8.
"PERSON" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust (including any beneficiary
thereof), unincorporated organization or government or any agency or political
subdivision thereof.
"PHYSICAL PROPERTY" has the meaning assigned to such term in the
definition of "Delivery" above.
"PLAN" has the meaning specified in Section 6.3.
"POOL BALANCE" as of the close of business on the last day of a
Collection Period means the aggregate Principal Balance of the Receivables
(excluding Purchased Receivables and Liquidated Receivables).
"PRINCIPAL BALANCE" of a Receivable, as of the close of business on
the last day of a Collection Period, means the Amount Financed minus the sum of
(i)(a) with respect to a Simple Interest Receivable, that portion of all
payments made by or on behalf of the related Obligor on or prior to such day and
allocable to principal using the Simple Interest Method and (b) in the case of
an Actuarial Receivable, that portion of all Scheduled Payments due on or prior
to such day allocable to principal using the actuarial method, (ii) any refunded
portion of extended warranty protection plan costs or of physical damage, theft,
credit life, credit accident or health insurance premiums included in the Amount
Financed, (iii) any payment of the Purchase Amount with respect to the
Receivable allocable to principal, (iv) any prepayment in full or any partial
prepayments applied to reduce the Principal Balance of the Receivable and (v)
Cram Down Losses in respect of such Receivable.
"PRINCIPAL COLLECTIONS" means, with respect to any Distribution Date,
the sum of (i) (a) with respect to Simple Interest Receivables, that portion of
all collections on the Receivable allocable to principal in respect of the
preceding Collection Period and (b) with respect to Actuarial Receivables, the
sum of (x) the amount of all Scheduled Payments allocable to principal due
during the preceding Collection Period and (y) the portion of all prepayments in
full allocable to principal received during the preceding Collection Period, in
the case of both (a) and (b), without regard to any extensions or modifications
thereof effected after the Cutoff Date, other than with respect to any
extensions or modifications required in connection with Cram Down Losses during
such Collection Period; (ii) the principal balance of each Receivable that was
repurchased by the Seller or purchased by the Servicer, in each case, as of the
close of business on the last day of the preceding Collection Period (except to
the extent included in (i) above; (iii) the principal balance of each Liquidated
Receivable which became such during the preceding Collection Period (except to
the extent included in (i) above); (iv) partial prepayments on Receivables in
respect of the preceding Collection Period relating to refunds of extended
service contracts, or of physical damage, credit life, credit accident or heath
insurance premium, disability insurance policy premiums, but only if such costs
or premiums were financed by the respective Obligor and only to the extent not
included in clause (i) above; and (v) the aggregate amount of Cram Down Losses
during such Collection Period.
"PURCHASE AMOUNT" means the amount, as of the close of business on the
last day of a Collection Period, required to prepay in full the respective
Receivable under the terms thereof including interest at the APR to the end of
the month of purchase (without giving effect to Outstanding Advances).
"PURCHASED RECEIVABLE" means a Receivable purchased as of the close of
business on the last day of a Collection Period by (i) the Servicer pursuant to
Section 3.7 or (ii) repurchased by the Seller pursuant to Section 2.3.
"RATING AGENCY" means ___________________________________. If no such
organization or successor is any longer in existence, "Rating Agency" shall be a
nationally recognized statistical rating organization or other comparable Person
designated by the Depositor, notice of which designation shall be given to the
Trustee, the Collateral Agent and the Servicer.
"RATING AGENCY CONDITION" means, with respect to any action, that each
Rating Agency shall have been given 10 days' prior notice thereof (or such
shorter period as shall be acceptable to the Rating Agencies) and that neither
of the Rating Agencies shall have notified the Depositor, the Servicer or the
Trustee in writing that such action will, in and of itself, result in a
reduction or withdrawal of the then current rating of either class of
Certificates. With respect to Section 4.2, the Rating Agency Condition shall be
deemed to be satisfied on the Closing Date after receipt of a letter from each
Rating Agency dated such date stating that the Class A Certificates are rated in
the highest investment rating category and the Class B Certificates are rated at
least "A" or its equivalent.
"REALIZED LOSSES" means the excess of the Principal Balance of any
Liquidated Receivable over Liquidation Proceeds to the extent allocable to
principal.
"RECEIVABLE" means any Contract listed on Schedule A (which Schedule
may be in the form of microfiche), but excluding Liquidated Receivables and
Purchased Receivables.
"RECEIVABLE FILES" means the documents specified in Section 2.4.
"RECORD DATE" means, in respect of each Collection Period and the
related Distribution Date, the last day of the calendar month immediately
preceding such Distribution Date.
"RECOVERIES" means, with respect to any Liquidated Receivable, monies
collected in respect thereof, from whatever source (other than any proceeds from
any Dealer commission), during any Collection Period following the Collection
Period in which such Receivable became a Liquidated Receivable, net of the sum
of any amounts expended by the Servicer for the account of the Obligor and any
amounts required by law to be remitted to the Obligor.
"RELATED FINANCED VEHICLE" means a Financed Vehicle securing the
Obligor's indebtedness under a Receivable.
"RESERVE FUND" means the fund established and maintained as such
pursuant to Section 4.1(b).
"RESERVE FUND DEPOSIT" means, with respect to the Closing Date,
$___________.
"SCHEDULED PAYMENT" on an Actuarial Receivable means that portion of
the payment required to be made by the Obligor during the respective Collection
Period sufficient to amortize the Principal Balance under the actuarial method
over the term of the Actuarial Receivable (except, in the case a Balloon Loan,
to the extent necessary to amortize the Principal Balance to the amount of the
Balloon Payment over the life of the Actuarial Receivable) and to provide
interest at the APR.
"SCHEDULE OF RECEIVABLES" means each list attached hereto as Schedule
A identifying the Receivables conveyed by the Depositor or at the Depositor's
direction, which list may be in the form of microfiche, or computer readable
tape or diskette.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SELLER" has the meaning specified in the preamble.
"SERVICER" means the Bank, the Servicer of the Receivables, and each
successor to the Bank (in the same capacity) pursuant to Section 7.5 or 8.3.
"SERVICER'S CERTIFICATE" has the meaning specified in Section 3.9.
"SERVICING FEE" means, with respect to any Distribution Date, the fee
payable to the Servicer for services rendered during such Collection Period,
determined pursuant to Section 3.8.
"SERVICING FEE RATE" shall be ___% per annum, calculated on the basis
of a 360-day year consisting of twelve 30-day months.
"SIMPLE INTEREST METHOD" means the method of allocating a fixed level
payment to principal and interest, pursuant to which the portion of such payment
that is allocated to interest is equal to the product of the fixed rate of
interest multiplied by the unpaid principal balance multiplied by the period of
time elapsed since the preceding payment of interest was made and the remainder
of such payment is allocable to principal.
"SIMPLE INTEREST RECEIVABLE" means any Receivable under which the
portion of a payment allocable to principal and the portion of a payment
allocable to interest is determined in accordance with the Simple Interest
Method.
"SPECIFIED RESERVE BALANCE" means, with respect to any Distribution
Date, the greater of (a) ____% of the sum of the Class A Principal Balance and
the Class B Principal Balance on such Distribution Date (after giving effect to
all distributions with respect to the Certificates to be made on such
Distribution Date) except that, if on any Distribution Date (x) the Cumulative
Net Loss Ratio exceeds the Trigger Percentage for such Distribution Date or (y)
the average of the Delinquency Percentages for the three preceding Collection
Periods exceeds ____%, then the Specified Reserve Balance shall be an amount
equal to the greater of ___% of the sum of the Class A Principal Balance and the
Class B Principal Balance on such Distribution Date (after giving effect to all
distributions with respect to the Certificates to be made on such Distribution
Date) and the amount specified in clause (b) below or (b) ____% of the sum of
the Original Class A Principal Balance and the Original Class B Principal
Balance. In no circumstances will the Depositor be required to deposit any
amounts in the Reserve Fund other than the Reserve Fund Deposit.
"STAMP" has the meaning specified in Section 6.3.
"STANDARD & POOR'S" or "S&P" means Standard & Poor's, a division of
the ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., or its successor.
"TRANSFER DATE" means, with respect to any Distribution Date, the
Business Day preceding such Distribution Date.
"TRIGGER PERCENTAGE" means (i) in the case of any Distribution Date
prior to ___ Distribution Date, ___%, (ii) in the case of any Distribution Date
on and after the ___ Distribution Date but prior to the ___ Distribution Date,
___%, (iii) in the case of any Distribution Date on and after the ___
Distribution Date but prior to the ___ Distribution Date, ___%, (iv) in the case
of any Distribution Date on and after the ___ Distribution Date but prior to the
___ Distribution Date, ___% and (v) in the case of any Distribution Date on and
after the ___ Distribution Date, ___%.
"TRUST" means the Mellon Auto Trust 199_-_ created by this Agreement.
"TRUSTEE" means ____________________, as Trustee under this Agreement,
or any successor, and any successor Trustee appointed and acting pursuant to
Sections 10.10 and 10.11.
"TRUST PROPERTY" means:
(a) all right, title and interest of the Seller in and to the
Receivables, and all moneys received thereon (other than any proceeds from any
Dealer commission), on or after the Cutoff Date and, with respect to Receivables
which are Actuarial Receivables, all monies received thereon prior to the Cutoff
Date that are due on or after the Cutoff Date;
(b) all right, title and interest of the Seller in the security
interests in the Financed Vehicles granted by Obligors pursuant to the
Receivables and any other interest of the Seller in the Financed Vehicles;
(c) all right, title and interest of the Seller in and to any proceeds
from claims on any physical damage, repossession, loss, skip, credit life and
credit accident, vendor's single interest and health insurance policies or
certificates relating to the Financed Vehicles or the Obligors;
(d) all right, title and interest of the Seller in and to refunds for
the costs of extended service contracts with respect to Financed Vehicles,
refunds of unearned premiums with respect to credit life and credit accident and
health insurance policies or certificates covering an Obligor or Financed
Vehicle or his or her obligations with respect to a Financed Vehicle and any
recourse to Dealers for any of the foregoing;
(e) the interest of the Seller in any proceeds from any Receivable
repurchased by a Dealer, pursuant to a Dealer Agreement, as a result of a breach
of representation or warranty in the related Dealer Agreement or a default by an
Obligor resulting in the repossession of the Financed Vehicle under such Dealer
Agreement; and
(f) the proceeds of any and all of the foregoing. "UCC" means the
Uniform Commercial Code as in effect in the relevant jurisdiction.
SECTION 1.2. OTHER DEFINITIONAL PROVISIONS.
(a) All terms defined in this Agreement shall have the defined
meanings when used in any instrument governed hereby and in any certificate or
other document made or delivered pursuant hereto unless otherwise defined
therein.
(b) As used in this Agreement, in any instrument governed hereby and
in any certificate or other document made or delivered pursuant hereto or
thereto, accounting terms not defined in this Agreement or in any such
instrument, certificate or other document, and accounting terms partly defined
in this Agreement or in any such instrument, certificate or other document to
the extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles as in effect on the date of this
Agreement or any such instrument, certificate or other document, as applicable.
To the extent that the definitions of accounting terms in this Agreement or in
any such instrument, certificate or other document are inconsistent with the
meanings of such terms under generally accepted accounting principles, the
definitions contained in this Agreement or in any such instrument, certificate
or other document shall control.
(c) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Article, Section, Schedule
and Exhibit references contained in this Agreement are references to Articles,
Sections, Schedules and Exhibits in or to this Agreement unless otherwise
specified; and the term "including" shall mean "including without limitation."
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
SECTION 1.3. CALCULATIONS. Except as otherwise specifically provided
herein, all calculations of the amount of interest accrued on the Certificates
during any Collection Period and all calculations of the amount of the Servicing
Fee payable with respect to a Collection Period shall be made on the basis of a
360-day year consisting of twelve 30-day months.
SECTION 1.4. REFERENCES. All references to the first day of a
Collection Period shall refer to the opening of business on such day. All
references to the last day of a Collection Period shall refer to the close of
business on such day.
SECTION 1.5. REFERENCES TO THE TRUST. Whenever any provision of this
Agreement refers to actions to be taken by the Trust, matters to be consented to
by the Trust, or deliveries or notices to the Trust, such provision shall be
deemed to refer to actions to be taken by the Trustee, matters to be consented
to by the Trustee, or deliveries or notices to the Trustee.
SECTION 1.6. ACTION BY OR CONSENT OF CERTIFICATEHOLDERS. Whenever any
provision of this Agreement refers to action to be taken or consented to by
Certificateholders, such provision shall be deemed to refer to
Certificateholders of record as of the Record Date immediately preceding the
date on which such action is to be taken, or consented to by Certificateholders.
ARTICLE II
THE TRUST PROPERTY
SECTION 2.1. CONVEYANCE OF TRUST PROPERTY. (a) The Seller,
concurrently with the execution and delivery hereof, does hereby sell, transfer,
assign and convey to the Depositor, at a purchase price previously agreed to by
the Seller and Depositor, the Trust Property, without recourse (subject to the
obligations herein). (b) In consideration of the Trustee's delivery to, or upon
the written order of the Depositor of authenticated Certificates, in authorized
denominations, in an aggregate amount equal to the Original Principal Balance,
the Depositor does hereby sell, transfer, assign and convey to the Trustee
without recourse (subject to the obligations herein) upon the terms and
conditions hereof, the Trust Property together with the Depositor's right to
require the Seller to cure any breach of a representation or warranty made
herein by the Seller or to repurchase or substitute for any affected Receivable
in accordance herewith.
SECTION 2.2.A. REPRESENTATIONS AND WARRANTIES OF THE SELLER. The
Seller makes the following representations and warranties as to the Receivables
on which each of the Depositor and the Trustee is deemed to have relied in
acquiring the Receivables. Unless otherwise indicated, such representations and
warranties are being made as of the execution and delivery of the Agreement, but
shall survive the sale, transfer and assignment of the Receivables and the other
Trust Property to the Trustee.
(a) TITLE. Immediately prior to the transfer and assignment to the
Depositor herein contemplated, the Seller had good and marketable title to each
Receivable conveyed by it to the Depositor, free and clear of all Liens and,
immediately upon the transfer thereof, the Depositor shall have good and
marketable title to each Receivable, free and clear of all Liens; and the
transfer of the Receivables to the Depositor has been perfected under the UCC.
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
Depositor and that the beneficial interest in and title to such Receivables not
be part of the debtor's estate in the event of the filing of a petition for
receivership by or against the Seller. No Receivable has been sold, transferred,
assigned or pledged by the Seller to any Person other than the Depositor.
(b) ALL FILINGS MADE. All filings (including UCC filings) necessary in
any jurisdiction to give the Seller a first priority perfected security interest
in the Receivables to give the Depositor a first priority perfected ownership
interest in the Receivables, and to give the Trustee a first priority perfected
security interest therein, shall have been presented to the Trustee for filing
in the appropriate filing offices. Upon such filing by the Servicer, the Trustee
will have a first priority perfected security interest in the Trust Property.
(c) CHARACTERISTICS OF RECEIVABLES. Each Receivable (A) has been
either originated by a Dealer in the regular course of such Dealer's business
and purchased from such Dealer by the Seller in the ordinary course of the
Seller's business or otherwise originated by the Seller in the ordinary course
of the Seller's business, and each Obligor was approved in accordance with the
Seller's standard underwriting procedures in effect at the time such Receivable
was originated or purchased, (B) was conveyed by the Seller to the Depositor,
(C) has created or shall create a valid, subsisting and enforceable first
priority security interest in favor of the Seller in the Financed Vehicle, which
security interest has been assigned by the Seller to the Depositor, which is
assignable by the Depositor to the Trustee, (D) contains customary and
enforceable provisions under the laws of the State governing such Receivable
such that the rights and remedies of the holder thereof are adequate for
realization against the collateral of the benefits of the security; and (E)
provides for level monthly payments that fully amortizes the Amount Financed by
maturity (except for the last payment, which may be different from the level
payment and except, with respect to a Balloon Loan, to the extent of the Balloon
Payment).
(d) SCHEDULE OF RECEIVABLES. The information set forth in Schedule A
to this Agreement is true and correct in all material respects as of the opening
of business on the Cutoff Date and no selection procedures believed by the
Seller to be adverse to the Certificateholders were utilized in selecting the
Receivables. The Computer Tape regarding the Receivables is true and correct in
all material respects as of the Cutoff Date.
(e) COMPLIANCE WITH LAW. Each Receivable, the sale of the Financed
Vehicle and the sale of any physical damage and credit life and credit accident
and health insurance and any extended service contracts complied in all material
respects at the time it was originated or made and at the Closing Date (after
giving effect to the transactions contemplated by the Basic Documents) complies
in all material respects with all requirements of applicable federal, state and
local laws and regulations thereunder, including usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit
Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade
Commission Act, the ▇▇▇▇▇▇▇▇-▇▇▇▇ Warranty Act, the Federal Reserve Board's
Regulations B and Z, the Soldier's and Sailor's Civil Relief Act of 1940, state
adaptations of the National Consumer Act and the Uniform Consumer Credit Code,
and other consumer credit laws and equal credit opportunity and disclosure laws.
(f) BINDING OBLIGATION. Each Receivable represents the legal, valid
and binding payment obligation in writing of the Obligor thereunder, enforceable
by the holder thereof in accordance with its terms except as such enforceability
may be limited by applicable bankruptcy, insolvency, moratorium, fraudulent
conveyance, reorganization and similar laws now or hereafter in effect related
to or affecting creditors' rights generally and subject to general principles of
equity (whether applied in a proceeding at law or in equity) and all parties to
such Receivable had full legal capacity to execute and deliver such Receivable
and all other documents related thereto and to grant the security interest
purported to be granted thereby.
(g) NO GOVERNMENT OBLIGOR. None of the Receivables is 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.
(h) SECURITY INTEREST IN FINANCED VEHICLE. Immediately prior to the
sale, assignment, and transfer thereof under the Agreement, (i) each Receivable
shall be secured by a validly perfected first priority security interest in the
Financed Vehicle in favor of the Seller as secured party or (ii) application has
been made with the appropriate governmental authority for a valid perfected
first priority security interest in the Financed Vehicle in favor of the Seller,
and such security interest is or shall be prior to all other Liens upon and
security interests in such Financed Vehicle which now exist or may hereafter
arise or be created (except, as to priority, for any tax liens or mechanics'
liens which may arise after the Closing Date).
(i) RECEIVABLES IN FORCE. No Receivable has been satisfied,
subordinated or rescinded, nor has any Financed Vehicle been released from the
Lien granted by the related Receivable in whole or in part unless another
vehicle has been substituted as collateral securing the Receivable without any
other modification to such Receivable.
(j) NO WAIVER. No provision of a Receivable has been modified or
waived except as reflected in the Receivable File relating to such Receivable.
(k) NO AMENDMENTS. No Receivable has been amended, except as permitted
pursuant to Section 3.2.
(l) NO DEFENSES. No right of rescission, setoff, counterclaim or
defense has been asserted or threatened with respect to any Receivable. The
operation of the terms of any Receivable or the exercise of any right thereunder
will not render such Receivable unenforceable in whole or in part or subject to
any such right of rescission, setoff, counterclaim, or defense.
(m) NO LIENS. As of the Cutoff Date, there are no Liens or claims,
including Liens for work, labor, materials or unpaid state or federal taxes
relating to any Financed Vehicle securing the related Receivable, that are or
may be prior to or equal to the Lien granted by such Receivable.
(n) NO DEFAULT. Except for payment delinquencies continuing for a
period of not more than thirty days as of the Cutoff Date and, except as
permitted in this paragraph, no default, breach, violation or event (in any such
case) permitting acceleration under the terms of any Receivable has occurred;
and no continuing condition that with notice or the lapse of time would
constitute a default, breach, violation or event (in any such case) permitting
acceleration under the terms of any Receivable has arisen; and the Seller has
not waived and shall not waive any of the foregoing.
(o) MATURITY OF RECEIVABLES. Each Receivable has an original maturity
of not more than ___ months; the weighted average original maturity of the
Receivables is ___ months as of the Cutoff Date; the remaining term of each
Receivable is ___ months or less as of the Cutoff Date; the weighted average
remaining term of the Receivables is ___ months as of the Cutoff Date; and the
latest scheduled maturity of any Receivable shall be no later than the Final
Scheduled Maturity Date.
(p) NO BANKRUPTCIES. No Obligor on any Receivable was noted in the
related Receivable File as having filed for bankruptcy in a proceeding which
remained undischarged as of the Cutoff Date.
(q) NO REPOSSESSIONS. As of the Cutoff Date, no Financed Vehicle
securing any Receivable is in repossession status.
(r) CHATTEL PAPER. Each Receivable constitutes "chattel paper" as
defined in the UCC.
(s) APR. The weighted average Annual Percentage Rate of the
Receivables as of the Cutoff Date is approximately ___%.
(t) PRINCIPAL BALANCE. Each Receivable has an outstanding principal
balance as of the Cutoff Date of not less than ___ or more than $____. The
average principal balance of the Receivables as of the Cutoff Date is $___. The
aggregate principal balance of the Receivables as of the Cutoff Date is $___.
(u) FINANCING. Approximately ___% of the aggregate principal balance
of the Receivables, constituting approximately ___% of the number of
Receivables, as of the Cutoff Date, represents financing of new vehicles; the
remainder of the Receivables represents financing of used vehicles.
Approximately ___% of the aggregate principal balance of the Receivables,
constituting approximately ___% of the number of Receivables, as of the Cutoff
Date, represents financing of Balloon Loans. Approximately ___% of the aggregate
Principal Balance of the Receivables, constituting approximately ___% of the
number of Receivables, as of the Cutoff Date, represents financing of Simple
Interest Receivables; the remainder of the Receivables represents financing of
Actuarial Receivables.
(v) PAID-AHEAD. Approximately ___% of the aggregate Principal Balance
of the Receivables, constituting approximately ___% of the number of Receivables
are paid-ahead for a period of one to six months. No Receivable is paid-ahead
more than ___ months.
(w) INSURANCE; OTHER. The Servicer, in accordance with its customary
procedures, has confirmed (A) that each Obligor has obtained insurance covering
the Financed Vehicle as of the date of execution of the related Receivable
insuring against loss and damage due to fire, theft, collision and other risks
generally covered by comprehensive and collision coverage and that each
Receivable requires the Obligor to maintain such insurance naming the Seller and
its successors and assigns as a loss payee, (B) each Receivable that finances
the cost of premiums for credit life and credit accident and health insurance is
covered by an insurance policy or certificate of insurance naming the Seller as
loss payee (lienholder) under each such insurance policy and certificate of
insurance and (C) as to each Receivable that finances the cost of an extended
service contract, the respective Financed Vehicle which secures the Receivable
is covered by an extended service contract.
(x) LAWFUL ASSIGNMENT. No Receivable has been originated in, or as of
the Closing Date is subject to the laws of, any jurisdiction under which the
sale, transfer and assignment of such Receivable under this Agreement or the
pledge of such Receivable to the Trustee under the Indenture (i) is unlawful,
void, voidable or unenforceable in accordance with its terms or (ii) would
render such Receivable void, voidable or unenforceable in accordance with its
terms. The Seller has not entered into any agreement with any account debtor
that prohibits, restricts or conditions the assignment of all or any portion of
the Receivable.
(y) NO INSURANCE PREMIUMS. As of the Cutoff Date, no portion of the
principal balance of any Receivable included amounts attributable to the payment
of any physical damage or theft insurance premium.
(z) ONE ORIGINAL. There is only one manually executed original copy of
each Receivable.
(aa) ORIGINATION OF RECEIVABLES. Based on the billing address of the
Obligors and the principal balance of Receivables as of the Cutoff Date,
approximately ___% of the Receivables were originated in ___, approximately ___%
of the Receivables were originated in ___ and approximately ___% of the
Receivables were originated in ___, each Obligor has been approved by the Seller
based on the Seller's standard underwriting procedures as in effect at the time
the related Receivable was entered into. Based on the billing address of the
Obligors and the principal balance of the Receivables as of the Cutoff Date, not
more than 10% of the Receivables were originated in any one state other than
___, ___ and ___.
(bb) RECEIVABLE FILES. The Receivable Files are kept at the locations
listed in Schedule B.
(cc) COMPUTER RECORDS. As of the Closing Date, the accounting and
computer records relating to the Receivables of the Seller have been marked to
indicate the Depositor's ownership interest therein.
SECTION 2.2.B. REPRESENTATIONS AND WARRANTIES OF DEPOSITOR. The
Depositor makes the following representations and warranties as to each
Receivable conveyed by the Depositor to the Trustee hereunder on which the
Trustee shall conclusively rely in accepting the Trust Property in trust and
authenticating the Certificates. Unless otherwise indicated, such
representations and warranties are being made as of the execution and delivery
of the Agreement, but shall survive the sale, transfer and assignment of the
Receivables and the other Trust Property to the Trustee.
(a) TITLE. It is the intention of the Depositor that the transfer and
assignment herein contemplated constitute a sale of the Receivables from the
Depositor to the Trustee and that the beneficial interest in and title to such
Receivables not be part of the debtor's estate in the event of the filing of a
petition for receivership by or against the Depositor. No Receivable has been
sold, transferred, assigned or pledged by the Depositor to any Person other than
the Trustee. Immediately prior to the transfer and assignment herein
contemplated, the Depositor had good and marketable title to each Receivable,
free and clear of all Liens and, immediately upon the transfer thereof, the
Trustee shall have good and marketable title to each such Receivable, free and
clear of all Liens; and the transfer of the Receivables to the Trustee has been
perfected under the UCC.
(b) ALL FILINGS MADE. All filings (including UCC filings) necessary in
any jurisdiction to give the Depositor a first priority perfected security
interest in the Receivables, to give the Trustee a first priority perfected
ownership interest in the Receivables, to give the Trustee a first priority
perfected ownership interest in the Receivables, and to give the Trustee a first
priority perfected security interest therein, shall have been presented to the
Trustee for filing in the appropriate filing offices. Upon such filing by the
Servicer, the Trustee will have a first priority perfected security interest in
the Trust Property.
(c) LAWFUL ASSIGNMENT. No Receivable has been originated in, or as of
the Closing Date is subject to the laws of, any jurisdiction under which the
sale, transfer and assignment of such Receivable under this Agreement (i) is
unlawful, void, voidable or unenforceable in accordance with its terms or (ii)
would render such Receivable void, voidable or unenforceable in accordance with
its terms. The Depositor has not entered into any agreement with any account
debtor that prohibits, restricts or conditions the assignment of all or any
portion of the Receivable.
(d) COMPUTER RECORDS. As of the Closing Date, the accounting and
computer records relating to the Receivables of the Depositor have been marked
to show the absolute ownership by the Trustee on behalf of the Trust of the
Receivables.
SECTION 2.3. REPURCHASE UPON BREACH. (a) The Seller, the Depositor,
the Servicer or the Trustee, as the case may be, shall inform the other parties
to this Agreement and the Trustee promptly, in writing, upon its discovery of
any breach of Seller's or the Depositor's representations and warranties made
pursuant to Section 2.2. Unless any such breach shall have been cured by the
last day of the first Collection Period following the discovery thereof by the
Trustee or receipt by the Trustee of written notice from the Seller, the
Depositor or the Servicer of such breach, the Seller shall be obligated to
repurchase any Receivable in which the interests of the Certificateholders are
materially and adversely affected by any such breach as of the last day of such
Collection Period. In consideration of and simultaneously with the repurchase of
the Receivable, the Seller shall remit to the Collection Account the Purchase
Amount in the manner specified in Section 4.3 and the Trustee shall execute such
assignments and other documents reasonably requested by the Seller in order to
effect such repurchase.
(b) The sole remedy of the Trust, the Trustee or the
Certificateholders with respect to a breach of representations and warranties
pursuant to Section 2.2 and the agreement contained in this Section shall be to
require the Seller to repurchase Receivables pursuant to this Section, subject
to the conditions contained herein. The Trustee shall not have any duty to
conduct any affirmative investigation as to the occurrence of any conditions
requiring the repurchase of any Receivable pursuant to this Section.
SECTION 2.4. CUSTODY OF RECEIVABLE FILES. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Trustee hereby
revocably appoints the Servicer, and the Servicer hereby accepts such
appointment, to act as the agent of the Trustee as custodian of the following
documents or instruments (the "Receivable Files") with respect to each
Receivable:
(i) the original of the Receivable;
(ii) a record of the information supplied by the Obligor in
the original credit application;
(iii) the original certificate of title or such documents
that the Servicer shall keep on file, in accordance with its customary
procedures, evidencing the security interest of the Depositor in the
Financed Vehicle (it being understood that the original certificates
of title generally are not delivered to the Servicer for 90 days but
that promptly upon delivery they shall be delivered to the Servicer as
custodian hereunder); and
(iv) any and all other documents that the Servicer shall keep
on file, in accordance with its customary procedures, relating to a
Receivable, an Obligor or a Financed Vehicle.
SECTION 2.5. DUTIES OF SERVICER AS CUSTODIAN. (a)
SAFEKEEPING. The Servicer shall hold the Receivable Files on
behalf of the Trustee for the benefit of all present and future
Certificateholders and maintain such accurate and complete accounts, records and
computer systems pertaining to each Receivable File as shall enable the Servicer
and Trustee to comply with this Agreement. In performing its duties as custodian
the Servicer shall act with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to the receivable files
relating to all comparable automotive receivables that the Servicer services for
itself or others. The Servicer shall conduct, or cause to be conducted, periodic
audits of the Receivable Files held by it under this Agreement and of the
related accounts, records and computer systems, in such a manner as shall enable
the Trustee to verify the accuracy of the Servicer's record keeping. The
Servicer shall promptly report to the Trustee any failure on its part to hold
the Receivable Files and maintain its accounts, records and computer systems as
herein provided and promptly take appropriate action to remedy any such failure.
(b) MAINTENANCE OF AND ACCESS TO RECORDS. The Servicer shall maintain
each Receivable File at one of its offices specified in Schedule B to this
Agreement or at such other office as shall be specified to the Trustee by
written notice not later than 90 days after any change in location. Upon
reasonable prior notice, the Servicer shall make available to the Trustee or its
respective duly authorized representatives, attorneys or auditors a list of
locations of the Receivable Files and records and computer systems maintained by
the Servicer at such times during normal business hours as the Trustee shall
instruct.
(c) RELEASE OF DOCUMENTS. Upon written instruction from the Trustee,
the Servicer shall release or shall cause to be released any Receivable File to
the Trustee, the Trustee's agent, or the Trustee's designee, as the case may be,
at such place or places as the Trustee may designate, as soon as practicable and
upon the release and delivery of any such document in accordance with the
instructions of the Trustee, the Servicer shall be released from any further
liability and responsibilities under this Section 2.5 with respect to such
documents unless and until such time as such document may be returned to the
Servicer.
SECTION 2.6. INSTRUCTIONS; AUTHORITY TO ACT. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable Files
upon its receipt of written instructions signed by an Authorized Officer of the
Trustee.
SECTION 2.7. CUSTODIAN'S INDEMNIFICATION. The Servicer as custodian
shall indemnify and hold harmless the Trustee and its officers, directors,
employees and agents for any and all liabilities, obligations, losses,
compensatory damages, payments, costs or expenses (including reasonable
attorneys' fees and expenses) that may be imposed on, incurred by or asserted
against the Trustee or any of its officers, directors, employees and agents as
the result of any improper act or omission in any way relating to the
maintenance and custody by the Servicer or any subservicer, as custodian of the
Receivable Files where the final determination that any such improper act or
omission by the Servicer, which resulted in such liability, obligation, loss,
damage, payment, cost or expense is established by a court of law, by an
arbitrator or by way of settlement agreed to by the Servicer; PROVIDED, HOWEVER,
that the Servicer shall not be liable for any portion of any such amount
resulting from the willful misfeasance, bad faith or negligence of the Trustee.
This provision shall not be considered to limit the Servicer's or any other
party's rights, obligations, liabilities, claims or defenses which arise as a
matter of law or pursuant to any other provision of this Agreement.
SECTION 2.8. EFFECTIVE PERIOD AND TERMINATION. The Servicer's
appointment as custodian shall become effective as of the Cutoff Date and shall
continue in full force and effect until terminated pursuant to this Section. If
the Bank shall resign as Servicer in accordance with the provisions of this
Agreement or if all of the rights and obligations of any Servicer shall have
been terminated under Section 9.1, the appointment of such Servicer as custodian
shall be terminated by the Trustee or by Holders of Certificates evidencing not
less than a majority of the aggregate outstanding principal balance of the Class
A Certificates and the Class B Certificates taken together as a single class, in
the same manner as the Trustee or such Holders may terminate the rights and
obligations of the Servicer under Section 9.1. The Trustee may terminate the
Servicer's appointment as custodian, with cause, at any time upon written
notification to the Servicer, and without cause upon 30 days' prior written
notification to the Servicer and the Rating Agencies. As soon as practicable
after any termination of such appointment, the Servicer shall deliver, or cause
to be delivered, the Receivable Files to the Trustee or the Trustee's agent at
such place or places as the Trustee may reasonably designate in writing. If the
Servicer shall be terminated as custodian hereunder for any reason but shall
continue to serve as Servicer, the Trustee shall, or shall cause its agent to,
make the Receivable Files available to the Servicer (or, if designated by the
Servicer, a permitted subservicer) during normal business hours upon reasonable
notice so as to permit the Servicer to perform its obligations as Servicer
hereunder.
ARTICLE III
ADMINISTRATION AND SERVICING OF THE TRUST PROPERTY
SECTION 3.1. DUTIES OF SERVICER . The Servicer, as agent for the Trust
(to the extent provided herein), shall manage, service, administer and make
collections on the Receivables (other than Purchased Receivables) with
reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to all comparable automotive receivables that it services
for itself or others. The Servicer's duties shall include collection and posting
of all payments, responding to inquiries of Obligors on such Receivables,
investigating delinquencies, sending payment coupons or periodic statements or
invoices to Obligors, reporting any tax information to Obligors, accounting for
collections and furnishing monthly and annual statements to the Trustee with
respect to distributions and making Advances pursuant to Section 4.8(a). Subject
to the provisions of Section 3.2, the Servicer shall follow its customary
standards, policies and procedures in performing its duties as Servicer. Without
limiting the generality of the foregoing, the Servicer is authorized and
empowered to execute and deliver, on behalf of itself, the Trust, the Trustee
and the Certificateholders or any of them, any and all instruments of
satisfaction or cancellation, or partial or full release or discharge, and all
other comparable instruments, with respect to such Receivables or to the
Financed Vehicles securing such Receivables. If the Servicer shall commence a
legal proceeding to enforce a Receivable, the Trustee (in the case of a
Receivable other than a Purchased Receivable) shall thereupon be deemed to have
automatically assigned, solely for the purpose of collection, such Receivable to
the Servicer. If in any enforcement suit or legal proceeding it shall be held
that the Servicer may not enforce a Receivable on the ground that it shall not
be a real party in interest or a holder entitled to enforce such Receivable the
Trustee shall, at the Servicer's expense and direction, take steps to enforce
such Receivable, including bringing suit in its name or the name of the Trustee
or the Certificateholders. The Trustee shall upon the written request of the
Servicer, furnish the Servicer with any powers of attorney and other documents
reasonably necessary or appropriate (as certified to the Trustee by the
Servicer) to enable the Servicer to carry out its servicing and administrative
duties hereunder.
SECTION 3.2. COLLECTION AND ALLOCATION OF RECEIVABLE PAYMENTS. (a) The
Servicer shall make reasonable efforts to collect all payments called for under
the terms and provisions of the Receivables as and when the same shall become
due and shall follow such collection procedures as it follows with respect to
all comparable automotive receivables that it services for itself or others. The
Servicer shall allocate collections between principal and interest in accordance
with the customary servicing procedures it follows with respect to all
comparable automotive receivables that it services for itself or others.
(b) The Servicer may not grant extensions or modify the original due
dates of a Receivable; PROVIDED, HOWEVER, that the Servicer may (i) grant one
extension with respect to a Receivable of one month in any rolling twelve month
period and may change the original due date once during the term of a Receivable
to a new due date within 20 days of the original scheduled due date of such
Receivable and (ii) grant extensions or modify the original due dates of a
Receivable with respect to a Receivable for which a court of appropriate
jurisdiction in a bankruptcy or insolvency proceeding shall have issued an order
reducing the amount owed on such Receivable or otherwise modifying or
restructuring the scheduled payments or other terms on such Receivable;
provided, however, that the Servicer may not extend the date for final payment
by the Obligor of any Receivable beyond the last day of the Collection Period
preceding the Certificate Final Scheduled Distribution Date. The Servicer may in
its discretion waive any late payment charge or any other fees that may be
collected in the ordinary course of servicing a Receivable. The Servicer shall
not voluntarily agree to any reduction of (i) the original interest rate, (ii)
the amount of any Scheduled Payment on an Actuarial Receivable or the original
regular scheduled payment on a Simple Interest Receivable, or (iii) the
Principal Balance of any Receivable.
SECTION 3.3. REALIZATION UPON RECEIVABLES. On behalf of the Trust, the
Servicer shall use all reasonable efforts, consistent with its customary
servicing procedures, to repossess or otherwise convert the ownership of the
Financed Vehicle securing any Receivable as to which the Servicer shall have
determined eventual payment in full is unlikely. From time to time, as
appropriate for servicing or foreclosing upon any Receivable, the Trustee shall,
upon written request of the Servicer, execute such documents as shall be
necessary to prosecute any such proceedings. The Servicer shall follow such
customary and usual practices and procedures as it shall deem necessary or
advisable in its servicing of automotive receivables, which may include
reasonable efforts to realize proceeds from Receivables repurchased by a Dealer,
pursuant to a Dealer Agreement, as a result of a breach of a representation or
warranty in the related Dealer Agreement or a default by an Obligor resulting in
the repossession of the Financed Vehicle under such Dealer Agreement. The
foregoing shall be subject to the provision that, in any case in which the
Financed Vehicle shall have suffered damage, the Servicer shall not expend funds
in connection with the repair or the repossession of such Financed Vehicle
unless it shall determine in its reasonable discretion that such repair and/or
repossession will increase the Liquidation Proceeds by an amount greater than
the amount of such expenses.
SECTION 3.4. PHYSICAL DAMAGE INSURANCE; OTHER INSURANCE. (a) The
Servicer shall, in accordance with its customary servicing procedures, verify
(i) that each Obligor shall have obtained insurance covering the Financed
Vehicle, as of the date of the execution of the Receivable, insuring against
loss and damage due to fire, theft, collision and other risks generally covered
by comprehensive and collision coverage and that each Receivable requires the
Obligor to maintain such physical loss and damage insurance naming the Seller
and its successors and assigns as a loss payee, (ii) that each Receivable that
finances the cost of premiums for credit life and credit accident and health
insurance is covered by an insurance policy or certificate naming the Seller as
policyholder (creditor) and (iii) as to each Receivable that finances the cost
of an extended service contract, the respective Financed Vehicle which secures
the Receivable is covered by an extended service contract.
(b) To the extent applicable, the Servicer shall not take any action
which would result in noncoverage under any of the insurance policies referred
to in Section 3.4(a) which, but for the actions of the Servicer, would have been
covered thereunder. The Servicer, on behalf of the Trustee shall take such
reasonable action as shall be necessary to permit recovery under any of the
foregoing insurance policies. Any amounts collected by the Servicer under any of
the foregoing insurance policies, shall be deposited in the Collection Account
pursuant to Section 4.2. The parties hereto acknowledge that the Servicer shall
not be required to force place any insurance coverage referred to in Section
3.4(a)(i) above, or any other insurance coverage.
SECTION 3.5. MAINTENANCE OF SECURITY INTERESTS IN FINANCED VEHICLES.
The Servicer shall, in accordance with its customary servicing procedures, take
such steps as are necessary to maintain perfection of (i) the security interest
created by each Receivable in the related Financed Vehicle and (ii) the interest
of the Trust in the Receivables created by this Agreement, including but not
limited to obtaining the execution by the Obligors and the recording,
registering, filing, re-recording, re-registering and refiling of all security
agreements, financing statements and continuation statements or instruments as
are necessary to maintain the security interest granted by Obligors under the
respective Receivables, each of the Seller and the Depositor hereunder. The
Servicer is hereby authorized to take such steps as are necessary to re-perfect
such security interest on behalf of the Trust and the Trustee in the event of
the relocation of a Financed Vehicle or for any other reason.
SECTION 3.6. COVENANTS OF SERVICER. The Servicer shall not release the
Financed Vehicle securing any Receivable from the security interest granted by
such Receivable in whole or in part except in the event of payment in full by
the Obligor thereunder or repossession or except as may be required by an
insurer in order to receive proceeds from insurance covering such Financed
Vehicle, nor shall the Servicer impair the rights of the Trustee or the
Certificateholders in such Receivables (it being understood that no action of
the Servicer taken in compliance with the terms of this Agreement shall be
deemed to impair such rights), nor shall the Servicer increase the number of
scheduled payments due under a Receivable. Notwithstanding the foregoing, the
Servicer may, as described in Section 3.2(b), grant extensions or modify the
original due dates of a Receivable or make such other changes with respect to a
Receivable for which a court of appropriate jurisdiction in a bankruptcy or
insolvency proceeding shall have issued an order reducing the amount owed on
such Receivable or otherwise modifying or restructuring the scheduled payments
on such Receivable; provided, however, that the Servicer may not extend the date
for final payment by the Obligor of any Receivable beyond the last day of the
Collection Period preceding the Final Scheduled Distribution Date.
SECTION 3.7. PURCHASE OF RECEIVABLES UPON BREACH. The Servicer or the
Trustee shall inform the other party and the Depositor promptly, in writing,
upon the discovery of any breach pursuant to Section 3.2(b), 3.5 or 3.6. Unless
the breach shall have been cured by the last day of the second Collection Period
following such discovery thereof by the Trustee or the receipt by the Trustee of
notice of such breach, the Servicer shall be obligated to purchase any
Receivable in which the interests of the Certificateholders are materially and
adversely affected by such breach as of the last day of such second Collection
Period (or, at the Servicer's option, the last day of the first Collection
Period following the discovery). In consideration of the purchase of any such
Receivable pursuant to the preceding sentence, the Servicer shall remit the
Purchase Amount in the manner specified in Section 4.3. The sole remedy of the
Trustee or the Certificateholders with respect to a breach of Section 3.2(b),
3.5 or 3.6 shall be to require the Servicer to purchase Receivables pursuant to
this Section. The Trustee shall have no duty to conduct any affirmative
investigation as to the occurrence of any condition requiring the purchase of
any Receivable pursuant to this Section.
SECTION 3.8. SERVICING FEE. The servicing fee for (a) the
___Distribution Date shall equal $___ and (b) for each Distribution Date
thereafter shall equal the product of (i) one-twelfth, (ii) the Servicing Fee
Rate and (iii) the Pool Balance as of the first day of the related Collection
Period (the "Servicing Fee"). In addition, the "Servicing Fee" described in (a)
and (b) above shall include late fees, prepayment charges and other similar
charges allowed by applicable law with respect to Receivables collected (from
whatever source) on the Receivables.
SECTION 3.9. SERVICER'S CERTIFICATE. Not later than 11:00 a.m. (New
York time) on each Determination Date, the Servicer shall deliver to the Trustee
and the Depositor, with a copy to the Rating Agencies, a Servicer's Certificate
containing all information necessary to make the distributions pursuant to
Sections 4.5 and 4.6 (including, if required, withdrawals from or deposits to
the Payahead Account and Advances by the Servicer pursuant to Section 4.8) for
the Collection Period preceding the date of such Servicer's Certificate.
Receivables to be purchased by the Servicer or to be repurchased by the Seller
shall be identified by the Servicer by account number with respect to such
Receivable (as specified in Schedule A).
SECTION 3.10. ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF DEFAULT.
(a) The Servicer shall deliver to the Trustee, on or before October 31 of each
year beginning October 31, 199_ ,an Officers' Certificate, dated as of June 30
of the preceding fiscal year, stating that (i) a review of the activities of the
Servicer during the preceding 12-month period (or, in the case of the first such
report, during the period from the Closing Date to June 30, 199_) and of its
performance under this Agreement has been made under such officers' supervision
and (ii) to the best of such officers' knowledge, based on such review, the
Servicer has fulfilled all its obligations under this Agreement throughout such
year (or, in the case of the first such certificate, such longer period) or, if
there has been a default in the fulfillment of any such obligation, specifying
each such default known to such officers and the nature and status thereof. The
Trustee shall send a copy of such certificate and the report referred to in
Section 3.11 to the Rating Agencies. A copy of such certificate and the report
referred to in Section 3.11 may be obtained by any Certificateholder by a
request in writing to the Trustee addressed to the Corporate Trust Office.
(b) The Servicer shall deliver to the Trustee and the Rating Agencies,
promptly after having obtained knowledge thereof, but in no event later than
five (5) Business Days thereafter, written notice in an Officers' Certificate of
any event which with the giving of notice or lapse of time, or both, would
become an Event of Servicing Termination under Section 9.1(a) or (b).
SECTION 3.11. ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' REPORT.
The Servicer shall cause a firm of independent certified public accountants,
which may also render other services to the Servicer or the Depositor, to
deliver to the Depositor and the Trustee on or before October 31 of each year as
of June 30 of the preceding fiscal year, beginning October 31, 199_, (1) a
report addressed to the Board of Directors of the Servicer, to the effect that
such firm has examined the financial statements of the Servicer and issued its
report and therefor and that such examination was made in accordance with
generally accepted auditing standards (except as otherwise noted therein), and
accordingly included such tests of the accounting records and such other
auditing procedures as such firm considered necessary in the circumstances; and
(2) a report on description of lease and loan servicing operations and tests of
operating effectiveness in form and substance as is currently prepared on an
annual basis with respect to Servicer. The Servicer shall also concurrently
cause the accountants to deliver a report addressed to the Servicer and Trustee
to the effect that (1) a review in accordance with agreed upon procedures was
made of three randomly selected Servicer Certificates; (2) except as disclosed
in the report, no exceptions or errors in the Servicer Certificates were found;
and (3) the delinquencies and loss information, relating to the Receivables
contained in the Servicer Certificates were found to be accurate.
Such report will also indicate that the firm is independent of the
Servicer within the meaning of the Code of Professional Ethics of the American
Institute of Certified Public Accountants.
SECTION 3.12. ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION
REGARDING RECEIVABLES. The Servicer shall provide to the Certificateholders
access to the Receivable Files in such cases where the Certificateholders shall
be required by applicable statutes or regulations to review such documentation
as demonstrated by evidence satisfactory to the Servicer in its reasonable
judgment. Access shall be afforded without charge, but only upon reasonable
request (not less than seventy-two hours) and during normal business hours at
the offices of the Servicer. Nothing in this Section shall affect the obligation
of the Servicer, to observe any applicable law prohibiting disclosure of
information regarding the Obligors and the failure of the Servicer to provide
access to information as a result of such obligation shall not constitute a
breach of this Section.
SECTION 3.13. SERVICER EXPENSES. The Servicer shall be required to pay
all expenses incurred by it in connection with its activities hereunder,
including fees and disbursements of independent accountants, taxes imposed on
the Servicer and expenses incurred in connection with distributions and reports
to Certificateholders.
SECTION 3.14. APPOINTMENT OF SUBSERVICERS. The Servicer may at any
time appoint a subservicer to perform all or any portion of its obligations as
Servicer hereunder; PROVIDED, HOWEVER, that the Rating Agency Condition shall
have been satisfied in connection therewith; PROVIDED FURTHER that the Servicer
shall remain obligated and be liable to the Trustee, and the Certificateholders
for the servicing and administering of the Receivables in accordance with the
provisions hereof without diminution of such obligation and liability by virtue
of the appointment of such subservicer and to the same extent and under the same
terms and conditions as if the Servicer alone were servicing and administering
the Receivables. The fees and expenses of the subservicer shall be as agreed
between the Servicer and its subservicer from time to time and none of the
Trustee or the Certificateholders shall have any responsibility therefor.
ARTICLE IV
DISTRIBUTIONS; RESERVE FUND; STATEMENTS TO CERTIFICATEHOLDERS
SECTION 4.1. ESTABLISHMENT OF ACCOUNTS. (a) (i) The Servicer, for the
benefit of the Certificateholders, shall establish and maintain in the name of
the Trustee an Eligible Deposit Account (the "Collection Account"), bearing a
designation clearly indicating that the funds deposited therein are held for the
benefit of the Certificateholders. The Servicer shall establish and maintain in
the name of the Trustee an Eligible Deposit Account (the "Class A Distribution
Account"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Class A Certificateholders. The Servicer
shall establish and maintain in the name of the Trustee an Eligible Deposit
Account (the "Class B Distribution Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Class B Certificateholders.
(ii) Funds on deposit in the Collection Account, the Class A
Distribution Account and the Class B Distribution Account
(collectively, the "Accounts") shall be established and maintained
with the Trustee and shall be invested by the Trustee in Eligible
Investments selected in writing by the Servicer (pursuant to standing
instructions delivered to an Authorized Officer of the Trustee or
other written notice so delivered); PROVIDED, HOWEVER, it is
understood and agreed that the Trustee shall not be liable for any
loss arising from such investment in Eligible Investments. All such
Eligible Investments shall be held by the Trustee for the benefit of
the beneficiaries of the applicable Account; PROVIDED, that on each
Distribution Date all interest and other investment income (net of
losses and investment expenses) on funds on deposit therein shall be
withdrawn from the Accounts at the written direction of the Servicer
and shall be paid to the Servicer. Funds on deposit in the Accounts
shall be invested in Eligible Investments that will mature so that
such funds will be available at the close of business on the Transfer
Date preceding the following Distribution Date. Funds deposited in an
Account on a Transfer Date which immediately precedes a Distribution
Date or upon the maturity of any Eligible Investments are not required
to be invested overnight.
(iii) The Trustee shall possess all right, title and interest
in all funds on deposit from time to time in the Accounts and in all
proceeds thereof (including all income thereon) and all such funds,
investments, proceeds and income shall be part of the Trust Property.
Except as otherwise provided herein, the Accounts shall be under the
sole dominion and control of the Trustee for the benefit of the
Certificateholders. If, at any time, any of the Accounts ceases to be
an Eligible Deposit Account, the Trustee (or the Servicer on its
behalf) shall within 10 Business Days (or such longer period, as to
which each Rating Agency may consent) establish a new Account as an
Eligible Deposit Account and shall transfer any cash and/or any
investments to such new Account. In connection with the foregoing, the
Servicer agrees that, in the event that any of the Accounts are not
accounts with the Trustee, the Servicer shall notify the Trustee in
writing promptly upon any of such Accounts ceasing to be an Eligible
Deposit Account.
(iv) The Servicer shall have the power, revocable by the
Trustee, to instruct the Trustee in writing to make withdrawals and
payments from the Accounts for the purpose of permitting the Servicer
to carry out its duties hereunder or permitting the Trustee to carry
out its duties.
(b) (i) The Servicer shall establish and maintain in the name
of _______________, as Collateral Agent, an Eligible Deposit Account (the
"Reserve Fund") bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Certificateholders. The
Servicer shall establish and maintain in the name of _______________, as
Collateral Agent, an Eligible Deposit Account (the "Payahead Account ") bearing
a designation clearly indicating that the funds deposited therein are held for
the benefit of the Certificateholders. Neither the Reserve Fund nor the Payahead
Account shall be property of the Trust.
(ii) Funds on deposit in the Reserve Fund and the Payahead
Account shall be invested by the Collateral Agent in Eligible
Investments selected in writing by the Servicer; PROVIDED, HOWEVER, it
is understood and agreed that the Collateral Agent shall not be liable
for any loss arising from such investment in Eligible Investments. All
such Eligible Investments shall be held by the Collateral Agent for
the benefit of the beneficiaries of the Reserve Fund; PROVIDED, that
on each Distribution Date all interest and other investment income
(net of losses and investment expenses) on funds on deposit therein
shall be withdrawn from the Reserve Fund and the Payahead Account at
the written direction of the Servicer and shall be paid to the
Servicer for distribution to the Servicer. Funds on deposit in the
Reserve Fund and the Payahead Account shall be invested in Eligible
Investments that will mature so that such funds will be available at
the close of business on the Transfer Date preceding the following
Distribution Date. Funds deposited in the Reserve Fund and the
Payahead Account on a Transfer Date which immediately precedes a
Distribution Date or upon the maturity of any Eligible Investments are
not required to be (but may be) invested overnight. Neither the
Servicer nor the Trustee shall be liable for any investment losses.
The Depositor will treat these funds, Eligible Investments and other
assets in the Reserve Fund and the Payahead Account as its own for
federal, state and local income tax and franchise tax purposes and
will report on its tax returns all income, gain and loss from the
Reserve Fund and the Payahead Account.
(iii) The Reserve Fund and the Payahead Account shall be
under the sole dominion and control of the Collateral Agent. If, at
any time, the Reserve Fund or the Payahead Account, as the case may
be, ceases to be an Eligible Deposit Account, the Servicer shall
within 10 Business Days (or such longer period, as to which each
Rating Agency may consent) establish a new Reserve Fund or the
Payahead Account, as the case may be, as an Eligible Deposit Account
and shall transfer any cash and/or any investments to such new Reserve
Fund or the Payahead Account, as the case may be. In connection with
the foregoing, the Servicer agrees that, in the event that the Reserve
Fund or the Payahead Account is not an account with the Trustee, the
Servicer shall notify the Trustee in writing promptly upon the Reserve
Fund or the Payahead Account ceasing to be an Eligible Deposit
Account.
(iv) The Servicer shall have the power, revocable by the
Trustee, to instruct the Collateral Agent in writing to make
withdrawals and payments from the Reserve Fund or the Payahead Account
for the purpose of permitting the Servicer to carry out its duties
hereunder or permitting the Collateral Agent to carry out its duties.
(c) With respect to the Account Property in respect of the Reserve
Fund or the Payahead Account, the Collateral Agent agrees and with respect to
the remainder of the Account Property, the Trustee agrees, that:
(i) any Account Property that is held in deposit accounts
shall be held solely in Eligible Deposit Accounts subject to the
penultimate sentence of Section 4.1(b)(iii); and, except as otherwise
provided herein, each such Eligible Deposit Account shall be subject
to the exclusive custody and control of the Collateral Agent or the
Trustee, as the case may be, and the Collateral Agent or the Trustee,
as the case may be, shall have sole signature authority with respect
thereto;
(ii) any Account Property shall be Delivered to the
Collateral Agent or the Trustee, as the case may be, in accordance
with the definition of "Delivery" and shall be held, pending maturity
or disposition, solely by the Collateral Agent or the Trustee, as the
case may be, or such other Person acting solely for the Collateral
Agent or the Trustee, as the case may be, as required for Delivery;
and
(iii) in the event that the Collateral Agent or the Trustee,
as the case may be, in its capacity as securities intermediary has or
subsequently obtains by agreement, operation of law or otherwise a
security interest in the Accounts or any security entitlement credited
thereto, the Collateral Agent or the Trustee, as the case may be, in
its capacity as securities intermediary hereby agrees that such
security interest shall be subordinate to the security interest of the
Collateral Agent or the Trustee, as the case may be. The financial
assets and other items deposited to the Accounts will not be subject
to deduction, set off, banker's lien, or any other right in favor of
any person (except that the Collateral Agent or the Trustee, as the
case may be, in its capacity as securities intermediary may set off
the face amount of any checks which have been credited to the Accounts
but are subsequently returned unpaid because of uncollected or
insufficient funds).
(d) (i) On the Closing Date, the Depositor shall cause to be deposited
$___in the Payahead Account representing all collected funds received in
connection with the Actuarial Receivables prior to the Cutoff Date that are due
on or after the Cutoff Date, consisting of all or a portion of the Scheduled
Payments due on the Actuarial Receivables in any Collection Period following the
first Collection Period.
(ii) The Servicer shall on or prior to each Distribution Date
(and prior to deposits to the Class A Distribution Account or the
Class B Distribution Account) transfer from the Collection Account to
the Payahead Account all Payaheads as described in Section 4.2
received by the Servicer during the Collection Period. Notwithstanding
the foregoing and the first sentence of Section 4.2, for so long as
the Servicer is permitted to make monthly remittances to the
Collection Account pursuant to Section 4.2, 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 such condition is
met, 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 4.5(a).
SECTION 4.2. COLLECTIONS. (a) On the Closing Date, the Depositor shall
cause to be deposited $___in the Collection Account representing all collected
funds received on the Receivables after the Cutoff Date and prior to the Closing
Date. The Servicer shall remit within two Business Days of receipt thereof to
the Collection Account all collected funds received from payments by or on
behalf of the Obligors with respect to the Receivables, and all Liquidation
Proceeds, both as collected during the Collection Period. Notwithstanding the
foregoing, for so long as (i) the Servicer is the Bank, (ii) no Event of
Servicing Termination shall have occurred and be continuing, (iii) if the
Servicer does not have a short term debt rating or deposit rating as applicable,
of at least A-1 from Standard & Poor's and P-1 from Moody's, a guaranty, letter
of credit, surety bond or other similar instrument is issued covering
collections, any amounts referred to in clause (e) of the definition of
Available Principal and Liquidation Proceeds held by the Bank, which is
acceptable to the Rating Agencies and issued by an entity, which has a short-
term debt or deposit rating, as applicable, of at least A-1 from Standard &
Poor's and P-1 from Moody's; and (iv) the Rating Agency Condition shall have
been satisfied (and any conditions or limitations imposed by the Rating Agencies
in connection therewith are complied with), the Servicer shall remit such
collections to the Collection Account on the related Transfer Date. For purposes
of this Article IV the phrase "payments by or on behalf of Obligors" shall mean
payments made with respect to the Receivables by Persons other than the
Servicer, the Seller or the Depositor.
(b) All collections for the Collection Period shall be applied by the
Servicer as follows: with respect to each Actuarial Receivable (other than a
Purchased Receivable), payments by or on behalf of the Obligor shall be applied
first to reduce Outstanding Advances as described in Section 4.8(a). Next, any
excess shall be applied, in the case of Actuarial Receivables, to the Scheduled
Payment and, shall be applied in the case of Simple Interest Receivables, to
interest and principal in accordance with the Simple Interest Method. With
respect to Actuarial Receivables, any remaining excess shall be added to the
Payahead Balance, and shall be applied to prepay the Actuarial Receivable, but
only if the sum of such excess and the previous Payahead Balance shall be
sufficient to prepay the Actuarial Receivable in full. Otherwise, any such
remaining excess payments shall constitute a Payahead and shall increase the
Payahead Balance.
(c) All Liquidation Proceeds shall be applied to the related
Receivable in accordance with the Servicer's customary servicing procedures.
SECTION 4.3. ADDITIONAL DEPOSITS. The Servicer shall deposit in the
Collection Account the aggregate Advances pursuant to Section 4.8. The Servicer
and the Seller shall deposit or cause to be deposited in the Collection Account
the aggregate Purchase Amount with respect to any Purchased Receivables and the
Servicer shall deposit therein any amounts to be paid under Section 11.1. The
Servicer will deposit or cause to be deposited the aggregate Purchase Amount
with respect to Purchased Receivables within two Business Days after such
obligations become due, unless the Servicer shall not be required to make
deposits within two Business Days of receipt pursuant to Section 4.2(a) (in
which case such deposit will be made by the related Transfer Date). All such
other deposits shall be made on the Transfer Date following the end of the
related Collection Period.
SECTION 4.4. NET DEPOSITS. As an administrative convenience, if the
Servicer is not required to remit collected funds within two Business Days of
receipt thereof, the Servicer will be permitted to make the deposit of such
funds, aggregate Advances and Purchase Amounts for or with respect to the
Collection Period net of distributions to be made to the Servicer with respect
to the Collection Period. Similarly, the Servicer may cause to be made a single,
net transfer, from the Collection Account to the Payahead Account, or vice
versa. The Servicer, however, will account to the Trustee and the
Certificateholders as if all deposits, distributions and transfers were made
individually.
SECTION 4.5. DISTRIBUTIONS. (a) On each Distribution Date, the Trustee
shall cause to be transferred from the Payahead Account, or from the Servicer in
the event the provisions of Section 4.1(d)(ii) are applicable, (i) to the
Collection Account, in immediately available funds, the aggregate previous
Payaheads to be applied to Scheduled Payments on Actuarial Receivables for the
related Collection Period or prepayments for the related Collection Period,
pursuant to Sections 4.2 and 4.8, in the amounts set forth in the Servicer's
Certificate for such Distribution Date and (ii) to the Depositor, in immediately
available funds, the investment earnings, net of losses on the Payaheads for the
related Collection Period. A single, net transfer may be made.
(b) The Servicer shall instruct the Trustee (based on the information
contained in the Servicer's Certificate delivered on the related Determination
Date pursuant to Section 3.9) to make, and the Trustee shall make, a
distribution from the Collection Account to the Servicer by 11:00 a.m. (New York
time), amounts in respect of Outstanding Advances to the extent that the
Servicer is entitled to reimbursement in respect thereof in accordance with
Section 4.8. On each Determination Date, the Servicer shall calculate all
amounts required to determine the amounts to be deposited in the Class A
Distribution Account and the Class B Distribution Account.
(c) Subject to the last paragraph of this Section 4.5(b), on each
Distribution Date, the Servicer shall instruct the Trustee in writing (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 deposits and
distributions for receipt by the Servicer or deposit in the applicable Account
by 12:00 P.M. (New York City time):
(i) to the extent of Interest Collections for such
Distribution Date (and, in the case of shortfalls occurring under
clause (B) below in the Class A Interest Distribution, the Class B
Percentage of Principal Collections for such Distribution Date to the
extent of such shortfalls):
(A) to the Servicer, the Servicing Fee for such Distribution
Date and all unpaid Servicing Fees from prior Collection
Periods (to the extent such amounts have not been
retained pursuant to Section 4.4);
(B) to the Class A Distribution Account, after the
application of clause (A), the Class A Interest
Distribution for such Distribution Date; and
(C) to the Class B Distribution Account, after the
application of clauses (A) and (B), the Class B Interest
Distribution for such Distribution Date; and
(ii) to the extent of the portion of Principal Collections and
Interest Collections for such Distribution Date remaining after the
application of clauses (i)(A), (B) and (C) above:
(A) to the Class A Distribution Account, the Class A
Principal Distribution for such Distribution Date;
(B) to the Class B Distribution Account, after the
application of clause (A), the Class B Principal
Distribution for such Distribution Date; and
(C) to the Reserve Fund, any amounts remaining after the
application of clauses (i)(A) through (C) and (ii) (A)
and (B).
In the event that the Collection Account is maintained with an institution other
than the Trustee, the Servicer shall instruct and cause such institution to make
all deposits and distributions pursuant to this Section 4.5(b) on the related
Transfer Date. The Trustee shall be entitled to conclusively rely on the
Servicer's instructions and any Servicer's Certificate without investigation.
(d) On each Distribution Date, in accordance with the written
direction of the Servicer, all amounts on deposit in the Class A Distribution
Account, after application of Section 4.6 below, will be distributed to the
Class A Certificateholders by the Trustee and all amounts on deposit in the
Class B Distribution Account, after application of Section 4.6 below, will be
distributed to the Class B Certificateholders by the Trustee. Payments under
this Section 4.5(c) shall be made to the Certificateholders either by wire
transfer, in immediately available funds, to the account of such Holder at a
bank or other entity having appropriate facilities therefor, if such
Certificateholder shall have provided to the Certificate Registrar appropriate
written instructions at least ten Business Days prior to such Distribution Date
and such Holder's Certificates in the aggregate evidence a denomination of not
less than $__________ or by check mailed by the Trustee to each Holder's
respective address of record (or, in the case of Certificates registered in the
name of a Clearing Agency, or its nominee, by wire transfer of immediately
available funds).
SECTION 4.6. RESERVE FUND. (a) On the Closing Date, the Reserve Fund
Deposit shall be deposited into the Reserve Fund from the net proceeds from the
sale of the Certificates. The Depositor hereby grants to the Collateral Agent a
security interest in and to the Reserve Fund and any and all property credited
thereto from time to time, including but not limited to Eligible Investments, to
secure payment of the Certificates according to their terms. Amounts held from
time to time in the Reserve Fund will continue to be held by the Collateral
Agent for the benefit of Class A Certificateholders and the Class B
Certificateholders but the Reserve Fund shall not be an asset of the Trust. By
acceptance of their Certificates, Certificateholders shall be deemed to have
appointed ________________ as Collateral Agent. _________________ hereby accepts
such appointment as Collateral Agent.
(b) On each Distribution Date, the Servicer shall instruct the
Collateral Agent in writing (based on the information contained in the
Servicer's Certificate delivered on the related Determination Date pursuant to
Section 3.9) to withdraw from the Reserve Fund on such Distribution Date, to the
extent of funds available therein, the amounts specified below, in the order of
priority specified below, and deposit such amounts in the Class A Distribution
Account or the Class B Distribution Account, as specified below, on such
Distribution Date:
(i) an amount equal to the excess, if any, of the Class A
Interest Distribution for such Distribution Date over the sum of
Interest Collections for such Distribution Date and the Class B
Percentage of Principal Collections for such Distribution Date will be
deposited into the Class A Distribution Account;
(ii) an amount equal to the excess, if any, of the Class B
Interest Distribution for such Distribution Date over the portion of
Interest Collections for such Distribution Date remaining after the
distribution of the Class A Interest Distribution for such
Distribution Date will be deposited into the Class B Distribution
Account;
(iii) an amount equal to the excess, if any, of the Class A
Principal Distribution for such Distribution Date over the portion of
Principal Collections and Interest Collections for such Distribution
Date remaining after the distribution of the Class A Interest
Distribution and the Class B Interest Distribution for such
Distribution Date will be deposited into the Class A Distribution
Account; and
(iv) an amount equal to the excess, if any, of the Class B
Principal Distribution for such Distribution Date over the portion of
Principal Collections and Interest Collections for such Distribution
Date remaining after the distribution of the Class A Interest
Distribution, the Class B Interest Distribution and the Class A
Principal Distribution for such Distribution Date will be deposited
into the Class B Distribution Account.
The Collateral Agent shall be entitled to conclusively rely on the Servicer's
instruction and the Servicer's Certificate without investigation.
(c) If the amount on deposit in the Reserve Fund on any Distribution
Date (after giving effect to all other deposits thereto and withdrawals
therefrom to be made on such Distribution Date) is greater than the Specified
Reserve Balance for such Distribution Date, the Servicer shall instruct the
Collateral Agent in writing to distribute the amount of the excess to the
Depositor on such Distribution Date. On the date on which the Trust terminates,
any funds remaining in the Reserve Fund (after all other distributions to be
made from the Reserve Fund pursuant to this Section 4.6 have been made) shall be
distributed to the Servicer upon written request. Amounts properly distributed
to the Servicer for distribution to the Servicer pursuant to Section 4.1(b)(ii)
or this Section 4.6(c) shall not be available under any circumstances to the
Trust, the Trustee or the Certificateholders and the Servicer shall in no event
thereafter be required to refund any such distributed amounts.
SECTION 4.7. STATEMENTS TO CERTIFICATEHOLDERS. (a) On each
Determination Date, the Servicer shall provide to the Trustee (with a copy to
the Rating Agencies) for the Trustee to forward to each Certificateholder of
record a statement, substantially in the form of Exhibit C (each a "Distribution
Date Statement") setting forth with respect to the related Collection Period at
least the following information as to the Certificates to the extent applicable:
(i) the amount of the distribution allocable to principal of
the Class A Certificates and the Class B Certificates;
(ii) the amount of the distribution allocable to interest on
the Class A Certificates and the Class B Certificates;
(iii) the Pool Balance as of the close of business on the
last day of such Collection Period, after giving effect to payments
allocated to principal reported under (i) and (ii) above;
(iv) the amount of the Servicing Fee paid to the Servicer
with respect to such Collection Period and the Class A Percentage and
Class B Percentage of the Servicing Fee paid to the Servicer with
respect to such Collection Period;
(v) the amount of any Class A Interest Carryover Shortfall,
Class A Principal Carryover Shortfall, Class B Interest Carryover
Shortfall and Class B Principal Carryover Shortfall on the
Distribution Date immediately following such Collection Period and the
change in such amounts from those with respect to the immediately
preceding Distribution Date;
(vi) the Class A Pool Factor and the Class B Pool Factor as
of such Distribution Date, after giving effect to payments allocated
to principal reported under clause (i) above;
(vii) the amount of the aggregate Realized Losses, net of
Recoveries if any, for such Collection Period;
(viii) the aggregate Principal Balance of all Receivables
which were more than 60 days delinquent as of the close of business on
the last day of such Collection Period;
(ix) the amount on deposit in the Reserve Fund on such
Distribution Date, after giving effect to distributions made on such
Distribution Date;
(x) the Class A Principal Balance and the Class B Principal
Balance as of such Distribution Date, after giving effect to payments
allocated to principal reported under clause (i) above;
(xi) the amount otherwise distributable to the Class B
Certificateholders that is being distributed to the Class A
Certificateholders on such Distribution Date;
(xii) the aggregate Purchase Amount of Receivables
repurchased by the Seller or purchased by the Servicer with respect to
such Collection Period;
(xiii) the amounts collected by the Servicer;
(xiv) the amounts received by the Trust from the Servicer;
(xv) delinquency information relating to the Receivables
which are 30, 60 and 90 days delinquent; and
Each amount set forth pursuant to clauses (i), (ii), (iv) and (v) above shall be
expressed in the aggregate and as a dollar amount per $1,000 of original
denomination of a Certificate.
(b) Within a reasonable period of time after the end of each calendar
year, but not later than the latest date permitted by law, the Trustee shall
mail, to each Person who at any time during such calendar year shall have been a
Certificateholder, a statement provided by the Servicer containing the sum of
the amounts described in clauses (i), (ii), (iv) and (v) above for such calendar
year or, in the event such Person shall have been a Certificateholder during a
portion of such calendar year, for the applicable portion of such year, for the
purposes of such Certificateholder's preparation of federal income tax returns.
In addition, the Servicer shall furnish to the Trustee for distribution to such
Person at such time any other information necessary under applicable law for the
preparation of such income tax returns.
(c) The Servicer, at its own expense, shall cause a firm of nationally
recognized accountants to prepare any state tax returns required to be filed by
the Trust, and the Trustee shall execute and file such returns if requested to
do so by the Servicer. The Trustee, upon written request, will promptly furnish
the Servicer with all such information known to the Trustee as may be reasonably
required in connection with the preparation of any state tax returns of the
Trust.
SECTION 4.8. 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 an
Actuarial Receivable (other than a Purchased Receivable) shall be less than the
Scheduled Payment, the Payahead Balance shall be applied by the Servicer to the
extent of the shortfall and such Payahead Balance shall be reduced accordingly.
Next, the Servicer shall advance any remaining shortfall (such amount an
"Advance"), to the extent that the Servicer, at its sole discretion, shall
determine that the Advance shall be recoverable from the Obligor, the Purchase
Amount, Liquidation Proceeds or proceeds of any other Actuarial Receivables.
With respect to each Actuarial 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 in
respect of the related Receivable or payments of the Purchase Amount of the
related Receivable.
If the Servicer shall determine that an Outstanding Advance with
respect to any Actuarial Receivable shall not be recoverable as aforesaid, the
Servicer shall be reimbursed from any collections (including Liquidation
Proceeds) on other Actuarial Receivables in the Trust and Outstanding Advances
with respect to such Actuarial Receivables shall be reduced accordingly.
(b) The Servicer shall not make any advance with respect to interest
on or principal of Simple Interest Receivables.
ARTICLE V
[Intentionally Omitted]
ARTICLE VI
THE CERTIFICATES
SECTION 6.1. THE CERTIFICATES. The Certificates shall be issued as
Class A Certificates and Class B Certificates, substantially in the form of
Exhibits A and B hereto, respectively. The Certificates shall be issued in
minimum denominations of $25,000 and integral multiples of $1,000 in excess
thereof; PROVIDED, HOWEVER, that one Class A Certificate and one Class B
Certificate may be issued in a denomination that represents any remaining
portion of the Original Class A Principal Balance and the Original Class B
Principal Balance, as the case may be. The Certificates shall be executed by the
Trustee on behalf of the Trust by manual or facsimile signature of an Authorized
Officer of the Trustee. Certificates bearing the manual or facsimile signatures
of individuals who were, at the time when such signatures shall have been
affixed, authorized to sign on behalf of the Trustee, shall be valid and binding
obligations of the Trust, notwithstanding that such individuals shall have
ceased to be so authorized prior to the authentication and delivery of such
Certificates or did not hold such offices at the date of such Certificates.
SECTION 6.2. AUTHENTICATION AND DELIVERY OF CERTIFICATES. The Trustee
shall cause to be authenticated and delivered to or upon the written order of
the Depositor, in exchange for the Receivables and other Trust Property,
simultaneously with the sale, assignment and transfer to the Trustee of the
Receivables, and the constructive delivery to the Trustee of the Receivables
Files and the other components of the Trust existing as of the Closing Date,
Certificates in authorized denominations equaling in the aggregate the sum of
the Original Class A Principal Balance and the Original Class B Principal
Balance, and evidencing the entire ownership of the Trust. No Certificate shall
entitle the Holder thereof to any benefit under this Agreement, or shall be
valid for any purpose, unless there shall appear on such Certificate a
certificate of authentication, substantially in the form set forth in the form
of Certificates attached hereto as Exhibit A and Exhibit B respectively,
executed by the Trustee by manual signature. Such authentication shall
constitute conclusive evidence, and the only evidence, that such Certificate has
been duly authenticated and delivered hereunder. All Certificates issued on the
Closing Date shall be dated the Closing Date. Any Certificates issued thereafter
shall be dated the date of their authentication.
SECTION 6.3. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
The Trustee shall maintain, or cause to be maintained, at the office or agency
to be maintained by it in accordance with Section 6.9, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. Upon surrender for registration of
transfer of any Class A Certificate or Class B Certificate at such office or
agency, the Trustee shall execute, authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Class A Certificates or
Class B Certificates, as the case may be, in authorized denominations of a like
aggregate amount. At the option of a Certificateholder, Class A Certificates or
Class B Certificates may be exchanged for other Class A Certificates or Class B
Certificates, as the case may be, of authorized denominations of a like
aggregate amount at the office or agency maintained by the Trustee in accordance
with Section 6.9. Every Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer
duly executed by the Holder and in a form satisfactory to the Trustee. No
service charge shall be made for any registration of transfer or exchange of
Certificates, but the Trustee may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
transfer or exchange of Certificates. All Certificates surrendered for
registration of transfer or exchange shall be canceled and disposed of in a
commercially reasonable manner approved by the Trustee.
A Class B Certificate may not be directly or indirectly sold or
transferred to, or purchased or acquired by, or on behalf of (1) any employee
benefit plan, retirement arrangement, individual retirement account or ▇▇▇▇▇
plan which is subject to either Title I of ERISA, or Section 4975 of the Code
(each, a "Plan"), or (2) any entity whose source of funds to be used for the
purchase of such Class B Certificate includes the assets of any such Plan, other
than an "Insurance Company General Account" as defined in, and which complies
with the provisions of, Prohibited Transaction Exemption 95-60 issued by the
United States Department of Labor. Every transferee of a Class B Certificate
represented by a Book-Entry Certificate shall be deemed to have represented and
warranted to the Depositor and the Trustee that it is not an entity described in
either clause (1) or (2) above. Each transferee of a Definitive Certificate
shall deliver a Benefit Plan Affidavit to the Depositor and the Trustee in the
form of Exhibit D. Neither the Servicer nor the Trustee will incur any liability
for any transfers made in accordance with this Section 6.3.
Every Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer in
form satisfactory to the Trustee duly executed by the Certificateholder or his
attorney duly authorized in writing, with such signature guaranteed by an
"eligible guarantor institution" meeting the requirements of the Trustee, which
requirements include membership or participation in the Securities Transfer
Agent's Medallion Program ("STAMP") or such other "signature guarantee program"
as may be determined by the Trustee in addition to, or in substitution for,
STAMP, all in accordance with the Exchange Act.
SECTION 6.4. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If (a)
any mutilated Class A Certificate or Class B Certificate shall be surrendered to
the Trustee, or if the Trustee shall receive evidence to its satisfaction of the
destruction, loss or theft of any Class A Certificate or Class B Certificate and
(b) there shall be delivered to the Trustee such security or indemnity as may be
required to save the Trustee harmless, then in the absence of notice that such
Class A Certificate or Class B Certificate shall have been acquired by a bona
fide purchaser, the Trustee shall execute, authenticate and deliver, in exchange
for or in lieu of any such mutilated, destroyed, lost or stolen Class A
Certificate or Class B Certificate, a new Class A Certificate or Class B
Certificate of like tenor and denomination. In connection with the issuance of
any new Certificate under this Section 6.4, the Trustee may require the payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith. Any replacement Certificate issued pursuant to
this Section 6.4 shall constitute conclusive evidence of ownership in the Trust,
as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
SECTION 6.5. PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Trustee may treat the Person in
whose name any Certificate shall be registered as the owner of such Certificate
for the purpose of receiving distributions pursuant to Section 4.5 and for all
other purposes, and the Trustee shall not be bound by any notice to the
contrary.
SECTION 6.6. ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND
ADDRESSES. The Trustee shall furnish or cause to be furnished to the Servicer,
within 15 days after receipt by the Trustee of a request therefor from the
Servicer in writing, a list of the names and addresses of the Certificateholders
as of the most recent Record Date. If Definitive Certificates have been issued,
the Trustee, upon written request by holders of Class A Certificates or Class B
Certificates evidencing not less than 25% of the aggregate outstanding principal
balance of either the Class A Certificates or the Class B Certificates, as the
case may be, will, within fifteen days after the receipt of such request, afford
such Class A Certificateholders or Class B Certificateholders access during
normal business hours to the most current list of Certificateholders for
purposes of communicating with other Certificateholders with respect to their
rights under the Agreement. Each Certificateholder, by receiving and holding a
Certificate, shall be deemed to have agreed that none of the Depositor, the
Servicer or the Trustee is accountable by reason of the disclosure of its name
and address, regardless of the source from which such information was derived.
SECTION 6.7. MAINTENANCE OF OFFICE OR AGENCY. The Trustee shall
maintain, or cause to be maintained, at its expense, in the Borough of
Manhattan, The City of New York, an office or agency where Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Trustee in respect of the Certificates and this Agreement
may be served. The Trustee initially designates ___________________________ or
by mail to the Corporate Trust Office as its office for such purposes. The
Trustee shall give prompt written notice to the Servicer and to
Certificateholders of any change in the location of any such office or agency.
SECTION 6.8. BOOK-ENTRY CERTIFICATES. Upon original issuance, the
Class A Certificates and the Class B Certificates shall be issued in the form of
one or more typewritten Certificates representing the Book-Entry Certificates,
to be delivered to DTC or its custodian, by, or on behalf of the Depositor. Such
Certificates shall initially be registered on the Certificate Register in the
name of Cede & Co., the nominee of DTC, and no Certificate Owner will receive a
definitive certificate representing such Certificate Owner's interest in the
Class A Certificates or the Class B Certificates, as the case may be, except as
provided in Section 6.10. Unless and until definitive, fully-registered
Certificates ("Definitive Certificates") have been issued to Class A
Certificateholders or Class B Certificateholders, as the case may be, pursuant
to Section 6.10:
(i) the provisions of this Section 6.8 shall be in full force
and effect;
(ii) the Depositor, the Servicer and the Trustee may deal
with the Clearing Agency for all purposes (including the making of
distributions on the Certificates and the taking of actions by the
Certificateholders) as the authorized representative of the
Certificate Owners;
(iii) to the extent that the provisions of this Section 6.8
conflict with any other provisions of this Agreement, the provisions
of this Section 6.8 shall control;
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency and shall be limited to those established
by law, the rules, regulations and procedures of the Clearing Agency
and agreements between such Certificate Owners and the Clearing Agency
and all references in this Agreement to actions by Certificateholders
shall refer to actions taken by the Clearing Agency upon instructions
from the Clearing Agency Participants, and all references in this
Agreement to distributions, notices, reports and statements to
Certificateholders shall refer to distributions, notices, reports and
statements to the Clearing Agency or its nominee, as registered holder
of the Certificates, as the case may be, for distribution to
Certificate Owners in accordance with the rules, regulations and
procedures of the Clearing Agency;
(v) pursuant to the Depository Agreement, DTC will make
book-entry transfers among the Clearing Agency Participants and
receive and transmit distributions of principal and interest on the
Certificates to the Clearing Agency Participants, for distribution by
such Clearing Agency Participants to the Certificate Owners or their
nominees; and
(vi) Certificate Owners may own beneficial interest in
Certificates representing original denominations of $25,000 and
integral multiples of $1,000 in excess thereof except for any residual
amount of Original Class A Principal Balance or Original Class B
Principal Balance.
For purposes of any provision of this Agreement requiring or
permitting actions with the consent of, or at the direction of, Holders of
Certificates evidencing specified percentages of the aggregate outstanding
principal balance of such Certificates, such direction or consent may be given
by Certificate Owners having interests in the requisite percentage, acting
through the Clearing Agency.
SECTION 6.9. NOTICES TO CLEARING AGENCY. Whenever notice or other
communication to the Certificateholders is required under this Agreement unless
and until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 6.10, the Trustee shall give all such notices and
communications specified herein to be given to Certificateholders to the
Clearing Agency.
SECTION 6.10. DEFINITIVE CERTIFICATES. If (i) (A) the Depositor
advises the Trustee in writing that the Clearing Agency is no longer willing or
able properly to discharge its responsibilities under the Depository Agreement
and (B) the Trustee or the Servicer is unable to locate a qualified successor,
(ii) the Depositor, at its option, advises the Trustee in writing that it elects
to terminate the book-entry system through the Clearing Agency or (iii) after
the occurrence of an Event of Servicing Termination, Holders of Certificates
evidencing not less than a majority of the aggregate outstanding principal
balance of the Class A Certificates and the Class B Certificates, taken together
as a single Class, advise the Trustee and the Clearing Agency through the
Clearing Agency Participants in writing, and the Clearing Agency shall so notify
the Trustee, that the continuation of a book-entry system through the Clearing
Agency is no longer in their best interests, the Trustee shall notify the
Clearing Agency which shall be responsible to notify the Certificate Owners of
the occurrence of any such event and of the availability of Definitive
Certificates to Certificate Owners, requesting the same. Upon surrender to the
Trustee by the Clearing Agency of the Certificates registered in the name of the
nominee of the Clearing Agency, accompanied by re-registration instructions from
the Clearing Agency for registration, the Trustee shall execute, on behalf of
the Trust, authenticate and deliver Definitive Certificates in accordance with
such instructions. The Servicer shall arrange for, and will bear all costs of,
the printing and issuance of such Definitive Certificates. Neither the
Depositor, the Servicer nor the Trustee shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be fully
protected in relying on, such instructions. Upon the issuance of Definitive
Certificates, the Trustee shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder. Definitive Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Trustee, as evidenced by its execution thereof.
Neither the Trust, the Depositor, the Servicer nor the Trustee will have any
responsibility or obligation to any Clearing Agency Participants or the Persons
for whom they act as nominees with respect to (1) the accuracy of any records
maintained by DTC or any Clearing Agency Participants, (2) the payment by DTC or
any Clearing Agency Participant of any amount due to any beneficial owner in
respect of the Principal Balance of, or interest on, the Certificates, (3) the
delivery by any Clearing Agency Participant of any notice to any Certificate
Owner which is required or permitted hereunder to be given to Certificateholders
or (4) any other action taken by DTC or its nominee as the Certificateholder.
ARTICLE VII
THE DEPOSITOR
SECTION 7.1. REPRESENTATIONS OF DEPOSITOR . The Depositor makes the
following representations on which the Trustee is deemed to have relied in
accepting the Receivables and other Trust Property in trust and in executing and
authenticating the Certificates. The representations are being made as of the
execution and delivery of this Agreement and shall survive the sale and
assignment of the Receivables and other Trust Property to the Trustee.
(a) ORGANIZATION AND GOOD STANDING. The Depositor is duly organized
and validly existing as a corporation in good standing under the laws of the
State of Delaware with the corporate power and authority to own its properties
and to conduct its business as such properties are currently owned and such
business is presently conducted, and had at all relevant times, and has, the
power, authority and legal right to acquire and own the Receivables.
(b) DUE QUALIFICATION. The Depositor is duly qualified to do business
as a foreign corporation in good standing, and has obtained all necessary
licenses and approvals in all jurisdictions in which the ownership or lease of
property or the conduct of its business shall require such qualifications.
(c) POWER AND AUTHORITY OF THE DEPOSITOR. The Depositor has the
corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder and under each of the Basic Documents to which
the Depositor is a party; the Depositor has full corporate power and authority
to sell and assign the property to be sold and assigned to and deposited with
the Trustee and the Depositor has duly authorized such sale and assignment to
the Trustee by all necessary corporate action; and the execution, delivery and
performance of this Agreement and under each of the Basic Documents to which the
Depositor is a party have been duly authorized by the Depositor by all necessary
corporate action.
(d) BINDING OBLIGATION. This Agreement and each of the Basic Documents
to which the Depositor is a party constitutes legal, valid and binding
obligations of the Depositor, enforceable in accordance with their respective
terms, subject to applicable bankruptcy, insolvency, moratorium, fraudulent
conveyance, reorganization and similar laws now or hereafter in effect relating
to creditors' rights generally and subject to general principles of equity
(whether applied in a proceeding at law or in equity).
(e) NO VIOLATION. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof do not 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
incorporation or by-laws of the Depositor, or any material indenture, agreement
or other instrument to which the Depositor is a party or by which it shall be
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 (other than pursuant to the Basic Documents); nor violate any law or,
to the best of its knowledge, any order, rule or regulation applicable to the
Depositor of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having jurisdiction
over the Depositor or its properties.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending
against the Depositor or, to its best knowledge, threatened against the
Depositor, before any court, regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Depositor or its
properties: (i) asserting the invalidity of this Agreement or any of the Basic
Documents, or the Certificates, (ii) seeking to prevent the issuance of the
Certificates or the consummation of any of the transactions contemplated by this
Agreement or any of the Basic Documents, (iii) seeking any determination or
ruling that could reasonably be expected to have a material and adverse effect
on the performance by the Depositor of its obligations under, or the validity or
enforceability of the Basic Documents, or the Certificates or (iv) seeking to
affect adversely the Federal or state income tax or ERISA attributes of the
Trust or the Certificates.
(g) ALL CONSENTS. All authorizations, licenses, consents, orders or
approvals of or registrations or declarations with any court, regulatory body,
administrative agency or other government instrumentality required to be
obtained, effected or given by the Depositor in connection with the execution
and delivery by the Depositor of this Agreement or any of the Basic Documents to
which it is a party and the performance by the Depositor of the transactions
contemplated by this Agreement or any of the Basic Documents to which it is a
party, have been duly obtained, effected or given and are in full force and
effect, except where failure to obtain the same would not have a material
adverse effect upon the rights of the Trust or the Certificateholders.
SECTION 7.2. SPECIAL PURPOSE ENTITY. The Depositor has been formed as
a special purpose entity whose business shall be limited to those activities
specified in its articles of incorporation. The Depositor agrees that it shall
not, under any circumstances, seek the protection of federal bankruptcy laws or
any similar state or local laws providing for the relief of debtors.
SECTION 7.3. CORPORATE EXISTENCE. (a) During the term of this
Agreement, subject to Section 7.5, the Depositor will keep in full force and
effect its existence, rights and franchises as a corporation under the laws of
the jurisdiction of its incorporation and will obtain and preserve its
qualification to do business in each jurisdiction in which such qualification is
or shall be necessary to protect the validity and enforceability of this
Agreement, the Basic Documents and each other instrument or agreement necessary
or appropriate to the proper administration of this Agreement and the
transactions contemplated hereby.
(b) During the term of this Agreement, the Depositor shall observe the
applicable legal requirements for the recognition of the Depositor as a legal
entity separate and apart from its affiliates, including as follows:
(i) the Depositor shall maintain corporate records and books
of account separate from those of its affiliates;
(ii) except as otherwise provided in this Agreement, the
Depositor shall not commingle its assets and funds with those of its
affiliates;
(iii) the Depositor shall hold such appropriate meetings of
its Board of Directors as are necessary to authorize all the
Depositor's corporate actions required by law to be authorized by the
Board of Directors, shall keep minutes of such meetings and of
meetings of its stockholder(s) and observe all other customary
corporate formalities (and any successor Depositor not a corporation
shall observe similar procedures in accordance with its governing
documents and applicable law);
(iv) the Depositor shall at all times hold itself out to the
public under the Depositor's own name as a legal entity separate and
distinct from its affiliates; and
(v) all transactions and dealings between the Depositor and
its affiliates will be conducted on an arm's-length basis
SECTION 7.4. LIABILITY OF DEPOSITOR; INDEMNITIES. The Depositor shall
be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Depositor under this Agreement and the
representations made by the Depositor in this Agreement.
(a) The Depositor shall indemnify, defend and hold harmless the Trust
and the Trustee and their respective officers, directors, employees and agents
from and against any taxes that may at any time be asserted against any such
Person with respect to the transactions contemplated in this Agreement and any
of the Basic Documents (except any income taxes arising out of fees paid to the
Trustee and except any taxes to which the Trustee may otherwise be subject to),
including any sales, gross receipts, general corporation, tangible personal
property, privilege or license taxes (but, in the case of the Trust, not
including any taxes asserted with respect to, and as of the date of, the
issuance and original sale of the Certificates or asserted with respect to
ownership of the Receivables or federal or other income taxes arising out of
distributions on the Certificates) and reasonable costs and expenses in
defending against the same or in connection with any application relating to the
Certificates under any state securities laws.
(b) The Depositor shall indemnify, defend and hold harmless the Trust,
the Trustee and the Certificateholders and the officers, directors, employees
and agents of the Trustee from and against any and all costs, expenses, losses,
claims, damages and liabilities to the extent arising out of, or imposed upon
such Person through (i) the Depositor's willful misfeasance, bad faith or
negligence 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 Depositor's or the Trust's violation of federal or state securities
laws in connection with the offering and sale of the Certificates or in
connection with any application relating to the Certificates under any state
securities laws.
(c) The Depositor shall be liable as primary obligor for, and shall
indemnify, defend and hold harmless the Trustee and its officers, directors,
employees and agents from and against any and all losses, claims, damages and
liabilities and reasonable costs and expenses arising out of, or incurred in
connection with, this Agreement or any of the Basic Documents, the Trust
Property, the acceptance or performance of the trusts and duties set forth
herein or the action or the inaction of the Trustee hereunder except to the
extent that such cost, expense, loss, claim, damage or liability: (i) shall be
due to the willful misfeasance, bad faith or negligence of the Trustee or (ii)
shall arise from any breach by the Trustee of its covenants, representations or
warranties under this Agreement. Such liability shall survive the termination of
the Trust. In the event of any claim, action or proceeding for which indemnity
will be sought pursuant to this paragraph, the Trustee's choice of legal counsel
shall be subject to the approval of the Depositor, which approval shall not be
unreasonably withheld.
(d) The Depositor shall pay any and all taxes levied or assessed upon
all or any part of the Trust Property (other than those taxes expressly excluded
from the Depositor's responsibilities pursuant to the parentheticals in
paragraph (a) above).
Indemnification under this Section shall survive the resignation or
removal of the Trustee and the termination of this Agreement and shall include
reasonable fees and expenses of counsel and other reasonable expenses of
litigation. If the Depositor shall have made any indemnity payments pursuant to
this Section 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
promptly repay such amounts to the Depositor, without interest.
SECTION 7.5. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF DEPOSITOR. Any Person (a) into which the Depositor may be merged
or consolidated, (b) which may result from any merger or consolidation to which
the Depositor shall be a party or (c) which may succeed to the properties and
assets of the Depositor substantially as a whole, shall be the successor to the
Depositor without the execution or filing of any document or any further act by
any of the parties to this Agreement; PROVIDED, HOWEVER, that the Depositor
hereby covenants that it will not consummate any of the foregoing transactions
except upon satisfaction of the following: (i) the surviving Depositor if other
than Mellon Auto Receivables Corporation, executes an agreement of assumption to
perform every obligation of the Depositor under this Agreement; (ii) immediately
after giving effect to such transaction, no representation or warranty made
pursuant to Section 2.2 or 7.1 shall have been breached and no Event of
Servicing Termination, and no event that, after notice or lapse of time, or both
would become an Event of Servicing Termination shall have happened and be
continuing, (iii) the Depositor shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that such consolidation,
merger or succession and such agreement of assumption, comply with this Section
and that all conditions precedent, if any, provided for in this Agreement
relating to such transaction have been complied with, and that the Rating Agency
Condition shall have been satisfied with respect to such transaction, (iv) the
surviving Depositor shall have a consolidated net worth at least equal to that
of the predecessor Depositor, (v) such transaction will not result in a material
adverse federal or state tax consequence to the Trust or the Certificateholders
and (vi) unless Mellon Auto Receivables Corporation is the surviving entity, the
Depositor shall have delivered to the 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 Trustee in the
Receivables and reciting the details of such filings, or (B) stating that, in
the opinion of such counsel, no such action shall be necessary to preserve and
protect such interests.
SECTION 7.6. LIMITATION ON LIABILITY OF DEPOSITOR AND OTHERS. The
Depositor and any director or officer or employee or agent of the Depositor may
rely in good faith on the advice of counsel or on any document of any kind,
prima facie properly executed and submitted by any Person respecting any matters
arising under this Agreement or any Basic Document (provided that such reliance
shall not limit in any way the Depositor's obligations under Section 2.2).
Except as provided in this Agreement, the Depositor 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 7.7. DEPOSITOR MAY OWN CERTIFICATES. The Depositor and any
Affiliate thereof may in its individual or any other capacity become the owner
or pledgee of Certificates with the same rights as it would have if it were not
the Depositor or an Affiliate thereof, except as expressly provided herein or in
any Basic Document.
SECTION 7.8. SECURITY INTEREST. During the term of this Agreement, the
Depositor will not take any action to assign the security interest in any
Financed Vehicles other than pursuant to this Agreement.
ARTICLE VIII
THE SERVICER AND THE SELLER
SECTION 8.1. REPRESENTATIONS OF THE BANK. The Bank makes the following
representations on which each of the Depositor and the Trustee is deemed to have
relied in accepting the Receivables and other Trust Property in trust and, in
the case of the Trustee, authenticating the Certificates. The representations
speak as of the execution and delivery of this Agreement and shall survive the
sale and assignment of the Receivables and other Trust Property to the Trustee.
(a) ORGANIZATION AND GOOD STANDING. The Bank is duly organized and
validly existing as a national banking association in good standing under the
laws of the United States of America with the power and authority to own its
properties and to conduct its business as such properties are currently owned
and such business is presently conducted, and had at all relevant times, and
has, the power, authority and legal right to acquire, own and service the
Receivables.
(b) DUE QUALIFICATION. The Bank is duly qualified to do business and
has obtained all necessary licenses and approvals in all jurisdictions in which
the ownership or lease of property or the conduct of its business (including the
servicing of the Receivables as required by this Agreement) shall require such
qualifications.
(c) POWER AND AUTHORITY OF THE BANK. The Bank has the power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder; the Bank has full power and authority to sell and assign the property
to be sold and assigned to and deposited with the Depositor; the Bank has duly
authorized such sale and assignment to the Depositor by all necessary action;
and the execution, delivery and performance of this Agreement have been duly
authorized by the Bank by all necessary action.
(d) BINDING OBLIGATION. This Agreement constitutes a legal, valid and
binding obligation of the Bank, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, moratorium, fraudulent conveyance,
reorganization and similar laws now or hereafter in effect relating to
creditors' rights generally, and the rights of creditors of national banking
associations and depository institutions, the accounts of which are insured by
the FDIC, and subject to general principles of equity (whether applied in a
proceeding of law or in equity).
(e) NO VIOLATION. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof do not 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 articles of association or
by-laws of the Bank, or any material indenture, agreement or other instrument to
which the Bank is a party or by which it shall be 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 (other than pursuant
to this Agreement); nor violate any law or, to the best of its knowledge, any
order, rule or regulation applicable to the Bank of any court or of any federal
or state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Bank or its properties.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending
against the Bank, or, to its best knowledge, threatened against the Bank, before
any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Bank or its properties: (i)
asserting the invalidity of this Agreement or the Certificates, (ii) seeking to
prevent the issuance of the Certificates or the consummation of any of the
transactions contemplated by this Agreement, (iii) seeking any determination or
ruling that could reasonably be expected to have a material and adverse effect
on the performance by the Bank of its obligations under, or the validity or
enforceability of this Agreement or the Certificates or (iv) seeking to affect
adversely the federal or state income tax or ERISA attributes of the Trust or
the Certificates.
(g) NO AMENDMENT OR WAIVER. No provision of any Receivable has been
waived, altered or modified in any respect, except pursuant to a document,
instrument or writing included in the relevant Receivable File, and no such
amendment, waiver, alteration or modification causes such Receivable not to
conform to the other warranties contained in this Section or those of the Seller
contained in Section 2.2.
(h) APPROVALS. All approvals, licenses, authorizations, consents,
orders or other actions of any person, corporation or other organization, or of
any court, governmental agency or body or official, required in connection with
the execution and delivery of this Agreement have been or will be taken or
obtained on or prior to the Closing Date.
(i) LOCATION OF RECEIVABLE FILES. The Receivable Files are kept in the
offices of the Bank, specified in Schedule B, or at such other office specified
in accordance with Section 2.4.
(j) ALL CONSENTS. All authorizations, consents, orders or approvals of
or registrations or declarations with any court, regulatory body, administrative
agency or other government instrumentality required to be obtained, effected or
given by the Bank in connection with the execution and delivery by the Bank of
this Agreement and the performance by the Bank of the transactions contemplated
by this Agreement, have been duly obtained, effected or given and are in full
force and effect, except where failure to obtain the same would not have a
material adverse effect upon the rights of the Certificateholders.
SECTION 8.2. INDEMNITIES OF THE BANK. The Bank shall be liable in
accordance herewith only to the extent of the obligations specifically
undertaken by the Bank, in its capacities as Seller or Servicer, as applicable,
under this Agreement.
The Bank shall indemnify, defend and hold harmless the Trust, the
Trustee, the Depositor and the Certificateholders and any of the officers,
directors, employees and agents of the Trustee or the Depositor from any and all
losses, claims, damages, liabilities and reasonable costs and expenses
(including reasonable attorneys' fees and expenses) to the extent arising out
of, or imposed upon any such Person through, the gross negligence, willful
misfeasance or bad faith of the Bank in the performance of its obligations and
duties under this Agreement or in the performance of the obligations and duties
of any subservicer under any subservicing agreement or by reason of the reckless
disregard of its obligations and duties under this Agreement or by reason of the
reckless disregard of the obligations of any subservicer under any subservicing
agreement, where the final determination that any such cost, expense, loss,
claim, damage or liability arose out of, or was imposed upon any such Person
through, any such gross negligence, willful misfeasance, bad faith or
recklessness on the part of the Bank or any subservicer, is established by a
court of law, by an arbitrator or by way of settlement agreed to by the Bank.
Notwithstanding the foregoing, if the Bank is rendered unable, in whole or in
part, by virtue of an act of God, act of war, fires, earthquake or other natural
disasters, to satisfy its obligations under this Agreement, the Bank shall not
be deemed to have breached any such obligation upon the sending of written
notice of such event to the other parties hereto, for so long as the Bank
remains unable to perform such obligation as a result of such event. This
provision shall not be construed to limit the Bank's, or any other party's
rights, obligations, liabilities, claims or defenses which arise as a matter of
law or pursuant to any other provision of this Agreement.
The Bank shall indemnify, defend and hold harmless the Trust, the
Trustee, the Depositor, the Certificateholders or any of the officers,
directors, employees and agents of the Trustee or the Depositor from any and all
losses, claims, damages, liabilities and reasonable costs and expenses
(including reasonable attorneys' fees and expenses) to the extent arising out of
or imposed upon any such Person as a result of any compensation payable to any
subcustodian or subservicer (including any fees payable in connection with the
release of any Receivable File from the custody of such subservicer or in
connection with the termination of the servicing activities of such subservicer
with respect to any Receivable) whether pursuant to the terms of any
subservicing agreement or otherwise.
The Bank shall indemnify, defend and hold harmless the Trust, the
Trustee, the Depositor, or the Certificateholders from and against any taxes
that may at any time be asserted against the Trust, the Trustee, the Depositor
or the Certificateholders, (other than any taxes based upon the income of any
such person), with respect to the transactions contemplated herein including,
without limitation, any sales, gross receipts, general corporation, tangible
personal property, privilege, or license taxes and costs and expenses in
defending against the same.
The Bank shall indemnify, defend, and hold harmless the Trust and
Trustee and each of its agents, officers, employees and other persons employed
by each of them from and against all reasonable costs and expenses, losses,
claims, damages, and liabilities arising out of or incurred in connection with
the acceptance or performance of the trusts and duties herein contained, if any,
except to the extent that such reasonable cost or expense, reasonable loss,
claim, damage or liability: (a) shall be due to the willful misfeasance, bad
faith, or negligence (except for errors in judgment) of the Trustee; or (b)
relates to any tax other than the taxes with respect to which the Servicer shall
be required to indemnify the Trustee.
Indemnification under this Section shall survive the resignation and
removal of the Trustee or the termination of this Agreement.
SECTION 8.3. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, THE BANK. Any Person (a) into which the Bank may be merged or
consolidated, (b) which may result from any merger or consolidation to which the
Bank shall be a party or (c) which may succeed to the properties and assets of
the Bank, substantially as a whole, shall be the successor to the Bank without
the execution or filing of any document or any further act by any of the parties
to this Agreement; PROVIDED, HOWEVER, that the Bank hereby covenants that it
will not consummate any of the foregoing transactions except upon satisfaction
of the following: (i) the surviving Servicer if other than the Bank executes an
agreement of assumption to perform every obligation of the Servicer under this
Agreement, (ii) immediately after giving effect to such transaction, no
representation or warranty made pursuant to Section 8.1 shall have been breached
and no Event of Servicing Termination, and no event that, after notice or lapse
of time, or both, would become an Event of Servicing Termination shall have
occurred and be continuing, (iii) the Bank shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption, if any,
comply with this Section and that all conditions precedent, if any, provided for
in this Agreement relating to such transaction have been complied with, and that
the Rating Agency Condition shall have been satisfied with respect to such
transaction, (iv) the surviving Servicer shall have a consolidated net worth at
least equal to that of the predecessor Servicer, and (v) such transaction will
not result in a material adverse federal or state tax consequence to the Trust
or the Certificateholders.
SECTION 8.4. LIMITATION ON LIABILITY OF THE BANK AND OTHERS. Neither
the Bank nor any of its directors, officers, employees or agents shall be under
any liability to the Trust or the Certificateholders, except as provided under
this Agreement, for any action taken or for refraining from the taking of any
action by the Bank or any subservicer pursuant to this Agreement or for errors
in judgment; PROVIDED, HOWEVER, that this provision shall not protect the Bank
or any such person against any liability that would otherwise be imposed by
reason of willful misfeasance, bad faith or gross negligence in the performance
of duties or by reason of reckless disregard of obligations and duties under
this Agreement. The Bank or any subservicer and any of their respective
directors, officers, employees or agents may rely in good faith on any document
of any kind prima facie properly executed and submitted by any Person respecting
any matters arising under this Agreement.
Except as provided in this Agreement, the Bank shall not be under any
obligation to appear in, prosecute or defend any legal action that shall be
incidental to its duties to service the Receivables in accordance with this
Agreement, and that in its opinion may involve it in any expense or liability;
PROVIDED, HOWEVER, that the Bank, may (but shall not be required to) undertake
any reasonable action that it may deem necessary or desirable in respect of this
Agreement to protect the interests of the Certificateholders under this
Agreement.
SECTION 8.5. THE BANK NOT TO RESIGN AS SERVICER. Subject to the
provisions of Section 8.3, the Bank, hereby agrees not to resign from the
obligations and duties hereby imposed on it as Servicer under this Agreement
except upon determination that the performance of its duties hereunder shall no
longer be permissible under applicable law or if such resignation is required by
regulatory authorities. Notice of any such determination permitting the
resignation of the Bank as Servicer shall be communicated to the Trustee at the
earliest practicable time (and, if such communication is not in writing, shall
be confirmed in writing at the earliest practicable time) and any such
determination shall be evidenced by an Opinion of Counsel to such effect
delivered to the Trustee concurrently with or promptly after such notice. No
such resignation shall become effective until the earlier of the Trustee or a
successor Servicer having assumed the responsibilities and obligations of the
resigning Servicer in accordance with Section 9.2 or the date upon which any
regulatory authority requires such resignation.
SECTION 8.6. CORPORATE EXISTENCE. (a) During the term of this
Agreement, subject to Section 8.3, the Bank will keep in full force and effect
its existence, rights and franchises as a national banking association under the
laws of the United States of America and will obtain and preserve its
qualification to do business in each jurisdiction in which such qualification is
or shall be necessary to protect the validity and enforceability of this
Agreement and each other instrument or agreement necessary or appropriate to the
proper administration of this Agreement and the transactions contemplated
hereby.
(b) During the term of this Agreement, the Bank shall observe the
applicable legal requirements for the recognition of the Bank as a legal entity
separate and apart from its Affiliates, including as follows:
(i) the Bank shall maintain corporate records and books of
account separate from those of its Affiliates;
(ii) except as otherwise provided in this Agreement, the Bank
shall not commingle its assets and funds with those of its Affiliates;
(iii) the Bank shall hold such appropriate meetings of its
Board of Directors as are necessary to authorize all the Bank's
corporate actions required by law to be authorized by the Board of
Directors, shall keep minutes of such meetings and of meetings of its
stockholder(s) and observe all other customary corporate formalities
(and any successor Servicer not a corporation shall observe similar
procedures in accordance with its governing documents and applicable
law);
(iv) the Bank shall at all times hold itself out to the
public under the Bank's own name as a legal entity separate and
distinct from its Affiliates; and
(v) all transactions and dealings between the Bank and its
Affiliates will be conducted on an arm's-length basis.
SECTION 8.7. TAX ACCOUNTING. The Servicer shall prepare any federal
tax returns of the Trust in accordance with the Code and any regulations
(including, to the extent applicable by their terms, proposed regulations)
thereunder. To the extent not inconsistent with any such regulations, such
returns shall be prepared in a manner consistent with the following rules:
(a) The Class A Certificateholders shall be treated as owning the
Class A Percentage of Interest Collections (but limited to the Class A
Certificate Rate plus the Servicing Fee Rate) and Principal Collections and the
Class B Certificateholders shall be treated as owning the Class B Percentage of
Interest Collections (but limited to the Class B Certificate Rate plus the
Servicing Fee Rate) and Principal Collections. The Depositor shall be treated as
having retained the stripped coupons on the Class A Percentage and the Class B
Percentage of each Receivable equal to the difference between the APR of such
Receivable and the portion owned by the Class A and Class B Certificateholders,
respectively, pursuant to this paragraph.
(b) To the extent that as a result of the subordination provisions of
this Agreement, actual cash distributions to the Class B Certificateholders are
less than the amount set forth in subsection (a), the Class B Certificateholders
shall be deemed to have (i) received the amount set forth in subsection (a),
(ii) paid such difference to the Class A Certificateholders pursuant to a
guaranty of the Class A Certificates, and (iii) become subrogated to the rights
of the Class A Certificateholders to recovery of the amounts so paid.
ARTICLE IX
SERVICING TERMINATION
SECTION 9.1. EVENTS OF SERVICING TERMINATION. If any one of the
following events ("Events of Servicing Termination") shall occur and be
continuing:
(a) any failure by the Servicer to deliver to the Trustee for deposit
in any of the Accounts, the Reserve Fund or the Payahead Account any required
payment or to direct the Trustee or the Collateral Agent, as applicable, to make
any required distributions therefrom that shall continue unremedied for a period
of three Business Days after written notice of such failure is received by the
Servicer from the Trustee or the Collateral Agent, as applicable, or after
discovery of such failure by an Authorized Officer of the Servicer; or
(b) failure on the part of the Servicer duly to observe or to perform
in any material respect any other covenants or agreements of the Servicer set
forth in this Agreement, which failure shall (i) materially and adversely affect
the rights of either the Class A Certificateholders or the Class B
Certificateholders and (ii) continue unremedied for a period of 30 days after
the date on which written notice of such failure, requiring the same to be
remedied, shall have been given (A) to the Servicer by the Trustee or (B) to the
Servicer and to the Trustee by Holders of Certificates evidencing not less than
25% of the aggregate outstanding principal balance of the Class A Certificates
and Class B Certificates taken together as a single class (or for such longer
period, not in excess of 120 days, as may be reasonably necessary to remedy such
default; provided that such default is capable of remedy within 120 days and the
Servicer delivers an Officers' Certificate to the Trustee to such effect and to
the effect that the Servicer has commenced or will promptly commence, and will
diligently pursue, all reasonable efforts to remedy such default); or
(c) an Insolvency Event occurs with respect to the Servicer or any
successor; then, and in each and every case, so long as the Event of Servicing
Termination shall not have been remedied, either the Trustee, or the Holders of
Certificates evidencing not less than 25% of the aggregate outstanding principal
balance of the Class A Certificates and the Class B Certificates taken together
as a single class, by notice then given in writing to the Servicer and the
Trustee may terminate all the rights and obligations (other than the obligations
set forth in Section 8.2) of the Servicer under this Agreement. On or after the
receipt by the Servicer of such written notice, all authority and power of the
Servicer under this Agreement, whether with respect to the Certificates or the
Receivables or otherwise, shall, without further action, pass to and be vested
in the Trustee or such successor Servicer as may be appointed under Section 9.2;
and, without limitation, the Trustee is hereby authorized and empowered to
execute and deliver, on behalf of the predecessor Servicer, as attorney-in-fact
or otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement of the Receivables and related documents, or otherwise. The
predecessor Servicer shall cooperate with the successor Servicer and the Trustee
in effecting the termination of the responsibilities and rights of the
predecessor Servicer under this Agreement, including the transfer to the
successor Servicer for administration by it of all cash amounts that shall at
the time be held by the predecessor Servicer for deposit, or shall thereafter be
received by it with respect to a Receivable. All reasonable costs and expenses
(including reasonable attorneys' fees) incurred in connection with transferring
the Receivable Files to the successor Servicer and amending this Agreement to
reflect such succession as Servicer pursuant to this Section shall be paid by
the predecessor Servicer upon presentation of reasonable documentation of such
costs and expenses. Upon receipt of notice of the occurrence of an Event of
Servicing Termination, the Trustee shall give notice thereof to the Rating
Agencies.
SECTION 9.2 APPOINTMENT OF SUCCESSOR. (a) Upon the Servicer's receipt
of notice of termination, pursuant to Section 9.1 or the Servicer's resignation
in accordance with the terms of this Agreement, the predecessor Servicer shall
continue to perform its functions as Servicer under this Agreement, in the case
of termination, only until the date specified in such termination notice or, if
no such date is specified in a notice of termination, until receipt of such
notice and, in the case of resignation, until the earlier of (x) the date 45
days from the delivery to the Trustee of written notice of such resignation (or
written confirmation of such notice) in accordance with the terms of this
Agreement and (y) the date upon which the predecessor Servicer shall become
unable to act as Servicer, as specified in the notice of resignation and
accompanying Opinion of Counsel. In the event of the Servicer's termination
hereunder, the Trustee shall appoint a successor Servicer, and the successor
Servicer shall accept its appointment by a written assumption in form acceptable
to the Trustee. In the event that a successor Servicer has not been appointed at
the time when the predecessor Servicer has ceased to act as Servicer in
accordance with this Section, the Trustee without further action shall
automatically be appointed the successor Servicer and the Trustee shall be
entitled to the Servicing Fee. Notwithstanding the above, the Trustee shall, if
it shall be unwilling or unable so to act, appoint or petition a court of
competent jurisdiction to appoint, any established institution, having a net
worth of not less than $50,000,000 and whose regular business shall include the
servicing of automotive receivables, as the successor to the Servicer under this
Agreement.
(b) Upon appointment, the successor Servicer (including the Trustee
acting as successor Servicer) shall be the successor in all respects to the
predecessor Servicer and shall be subject to all the responsibilities, duties
and liabilities arising thereafter relating thereto placed on the predecessor
Servicer and shall be entitled to the Servicing Fee and all the rights granted
to the predecessor Servicer by the terms and provisions of this Agreement. No
successor Servicer shall be liable for any acts or omissions of any predecessor
Servicer.
SECTION 9.3. PAYMENT OF SERVICING FEE; REPAYMENT OF ADVANCES. If the
Servicer shall change, the predecessor Servicer shall be entitled to (i) receive
any accrued and unpaid Servicing Fees through the date of the successor
Servicer's acceptance hereunder in accordance with Section 4.8. and (ii)
reimbursement for Outstanding Advances pursuant to Sections 4.2 and 4.8 with
respect to all Advances made by the predecessor Servicer.
SECTION 9.4. NOTIFICATION TO CERTIFICATEHOLDERS. Upon receipt by an
Authorized Officer of the Trustee of written notice of any termination of, or
appointment of a successor to, the Servicer pursuant to this Article IX, the
Trustee shall give prompt written notice thereof to Certificateholders and the
Rating Agencies subject to the Rating Agency Condition.
SECTION 9.5. WAIVER OF PAST EVENTS OF SERVICING TERMINATION. The
Holders of Certificates evidencing not less than a majority of the aggregate
outstanding principal balance of the Class A Certificates and the Class B
Certificates taken together as a single class, may, on behalf of all
Certificateholders, waive in writing any default by the Servicer in the
performance of its obligations hereunder and its consequences, except a default
in making any required deposits to or payments from any of the Accounts, the
Reserve Fund or the Payahead Account in accordance with this Agreement. Upon any
such waiver of a past default, such default shall cease to exist, and any Events
of Servicing Termination arising therefrom shall be deemed to have been remedied
for every purpose of this Agreement. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereto.
ARTICLE X
THE TRUSTEE
SECTION 10.1. ACCEPTANCE BY TRUSTEE. The Trustee, by its execution of
this Agreement, accepts all consideration conveyed by the Depositor pursuant to
Section 2.1 and the Trust created hereunder and declares that it shall hold such
consideration in trust upon the terms hereof set forth for the benefit of the
Certificateholders.
SECTION 10.2. DUTIES OF TRUSTEE. (a) The Trustee, both prior to and
after the curing of an Event of Servicing Termination, undertakes to perform
only such duties as are specifically set forth in this Agreement and no implied
covenants or obligations shall be read into this Agreement against the Trustee.
If an Event of Servicing Termination shall have occurred and shall not have been
cured (the appointment of a successor Servicer (including the Trustee) to
constitute a cure for the purposes of this Article), of which an Authorized
Officer of the Trustee has actual knowledge the Trustee shall exercise such of
the rights and powers vested in it by this Agreement, and shall use the same
degree of care and skill in their exercise, as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs; PROVIDED,
HOWEVER, that if the Trustee assumes the duties of the Servicer pursuant to
Section 9.2, the Trustee in performing such duties shall use the degree of skill
and attention required by Section 3.1.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee that are required specifically to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
reasonably conform to the requirements of this Agreement. No provision of this
Agreement shall be construed to relieve the Trustee from liability for its own
negligent action, its own negligent failure to act, its own bad faith or its own
willful misconduct; PROVIDED, HOWEVER, that:
(i) Prior to the occurrence of an Event of Servicing
Termination, and after the curing of all such Events of Servicing
Termination that may have occurred, the duties and obligations of the
Trustee shall be determined solely by the express provisions of this
Agreement, the Trustee shall not be liable except for the performance
of such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this
Agreement against the Trustee, the permissible right of the Trustee
(solely in its capacity as such) to do things enumerated in this
Agreement shall not be construed as a duty and, in the absence of bad
faith on the part of the Trustee, or manifest error, the Trustee
(solely in its capacity as such) may conclusively rely on the truth of
the statements and the correctness of the opinions expressed upon any
certificates or opinions furnished to the Trustee and conforming to
the requirements of this Agreement;
(ii) The Trustee shall not be liable for an error of judgment
made in good faith by an officer of the Trustee, unless it shall be
proved that the Trustee shall have been negligent in ascertaining the
pertinent facts; and
(iii) The Trustee shall not be liable with respect to any
action taken, suffered, or omitted to be taken in good faith in
accordance with the direction of the Holders of Certificates
evidencing not less than a majority of the aggregate outstanding
principal balance of the Class A Certificates and the Class B
Certificates taken together as a single class, as set forth in Section
9.1, relating to the time, method and place of conducting any
proceeding or any remedy available to the Trustee, or exercising any
trust or power conferred upon the Trustee, under this Agreement.
(c) The Trustee (solely in its capacity as such) shall not be required
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that the
repayment of such funds or indemnity satisfactory to it against such risk or
liability shall not be assured to it, and none of the provisions contained in
this Agreement shall in any event require the Trustee to perform, or be
responsible for the manner of performance of, any of the obligations of the
Servicer under this Agreement except during such time, if any, as the Trustee
shall be the successor to, and be vested with the rights, duties, powers and
privileges of, the Servicer in accordance with the terms of this Agreement.
(d) Except for actions expressly authorized by this Agreement, the
Trustee shall take no action reasonably likely to impair the security interests
created or existing under any Receivable or Financed Vehicle or to impair the
value of any Receivable or Financed Vehicle.
(e) The Trustee shall have no power to vary the corpus of the Trust
including (i) accepting any substitute obligation for a Receivable initially
assigned to the Trustee under this Agreement, (ii) adding any other investment,
obligation or security except for investments of moneys in the Accounts as
permitted in this Agreement, or (iii) withdrawing any Receivable, except for a
withdrawal permitted under this Agreement.
SECTION 10.3. TRUSTEE'S CERTIFICATE. As soon as practicable after each
Transfer Date on which Receivables shall be assigned to the Depositor pursuant
to Section 2.3 or 11.2, as applicable, or to the Servicer pursuant to Section
3.7, the Trustee shall execute a certificate, prepared by the Servicer,
substantially in the form of Exhibit E hereto, including its date and the date
of the Agreement, and accompanied by a copy of the Servicer's Certificate for
the related Collection Period. The Trustee's certificate shall operate, as of
such Transfer Date, as an assignment pursuant to Section 10.4.
SECTION 10.4. TRUSTEE'S ASSIGNMENT OF PURCHASED RECEIVABLES. With
respect to all Receivables repurchased by the Seller pursuant to Section 2.3 or
11.2, or purchased by the Servicer pursuant to Section 3.7, the Trustee shall
assign, without recourse, representation or warranty, to the Seller or to the
Servicer, as the case may be, all the Trustee's right, title and interest in and
to such Receivables, and all security and documents and all other Trust Property
conveyed pursuant to Section 2.1 with respect to such Receivables. Such
assignment shall be a sale and assignment outright, and not for security. If, in
any enforcement suit or legal proceeding, it is held that the Seller or the
Servicer, as the case may be, may not enforce any such Receivable on the ground
that it shall not be a real party in interest or a holder entitled to enforce
the Receivable, the Trustee shall, at the expense of the Seller or the Servicer,
as the case may be, take such steps as the Seller or the Servicer, as the case
may be, deems necessary to enforce the Receivable, including bringing suit in
the Trustee's name or the names of the Certificateholders.
SECTION 10.5. CERTAIN MATTERS AFFECTING THE TRUSTEE. Except as
otherwise provided in Section 10.2:
(i) The Trustee may conclusively rely and shall be protected
in acting or refraining from acting upon any resolution, certificate
of auditors or accountants or any other certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, appraisal, bond, note or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party
or parties.
(ii) The Trustee may consult with counsel and any Opinion of
Counsel or any advice of such counsel shall be full and complete
authorization and protection in respect of any action taken or
suffered or omitted by it under this Agreement in good faith and in
accordance with such Opinion of Counsel or any advice of such counsel.
(iii) The Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Agreement, or to
institute, conduct or defend any litigation under this Agreement or in
relation to this Agreement, at the request, order or direction of any
of the Certificateholders pursuant to the provisions of this
Agreement, unless such Certificateholders shall have offered to the
Trustee security or indemnity satisfactory to it against the costs,
expenses, and liabilities that may be incurred therein or thereby.
(iv) The Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion, rights or powers conferred upon
it by this Agreement; PROVIDED, HOWEVER, that the Trustee's conduct
does not constitute willful misfeasance or negligence.
(v) Prior to the occurrence of an Event of Servicing
Termination and after the curing of all Events of Servicing
Termination that may have occurred, the Trustee shall not be bound to
make any investigation into the facts of any matters stated in any
resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, direction, order, approval, bond, note or
other paper or document, unless requested in writing so to do by
Holders of Certificates evidencing not less than a majority of the
aggregate outstanding principal balance of the Class A Certificates
and the Class B Certificates taken together as a single class;
PROVIDED, HOWEVER, that if the payment within a reasonable time to the
Trustee of the costs, expenses, or liabilities likely to be incurred
by it in the making of an investigation requested by the
Certificateholders is, in the opinion of the Trustee, not reasonably
assured to the Trustee by the security afforded to it by the terms of
this Agreement, the Trustee may require indemnity satisfactory to it
against such cost, expense, or liability as a condition to so
proceeding. The reasonable expense of every such examination shall be
paid by the Servicer, or, if paid by the Trustee, shall be reimbursed
by the Servicer upon demand. Nothing in this clause (v) shall affect
the obligation of the Servicer to observe any applicable law
prohibiting disclosure of information regarding the Obligors;
PROVIDED, FURTHER, that the Trustee shall be entitled to make such
further inquiry or investigation into such facts or matter as it may
reasonably see fit, and if the Trustee shall determine to make such
further inquiry or investigation it shall be entitled to examine the
books and records of the Servicer or the Depositor, personally or by
agent or attorney, at the sole cost and expense of the Servicer or
Depositor, as the case may be.
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties under this Agreement either directly
or by or through agents, attorneys, nominees or a custodian, and shall
not be liable for the acts of such agents, attorneys, nominees or
custodians provided that they have been appointed with due care.
(vii) The Trustee shall not be required to make any initial
or periodic examination of any documents or records related to the
Receivables or Financed Vehicles for the purpose of establishing the
presence or absence of defects, the compliance by the Depositor with
their representations and warranties or for any other purpose.
SECTION 10.6. TRUSTEE NOT LIABLE FOR CERTIFICATES OR RECEIVABLES. The
Trustee assumes no responsibility for the correctness of the recitals contained
herein and in the Certificates (other than the Trustee's execution of, and the
certificate of authentication on, the Certificates). Except as expressly
provided herein, the Trustee makes no representations as to the validity or
sufficiency of this Agreement or of the Certificates (other than the Trustee's
execution of, and the authentication of the Certificates), or of any Receivable
or related document, or for the validity of the execution by the Depositor, the
Seller and the Servicer of this Agreement or of any supplements hereto or
instruments of further assurance, or for the sufficiency of the Trust Property
hereunder, and the Trustee shall not be bound to ascertain or inquire as to the
performance or observance of any covenants, conditions or agreements on the part
of the Depositor, the Seller or the Servicer under this Agreement except as
herein set forth; but the Trustee may require the Depositor, the Seller or the
Servicer to provide full information and advice as to the performance of the
aforesaid covenants, conditions and agreements. The Trustee (solely in its
capacity as such) shall have no obligation to perform any of the duties of the
Depositor, the Seller or the Servicer, except as explicitly set forth in this
Agreement. The Trustee shall have no liability in connection with compliance of
the Servicer, the Seller or the Depositor with statutory or regulatory
requirements related to the Receivables. The Trustee shall not make or be deemed
to have made any representations or warranties with respect to the Receivables
or the validity or sufficiency of any assignment of the Receivables to the Trust
or the Trustee. The Trustee (solely in its capacity as such) shall at no time
have any responsibility or liability for, or with respect to, the legality,
validity or enforceability of any security interest in any Financed Vehicle or
(prior to the time, if any, that the Servicer is terminated as custodian
hereunder) any Receivable, or the perfection and priority of such a security
interest or the maintenance of any such perfection and priority, the efficacy of
the Trust or its ability to generate funds sufficient to provide for the
payments to be distributed to Certificateholders under this Agreement, the
existence, condition, location and ownership of any Financed Vehicle, the
existence and contents of any Receivable or any computer or other record
thereof, the validity of the assignment of any Receivable to the Trust or of any
intervening assignment, the completeness of any Receivable, the performance or
enforcement of any Receivable, the compliance by the Depositor or the Seller
with any representation or warranty made under this Agreement or in any related
document and the accuracy of any such representation or warranty, prior to the
Trustee's receipt of notice or other discovery of any noncompliance therewith or
any breach thereof, any investment of monies by the Servicer or any loss
resulting therefrom (it being understood that the Trustee, on behalf of the
Trust shall remain responsible for any Trust Property that it may hold), the
acts or omissions of the Depositor, the Seller, the Servicer, or any Obligor,
any action of the Servicer taken in the name of the Trustee, or any action by
the Trustee taken at the instruction of the Servicer (PROVIDED that such
instruction is not in express violation of the terms and provisions of this
Agreement); PROVIDED, HOWEVER, that the foregoing shall not relieve the Trustee
of its obligation to perform its duties under this Agreement. Except with
respect to a claim based on the failure of the Trustee to perform its duties
under this Agreement (whether in its capacity as Trustee or as successor
Servicer) or based on the Trustee's willful misfeasance, negligence or bad
faith, or based on the Trustee's breach of a representation and warranty
contained in Section 10.14, no recourse shall be had to the Trustee (whether in
its individual capacity or as Trustee) for any claim based on any provision of
this Agreement, the Certificates or any Receivable or assignment thereof against
the Trustee in its individual capacity; the Trustee shall not have any personal
obligation, liability, or duty whatsoever to any Certificateholder or any other
Person with respect to any such claim. The Trustee shall not be accountable for
the use or application by the Depositor of the proceeds of such Certificates, or
for the use or application of any funds paid to the Servicer in respect of the
Receivables prior to the time such amounts are deposited in the Collection
Account (whether or not the Collection Account is maintained with the Trustee).
The Trustee shall have no liability for any losses from the investment or
reinvestment in Eligible Investments made in accordance with Section 4.1.
SECTION 10.7. TRUSTEE MAY OWN CERTIFICATES. The Trustee in its
individual or any other capacity may become the owner or pledgee of Certificates
with the same rights as it would have if it were not Trustee.
SECTION 10.8. TRUSTEE'S FEES AND EXPENSES. The Servicer agrees to pay
to the Trustee, and the Trustee shall be entitled to, reasonable compensation as
is agreed upon in writing between the Trustee and the Servicer (which shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust) for all services rendered by it in the execution of the trusts
created by this Agreement and in the exercise and performance of any of the
powers and duties under this Agreement as Trustee, and the Servicer shall pay or
reimburse the Trustee upon its request for all reasonable expenses (including,
without limitation, expenses incurred in connection with notices or other
communications to Certificateholders), disbursements and advances (including the
reasonable compensation and the reasonable expenses and disbursements of its
counsel and of all persons not regularly in its employ) incurred or made by the
Trustee in accordance with any of the provisions of this Agreement (including
the reasonable fees and expenses of its agents, any co-trustee and counsel) or
in defense of any action brought against it in connection with this Agreement
except any such expense, disbursement, or advance as may arise from its
negligence, willful misfeasance or bad faith. The Servicer shall indemnify the
Trustee, its officers, directors, agents and employees for, and hold it, and its
officers, directors, agents and employees harmless against, any loss, liability,
cost or expense, arising out of or in connection with the transactions
contemplated by this Agreement PROVIDED, that such loss, liability, cost, or
expense is not caused by the Trustee's negligence, willful misconduct or bad
faith. The Servicer's covenant to pay the expenses, disbursements and advances
provided for in the second preceding sentence, the Servicer's indemnification of
the Trustee provided for in the preceding sentence and the Servicer's indemnity
pursuant to Section 8.2 shall survive the termination of this Agreement.
SECTION 10.9. ELIGIBILITY REQUIREMENTS FOR TRUSTEE. The trustee shall
be organized and doing business under the banking laws of such state or of the
United States, shall be authorized under such laws to exercise corporate trust
powers, shall have a combined capital and surplus of at least $50,000,000, shall
have a credit rating of at least Baa3 from ▇▇▇▇▇'▇ and shall be subject to
supervision or examination by federal or state banking authorities. If such
corporation shall publish reports of condition at least annually, pursuant to
law or to the requirements of the aforesaid supervising or examining authority,
then for the purpose of this Section 10.9, the consolidated net worth of such
corporation shall be deemed to be its consolidated capital and surplus as set
forth in its most recent consolidated report of condition so published. In case
at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 10.9, the Trustee shall resign immediately in the
manner and with the effect specified in Section 10.10.
SECTION 10.10. RESIGNATION OR REMOVAL OF TRUSTEE. (a) The Trustee may
at any time resign and be discharged from the trusts hereby created by giving 30
days' prior written notice thereof to the Servicer. Upon receiving such notice
of resignation, the Servicer shall promptly appoint a successor Trustee, by
written instrument, in duplicate, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the successor Trustee. If no
successor Trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor Trustee.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 10.9 and shall fail to resign after
written request therefor by the Servicer, or if at any time the Trustee shall be
legally unable to act, or shall be adjudged bankrupt or insolvent, or a
receiver, conservator or liquidator of the Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Servicer may remove the Trustee. If the Trustee is removed
under the authority of the immediately preceding sentence, the Servicer shall
promptly appoint a successor trustee by written instrument, in duplicate, one
copy of which instrument shall be delivered to the Trustee so removed, the
successor Trustee, the Certificateholders at their respective addresses of
record and the Rating Agencies.
(c) Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 10.10 shall
not become effective until acceptance of appointment by the successor Trustee
pursuant to Section 10.11.
(d) The respective obligations of the Depositor, the Seller and the
Servicer described in this Agreement shall survive the removal or resignation of
the Trustee as provided in this Agreement. The Trustee shall be paid all amounts
outstanding upon its resignation or removal.
SECTION 10.11. SUCCESSOR TRUSTEE. (a) Any successor Trustee appointed
pursuant to Section 10.10 shall execute, acknowledge, and deliver to the
Servicer and to its predecessor Trustee an instrument accepting such appointment
under this Agreement, and thereupon the resignation or removal of the
predecessor Trustee shall become effective and such successor Trustee, without
any further act, deed or conveyance, shall become fully vested with all rights,
powers, duties and obligations of its predecessor under this Agreement, with
like effect as if originally named as Trustee. The predecessor Trustee shall
deliver to the successor Trustee all documents and statements held by it under
this Agreement, and the Servicer and the predecessor Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for fully and certainly vesting and confirming in the successor Trustee all such
rights, powers, duties and obligations.
(b) No successor Trustee shall accept appointment as provided in this
Section 10.11 unless at the time of such acceptance such successor Trustee shall
be eligible pursuant to Section 10.9.
(c) Upon acceptance of appointment by a successor Trustee pursuant to
this Section 10.11, the Servicer shall mail notice of such acceptance by the
successor Trustee under this Agreement to all Certificateholders at their
respective addresses of record and to the Rating Agencies. If the Servicer shall
fail to mail such notice within ten days after acceptance of appointment by the
successor Trustee, the successor Trustee shall cause such notice to be mailed at
the expense of the Servicer.
SECTION 10.12. MERGER OR CONSOLIDATION OF TRUSTEE. Any corporation or
banking association which is eligible to be a successor Trustee under Section
10.9 (i) into which the Trustee may be merged or consolidated, (ii) that may
result from any merger, conversion, or consolidation to which the Trustee shall
be a party, or (iii) that may succeed by purchase and assumption to the business
of the Trustee, where the Trustee is not the surviving entity, which corporation
or banking association executes an agreement of assumption to perform every
obligation of the Trustee under this Agreement, shall be the successor of the
Trustee hereunder, without the execution or filing of any instrument or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding. The Trustee shall promptly notify the Servicer and the
Rating Agencies of any such merger, conversion, consolidation or purchase and
assumption where the Trustee is not the surviving entity.
SECTION 10.13. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. (a)
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Property or any Financed Vehicle may at the time be located, the
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee, jointly with the Trustee, or separate trustee or
separate trustees, of all or any part of the Trust, and to vest in such Person,
in such capacity and for the benefit of the Certificateholders, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 10.13, such powers, duties, obligations, rights and trusts as the
Servicer and the Trustee may consider necessary or desirable. If the Servicer
shall not have joined in such appointment within 15 days after the receipt by it
of a request so to do, or in case an Event of Servicing Termination shall have
occurred and be continuing, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee under this Agreement shall be
required to meet the terms of eligibility as a successor trustee pursuant to
Section 10.9 and no notice to Certificateholders of the appointment of any
co-trustee or separate trustee shall be required pursuant to Section 10.11.
Notwithstanding the appointment of a co-trustee or separate trustee hereunder,
the Trustee shall not be relieved of any of its obligations under this
Agreement.
(b) Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) All rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred upon and exercised or
performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-
trustee, is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed
(whether as Trustee under this Agreement or as successor to the
Servicer under this Agreement), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to the
Trust Property or any portion thereof in any such jurisdiction) shall
be exercised and performed singly by such separate trustee or
co-trustee, but solely at the direction of the Trustee.
(ii) No trustee under this Agreement shall be liable by
reason of any act or omission of any other trustee under this
Agreement.
(iii) The Servicer and the Trustee acting jointly may at any
time accept the resignation of or remove any separate trustee or
co-trustee.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and in particular
to the provisions of this Article. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Each such instrument shall be filed with the Trustee and a copy
thereof given to the Servicer.
(d) Any separate trustee or co-trustee may, at any time, appoint the
Trustee its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee. The Trustee shall promptly notify the Servicer and the Rating
Agencies of any appointment made pursuant to this Section 10.13.
SECTION 10.14. REPRESENTATIONS AND WARRANTIES OF TRUSTEE. The Trustee
makes the following representations and warranties on which the Depositor, the
Seller, the Servicer, and Certificateholders may rely:
(i) ORGANIZATION AND GOOD STANDING. The Trustee is a
corporation duly organized, validly existing, and in good standing
under the laws of ___________________; and
(ii) Power and Authority. The Trustee has full power,
authority and legal right to execute, deliver, and perform this
Agreement and has taken all necessary action to authorize the
execution, delivery, and performance by it of this Agreement.
SECTION 10.15. REPORTS BY TRUSTEE. The Trustee shall provide to any
Certificateholder or Certificate Owner who so requests in writing (addressed to
the Corporate Trust Office) a copy of any Servicer's Certificate, the annual
statement described in Section 3.10, and the annual accountant's examination
described in Section 3.11. The Trustee may require any Certificateholder or
Certificate Owner requesting such report to pay a reasonable sum to cover the
cost of the Trustee's complying with such request.
SECTION 10.16. TAX ACCOUNTING. The Servicer shall prepare any federal
tax returns of the Trust in accordance with the Code and any regulations
(including, to the extent applicable by their terms, proposed regulations)
thereunder. In no event shall the Trustee in its individual capacity be liable
for any liabilities, costs or expenses of the Trust, the Certificateholders, the
Depositor, the Seller or the Servicer arising under any tax law or regulation,
including, without limitation, federal, state or local income or excise taxes or
any tax imposed on or measured by income (or any interest or penalty with
respect thereto or arising from any failure to comply therewith).
Notwithstanding the foregoing, in no event shall the Trustee be liable hereunder
for any liabilities, costs or expenses incurred from any information furnished
to it by the Servicer or failure to furnish information by the Servicer in a
timely manner.
SECTION 10.17. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
CERTIFICATES. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as Trustee. Any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Certificateholders in respect of which such judgment has
been obtained.
ARTICLE XI
TERMINATION
SECTION 11.1. TERMINATION OF THE TRUST. (a) The Trust, and the
respective obligations and responsibilities of the Depositor, the Seller, the
Servicer and the Trustee hereunder shall terminate (except as otherwise
expressly provided herein) upon the earliest of: (i) the Distribution Date next
succeeding the purchase by the Servicer at its option, pursuant to Section 11.2,
of the Receivables remaining in the Trust, (ii) the Distribution Date next
succeeding the sale through Auction, pursuant to Section 11.3 of the Receivables
remaining in the Trust, (iii) the payment to Certificateholders of all amounts
required to be paid to them pursuant to this Agreement or (iv) the Distribution
Date next succeeding the month following the maturity or the liquidation of the
last Receivable held in the Trust and the disposition of any amounts received
upon liquidation of any property remaining in the Trust; PROVIDED, HOWEVER, in
no event shall the Trust created hereby continue beyond the expiration of 21
years from the death of the last survivor of the descendants of ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, the late Ambassador of the United States to the Court of St. James's,
living on the date of this Agreement. The Servicer shall promptly notify the
Trustee of any prospective termination pursuant to this Section 11.1.
(b) Upon receipt of written notice of termination by the Servicer,
notice of any termination, specifying the Distribution Date upon which the
Certificateholders may surrender the Certificates to the Trustee for payment of
the final distribution and cancellation, shall be given promptly by the Trustee
by letter to Certificateholders and the Rating Agencies mailed not earlier than
the 15th day and not later than the 25th day of the month next preceding the
specified Distribution Date stating the amount of any such final payment and
that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office of the Trustee therein specified. Upon presentation
and surrender of the Certificates, the Trustee shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date pursuant to
Section 4.5. Amounts remaining after distribution, or providing for
distribution, to the Certificateholders shall be distributed to the Depositor
upon written request.
(c) In the event that all of the Certificateholders shall not
surrender their Certificates for cancellation within six months after the date
specified in the above-mentioned written notice, the Trustee shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. The Trustee shall after giving such notice deliver or cause to be
delivered to the Servicer the Certificate Register. If within one year after the
second notice all the Certificates shall not have been surrendered for
cancellation, the Servicer may take appropriate steps, or may appoint an agent
to take appropriate steps, to contact the remaining Certificateholders
concerning surrender of their Certificates, and the cost thereof shall be paid
out of the funds and other assets that shall remain subject to this Agreement.
Any such funds held pending such distribution shall be held uninvested. Any
funds remaining in the Trust after exhaustion of such remedies shall be
distributed by the Trustee to the Depositor upon written request.
SECTION 11.2. OPTIONAL PURCHASE OF ALL RECEIVABLES. On the last day of
any Collection Period immediately preceding a Determination Date as of which the
then outstanding Pool Balance is 5% or less of the Initial Pool Balance, the
Servicer shall have the option to purchase the corpus of the Trust. To exercise
such option, the Servicer shall deposit pursuant to Section 4.3 the sum of the
Class A Principal Balance and the Class B Principal Balance plus accrued and
unpaid interest thereon into the Collection Account for the Distribution Date
occurring in the month in which such repurchase is to be effected. The payment
shall be made in the manner specified in Section 4.3, and shall be distributed
pursuant to Section 4.5. Upon such payment the Servicer shall succeed to and own
all interests in and to the Trust and the Trust Property.
SECTION 11.3. MANDATORY SALE OF ALL CONTRACTS. In accordance with the
procedures and schedule set forth in Exhibit F hereto (the "Auction
Procedures"), the Trustee shall conduct or shall cause to be conducted an
auction (the "Auction") of the Receivables remaining in the Trust (such
Receivables hereinafter referred to as the "Auction Property") in order to
effect a termination of the Trust pursuant to Section 11.1 on the second
Distribution Date succeeding the Record Date on which the Pool Balance is 5% or
less of the Original Pool Balance and at such time as the Depositor shall have
not exercised its option contained in Section 11.2. Such Auction shall be
conducted within 10 days following the Distribution Date following the Record
Date on which the Pool Balance is 5% or less of the Original Pool Balance. The
Depositor, the Seller, or the Servicer may, but shall not be required to, bid at
the Auction. The Trustee shall sell or shall cause the sale and transfer of the
Auction Property to the highest bidder therefor at the Auction provided that;
(i) the Auction has been conducted in accordance with the
Auction Procedures;
(ii) the Trustee has received good faith bids for the Auction
Property from two prospective purchasers that are considered by the
Trustee, in its sole discretion, to be competitive participants in the
market for motor vehicle retail installment sale contracts and other
motor vehicle installment sale contracts;
(iii) a financial advisor, as advisor to the Trustee (in such
capacity, the "Advisor"), shall have advised the Trustee in writing
that at least two of such bidders (including the winning bidder) are
participants in the market for motor vehicle retail installment sale
contracts and other motor vehicle installment sale contracts willing
and able to purchase the Auction Property;
(iv) the highest bid in respect of the Auction Property is
not less than the aggregate fair market value of the Auction Property
(as determined by the Trustee in its sole discretion);
(v) any bid submitted by the Depositor, the Seller, the
Servicer or any Affiliate of any of them shall reasonably represent
the fair market value of the Auction Property, as independently
verified and represented in writing by a qualified independent third
party evaluator (which may include the Advisor or an investment bank
firm) selected by the Trustee; and
(vi) the highest bid would result in proceeds from the sale
of the Auction Property which will be at least equal to the sum of (A)
the greater of (1) the aggregate Purchase Price for the Receivables
(including defaulted Receivables), plus the appraised value of any
other property held by the Trust (less liquidation expenses) or (2) an
amount that, when added to amounts on deposit in the Collection
Account and available for distribution to Certificateholders on the
second Distribution Date following the consummation of such sale (the
"Liquidation Distribution Date"), would result in proceeds sufficient
to distribute to Certificateholders the amounts of interest due to the
Certificateholders for such Distribution Date and any unpaid interest
payable to the Certificateholders with respect to one or more prior
Distribution Dates and the outstanding principal amount of the
Certificate Balance, and (B) the Total Servicing Fee payable on such
second Distribution Date.
Provided that all of the conditions set forth in clauses (i) through
(vi) have been met, the Trustee shall sell and transfer the Auction Property,
without representation, warranty or recourse, to such highest bidder in
accordance with and upon completion of the Auction Procedures. The Trustee shall
deposit the purchase price for the Auction Property in the Collection Account at
least one Business Day prior to such second succeeding Distribution Date. In
addition, the Auction must stipulate that the Servicer be retained to service
the Receivables on terms substantially similar to those in the Agreement. In the
event that any of such conditions are not met or such highest bidder fails or
refuses to comply with any of the Auction Procedures, the Trustee shall decline
to consummate such sale and transfer. In the event such sale and transfer is not
consummated in accordance with the foregoing, however, the Trustee may from time
to time in the future, but shall not be under any further obligation to, solicit
bids for sale of the assets of the Trust upon the same terms and conditions as
set forth above.
If any of the foregoing conditions are not met, the Trustee shall
decline to consummate such sale and shall not be under any obligation to solicit
any further bids or otherwise negotiate any further sale of Receivables
remaining in the Trust. In such event, however, the Trustee may from time to
time solicit bids in the future for the purchase of such Receivables pursuant to
this Section 11.3.
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.1. AMENDMENT. (a) This Agreement may be amended by the
Depositor, the Seller, the Servicer and the Trustee, but without the consent of
any of the Certificateholders, to cure any ambiguity or defect, to correct or
supplement any provision in this Agreement or for the purpose of adding any
provision to or changing in any manner or eliminating any of the provisions of
this Agreement, or of modifying in any manner the rights of the
Certificateholders; PROVIDED, that such action shall not, as evidenced by an
Opinion of Counsel delivered to the Trustee, adversely affect the interests of
any Certificateholder and receipt of an opinion pursuant to Section 12.2(i);
PROVIDED FURTHER, that any amendment within the scope of Section 12.1(b)(i) or
(ii) shall be deemed to materially and adversely affect the interests of the
Certificateholders, as evidenced by an Officer's Certificate of the Servicer
delivered to the Trustee.
(b) This Agreement may also be amended from time to time by the
Depositor, the Seller, the Servicer and the Trustee, with the consent of the
Holders of Certificates evidencing not less than a majority of the aggregate
outstanding principal balance of the Class A Certificates and the Class B
Certificates taken together as a single class, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement, or of modifying in any manner the rights of the
Certificateholders; PROVIDED, HOWEVER, that no such amendment shall (i) increase
or reduce in any manner the amount of, or accelerate or delay the timing of,
collections of payments on Receivables or distributions that shall be required
to be made on any Certificate, without the consent of all adversely affected
Certificateholders or (ii) reduce the percentage of the aggregate outstanding
principal balance of the Certificates, the holders of which are required to
consent to any such amendment, without the consent of all Certificateholders.
(c) Prior to its execution of any such amendment or consent, the
Trustee shall furnish written notification of the substance of such amendment or
consent to the Rating Agencies. Promptly after its execution of any such
amendment or consent, the Trustee shall furnish written notification of the
substance of such amendment or consent to each Rating Agency.
(d) It shall not be necessary for the consent of Certificateholders
pursuant to Section 12.1(b) to approve the particular form of any proposed
amendment or consent, but it shall be sufficient if such consent shall approve
the substance thereof.
(e) Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating
that the execution of such amendment is authorized or permitted by this
Agreement and that all conditions precedent to the execution and delivery of
such amendment have been satisfied and the Opinion of Counsel referred to in
Section 12.2(i) has been delivered. The Trustee may, but shall not be obligated
to, enter into any such amendment which affects the Trustee's own rights, duties
or immunities under this Agreement or otherwise.
SECTION 12.2. PROTECTION OF TITLE TO TRUST. (a) The Depositor 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
Certificateholders and the Trustee under this Agreement in the Trust Property
and in the proceeds thereof. The Depositor shall deliver (or cause to be
delivered) to the Trustee file-stamped copies of, or filing receipts for, any
document filed as provided above, as soon as available following such filing.
(b) None of the Depositor, 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 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 Trustee at least five days'
prior written notice thereof and shall have promptly filed appropriate
amendments to all previously filed financing statements or continuation
statements.
(c) Each of the Depositor, the Seller and the Servicer shall have an
obligation to give the Trustee at least 60 days' prior written notice of any
relocation of its principal executive office if, as a result of such relocation,
the applicable provisions of the UCC would require the filing of any amendment
of any previously filed financing or continuation statement or of any new
financing statement and shall promptly file any such amendment. The Servicer
shall at all times maintain each office from which it shall service Receivables,
and its principal executive office, within the United States of America.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit (i) the reader thereof
to know at any time the status of such Receivable, including payments and
recoveries made and payments owing (and the nature of each) and (ii)
reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Collection Account
and Payahead Account in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that, from and
after the time of sale under this Agreement of the Receivables to the Trustee,
the Servicer's master computer records (including any backup archives) that
refer to a Receivable shall indicate clearly that such Receivable is owned by
the Trust. Indication of the Trust's ownership of a Receivable shall be deleted
from or modified on the Servicer's computer systems when, and only when, the
Receivable shall have been paid in full or repurchased by the Seller or
purchased by the Servicer.
(f) If at any time the Seller, the Depositor 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 or cause to be given to such prospective
purchaser, lender or other transferee computer tapes, records or printouts
(including any restored from backup archives) that, if they shall refer in any
manner whatsoever to any Receivable, shall indicate clearly that such Receivable
has been sold and is owned by the Trust.
(g) The Servicer shall permit the Trustee and its agents at any time
during normal business hours to inspect, audit and make copies of and abstracts
from the Servicer's or any subservicer's records regarding any Receivable.
(h) Upon request at any time the Trustee shall have reasonable grounds
to believe that such request is necessary in connection with the performance of
its duties under this Agreement, the Servicer shall furnish to the Trustee,
within five Business Days, a list of all Receivables (by contract number and
name of Obligor) then held as part of the Trust, together with a reconciliation
of such list to the Schedule of Receivables and to each of the Servicer's
Certificates furnished before such request indicating removal of Receivables
from the Trust.
(i) The Servicer shall deliver to the 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
Trustee and the Trustee in the Receivables, and reciting the details
of such filings or referring to prior Opinions of Counsel in which
such details are given, or (B) stating that, in the opinion of such
counsel, no such action shall be necessary to preserve and protect
such interest; 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 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 (l) or (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 Depositor shall, to the extent required by applicable law,
cause the Certificates to be registered with the Securities and Exchange
Commission pursuant to Section 12(b) or Section 12(g) of the Exchange Act within
the time periods specified in such sections.
SECTION 12.3. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. (a) The
death or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, or entitle the Certificateholder's legal representatives
or heirs to claim an accounting or to take any action or commence any proceeding
in any court for a partition or winding up of the Trust, or otherwise affect the
rights, obligations and liabilities of the parties to this Agreement or any of
them.
(b) No Certificateholder shall have any right to vote (except as
expressly provided herein) or in any manner otherwise control the operation and
management of the Trust, or the obligations of the parties to this Agreement,
nor shall anything set forth in this Agreement, or contained in the terms of the
Certificates, be construed so as to constitute the Holders as partners or
members of an association; nor shall any Certificateholder be under any
liability to any third party by reason of any action taken pursuant to any
provision of this Agreement.
(c) No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of default and of the continuance thereof, as hereinbefore provided, and unless
the Holders of the Certificates evidencing not less than a majority of the
aggregate outstanding principal balance of the Class A Certificates and the
Class B Certificates taken together as a single class shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee under the Agreement and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses, and
liabilities to be incurred therein or thereby, and the Trustee, for 30 days
after its receipt of such notice, request, and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding; no one or
more Holders of Certificates shall have any right in any manner whatever by
virtue or by availing itself or themselves of any provisions of this Agreement
to affect, disturb or prejudice the rights of the Holders of any other of the
Certificates, or to obtain or seek to obtain priority over or preference to any
other such Holder or to enforce any right, under this Agreement, except in the
manner provided in this Agreement and for the equal, ratable, and common benefit
of all Class A Certificateholders or Class B Certificateholders, as the case may
be. For the protection and enforcement of the provisions of this Section 12.3,
each Certificateholder and the Trustee shall be entitled to such relief as can
be given either at law or in equity.
SECTION 12.4. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS, AND REMEDIES OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 12.5. NOTICES. All demands, notices and communications upon or
to the Depositor, the Servicer, the Trustee or the Rating Agencies under this
Agreement shall be in writing, personally delivered, sent by 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 Depositor to Mellon
Auto Receivables Corporation, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, (b) in the case of the Seller or
the Servicer, to Mellon Bank, N.A., One Mellon Bank Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇, (c) in the case of the
Trustee, at the Corporate Trust Office, (d) in the case of __________________,
to ______________________ and (e) in the case of ______________________, to
___________________________________; or, as to each of the foregoing, at such
other address as shall be designated by written notice to the other parties. All
demands, notices and communications upon or to the Certificateholders under this
Agreement shall be in writing, sent by first class mail.
SECTION 12.6. SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, provisions or terms shall be
deemed severable from the remaining covenants, provisions or terms of this
Agreement, and shall in no way affect the validity or enforceability of the
other provisions of this Agreement or of the Certificates or the rights of the
Holders thereof.
SECTION 12.7. ASSIGNMENT. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 7.5, 8.3 and 8.5, this
Agreement may not be assigned by the Depositor or the Servicer. This Agreement
may not be assigned by the Trustee except as provided by Sections 10.10 through
10.13 hereof.
SECTION 12.8. CERTIFICATES NONASSESSABLE AND FULLY PAID. The interests
represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust or for any reason whatsoever, and, upon authentication
thereof by the Trustee pursuant to Section 6.1, each Certificate shall be deemed
fully paid.
SECTION 12.9. INTENTION OF PARTIES. (a) The execution and delivery of
this Agreement shall constitute an acknowledgment by the Depositor, the Seller
and the Trustee, on behalf of the Certificateholders, that it is intended that
each of the assignments and transfers herein contemplated constitute a sale and
assignment outright, and not for security, of the Receivables and the other
Trust Property, conveying good title thereto free and clear of any liens, from
the Seller to the Depositor and from the Depositor to the Trustee, and that the
Receivables and the other Trust Property shall not be a part of the estate of
either the Seller or the Depositor in the event of the insolvency, receivership,
conservatorship or the occurrence of another similar event, of, or with respect
to, the Seller or the Depositor, as applicable. In the event that either such
conveyance is determined to be made as security for a loan made by the
Depositor, the Trustee or the Certificateholders, as applicable, to the Seller
or the Depositor, as applicable, the parties intend that the Seller shall have
granted to the Depositor and the Depositor shall have granted to the Trustee a
security interest in all of the Seller's or the Depositor's, as applicable,
right, title and interest in and to the Trust Property conveyed to the Trustee
pursuant to Section 2.1 in order to secure the obligations under the
Certificates, and that this Agreement shall constitute a security agreement
under applicable law.
(b) The execution and delivery of this Agreement shall constitute an
acknowledgment by the Depositor on behalf of the Certificateholders that they
intend that the Trust be classified (for federal tax purposes) as a grantor
trust under Subpart E, Part I of Subchapter J of the Code of which the
Certificateholders are owners, rather than as an association taxable as a
corporation. The powers granted and obligations undertaken in this Agreement
shall be construed so as to further such intent.
SECTION 12.10. COUNTERPARTS. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 12.11. COLLATERAL AGENT PROTECTION. Notwithstanding anything
contained herein to the contrary, the Collateral Agent shall have the same
rights and protection afforded to the Trustee hereunder.
SECTION 12.12. LIMITATION OF LIABILITY OF TRUSTEE AND COLLATERAL
AGENT. Notwithstanding anything contained herein to the contrary (i) this
Agreement has been accepted by ________________ as Trustee and as Collateral
Agent with respect to the Reserve Fund and in no event shall __________ have any
liability for the representations, warranties, covenants, agreements or other
obligations of the Seller or the Depositor 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 Seller or the Depositor,
as applicable, and (ii) under no circumstances shall _______________ be liable
for the payment of any indebtedness or expenses of the Trust; PROVIDED, HOWEVER,
nothing contained herein shall relieve _________________ of its obligations
contained herein in its capacity as Trustee and as Collateral Agent.
SECTION 12.13. INDEPENDENCE OF THE SERVICER. For all purposes of this
Agreement, the Servicer shall be an independent contractor and shall not be
subject to the supervision of the Trustee with respect to the manner in which it
accomplishes the performance of its obligations hereunder. Unless expressly
authorized by the Trustee, the Servicer shall have no authority to act for or
represent the Trustee in any way and shall not otherwise be deemed an agent of
the Trustee.
SECTION 12.14. NO JOINT VENTURE. Nothing contained in this Agreement
(i) shall constitute the Servicer and the Trustee as members of any partnership,
joint venture, association, syndicate, unincorporated business or other separate
entity, (ii) shall be construed to impose any liability as such on any of them
or (iii) shall be deemed to confer on any of them any express, implied or
apparent authority to incur any obligation or liability on behalf of the others.
SECTION 12.15. HEADINGS. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 12.16. LIMITATIONS ON RIGHTS OF OTHERS. The provisions of this
Agreement are solely for the benefit of the Depositor, the Seller, the Servicer,
the Trust, the Trustee and for the benefit of the Certificateholders nothing in
this Agreement, whether express or implied, shall be construed to give to any
other Person any legal or equitable right, remedy or claim in the Trust Property
or under or in respect of this Agreement or any covenants, conditions or
provisions contained herein.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective officers thereunto duly authorized as of the day
and year first above written.
MELLON AUTO RECEIVABLES
CORPORATION,
as Depositor
By:_________________________________
Name:
Title:
MELLON BANK, N.A.,
as Servicer and Seller
By:_________________________________
Name:
Title:
_______________________________,
as Trustee and Collateral Agent
By:_________________________________
Name:
Title:
SCHEDULE A
SCHEDULE OF RECEIVABLES
(delivered to the Trustee at Closing)
SCHEDULE B
LOCATION OF RECEIVABLES
EXHIBIT A
FORM OF CLASS A CERTIFICATE
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN
THE AMOUNT BALANCE ON THE FACE HEREOF.
NUMBER A- $_______________ (of
CUSIP NO. ______________ $____________ issued)
MELLON AUTO TRUST 199_-_
CLASS A _____% ASSET BACKED CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined below, the
property of which includes a pool of motor vehicle retail installment sale
contracts and other motor vehicle installment chattel paper secured by new or
used automobiles (including passenger cars, minivans, sport/utility vehicles and
light trucks).
(This Certificate does not represent an interest in or obligation of Mellon Auto
Receivables Corporation or any of its Affiliates, except to the extent described
below.)
THIS CERTIFIES THAT _________________ is the registered owner of a
$____________________ nonassessable, fully-paid, fractional undivided interest
in Mellon Auto Trust 199_-_ (the "Trust") formed pursuant to the Pooling and
Servicing Agreement (the "Agreement") dated as of ______________ among Mellon
Auto Receivables Corporation, as depositor (the "Depositor"), Mellon Bank, N.A.,
as servicer (the "Servicer") and seller (the "Seller") and ______________, a
__________________, as Trustee and Collateral Agent, a summary of certain of the
pertinent provisions of which is set forth below. To the extent not otherwise
defined herein, the capitalized terms used herein have the meanings assigned to
them in the Agreement.
This Certificate is one of the duly authorized Certificates,
designated as the Class A ____% Asset Backed Certificates (herein called the
"Class A Certificates"), issued under the Agreement. Also issued under the
Agreement are Certificates designated as the Class B ____% Asset Backed
Certificates (the "Class B Certificates"). The Class A Certificates and the
Class B Certificates are hereinafter collectively called the "Certificates." The
aggregate beneficial ownership interests in the Trust evidenced by all Class A
Certificates is ___%. This Class A Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement to which Agreement
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Depositor, the Seller, the Servicer, the Trustee
and Holders of the Class A Certificates.
The property of the Trust includes a pool of motor vehicle retail
installment sale contracts and other motor vehicle retail installment chattel
paper secured by new or used automobiles (including passenger cars, minivans,
sport/utility vehicles or light trucks) (collectively, the "Receivables"), all
monies received under the Receivables on or after the related Cutoff Date and
with respect to Receivables which are Actuarial Receivables, all monies received
thereon prior to the Cutoff Date that are due on or after the Cutoff Date,
security interests in the vehicles financed thereby, certain bank accounts, the
rights to proceeds from certain insurance proceeds, the rights of the Trust
under the Agreement, the right to receive certain payments from funds deposited
in the Reserve Fund and all proceeds of the foregoing.
Under the Agreement, there will be distributed on the 15th day of each
month or, if such 15th day is not a Business Day, the next Business Day (each, a
"Distribution Date"), commencing on ______________, to the Person in whose name
this Certificate is registered at the close of business on the last day of the
calendar month preceding such Distribution Date (the "Record Date"), such
Certificateholder's fractional undivided interest in the amount to be
distributed to Certificateholders on such Distribution Date.
It is the intent of the Seller, the Depositor, the Trustee and the
Certificateholders that the Trust be classified (for federal tax purposes) as a
grantor trust under Subpart E, Part I of Subchapter J of the Code of which the
Class A Certificateholders are owners, rather than as an association taxable as
a corporation. The Depositor, the Seller, the Servicer, the Trustee and the
Certificateholders, by acceptance of a Class A Certificate, agree to treat, and
to take no action inconsistent with the treatment of, the Certificates for such
tax purposes as interests in a grantor trust.
Distributions on this Certificate will be made as provided in the
Agreement by the Trustee by check mailed or wire to the Certificateholder of
record in the Certificate Register without the presentation or surrender of this
Certificate or the making of any notation hereon, except that with respect to
Certificates registered on the Record Date in the name of the nominee of the
Clearing Agency (initially, such nominee to be Cede & Co.), payments will be
made by wire transfer in immediately available funds to the account designated
by such nominee. Except as otherwise provided in the Agreement and
notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
maintained for that purpose by the Trustee in the Borough of Manhattan, the City
of New York.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Trustee, by manual signature, this
Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this Certificate to be duly executed.
Date:
__________________________________,
as Trustee
By:________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the within-mentioned
Agreement.
Date:
__________________________________,
as Trustee
By:________________________________
Authorized Signatory
(REVERSE OF CLASS A CERTIFICATE)
The Class A Certificates do not represent an obligation of, or an
interest in, any of the Depositor, the Servicer, the Trustee or any affiliates
of any of them, and no recourse may be had against such parties or their assets
except as expressly set forth or contemplated herein or in the Agreement. In
addition, this Certificate is limited in right of payment to certain collections
and recoveries with respect to the Receivables (and certain other amounts), all
as more specifically set forth herein and in the Agreement. A copy of the
Agreement may be examined by any Certificateholder upon written request during
normal business hours at the principal office of the Depositor and at such other
places, if any, designated by the Depositor.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Seller, the Servicer and the Trustee and the rights of the
Certificateholders at any time by the Depositor, the Seller, the Servicer and
the Trustee with the consent of the Holders of Certificates evidencing not less
than a majority of the aggregate outstanding principal balance of the Class A
Certificates and the Class B Certificates taken together as a single class. Any
such consent by the Holder of this Certificate shall be conclusive and binding
on such Holder and on all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registerable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies maintained by the Trustee in the Borough of
Manhattan, The City of New York, accompanied by a written instrument of transfer
in form satisfactory to the Trustee and duly executed by the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Class A Certificates of authorized denominations evidencing the same aggregate
interest in the Trust will be issued to the designated transferee.
Except as provided in the Agreement, the Class A Certificates are
issuable only as registered certificates without coupons in minimum
denominations of $25,000 and integral multiples of $1,000 in excess thereof;
provided, however, that one Class A Certificate may be issued in a denomination
that represents any remaining portion of the Original Class A Principal Balance.
As provided in the Agreement and subject to certain limitations therein set
forth, Class A Certificates are exchangeable for new Class A Certificates of
authorized denominations evidencing the same aggregate denomination, as
requested by the Holder surrendering the same. No service charge will be made
for any such registration of transfer or exchange, but the Trustee may require
payment of a sum sufficient to cover any tax or governmental charge payable in
connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose
name this Certificate is registered as the owner hereof for all purposes, and
none of the Trustee or any such agent shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the Agreement and the
Trust created thereby shall terminate upon the payment to Certificateholders of
all amounts required to be paid to them pursuant to the Agreement and the
disposition of all property held by the Trust. The Servicer may at its option
purchase the corpus of the Trust at a price specified in the Agreement, and such
purchase of the Receivables and other property of the Trust will effect early
retirement of the Certificates; however, such right of purchase is exercisable,
subject to certain restrictions, only as of the last day of any Collection
Period as of which the Pool Balance is 5% or less of the Original Pool Balance.
In addition, within ten days following a Distribution Date as of which the Pool
Balance is 5% or less of the Original Pool Balance, and if the Depositor has not
exercised its option to repurchase the Receivable an auction sale shall be
conducted (as described in the Agreement) and such auction shall effect early
retirement of the Certificates.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
_______________________________________________________________________________
Please print or type name and address, including postal zip code, of
assignee)
_______________________________________________________________________________
the within Class A Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing ____________________________ to transfer said Class
A Certificate on the books of the Trustee, with full power of substitution in
the premises.
Dated:
___________________________________________*/
Medallion:
____________________________*/
_______________________
*/ NOTICE: The signature to this assignment must correspond with the name of the
registered owner as it appears upon the face of the within Class A Certificate
in every particular, without alteration, enlargement or any change whatever.
Such signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Trustee, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Trustee in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
EXHIBIT B
FORM OF CLASS B CERTIFICATE
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
THIS CERTIFICATE MAY NOT BE DIRECTLY OR INDIRECTLY SOLD OR TRANSFERRED
TO, OR PURCHASED OR ACQUIRED BY, OR ON BEHALF OF (1) ANY EMPLOYEE BENEFIT PLAN,
RETIREMENT ARRANGEMENT, INDIVIDUAL RETIREMENT ACCOUNT OR ▇▇▇▇▇ PLAN WHICH IS
SUBJECT TO EITHER TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (EACH, A "PLAN"), OR (2) ANY ENTITY WHOSE SOURCE OF FUNDS TO BE USED FOR
THE PURCHASE OF THIS CLASS B CERTIFICATE INCLUDES THE ASSETS OF ANY SUCH PLAN,
OTHER THAN AN "INSURANCE COMPANY GENERAL ACCOUNT" AS DEFINED IN, AND WHICH
COMPLIES WITH THE PROVISIONS OF, PROHIBITED TRANSACTION EXEMPTION 95-60.
DISTRIBUTIONS IN REDUCTION OF THE PRINCIPAL BALANCE OF THIS
CERTIFICATE WILL BE MADE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN
THE AMOUNT BALANCE ON THE FACE HEREOF.
NUMBER B- $_______________ (of
CUSIP NO. ____________ $___________ issued)
MELLON AUTO TRUST 199_-_
CLASS B ____% ASSET BACKED CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined below, the
property of which includes a pool of motor vehicle retail installment sale
contracts and other motor vehicle installment chattel paper secured by new or
used automobiles (including passenger cars, minivans, sport/utility vehicles and
light trucks).
(This Certificate does not represent an interest in or obligation of Mellon
Auto Receivables Corporation or any of its affiliates, except to the extent
described below.)
THIS CERTIFIES THAT _________________ is the registered owner of a
$____________________ nonassessable, fully-paid, fractional undivided interest
in Mellon Auto Trust 199__ (the "Trust") formed pursuant to the Pooling and
Servicing Agreement (the "Agreement") dated as of ________________ _______ __,
199_ among Mellon Auto Receivables Corporation, as depositor (the "Depositor"),
Mellon Bank, N.A., as servicer (the "Servicer") and seller (the "Seller") and
______________, a ___________, as Trustee and Collateral Agent, a summary of
certain of the pertinent provisions of which is set forth below. To the extent
not otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in the Agreement.
This Certificate is one of the duly authorized Certificates,
designated as the Class B ____% Asset Backed Certificates (herein called the
"Class B Certificates"), issued under the Agreement. Also issued under the
Agreement are Certificates designated as the Class A ____% Asset Backed
Certificates (the "Class A Certificates"). The Class A Certificates and the
Class B Certificates are hereinafter collectively called the "Certificates." The
aggregate beneficial ownership interests in the Trust evidenced by all Class B
Certificates is ___%. This Class B Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement to which Agreement
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Depositor, the Seller, the Servicer, the Trustee
and Holders of the Class B Certificates.
The property of the Trust includes a pool of simple interest motor
vehicle retail installment sale contracts and other motor vehicle retail
installment chattel paper secured by new or used automobiles (including
passenger cars, minivans, sport/utility vehicles or light trucks) (collectively,
the "Receivables"), all monies received under the Receivables on or after the
Cutoff Date and, with respect to Receivables which are Actuarial Receivables,
all monies received thereon prior to the Cutoff Date that are due on or after
the Cutoff Date, security interests in the vehicles financed thereby, certain
bank accounts, the rights to proceeds from certain insurance proceeds, the
rights of the Trust under the Agreement, the right to receive certain payments
from funds deposited in the Reserve Fund and all proceeds of the foregoing.
Under the Agreement, there will be distributed on the 15th day of each
month or, if such 15th day is not a Business Day, the next Business Day (each, a
"Distribution Date"), commencing on _____________, to the Person in whose name
this Certificate is registered at the close of business on the last day of the
calendar month preceding such Distribution Date (the "Record Date"), such
Certificateholder's fractional undivided interest in the amount to be
distributed to Certificateholders on such Distribution Date.
It is the intent of the Seller, the Depositor, the Trustee and the
Certificateholders that the Trust be classified (for Federal tax purposes) as a
grantor trust under Subpart E, Part I of Subchapter J of the Code of which the
Class B Certificateholders are owners, rather than as an association taxable as
a corporation. The Depositor, the Servicer and the Certificateholders, by
acceptance of a Class B Certificate, agree to treat, and to take no action
inconsistent with the treatment of, the Certificates for such tax purposes as
interests in a grantor trust.
Distributions on this Certificate will be made as provided in the
Agreement by the Trustee by check mailed or wire to the Certificateholder of
record in the Certificate Register without the presentation or surrender of this
Certificate or the making of any notation hereon, except that with respect to
Certificates registered on the Record Date in the name of the nominee of the
Clearing Agency (initially, such nominee to be Cede & Co.), payments will be
made by wire transfer in immediately available funds to the account designated
by such nominee. Except as otherwise provided in the Agreement and
notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
maintained for that purpose by the Trustee in the Borough of Manhattan, the City
of New York.
Reference is hereby made to the further provisions of this Certificate
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Trustee, by manual signature, this
Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this Certificate to be duly executed.
Date:
___________________________________,
as Trustee
By:________________________________
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the within-mentioned
Agreement.
Date:
__________________________________,
as Trustee
By:________________________________
Authorized Signatory
(REVERSE OF CLASS B CERTIFICATE)
The Class B Certificates do not represent an obligation of, or an
interest in, any of the Depositor, the Servicer, the Trustee or any affiliates
of any of them, and no recourse may be had against such parties or their assets
except as expressly set forth or contemplated herein or in the Agreement. In
addition, this Certificate is limited in right of payment to certain collections
and recoveries with respect to the Receivables (and certain other amounts), all
as more specifically set forth herein and in the Agreement. A copy of the
Agreement may be examined by any Certificateholder upon written request during
normal business hours at the principal office of the Depositor and at such other
places, if any, designated by the Depositor.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Seller, the Servicer and the Trustee and the rights of the
Certificateholders at any time by the Depositor, the Seller, the Servicer and
the Trustee with the consent of the Holders of Certificates evidencing not less
than a majority of the aggregate outstanding principal balance of the Class A
Certificates and the Class B Certificates taken together as a single class. Any
such consent by the Holder of this Certificate shall be conclusive and binding
on such Holder and on all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registerable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies maintained by the Trustee in the Borough of
Manhattan, The City of New York, accompanied by a written instrument of transfer
in form satisfactory to the Trustee and duly executed by the Holder hereof or
such Holder's attorney duly authorized in writing, and thereupon one or more new
Class B Certificates of authorized denominations evidencing the same aggregate
interest in the Trust will be issued to the designated transferee.
Except as provided in the Agreement, the Class B Certificates are
issuable only as registered certificates without coupons in minimum
denominations of $25,000 and integral multiples of $1,000 in excess thereof;
PROVIDED, HOWEVER, that one Class B Certificate may be issued in a denomination
that represents any remaining portion of the Original Class B Principal Balance.
As provided in the Agreement and subject to certain limitations therein set
forth, Class B Certificates are exchangeable for new Class B Certificates of
authorized denominations evidencing the same aggregate denomination, as
requested by the Holder surrendering the same. No service charge will be made
for any such registration of transfer or exchange, but the Trustee may require
payment of a sum sufficient to cover any tax or governmental charge payable in
connection therewith.
The Trustee and any agent of the Trustee may treat the Person in whose
name this Certificate is registered as the owner hereof for all purposes, and
none of the Trustee or any such agent shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the Agreement and the
Trust created thereby shall terminate upon the payment to Certificateholders of
all amounts required to be paid to them pursuant to the Agreement and the
disposition of all property held by the Trust. The Servicer may at its option
purchase the corpus of the Trust at a price specified in the Agreement, and such
purchase of the Receivables and other property of the Trust will effect early
retirement of the Certificates; however, such right of purchase is exercisable,
subject to certain restrictions, only as of the last day of any Collection
Period as of which the Pool Balance is 5% or less of the Original Pool Balance.
In addition, within ten days following a Distribution Date as of which the Pool
Balance is 5% or less of the Original Pool Balance, and if the Depositor has not
exercised its option to repurchase the Receivable an auction sale shall be
conducted (as described in the Agreement) and such auction shall effect early
retirement of the Certificates.
[By accepting and holding this Class B Certificate, the Holder hereof
shall be deemed to have represented and warranted that it is it is not acquiring
Class B Certificates, directly or indirectly, for or on behalf of an ERISA
Entity other than an "insurance company general account" as defined in, and
which complies with the provisions of, Prohibited Transaction Exemption 95-60.]
[The transferee hereof of this Class B Definitive Certificate will
represent that it is not either (1) an employee benefit plan, retirement
arrangement, individual retirement account or ▇▇▇▇▇ plan which is subject to
either Title I of ERISA, or Section 4975 of the Code, or (2) any entity whose
source of funds to be used for the purchase of the Class B Certificate includes
the assets of any such Plan, other than an "Insurance Company General Account"
as defined in, and which complies with the provisions of, Prohibited Transaction
Exemption 95-60 issued by the United States Department of Labor.]
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
_______________________________________________________________________________
(Please print or type name and address, including postal zip code, of assignee)
_______________________________________________________________________________
the within Class B Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing ____________________________ to transfer said Class
B Certificate on the books of the Trustee, with full power of substitution in
the premises.
Dated:
___________________________________________*/
Medallion:
____________________________*/
_______________________
*/ NOTICE: The signature to this assignment must correspond with the name of the
registered owner as it appears upon the face of the within Class B Certificate
in every particular, without alteration, enlargement or any change whatever.
Such signature must be guaranteed by an "eligible guarantor institution" meeting
the requirements of the Trustee, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Trustee in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
EXHIBIT D
FORM OF BENEFIT PLAN AFFIDAVIT
STATE OF ___________ )
ss:
COUNTY OF __________ )
Under penalties of perjury, I, the undersigned, declare that, to the
best of my knowledge and belief, the following representations are true,
correct, and complete.
1. That I am a duly authorized officer of _____________ (the
"PURCHASER"), whose taxpayer identification number is _________, and on behalf
of which I have the authority to make this affidavit.
2. That the Purchaser is acquiring a Class B Certificate (the
"CERTIFICATE") representing an interest in the Trust.
3. That the Purchaser is not either (1) an employee benefit plan,
retirement arrangement, individual retirement account or ▇▇▇▇▇ plan which is
subject to either Title I of ERISA, or Section 4975 of the Code, or (2) any
entity whose source of funds to be used for the purchase of the Class B
Certificate includes the assets of any such Plan, other than an "Insurance
Company General Account" as defined in, and which complies with the provisions
of, Prohibited Transaction Exemption 95-60 issued by the United States
Department of Labor.
Capitalized terms used in and not otherwise defined herein shall have
the meaning assigned to them in the Pooling and Servicing Agreement dated as of
______ __, 199__ among Mellon Auto Receivables Corporation, as depositor, Mellon
Bank, N.A., as servicer and seller and _______________, as trustee.
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be
duly executed on its behalf, by its duly authorized officer this ____ day of
___________, 19__.
___________________________________
By:________________________________
Its:_______________________________
Personally appeared before me ____________, known or proved to me to
be the same person who executed the foregoing instrument and to be a
________________ of the Purchaser, and acknowledged to me that he or she
executed the same as his or her free act and deed and as the free act and deed
of the Purchaser.
Subscribed and sworn before me
this ____ day of ____________, 19__
_______________________________________
Notary Public
My commission expires the ____ day
of ___________________, 19__.
EXHIBIT E-1
FORM OF TRUSTEE'S CERTIFICATE - ASSIGNMENT TO SELLER
Trustee's Certificate pursuant to Section 10.3 of the Pooling and
Servicing Agreement.
_________________, a ______________ corporation, as trustee (the
"Trustee") of Mellon Auto Trust 199_-_, created pursuant to the Pooling and
Servicing Agreement, dated as of ___________ (the "Pooling and Servicing
Agreement"), among Mellon Auto Receivables Corporation, as depositor (the
"Depositor"), Mellon Bank, N.A., as servicer (the "Servicer") and Seller (the
"Seller") and the Trustee, does hereby sell, transfer, assign and otherwise
convey to the Seller, without recourse, representation or warranty, all of the
Trustee's right, title and interest in and to all of the Receivables (as defined
in the Pooling and Servicing Agreement) identified in the attached Servicer's
Certificate as "Purchased Receivables," which are to be retransferred to the
Seller pursuant to Section [2.3] [11.2] of the Pooling and Servicing Agreement,
and all security and documents relating thereto.
IN WITNESS WHEREOF, I have hereunto set my hand this _______ day of
______________________, 199___.
_____________________________________
EXHIBIT E-2
FORM OF TRUSTEE'S CERTIFICATE - ASSIGNMENT TO
SERVICER Trustee's Certificate pursuant to Section 10.3 of the Pooling
and Servicing Agreement.
________________, a _______________ corporation (the "Trustee") of
Mellon Auto Trust 199_-_, created pursuant to the Pooling and Servicing
Agreement, dated as of _____________ (the "Pooling and Servicing Agreement"),
among Mellon Auto Receivables Corporation, as depositor (the "Depositor"),
Mellon Bank, N.A., as servicer (the "Servicer") and seller (the "Seller") and
the Trustee does hereby sell, transfer, assign and otherwise convey to the
Servicer, without recourse, representation or warranty, all of the Trustee's
right, title and interest in and to all of the Receivables (as defined in the
Pooling and Servicing Agreement) identified in the attached Servicer's
Certificate as "Purchased Receivables," which are to be transferred by the
Trustee to the Servicer pursuant to Section 3.7 of the Pooling and Servicing
Agreement, and all security and documents relating thereto.
IN WITNESS WHEREOF, I have hereunto set my hand this _______ day of
__________________________, 199___.
_________________________________
EXHIBIT F
TERMINATION - AUCTION PROCEDURES
The following sets forth the auction procedures to be followed in
connection with a sale effected pursuant to Section 11.3 of the Pooling and
Servicing Agreement dated as of _________, 199__ (the "Agreement"), among Mellon
Auto Receivables Corporation, a Delaware corporation, as depositor (the
"Depositor"), Mellon Bank, N.A., a national banking association (the "Bank"), as
servicer (the "Servicer") and seller (the "Seller") and _____________, as
trustee hereunder (the "Trustee") and as collateral agent with respect to the
Reserve Fund (the "Collateral Agent"). Capitalized terms used herein that are
not otherwise defined shall have the meanings ascribed thereto in the Agreement.
PRE-AUCTION PROCESS
(a) Upon receiving notice of the Auction, the Advisor will initiate
its general Auction procedures consisting of the following: (i) with the
assistance of the Servicer, prepare a general solicitation package along with a
confidentiality agreement; (ii) derive a list of qualified bidders, in a
commercially reasonable manner; (iii) initiate contact with all qualified
bidders; (iv) send a confidentiality agreement to all qualified bidders; (v)
upon receipt of a signed confidentiality agreement, send solicitation packages
to all interested bidders on behalf of the applicable Trustee; and (vi) notify
the Servicer of all potential bidders and anticipated timetable.
(b) The general solicitation package will include: (i) the prospectus
from the public offering of the Certificates; (ii) a copy of all monthly
servicing reports or a copy of all annual servicing reports and the prior year's
monthly servicing reports; (iii) a form of a Purchase Agreement and Pooling and
Servicing Agreement; (iv) a description of the minimum purchase price required
to cause the Trustee to sell the Auction Property as set forth in Section 11.3
of the Agreement; (v) a formal bidsheet; (vi) a detailed timetable; and (vii) a
preliminary data tape of the Pool Balance as of the related Distribution Date
reflecting the same data attributes used to create the Cutoff Date tables for
the Prospectus Supplement dated ________ __, 199_ relating to the offering of
the Certificates.
(c) The Trustee, with the assistance of the Servicer and the Advisor,
will maintain an auction package beginning at the time of closing of the
transaction, which will contain terms (i)-(iii) listed in the preceding
paragraph. If the Advisor is unable to perform its role as advisor to the
Trustee, the Servicer acting in its capacity under the Agreement will select a
successor Advisor and inform the Trustee of its actions.
(d) The Advisor will send solicitation packages to all bidders at
least 15 business days before the date of the Auction. Bidders will be required
to submit any due diligence questions in writing to the Advisor for
determination of their relevancy, no later than 10 business days before the date
of the Auction. The Servicer and the Advisor will be required to satisfy all
relevant questions at least five Business Days prior to the date of the Auction
and distribute the questions and answers to all bidders.
AUCTION PROCESS
(a) _______________________, in its role as Advisor to the Trustee,
will be allowed to bid in the Auction, but will not be required to do so.
(b) The Servicer will also be allowed to bid in the Auction if it
deems appropriate, but will not be required to do so.
(c) On the date of the Auction, all bids will be due by facsimile to
the offices of the applicable Trustee by 1:00 p.m. New York City time, with the
winning bidder to be notified by 2:00 p.m. New York City time. All acceptable
bids (as described in Section 11.3 of the Agreement) will be due on a conforming
basis on the bid sheet contained in the solicitation package.
(d) If the Trustee receives fewer than two market value bids from
participants in the market for motor vehicle retail installment sale contracts
and other motor vehicle installment sale contracts willing and able to purchase
the Auction Property, the Trustee shall decline to consummate the sale.
(e) Upon notification to the winning bidder, a good faith deposit
equal to one percent (1%) of the Pool Balance will be required to be wired to
the Trustee upon acceptance of the bid. This deposit, along with any interest
income attributable to it, will be credited to the purchase price but will not
be refundable. The Trustee will establish a separate account for the acceptance
of the good faith deposit, until such time as the account is fully funded and
all monies are transferred into the Collection Account, such time not to exceed
one Business Day before the related Distribution Date (as described above).
(f) The winning bidder will receive on the date of the Auction a copy
of the draft Purchase Agreement, Pooling and Servicing Agreement and Servicer's
Representations and Warranties (which shall be substantially identical to the
representations and warranties set forth in Section 8.1 of the Agreement).
(g) ______________, in its capacity as Advisor to the Trustee, will
provide to the Trustee a letter concluding whether or not the winning bid is a
fair market value bid. __________________ will also provide such letter if it is
the winning bidder. In the case where _____________ or the Servicer is the
winning bidder it will in its letter provide for market comparable valuations.
(h) The Auction will stipulate that the Servicer be retained to
service the Receivables sold pursuant to the terms of the Purchase and Sale
Agreement and the Pooling and Servicing Agreement.