EXHIBIT 4.4
FORM OF POOLING AND SERVICING AGREEMENT
TOYOTA AUTO FINANCE RECEIVABLES LLC,
SELLER
AND
TOYOTA MOTOR CREDIT CORPORATION,
SERVICER
AND
_______________________,
TRUSTEE
DATED AS OF
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS
Section 1.01 Definitions.............................................. 5
ARTICLE II CREATION OF TRUST; CONVEYANCE OF RECEIVABLES;
CUSTODY OF RECEIVABLE FILES
Section 2.01 Creation of Trust; Conveyance of Receivables............. 18
Section 2.02 Custody of Receivable Files.............................. 19
Section 2.03 Acceptance by Trustee.................................... 19
Section 2.04 Representations and Warranties of Seller as to the
Receivables............................................ 19
Section 2.05 Repurchase of Receivables Upon Breach.................... 22
Section 2.06 Duties of Servicer as Custodian.......................... 22
Section 2.07 Instructions; Authority to Act........................... 23
Section 2.08 Indemnification of Custodian............................. 23
Section 2.09 Effective Period and Termination......................... 23
Section 2.10 Usage of Terms........................................... 23
Section 2.11 Cutoff Date and Record Date.............................. 23
Section 2.12 Section References....................................... 23
Section 2.13 Agent for Service........................................ 23
ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES
Section 3.01 Duties of Servicer....................................... 23
Section 3.02 Collection of Receivable Payments........................ 24
Section 3.03 Rebates on Full Prepayments.............................. 24
Section 3.04 Realization Upon Receivables............................. 24
Section 3.05 Maintenance of Physical Damage Insurance Policies........ 25
Section 3.06 Maintenance of Security Interests in Financed Vehicles... 25
Section 3.07 Covenants of Service..................................... 25
Section 3.08 Purchase of Receivables Upon Breach...................... 25
Section 3.09 Total Servicing Fee; Payment of Certain Expenses by
Servicer............................................... 26
Section 3.10 Servicer's Certificate................................... 26
Section 3.11 Annual Statement as to Compliance; Notice of Default..... 26
Section 3.12 Annual Accountants' Report............................... 26
Section 3.13 Access to Certain Documentation and Information
Regarding Receivables.................................. 26
Section 3.14 Amendments to Schedule of Receivables.................... 27
Section 3.15 Reports to Certificate holders and Rating Agencies....... 27
ARTICLE IV ACCOUNTS; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
Section 4.01 Accounts................................................. 27
Section 4.02 Collections.............................................. 28
Section 4.03 Application of Collections............................... 29
Section 4.04 Advances................................................. 29
Section 4.05 Additional Deposits...................................... 30
Section 4.06 Distributions............................................ 30
Section 4.07 Reserve Fund............................................. 32
Section 4.08 Yield Maintenance Account................................ 34
Section 4.09 Net Deposits............................................. 36
Section 4.10 Statements to Certificate holders........................ 36
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PAGE
ARTICLE V THE CERTIFICATES
Section 5.01 The Certificates......................................... 37
Section 5.02 Authentication and Delivery of Certificates.............. 37
Section 5.03 Registration of Transfer and Exchange of Certificates.... 37
Section 5.04 Registration of Transfer and Exchange of Class B
Certificates........................................... 38
Section 5.05 Mutilated, Destroyed, Lost or Stolen Certificates........ 39
Section 5.06 Persons Deemed Owners.................................... 39
Section 5.07 Access to List of Certificateholders' Names and
Addresses.............................................. 39
Section 5.08 Maintenance of Office or Agency.......................... 40
Section 5.09 Temporary Certificates................................... 40
Section 5.10 Book-Entry Certificates.................................. 40
Section 5.11 Notices to Clearing Agency............................... 41
Section 5.12 Definitive Certificates.................................. 41
ARTICLE VI THE SELLER
Section 6.01 Representations of Seller................................ 41
Section 6.02 Liability of Seller; Indemnities......................... 42
Section 6.03 Merger or Consolidation of, or Assumption of the
Obligations of, Seller; Certain Limitations............ 42
Section 6.04 Limitation on Liability of Seller and Others............. 44
Section 6.05 Seller May Own Certificates.............................. 44
Section 6.06 No Transfer.............................................. 44
ARTICLE VII THE SERVICER
Section 7.01 Representations of Servicer.............................. 44
Section 7.02 Liability of Servicer; Indemnities....................... 45
Section 7.03 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer........................... 46
Section 7.04 Limitation on Liability of Servicer and Others........... 46
Section 7.05 Servicer Not to Resign................................... 46
ARTICLE VIII EVENTS OF DEFAULT
Section 8.01 Events of Default........................................ 46
Section 8.02 Consequences of an Event of Default...................... 47
Section 8.03 Trustee to Act; Appointment of Successor Servicer........ 48
Section 8.04 Notification to Certificate holders...................... 48
Section 8.05 Waiver of Past Defaults.................................. 48
Section 8.06 Repayment of Advances.................................... 48
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PAGE
ARTICLE IX THE TRUSTEE
Section 9.01 Duties of Trustee........................................ 49
Section 9.02 Trustee's Certificate.................................... 50
Section 9.03 Trustee's Assignment of Administrative Receivables
and Warranty Receivables............................... 50
Section 9.04 Certain Matters Affecting the Trustee.................... 50
Section 9.05 Limitation on Trustee's Liability........................ 51
Section 9.06 Trustee May Own Certificates............................. 52
Section 9.07 Trustee's Fees and Expenses.............................. 52
Section 9.08 Indemnity of Trustee and Successor Servicer.............. 52
Section 9.09 Eligibility Requirements for Trustee..................... 52
Section 9.10 Resignation or Removal of Trustee........................ 53
Section 9.11 Successor Trustee........................................ 53
Section 9.12 Merger or Consolidation of Trustee....................... 53
Section 9.13 Appointment of Co-Trustee or Separate Trustee............ 54
Section 9.14 Representations and Warranties of Trustee................ 54
Section 9.15 Tax Returns.............................................. 55
Section 9.16 Trustee May Enforce Claims Without Possession
of Certificates........................................ 55
Section 9.17 Suit for Enforcement..................................... 55
Section 9.18 Rights of Certificate holders to Direct Trustee.......... 55
ARTICLE X TERMINATION
Section 10.01 Termination of the Trust................................. 56
Section 10.02 Optional Purchase of All Receivables..................... 56
ARTICLE XI MISCELLANEOUS PROVISIONS
Section 11.01 Amendment................................................ 57
Section 11.02 Protection of Title to Trust............................. 58
Section 11.03 Limitation on Rights of Certificate holders.............. 59
Section 11.04 Governing Law............................................ 60
Section 11.05 Notices.................................................. 60
Section 11.06 Severability of Provisions............................... 60
Section 11.07 Assignment............................................... 60
Section 11.08 Certificates Nonassessable and Fully Paid................ 60
Section 11.09 No Petition.............................................. 60
Exhibit A Form of Servicer's Certificate Pursuant to Section 3.10.. A-1
Exhibit B Trustee's Certificate Pursuant to Section 9.02 or 9.03... B-1
Exhibit C Form of Class A Certificate.............................. C-1
Exhibit D Form of Class B Certificate.............................. D-1
Exhibit E Form of Transferee Certificate........................... E-1
Exhibit F Form of Letter of Representations........................ F-1
Schedule A Schedule of Receivables Schedule A-1
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ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINITIONS. Except as otherwise provided in this Agreement,
whenever used herein, the following words and phrases, unless the context
otherwise requires, shall have the following meanings:
"ACCOUNTS" means the Collection Account, the Payahead Account, the Yield
Maintenance Account, if any, and the Reserve Fund.
"ACTUAL PAYMENT" means, with respect to a Receivable and a Collection
Period, all payments received by the Servicer from or for the account of the
related Obligor on such Receivable during such Collection Period (and, in the
case of the first Collection Period, all payments received by the Servicer from
or for the account of such Obligor since the Cutoff Date through the last day of
such Collection Period), net of any Supplemental Servicing Fees attributable to
such Receivable. Actual Payments do not include Applied Payments Ahead.
"ACTUARIAL RECEIVABLE" means any Receivable which provides for the
allocation of payments according to the "actuarial" method.
"ADDITIONAL AGREEMENTS" shall have the meaning specified in Section
6.03(b)(ii)(C).
"ADDITIONAL TRUSTS" shall have the meaning specified in Section
6.03(b)(ii)(C).
"ADDITIONAL YIELD MAINTENANCE AMOUNT" means, with respect to any
Distribution Date, the amount, if any, by which the Required Yield Maintenance
Amount exceeds the Yield Maintenance Amount.
"ADMINISTRATIVE PURCHASE PAYMENT" means, with respect to a Distribution
Date and to (1) an Administrative Receivable which is a Precomputed Receivable
purchased by the Seller or the Servicer as of the end of the related Collection
Period, (a) the sum of (i) all Scheduled Payments on such Receivable due after
the last day of such Collection Period (plus any portion of a Yield Maintenance
Amount attributable to such Receivable), (ii) an amount equal to any
reimbursement of Outstanding Advances made pursuant to Section 4.04(b) with
respect to such Receivable (plus all Outstanding Advances made in respect of
such Receivable, in the case of an Administrative Purchase Payment made by the
Seller) and (iii) all past due Scheduled Payments for which an Advance has not
been made, minus (b) any Rebate paid to the Obligor on such Receivable on or
prior to the date of such purchase and (2) an Administrative Receivable which is
a Simple Interest Receivable purchased by the Seller or the Servicer during the
related Collection Period, the sum of (a) the unpaid principal balance owed by
the Obligor in respect of such Receivable plus (b) interest on such unpaid
principal balance at a rate equal to the sum of the [Class B Pass Through Rate]
[or specify other rate] and the Servicing Fee Rate to the last day in the
related Collection Period.
"ADMINISTRATIVE RECEIVABLE" means a Receivable which the Servicer is
required to purchase pursuant to Section 3.02 or 3.08 or which the Seller or the
Servicer has elected to purchase pursuant to Section 10.02.
"ADVANCE" means a Precomputed Advance or a Simple Interest Advance.
"AFFILIATE" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the 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 term "controlling" and
"controlled" have meanings correlative to the foregoing.
"AGGREGATE NET LOSSES" means, with respect to a Collection Period, an
amount equal to the aggregate Principal Balance of all Receivables that became
Defaulted Receivables during such Collection Period minus all Net Liquidation
Proceeds collected during such Collection Period with respect to Defaulted
Receivables.
"AGREEMENT" means this Pooling and Servicing Agreement with respect to the
Toyota Auto Receivables Grantor Trust 200_-_ among Toyota Auto Finance
Receivables LLC, Toyota Motor Credit Corporation and the Trustee, as the same
may be amended or supplemented from time to time.
"AMOUNT FINANCED" in respect of a Receivable means the aggregate amount
advanced under such Receivable toward the purchase price of the related Financed
Vehicle and any related costs, including but not
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limited to accessories, insurance premiums, service and warranty contracts and
other items customarily financed as part of retail automobile and light duty
truck installment sale contracts.
"ANNUAL PERCENTAGE RATE" or "APR" of a Receivable means the annual rate of
finance charges specified in such Receivable.
"APPLICANTS" shall have the meaning specified in Section 5.07.
"APPLIED PAYMENT AHEAD" means, with respect to a Precomputed Receivable
and a Collection Period as to which (a) the Actual Payment is less than the
Scheduled Payment and (b) a Deferred Prepayment is on deposit in the Payahead
Account, an amount equal to the lesser of (i) such Deferred Prepayment and (ii)
the amount by which the Scheduled Payment exceeds the Actual Payment.
"AUTOMOBILE RECEIVABLES" shall have the meaning specified in Section
6.03(b)(ii)(A).
"AVAILABLE INTEREST" means, with respect to any Distribution Date, the
total of the following amounts allocable to interest received by the Servicer on
or in respect of the Receivables during the related Collection Period (in the
case of the Precomputed Receivables, computed in accordance with the actuarial
method and in the case of the Simple Interest Receivables, computed in
accordance with the simple interest method): (a) the sum of the interest
component of (i) all collections on or in respect of all Receivables other than
Defaulted Receivables (including Scheduled Surplus, Prepayment Surplus and the
interest portion of Applied Payments Ahead, but otherwise excluding Payments
Ahead), (ii) the Yield Maintenance Deposit, if applicable, (iii) all Net
Liquidation Proceeds, (iv) all Advances made by the Servicer, (v) all Warranty
Purchase Payments and (vi) all Administrative Purchase Payments, less (b) the
sum of all (i) amounts received on or in respect of a particular Receivable
(other than a Defaulted Receivable) to the extent of the aggregate Outstanding
Interest Advances in respect of such Receivable and (ii) Net Liquidation
Proceeds with respect to a particular Receivable to the extent of the aggregate
Outstanding Interest Advances in respect of such Receivable.
"AVAILABLE PRINCIPAL" means, with respect to any Distribution Date, the
total of the following amounts allocable to principal received by the Servicer
on or in respect of the Receivables during the related Collection Period (in the
case of the Precomputed Receivables, computed in accordance with the actuarial
method and in the case of the Simple Interest Receivables, computed in
accordance with the simple interest method): (a) the sum of the principal
component of all (i) collections on or in respect of all Receivables other than
Defaulted Receivables (including the principal portion of Applied Payments Ahead
but otherwise excluding Payments Ahead), (ii) Net Liquidation Proceeds, (iii)
Advances made by the Servicer, (iv) Warranty Purchase Payments, and (v)
Administrative Purchase Payments, less (b) an amount equal to all (i) amounts
received on or in respect of a particular Receivable (other than a Defaulted
Receivable) to the extent of the aggregate Outstanding Principal Advances in
respect of such Receivable, and (ii) Net Liquidation Proceeds with respect to a
particular Receivable to the extent of the aggregate Outstanding Principal
Advances in respect of such Receivable.
"BASIC SERVICING FEE" means the fee payable to the Servicer on each
Distribution Date, calculated pursuant to Section 3.09, for services rendered
during the related Collection Period, which shall be equal to one-twelfth of the
Servicing Fee Rate multiplied by the Pool Balance as of the first day of the
related Collection Period or, with respect to the first Distribution Date, the
Original Pool Balance.
"BOOK-ENTRY CERTIFICATES" means a beneficial interest in the Certificates,
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 5.10.
"BUSINESS DAY" means any day other than a Saturday, a Sunday or a day on
which banking institutions in New York, New York or Los Angeles, California are
authorized or obligated by law, executive order or governmental decree to be
closed.
"CERTIFICATE REGISTER" means the register maintained pursuant to Section
5.03.
"CERTIFICATEHOLDER" or "HOLDER" means the Person in whose name a
Certificate is registered in the Certificate Register, except that, solely for
the purposes of giving certain consents, waivers, requests or demands pursuant
to this Agreement, the interest evidenced by any Class A Certificate registered
in the name of the Seller or the Servicer, or any Person actually known to a
Responsible Officer of the Trustee to be controlling, controlled by or under
common control with the Seller or the Servicer, shall not be taken into account
in determining whether the requisite percentage necessary to effect any such
consent, waiver, request or demand shall have been obtained.
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"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 either
case in accordance with the rules of such Clearing Agency) and shall mean, with
respect to a Definitive Certificate, the related Certificateholder.
"CERTIFICATE REGISTRAR" means the Trustee unless a successor thereto is
appointed pursuant to Section 5.03. The Certificate Registrar initially
designates its offices at o, as its offices for purposes of Section 5.08.
"CERTIFICATES" means the Class A Certificates and the Class B
Certificates.
"CHARGE-OFF RATE" means, with respect to a Collection Period, the
percentage equivalent of a fraction, the numerator of which is the Aggregate Net
Losses for such Collection Period, and the denominator of which is the average
of (i) the aggregate Principal Balance on the last day of the Collection Period
immediately preceding such Collection Period and (ii) the aggregate Principal
Balance on the last day of such Collection Period; such quotient is then
multiplied by twelve to arrive at an annualized percentage.
"CLASS" means all Certificates whose form is identical except for
variation in denomination, principal amount or owner.
"CLASS A CERTIFICATE" means one of the Certificates executed by the
Trustee on behalf of the Trust and authenticated by the Trustee in substantially
the form attached hereto as Exhibit C.
"CLASS A CERTIFICATE BALANCE" shall initially equal the Original Class A
Certificate Balance and, on any date thereafter, shall equal the Original Class
A Certificate Balance, reduced by all amounts previously distributed to Class A
Certificateholders and allocable to principal; provided, however, that on any
Distribution Date on or after the Distribution Date on which the Class B
Certificate Balance is reduced to zero, after all required distributions and
deposits have been made, the Class A Certificate Balance will be reduced by the
amount, if any, necessary to cause the Class A Certificate Balance to equal the
Pool Balance as of the last day of the related Collection period.
"CLASS A DISTRIBUTABLE AMOUNT" means, with respect to any Distribution
Date, the sum of the Class A Principal Distributable Amount and the Class A
Interest Distributable Amount.
"CLASS A INTEREST CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess, if any, of (i) the Class A Interest Distributable
Amount for such Distribution Date plus any outstanding Class A Interest
Carryover Shortfall from the immediately preceding Distribution Date plus
interest on such outstanding Class A Interest Carryover Shortfall, to the extent
permitted by law, at the Class A Pass Through Rate from and including such
immediately preceding Distribution Date to but excluding the current
Distribution Date, over (ii) the amount of interest distributed to Class A
Certificateholders on such current Distribution Date.
"CLASS A INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Distribution Date, the product of one-twelfth of the Class A Pass Through Rate
and the Class A Certificate Balance as of the immediately preceding Distribution
Date (after giving effect to distributions of principal made on such immediately
preceding Distribution Date) or, in the case of the first Distribution Date, the
Original Class A Certificate Balance.
"CLASS A PASS THROUGH RATE" means ___% per annum.
"CLASS A PERCENTAGE" means ___%.
"CLASS A POOL FACTOR" means, with respect to any Distribution Date, a
seven-digit decimal figure (rounded upwards) equal to the Class A Certificate
Balance as of such Distribution Date divided by the Original Class A Certificate
Balance.
"CLASS A PRINCIPAL CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess, if any, of (i) the Class A Principal
Distributable Amount plus any outstanding Class A Principal Carryover Shortfall
with respect to one or more prior Distribution Dates, over (ii) the amount of
principal distributed to Class A Certificateholders on such current Distribution
Date.
"CLASS A PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any
Distribution Date, the sum of the Class A Percentage of the following amounts
(but not exceeding the Class A Certificate Balance as of
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such Distribution Date): (i) in the case of Precomputed Receivables, the
principal portion of all Scheduled Payments due during the related Collection
Period, computed in accordance with the actuarial method, (ii) in the case of
Simple Interest Receivables, the principal portion of all Scheduled Payments
actually received during the related Collection Period, (iii) the principal
portion of all Prepayments received during such Collection Period (to the extent
such amounts are not included in clauses (i) and (ii) above), and (iv) the
Principal Balance of each Receivable that became an Administrative Receivable, a
Warranty Receivable or a Defaulted Receivable during such Collection Period (to
the extent such amounts are not included in clauses (i), (ii) and (iii) above).
In addition, with respect to the Final Scheduled Distribution Date or the
Distribution Date upon which all remaining Receivables are to be purchased
pursuant to Section 10.02, the Class A Principal Distributable Amount will
include the portion of such amount necessary (after giving effect to the other
amounts to be distributed to the Class A Certificateholders on such Final
Scheduled Distribution Date or Distribution Date and allocable to principal) to
reduce the Class A Certificate Balance to zero.
"CLASS B CERTIFICATE" means any one of the Certificates executed by the
Trustee on behalf of the Trust and authenticated by the Trustee in substantially
the form attached hereto as Exhibit D.
"CLASS B CERTIFICATE BALANCE" shall initially equal the Original Class B
Certificate Balance and, on any Distribution Date, shall equal the amount by
which the Pool Balance as of the last day of the related Collection Period
exceeds the Class A Certificate Balance on such Distribution Date.
"CLASS B DISTRIBUTABLE AMOUNT" means, with respect to any Distribution
Date, the sum of the Class B Principal Distributable Amount and the Class B
Interest Distributable Amount.
"CLASS B INTEREST CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess, if any, of (i) the Class B Interest Distributable
Amount for such Distribution Date plus any outstanding Class B Interest
Carryover Shortfall from the immediately preceding Distribution Date plus
interest on such outstanding Class B Interest Carryover Shortfall, to the extent
permitted by law, at the Class B Pass Through Rate from and including such
immediately preceding Distribution Date to but excluding the current
Distribution Date, over (ii) the amount of interest distributed to Class B
Certificateholders on such current Distribution Date.
"CLASS B INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Distribution Date, the product of one-twelfth of the Class B Pass Through Rate
and the Class B Certificate Balance as of the immediately preceding Distribution
Date (after giving effect to distributions of principal made on such immediately
preceding Distribution Date) or, in the case of the first Distribution Date, the
Original Class B Certificate Balance.
"CLASS B PASS THROUGH RATE" means ___% per annum.
"CLASS B PERCENTAGE" means ___%.
"CLASS B PRINCIPAL CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess, if any, of (i) the Class B Principal
Distributable Amount and any outstanding Class B Principal Carryover Shortfall
with respect to one or more prior Distribution Dates, over (ii) the amount of
principal distributed to Class B Certificateholders on such current Distribution
Date.
"CLASS B PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any
Distribution Date, the sum of the Class B Percentage of the following amounts
(but not exceeding the Class B Certificate Balance as of such Distribution
Date): (i) in the case of Precomputed Receivables, the principal portion of all
Scheduled Payments due during the related Collection Period, computed in
accordance with actuarial method, (ii) in the case of Simple Interest
Receivables, the principal portion of all Scheduled Payments actually received
during the related Collection Period, (iii) the principal portion of all
Prepayments received during such Collection Period (to the extent such amounts
are not included in clauses (i) and (ii) above), and (iv) the Principal Balance
of each Receivable that became an Administrative Receivable, a Warranty
Receivable or a Defaulted Receivable during such Collection Period (to the
extent such amounts are not included in clauses (i), (ii) and (iii) above). In
addition, with respect to the Final Scheduled Distribution Date or the
Distribution Date upon which all remaining Receivables are to be purchased
pursuant to Section 10.02, the Class B Principal Distributable Amount will
include the portion of such amount necessary (after giving effect to the other
amounts to be distributed to the Class B Certificateholders on such Final
Scheduled Distribution Date or Distribution Date and allocable to principal) to
reduce the Class B Certificate Balance to zero.
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"CLEARING AGENCY" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act.
"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 __________.
"CODE" means the Internal Revenue Code of 1986, as amended.
["COLLATERAL SECURITY AGREEMENT" means the Collateral Security Agreement
dated o, by and among the Seller, the Servicer, [third party] and the Trustee,
as collateral agent, pursuant to which [third party] has conveyed the property
and proceeds of any Yield Maintenance Account to the Trustee in trust for the
benefit of the Certificateholders as described in Section 4.08(a).]
"COLLECTION ACCOUNT" means the account or accounts designated as such and
established and maintained pursuant to Section 4.01.
"COLLECTION PERIOD" means, with respect to any Distribution Date, the
calendar month immediately preceding the month in which such Distribution Date
occurs (or, in the case of the first Distribution Date, the period of time since
the Cutoff Date through the end of the calendar month immediately preceding the
month in which such first Distribution Date occurs).
"COMMISSION" means the Securities and Exchange Commission, and any
successor thereto.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered,
which office at the date of execution of this Agreement is located at o.
"CURRENT RECEIVABLE" means each Receivable that is not a Defaulted
Receivable or a Liquidated Receivable.
"CUTOFF DATE" means __________.
"DEALER" means the dealer of automobile and/or light duty trucks who sold
a Financed Vehicle and who originated and assigned the Receivable relating to
such Financed Vehicle to TMCC under an existing agreement between such dealer
and TMCC.
"DEALER RECOURSE" means, with respect to a Receivable, all recourse rights
against the Dealer which originated the Receivable, and any successor Dealer.
"DEFAULTED RECEIVABLE" means a Receivable (other than an Administrative
Receivable or a Warranty Receivable) as to which (i) all or any part of a
Scheduled Payment is o or more days past due and the Servicer has not
repossessed the related Financed Vehicle, or (ii) the Servicer has, in
accordance with its customary servicing procedures, determined that eventual
payment in full is unlikely and either repossessed and liquidated the related
Financed Vehicle or repossessed and held the related Financed Vehicle in its
repossession inventory for 90 days, whichever occurs first.
"DEFINITIVE CERTIFICATES" shall have the meaning specified in Section
5.10.
"DEFERRED PREPAYMENT" means, with respect to a Precomputed Receivable and
a Collection Period, the aggregate amount, if any, of Payments Ahead remitted to
the Servicer in respect of such Receivable during one or more prior Collection
Periods and currently held by the Servicer or in the Payahead Account.
"DELINQUENCY PERCENTAGE" means, with respect to a Collection Period, the
percentage equivalent of a fraction, the numerator of which is the number of (i)
all outstanding Receivables 61 days or more delinquent (after taking into
account permitted extensions) as of the last day of such Collection Period,
determined in accordance with the Servicer's normal practices, plus (ii) all
repossessed Financed Vehicles that have not been liquidated (to the extent the
related Receivable is not otherwise reflected in clause (i) above), and the
denominator of which is the aggregate number of Current Receivables on the last
day of such Collection Period.
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"DELIVERY" means, when used with respect to the Reserve Fund:
(i) with respect to certificated securities, bankers' acceptances,
commercial paper, negotiable certificates of deposit and other obligations
that constitute "instruments" within the meaning of Section 9-105(1)(i) of
the UCC and are susceptible of physical delivery (collectively, "Physical
Property"), transfer thereof to the Trustee or its financial intermediary
as defined in Section 8-313(4) of the UCC (a "Financial Intermediary") in
accordance with Sections 8-313(1)(a), 8-313(1)(d)(i) or 8-313(1)(g) of the
UCC, and evidence that any such Physical Property that is in registrable
form has been registered in the name of the Trustee, its Financial
Intermediary, its custodian or its nominee;
(ii) with respect to any Reserve Fund property that is a book-entry
security held through the Federal Reserve System pursuant to federal
book-entry regulations, the following procedures, all in accordance with
applicable law, including applicable federal regulations and Articles 8
and 9 of the UCC: (A) book-entry registration of such property to an
appropriate book-entry account maintained with a Federal Reserve Bank by
the Trustee or by a custodian and issuance to the Trustee or to such
custodian, as the case may be, of a deposit advice or other written
confirmation of such book-entry registration, (B) the making by any such
custodian of entries in its books and records identifying such book-entry
security held through the Federal Reserve System pursuant to federal
book-entry regulations as belonging to the Trustee and indicating that
such custodian holds such Reserve Fund property solely as agent for the
Trustee, and the making by the Trustee of entries in its books and records
establishing that it holds such Reserve Fund property solely as Trustee
pursuant to Section 4.07, and (C) such additional or alternative
procedures as may hereafter become necessary to effect complete transfer
of ownership of any such Reserve Fund property to the Trustee, consistent
with changes in applicable law or regulations or the interpretation
thereof; and
(iii) with respect to any Reserve Fund property that is an
uncertificated security under Article 8 of the UCC and that is not
governed by clause (ii) above, registration of the transfer to, and
ownership of such Reserve Fund property by, the Trustee, its Financial
Intermediary, its custodian or its nominee by the issuer of such Reserve
Fund.
"DETERMINATION DATE" means, with respect to any Distribution Date, the o
calendar day of the month in which such Distribution Date occurs or, if such day
is not a Business Day, the next succeeding Business Day.
"DISTRIBUTION DATE" means, with respect to a Collection Period, the o
calendar day of the following calendar month, or if such day is not a Business
Day, the next succeeding Business Day, commencing o.
"DTC" means The Depository Trust Company, and its successors.
"DUFF & ▇▇▇▇▇▇" means Duff & ▇▇▇▇▇▇ Inc., and its successors.
"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 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 that 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
unsecured debt rating of "AA-" or better by Standard & Poor's and "Aa3" or
better by Moody's or (B) an account or accounts in which funds will be held
therein for 30 days or less which are maintained with a depository institution
or trust company, the short-term unsecured debt obligations of which are rated
"A-1+" or better by Standard & Poor's or if not rated by Standard & Poor's then
otherwise approved by Standard & Poor's and rated "P-1" or better by Moody's, or
if not rated by Moody's then otherwise approved by Moody's, and (ii) whose
deposits are insured by the FDIC. If so qualified, the Trustee may be considered
an Eligible Institution for the purposes of clause (b) of this definition.
10
"ELIGIBLE INVESTMENTS" means, at any time, any one or more of the
following obligations and securities:
(i) obligations of, and obligations fully guaranteed as to timely
payment of principal and interest by, the United States or any agency
thereof, provided such obligations are backed by the full faith and credit
of the United States;
(ii) general obligations of or obligations guaranteed by FNMA or any
state of the United States, the District of Columbia or the Commonwealth
of Puerto Rico then rated the highest available credit rating of each
Rating Agency for such obligations;
(iii) securities bearing interest or sold at a discount issued by
any corporation incorporated under the laws of the United States, any
state thereof, the District of Columbia or the Commonwealth of Puerto
Rico, so long as at the time of such investment or contractual commitment
providing for such investment either the long-term unsecured debt of such
corporation has the highest available rating from each Rating Agency for
such obligations or the commercial paper or other short-term debt which is
then rated has the highest available credit rating of each Rating Agency
for such obligations;
(iv) certificates of deposit issued by any depository institution or
trust company (including the Trustee) incorporated under the laws of the
United States or of any state thereof, the District of Columbia or the
Commonwealth of Puerto Rico and subject to supervision and examination by
banking authorities of one or more of such jurisdictions, provided that
the short-term unsecured debt obligations of such depository institution
or trust company is then rated the highest available rating of each Rating
Agency for such obligations;
(v) certificates of deposit issued by any bank, trust company,
savings bank or other savings institution and fully insured by the FDIC;
(vi) repurchase obligations held by the Trustee that are acceptable
to the Trustee with respect to any security described in clauses (i), (ii)
or (vii) hereof or any other security issued or guaranteed by any other
agency or instrumentality of the United States, in either case entered
into with a federal agency or a depository institution or trust company
(acting as principal) described in clause (iv) above;
(vii) interests in any closed-end management type investment company
or investment trust (a) registered under the Investment Company Act, the
portfolio of which is limited to the obligations of, or guaranteed by, the
United States and to agreements to repurchase such obligations, which
agreements, with respect to principal and interest, are at least 100%
collateralized by such obligations marked to market on a daily basis and
he investment company or investment trust shall take delivery of such
obligations either directly or through an independent custodian designated
in accordance with the Investment Company Act and (b) acceptable to each
Rating Agency (as approved in writing by each Rating Agency) as collateral
for securities having ratings equivalent to the rating of the Rated
Certificates on the Closing Date;
(viii) money market funds, including, without limitation, the VISTA4
Money Market Funds, so long as such funds are rated ___ by Moody's (so
long as ▇▇▇▇▇'▇ is a Rating Agency) and ___ by Standard & Poor's (so long
as Standard & Poor's is a Rating Agency), and any other fund for which the
Trustee or an Affiliate of the Trustee serves as an investment advisor,
administrator, shareholder servicing agent and/or custodian or
subcustodian, provided that any shares of such funds have a credit rating
of at least ___ by Moody's (so long as ▇▇▇▇▇'▇ is a Rating Agency) and ___
by Standard & Poor's (so long as Standard & Poor's is a Rating Agency) and
notwithstanding that (i) the Trustee or an Affiliate of the Trustee
charges and collects fees and expenses from such funds for services
rendered, (ii) the Trustee charges and collects fees and expenses for
services rendered pursuant to this Agreement, and (iii) services performed
for such funds and pursuant to this Agreement may converge at any time.
Each of the Seller and the Servicer hereby specifically authorizes the
Trustee or an Affiliate of the Trustee to charge and collect all fees and
expenses from such funds for services rendered to such funds, in addition
to any fees and expenses the Trustee may charge and collect for services
rendered pursuant to this Agreement; and
(ix) such other investments acceptable to each Rating Agency (as
approved in writing by each Rating Agency) as will not result in the
qualification, downgrading or withdrawal of the rating then assigned to
the Rated Certificates by such Rating Agency;
11
provided that each of the foregoing investments shall mature no later than
the Distribution Date immediately following the date of purchase (other than in
the case of the investment of monies in instruments of which the entity at which
the related Account is located is the obligor, which may mature on the related
Distribution Date), and shall be required to be held to such maturity.
Notwithstanding anything to the contrary contained in this definition, (a)
no Eligible Investment may be purchased at a premium, (b) any of the foregoing
which constitutes a certificated security shall not be considered a Eligible
Investment unless it is registered in the name of the Trustee in its capacity as
such, and (c) any of the foregoing which constitutes an uncertificated security
shall not be considered a Eligible Investment unless (i) it is registered in the
name of the Trustee in its capacity as such or in the name of its Financial
Intermediary; (ii) no notation of the right of the issuer thereof to a Lien
thereon is contained in the initial transaction statement therefor sent to the
Trustee; (iii) a Responsible Officer of the Trustee does not have notice or
actual knowledge of (A) any restriction on the transfer thereof imposed by the
issuer thereof, or (B) any adverse claim, and no notation of any such
restriction or of any specific adverse claim as to which the issuer has a duty
under the law of the state in which the Corporate Trust Office is located at the
time of registration is contained in the initial transaction statement therefor
sent to the Trustee; and (iv) to a Responsible Officer of the Trustee's actual
knowledge, no creditor has served legal process upon the issuer thereof at its
chief executive office in the United States which legal process attempts to
place a Lien thereon prior to the registration thereof in the name of the
Trustee.
For purposes of this definition, any reference to the highest available
credit rating of an obligation shall mean the highest available credit rating
for such obligation, or such lower credit rating (as approved in writing by each
Rating Agency) as will not result in the qualification, downgrading or
withdrawal of the rating then assigned to the Rated Certificates by such Rating
Agency.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EVENT OF DEFAULT" shall have the meaning specified in Section 8.01.
"EXCESS AMOUNTS" means, with respect to any Distribution Date, the
remaining Available Interest on deposit in the Collection Account in respect of
such Distribution Date after all distributions pursuant to Section 4.06(c) have
been made. Excess Amounts shall include all amounts received upon prepayment in
full of Rule of 78s Receivables in excess of the then outstanding principal
balances thereof and accrued interest thereon (calculated pursuant to the
actuarial method).
"EXCESS PAYMENT" means, with respect to a Receivable and a Collection
Period, the amount, if any, by which the Actual Payment exceeds the sum of (i)
the Scheduled Payment, and (ii) any Overdue Payment.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FDIC" means the Federal Deposit Insurance Corporation, and its
successors.
"FNMA" means the Federal National Mortgage Association, and its
successors.
"FINAL SCHEDULED DISTRIBUTION DATE" shall mean __________.
"FINAL SCHEDULED MATURITY DATE" shall mean __________.
"FINANCED VEHICLE" means, with respect to a Receivable, the related
automobile or light duty truck, as the case may be, together with all accessions
thereto, securing the related Obligor's indebtedness under such Receivable.
"FINANCIAL INTERMEDIARY" shall have the meaning specified in the
definition of the term "Delivery."
"INDEPENDENT DIRECTOR" means a director of the Seller who is not (i) a
director, officer or employee of any affiliate of the Seller, (ii) a natural
person related to any director or officer of any affiliate of the Seller, (iii)
a holder (directly or indirectly) of more than 10% of any voting securities of
any affiliate of the Seller, or (iv) a natural person related to a holder
(directly or indirectly) of more than 10% of any voting securities of any
affiliate of the Seller.
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"INSURANCE POLICY" means, with respect to a Receivable, an insurance
policy covering physical damage, credit life, credit disability, theft,
mechanical breakdown or similar event relating to the related Financed Vehicle
or Obligor.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as
amended.
"LIEN" means any security interest, lien, charge, pledge, equity or
encumbrance of any kind other than tax liens, mechanics' liens and any liens
that attach to a Receivable or any property, as the context may require, by
operation of law.
"LIQUIDATED RECEIVABLE" means a Receivable that (i) has been the subject
of a Prepayment in full, or (ii) has been paid in full or the final amounts in
respect of such payment have been paid with respect to a Defaulted Receivable,
regardless of whether all or any part of such payment has been made by the
Obligor under such Receivable, the Seller pursuant to this Agreement, the
Servicer pursuant to this Agreement or pursuant to the Receivables Purchase
Agreement, an insurer pursuant to an Insurance Policy or otherwise.
"LIQUIDATION EXPENSES" means, with respect to a Defaulted Receivable, the
amount charged by the Servicer, in accordance with its customary servicing
procedures, to or for its account for repossessing, refurbishing and disposing
of the related Financed Vehicle and other out-of-pocket costs related to such
liquidation.
"LIQUIDATION PROCEEDS" means, with respect to a Defaulted Receivable, all
amounts realized with respect to such Receivable from whatever sources
(including, without limitation, proceeds of any Insurance Policy), net of
amounts that are required by law or such Receivable to be refunded to the
related Obligor.
"MONTHLY PAYMENT" means, with respect to any Receivable, the amount of
each fixed monthly payment payable to the obligee under such Receivable in
accordance with the terms thereof, net of any portion of such monthly payment
that represents late payment charges, extension fees or collections allocable to
payments to be made by Obligors for payment of insurance premiums, extended
service contracts or similar items.
"MONTHLY REMITTANCE CONDITIONS" shall have the meaning specified in
Section 4.02(a).
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, and its successors.
"NET LIQUIDATION PROCEEDS" means, with respect to a Defaulted Receivable,
Liquidation Proceeds less Liquidation Expenses.
"NONRECOVERABLE ADVANCE" shall have the meaning specified in Section
4.04(c).
"OBLIGOR" on a Receivable means the purchaser or co-purchasers of the
related Financed Vehicle purchased in part or in whole by the execution and
delivery of such Receivable or any other Person who owes or may be liable for
payments under such Receivable.
"OFFERED CERTIFICATES" shall have the meaning specified in Section
6.03(b)(ii)(D).
"OFFICER'S CERTIFICATE" means a certificate signed by the president, any
vice president, the treasurer or the secretary of the Seller or the Servicer, as
the case may be, and delivered to the Trustee.
"OPINION OF COUNSEL" means a written opinion of counsel (who, in the case
of counsel to the Seller or the Servicer, may be an employee of or outside
counsel to the Seller or the Servicer), which counsel shall be acceptable to the
Trustee.
"OPTIONAL PURCHASE PERCENTAGE" means 10.00%.
"ORIGINAL CLASS A CERTIFICATE BALANCE" means $__________.
"ORIGINAL CLASS B CERTIFICATE BALANCE" means $__________.
"ORIGINAL POOL BALANCE" means $__________.
"OUTSTANDING ADVANCES" means, with respect to a Receivable and the last
day of a Collection Period, the sum of all Advances made as of or prior to such
date, minus all payments or collections as of or prior to
13
such date which are specified in Section 4.04(b) as applied to reimburse all
unpaid Advances with respect to such Receivable.
"OUTSTANDING INTEREST ADVANCES" means, as of the last day of a Collection
Period with respect to a Receivable, the portion of Outstanding Advances
allocable to interest.
"OUTSTANDING PRINCIPAL ADVANCES" means, as of the last day of a Collection
Period with respect to a Receivable, the portion of Outstanding Advances
allocable to principal.
"OVERDUE PAYMENT" shall have the meaning specified in Section 4.03(a).
"PASS THROUGH RATE" means the Class A Pass Through Rate or the Class B
Pass Through Rate, as indicated by the context.
"PAYAHEAD ACCOUNT" means the account or accounts designated as such and
established and maintained pursuant to Section 4.01.
"PAYMENT AHEAD" means, with respect to a Precomputed Receivable and a
Collection Period, any Excess Payment (not representing prepayment in full of
such Precomputed Receivable) which the Servicer, in accordance with its
customary servicing practices, will apply towards the payment of Scheduled
Payments in one or more future Collection Periods.
"PERSON" means any legal person, including any individual, corporation,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PHYSICAL PROPERTY" shall have the meaning specified in the definition of
the term "Delivery."
"POOL BALANCE" means, as of any date, the aggregate Principal Balance of
the Receivables (exclusive of all Administrative Receivables for which the
Servicer has paid the Administrative Purchase Payment, Warranty Receivables for
which the Seller has paid the Warranty Purchase Payment and Defaulted
Receivables) as of the close of business on such date.
"POOL FACTOR" as of any Distribution Date, means a seven-digit decimal
figure equal to the Pool Balance as of such Distribution Date divided by the
Original Pool Balance.
"PRECOMPUTED ADVANCE" shall have the meaning specified in Section 4.04(a).
"PRECOMPUTED RECEIVABLE" means any Actuarial Receivable or Rule of 78s
Receivable.
"PREPAYMENT" means (i) with respect to any Precomputed Receivable, any
Excess Payment other than a Payment Ahead or (ii) with respect to any Simple
Interest Receivable, any prepayment, whether in part or in full, in respect of
such Simple Interest Receivable.
"PREPAYMENT SURPLUS" means, with respect to any Distribution Date on which
a Prepayment is to be applied with respect to a Precomputed Receivable, that
portion of such Prepayment which is not attributable to principal in accordance
with the actuarial method, net of one month's interest at the Weighted Average
Pass-Through Rate on the Principal Balance of such Receivable as of the first
day of the related Collection Period.
"PRINCIPAL BALANCE" means, with respect to any Receivable as of any date,
the Amount Financed minus the sum of the following amounts: (i) in the case of a
Precomputed Receivable, that portion of all Scheduled Payments due on or prior
to such date allocable to principal, computed in accordance with the actuarial
method, (ii) in the case of a Simple Interest Receivable, that portion of all
Scheduled Payments actually received on or prior to such date allocable to
principal, (iii) any Warranty Purchase Payment or Administrative Purchase
Payment with respect to such Receivable allocable to principal, and (iv) any
Prepayments or other payments applied to reduce the unpaid principal balance of
such Receivable.
"RATED CERTIFICATES" means any Class of Certificates that has been rated
by a Rating Agency at the request of the Seller.
"RATING AGENCY" means each of Moody's and Standard & Poor's.
14
"REBATE" means, with respect to a Precomputed Receivable and any date, the
rebate, calculated on an actuarial basis, under such Precomputed Receivable that
is or would be payable to the related Obligor for unearned finance charges or
any other charges subject to rebate if such Obligor were to prepay such
Receivable in full on such date.
"RECEIVABLE" means any retail installment sale contract executed by an
Obligor in respect of a Financed Vehicle, and all proceeds thereof and payments
thereunder, which Receivable shall be identified in the Schedule of Receivables.
"RECEIVABLE FILE" means the documents specified in Section 2.02 pertaining
to a particular Receivable.
"RECEIVABLES PURCHASE AGREEMENT" means that certain Receivables Purchase
Agreement, dated as of the Cutoff Date, between the Seller and TMCC.
"RECORD DATE" means, with respect to Certificates of either Class and each
Distribution Date, the calendar day immediately preceding such Distribution Date
or, if Definitive Certificates representing Certificates of such Class have been
issued, the last day of the month immediately preceding the month in which such
Distribution Date occurs. Any amount stated "as of a Record Date" or "on a
Record Date" shall give effect to (i) all applications of collections, and (ii)
all distributions to any party under this Agreement or to the related Obligor,
as the case may be, in each case as determined as of the opening of business on
the related Record Date.
"RELEASED ADMINISTRATIVE AMOUNT" means, with respect to a Distribution
Date and to an Administrative Receivable, the Deferred Prepayment, if any, for
such Administrative Receivable.
"RELEASED WARRANTY AMOUNT" means, with respect to a Distribution Date and
to a Warranty Receivable, the Deferred Prepayment, if any, for such Warranty
Receivable.
"REQUIRED RATE" means, with respect to each Collection Period, [the sum of
the Servicing Fee Rate and the Class B Pass Through Rate][or specify other
rate].
"REQUIRED RATING" means a rating of ___ by Moody's and ___ by Standard &
Poor's.
"REQUIRED YIELD MAINTENANCE AMOUNT" means, with respect to any
Distribution Date, an amount equal to [the aggregate amount by which (i) the
aggregate amount of interest that would accrue on the Principal Balance of each
Receivable that is an asset of the Trust for the period commencing on the last
day of the related Collection Period and ending on the last day of the
Collection Period during which such Receivable is scheduled to mature if such
Receivable bore interest at the Required Rate (assuming that all subsequent
payments on such Receivable are made as scheduled and no prepayments are made in
respect thereof) exceeds (ii) the aggregate amount of interest that would accrue
thereon for the same period at the related APR][or specify other
formula][specify discounting factors].
"RESERVE FUND" means the segregated trust account established and
maintained for the benefit of the Certificateholders as a reserve fund pursuant
to Section 4.07(a).
"RESERVE FUND INITIAL DEPOSIT" means $__________.
"RESIDUAL CERTIFICATE" shall have the meaning specified in Section 5.01.
"RESPONSIBLE OFFICER" means, when used with respect to the Trustee, any
officer within the Corporate Trust Office of the Trustee, including any Vice
President, Assistant Vice President, Assistant Treasurer, Assistant Secretary 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 such particular
subject.
"RULE OF 78S RECEIVABLE" means any Receivable which provides for the
allocation of payments according to the "sum of periodic balances" or "sum of
monthly payments" method.
"SCHEDULE OF RECEIVABLES" means the schedule of receivables attached as
Schedule A to this Agreement, as it may be amended from time to time.
15
"SCHEDULED PAYMENT" means, with respect to any Distribution Date and to a
Receivable, the payment set forth in such Receivable as due from the Obligor in
the related Collection Period; provided, however, that in the case of the first
Collection Period, the Scheduled Payment shall include all such payments due
from the Obligor on or after the Cutoff Date.
"SCHEDULED SURPLUS" means, with respect to any Distribution Date for any
Receivable having an APR which exceeds the sum of the Weighted Average Pass
Through Rate and the Servicing Fee Rate, the product of (i) the interest portion
of the related Scheduled Payment (in the case of any Precomputed Receivable,
determined in accordance with the actuarial method), and (ii) the remainder of
(a) one minus (b) a fraction, the numerator of which equals the sum of the
Weighted Average Pass Through Rate and the Servicing Fee Rate and the
denominator of which equals such APR.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SELLER" means Toyota Auto Finance Receivables LLC, in its capacity as
seller of the Receivables under this Agreement, and each successor thereto (in
the same capacity) pursuant to Section 6.03.
"SERVICER" means TMCC, in its capacity as servicer of the Receivables
pursuant to this Agreement, and each successor thereto (in the same capacity)
appointed pursuant to Section 8.03.
"SERVICER'S CERTIFICATE" means an Officer's Certificate of the Servicer
completed and executed pursuant to Section 3.10, substantially in the form
attached hereto as Exhibit A.
"SERVICING FEE RATE" means ___% per annum.
"SIMPLE INTEREST ADVANCE" shall have the meaning specified in Section
4.04(a).
"SIMPLE INTEREST RECEIVABLE" means any Receivable which provides for the
allocation of payments according to the simple interest method.
"SPECIFIED RESERVE FUND BALANCE" means with respect to any Distribution
Date, an amount equal to [ ___% of the sum of the Class A Certificate Balance
and the Class B Certificate Balance (after giving effect to distributions of
principal to be made on such Distribution Date), except that, if on any
Distribution Date (i) the average of the Charge-off Rates for the preceding
three Collection Periods exceeds ___% or (ii) the average of the Delinquency
Percentages for the preceding three Collection Periods exceeds ___%, then the
Specified Reserve Fund Balance for such Distribution Date will be an amount
equal to ___% of such sum (after giving effect to such principal distributions).
Finally, on any Distribution Date on which the sum of the Class A Certificate
Balance and the Class B Certificate Balance is $_____ or less after giving
effect to distributions of principal on such Distribution Date, the Specified
Reserve Fund Balance for the immediately succeeding Distribution Date will be
the greater of the applicable amount determined as set forth above or $___;
provided, however, that the Specified Reserve Fund Balance shall in no event be
more than the sum of the Class A Certificate Balance and the Class B Certificate
Balance, in each case as of such Distribution Date][or specify other formula].
"STANDARD & POOR'S" means Standard & Poor's, a division of The ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc. and its successors
"SUCCESSOR SERVICER" means any entity appointed as a successor to the
Servicer pursuant to Section 8.03.
"SUPPLEMENTAL SERVICING FEE" means, with respect to any Distribution Date,
all late fees, prepayment charges, extension fees and other administrative fees
and expenses or similar charges allowed by applicable law with respect to the
Receivables received by the Servicer during the related Collection Period.
"TAFR LLC" means Toyota Auto Finance Receivables LLC, and its successors
and assigns.
"TMCC" means Toyota Motor Credit Corporation, and its successors and
assigns.
"TOTAL SERVICING FEE" means the sum of the Basic Servicing Fee and the
Supplemental Servicing Fee.
"TRUST" means the trust created by this Agreement, the estate of which
consists of (i) the Receivables (other than Warranty Receivables for which the
Seller has paid the Warranty Purchase Payment and Administrative Receivables for
which the Servicer or the Seller has paid the Administrative Purchase Payment)
and all monies paid
16
thereunder, or due and to become due thereunder, in each case on and after the
Cutoff Date; (ii) security interests in the Financed Vehicles; (iii) such assets
(excluding investment earnings thereon) as are from time to time deposited in
the Accounts, other than the Reserve Fund and any Yield Maintenance Account;
(iv) proceeds from claims on any Insurance Policies; (v) the right to realize
upon any property (including the right to receive future Liquidation Proceeds)
that shall have secured a Receivable and have been repossessed by or on behalf
of the Trustee; (vi) an assignment of the Seller's rights as purchaser under the
Receivables Purchase Agreement; (vii) the right of the Seller to receive
payments pursuant to any Dealer Recourse; and (viii) all proceeds of the
foregoing. Neither the Reserve Fund nor any Yield Maintenance Account shall be a
part of or otherwise includable in the Trust.
"TRUSTEE" means o and any successor trustee appointed pursuant to Section
9.11.
"TRANSFEREE'S CERTIFICATE" means the representation letter to be delivered
to the Trustee by any transferee of a Class B Certificate pursuant to Section
5.04, substantially in the form attached hereto as Exhibit E.
"TRUSTEE'S CERTIFICATE" means a certificate completed and executed by a
Responsible Officer pursuant to Section 9.02 or 9.03, substantially in the form
attached hereto as Exhibit B.
"UCC" means the Uniform Commercial Code as in effect in the respective
jurisdiction.
"UNITED STATES" means the United States of America.
"VICE PRESIDENT" of any Person means any vice president of such Person,
whether or not designated by a number or words before or after the title "Vice
President", who is a duly elected officer of such Person.
"VOTING INTERESTS" means the aggregate voting strength evidenced by the
Class A Certificates or the Class B Certificates, as the case may be; provided,
however, that where the Voting Interests are relevant in determining whether the
vote of the requisite percentage of Class A Certificateholders necessary to
effect any consent, waiver, request or demand shall have been obtained, the
Voting Interests shall be deemed to be reduced by the amount equal to the Voting
Interests (without giving effect to this provision) represented by the interests
evidenced by any Certificate registered in the name of the Seller, the Servicer
or any Person actually known to a Responsible Officer of the Trustee to be
controlling, controlled by or under common control with the Seller or the
Servicer.
"WARRANTY PURCHASE PAYMENT" means, with respect to a Distribution Date and
to (1) a Warranty Receivable which is a Precomputed Receivable repurchased by
the Seller as of the end of the related Collection Period, (a) the sum of (i)
all Scheduled Payments on such Receivable due after the last day of such
Collection Period (plus the portion of the Yield Maintenance Amount attributable
to such Receivable, if any), (ii) all past due Scheduled Payments for which an
Advance has not been made, (iii) an amount equal to any reimbursement of
Outstanding Advances made pursuant to Section 4.04(b) with respect to such
Receivable and (iv) all Outstanding Advances made in respect of such Receivable,
minus (b) the sum of (i) any Rebate paid to the Obligor on such Receivable on or
prior to the date of such purchase and (ii) any other proceeds in respect of
such Receivable previously received (to the extent applied to reduce the
Principal Balance of such Receivable on such Distribution Date), and (2) a
Warranty Receivable which is a Simple Interest Receivable repurchased by the
Seller as of the end of the related Collection Period, the sum of (a) the unpaid
principal balance owed by the Obligor in respect of such Receivable plus (b)
interest on such unpaid principal balance at a rate equal to the sum of [the
Class B Pass Through Rate][or specify other rate] and the Servicing Fee Rate to
the last day in the related Collection Period.
"WARRANTY RECEIVABLE" means a Receivable which the Seller is required to
repurchase pursuant to Section 2.05.
"WEIGHTED AVERAGE PASS THROUGH RATE" means the average of the Class A Pass
Through Rate and Class B Pass Through Rate weighted on the basis of the Class A
Certificate Balance and the Class B Certificate Balance as of the first day of
the relevant Interest Period.
"YIELD MAINTENANCE ACCOUNT" means the segregated trust account established
and maintained for the benefit of the Certificateholders as a reserve fund
pursuant to Section 4.08(a), if any.
"YIELD MAINTENANCE AGREEMENT" means the Yield Maintenance Agreement dated
o, among the Servicer, the Seller [, third party] and the Trustee, pursuant to
which Additional Yield Maintenance Amounts are to be deposited in the Yield
Maintenance Account on each Distribution Date.
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"YIELD MAINTENANCE AMOUNT" means, with respect to any Distribution Date,
the aggregate amount on Deposit in any Yield Maintenance Account after giving
effect to the withdrawal therefrom of any related Yield Maintenance Deposit and
without regard to any amounts on deposit therein in respect of interest or
investment earnings earned on the investment of amounts on deposit therein in
Eligible Investments for any period.
"YIELD MAINTENANCE ACCOUNT INITIAL DEPOSIT" means an amount equal to [the
aggregate amount by which (i) the aggregate amount of interest that would accrue
on the Principal Balance of each Receivable that is an asset of the Trust for
the period commencing on the last day of the first Collection Period and ending
on the last day of the Collection Period during which such Receivable is
scheduled to mature if such Receivable bore interest at the Required Rate
(assuming that all subsequent payments on such Receivable are made as scheduled
and no prepayments are made in respect thereof) exceeds (ii) the aggregate
amount of interest that would accrue thereon for the same period at the related
APR][or specify other formula][specify discounting factors].
"YIELD MAINTENANCE DEPOSIT" means, with respect to any Distribution Date,
the amount by which (i) the aggregate amount of interest that would have been
due during the related Collection Period on all Receivables that have APRs less
than the Required Rate if such Receivables bore interest at the Required Rate
exceeds (ii) the amount of interest accrued on such receivables at their
respective APRs and due during such Collection Period.
ARTICLE II
CREATION OF TRUST; CONVEYANCE OF RECEIVABLES;
CUSTODY OF RECEIVABLE FILES
SECTION 2.01 CREATION OF TRUST; CONVEYANCE OF RECEIVABLES.
(a) Upon the execution of this Agreement by the parties hereto, there is
hereby created the Toyota Auto Receivables 200_-_ Grantor Trust. The Seller,
pursuant to the mutually agreed upon terms contained in this Agreement, shall
sell, transfer, assign and otherwise convey to the Trustee on behalf of the
Trust, without recourse (but subject to the Seller's obligations in this
Agreement), all of its right, title and interest in and to the Receivables and
any proceeds related thereto, including any Dealer Recourse and such other items
as shall be specified in this Agreement.
(b) In consideration of the Trustee's delivery to the Seller on behalf of
the Trust of authenticated Certificates, in authorized denominations, in an
aggregate amount equal to the Original Pool Balance, the Seller does hereby
sell, transfer, assign and otherwise convey to the Trustee, in trust for the
benefit of the Certificateholders, without recourse (subject to the Seller's
obligations herein):
(i) all right, title and interest of the Seller in and to the
Receivables and all monies due thereon or paid thereunder or in respect
thereof (including proceeds of the repurchase of Receivables by the Seller
pursuant to Section 2.05 or 10.02 or the purchase of Receivables by the
Servicer pursuant to Section 3.08 or 10.02) on or after the Cutoff Date;
(ii) the interest of the Seller in the security interests in the
Financed Vehicles granted by the Obligors pursuant to the Receivables
and any accessions thereto;
(iii) the interest of the Seller in any proceeds of any physical
damage insurance policies covering Financed Vehicles and in any proceeds
of any credit life or credit disability insurance policies relating to the
Receivables or the Obligors;
(iv) the interest of the Seller in any Dealer Recourse;
(v) the interest of the Seller under the Receivables Purchase
Agreement;
(vi) the right of the Seller to realize upon any property (including
the right to receive future Liquidation Proceeds) that shall have secured
a Receivable and have been repossessed by or on behalf of the Trustee;
(vii) all other assets comprising the Trust; and
(viii) all proceeds of the foregoing.
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(c) It is the intention of the Seller that the transfer and assignment
contemplated by this Agreement shall constitute a sale of the Receivables from
the Seller to the Trust and the beneficial interest in and title to the
Receivables shall not be part of the Seller's estate in the event of the filing
of a bankruptcy petition by or against the Seller under any bankruptcy law. The
Seller agrees to execute and file all filings (including filings under the UCC)
necessary in any jurisdiction to provide third parties with notice of the sale
of the Receivables pursuant to this Agreement and to perfect such sale under the
UCC.
(d) Although the parties hereto intend that the transfer and assignment
contemplated by this Agreement be a sale, in the event such transfer and
assignment is deemed to be other than a sale, the parties intend that all
filings described in the foregoing paragraph shall give the Trustee on behalf of
the Trust a first priority perfected security interest in, to and under the
Receivables, and other property conveyed hereunder and all proceeds of any of
the foregoing. This Agreement shall be deemed to be the grant of a security
interest from the Seller to the Trustee on behalf of the Trust, and the Trustee
on behalf of the Trust shall have all the rights, powers and privileges of a
secured party under the UCC.
(e) In connection with the foregoing conveyance, the Servicer shall
maintain its computer system so that, from and after the time of sale of the
Receivables to the Trustee on behalf of the Trust under this Agreement, the
Servicer's master computer records (including any back-up archives) that refer
to any Receivable indicate clearly the interest of the Trust in such Receivables
and that the Receivable is owned by the Trustee on behalf of 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
has been paid in full, repurchased or assigned pursuant to this Agreement.
SECTION 2.02 CUSTODY OF RECEIVABLE FILES. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Trustee on
behalf of the Trust, upon the execution and delivery of this Agreement,
revocably appoints the Servicer, and the Servicer accepts such appointment, to
act as the agent of the Trust as custodian of the following documents or
instruments which are hereby constructively delivered to the Trustee with
respect to each Receivable:
(a) the fully executed original of the Receivable;
(b) documents evidencing or related to any Insurance Policy;
(c) the original credit application of each Obligor, fully executed by
such Obligor on TMCC's customary form, or on a form approved by TMCC, for such
application;
(d) the original certificate of title (or evidence that such certificate
of title has been applied for) or such documents that the Servicer shall keep on
file, in accordance with TMCC's customary procedures, evidencing the security
interest in the related Financed Vehicle; and
(e) any and all other documents that the Seller or the Servicer, as the
case may be, shall keep on file, in accordance with its customary procedures,
relating to such Receivable or the related Obligor or Financed Vehicle.
SECTION 2.03 ACCEPTANCE BY TRUSTEE. The Trustee hereby acknowledges its
acceptance, on behalf of the Trust, pursuant to this Agreement, of all right,
title and interest in and to the Receivables conveyed by the Seller pursuant to
this Agreement and declares and shall declare from and after the date hereof
that the Trustee holds and shall hold such right, title and interest, upon the
trust set forth in this Agreement.
SECTION 2.04 REPRESENTATIONS AND WARRANTIES OF SELLER AS TO THE
RECEIVABLES. The Seller does hereby make the following representations and
warranties on which the Trustee shall rely in accepting the Receivables in trust
and authenticating the Certificates:
(a) Characteristics of Receivables. Each Receivable (i) shall have been
originated in the United States by a Dealer for the retail sale of the related
Financed Vehicle in the ordinary course of such Dealer's business, shall have
been fully and properly executed by the parties thereto, shall have been
purchased by TMCC from such Dealer under an existing agreement with TMCC and
shall have been validly assigned by such Dealer to TMCC in accordance with the
terms of such agreement and shall have been subsequently sold by TMCC to the
Seller pursuant to the Receivables Purchase Agreement, (ii) shall have created
or shall create a valid, subsisting and enforceable first priority security
interest in favor of TMCC in the related Financed Vehicle, which security
interest has been assigned by TMCC to the Seller and shall be assignable, and
shall be so assigned, by the Seller to the Trustee, (iii)
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shall, except as otherwise provided in this Agreement, provide for level Monthly
Payments (provided that the payment in the first or last month in the life of
the Receivable may be minimally different from the level payment) that fully
amortize the Amount Financed by maturity and provide for a finance charge or
yield interest at its APR, in either case calculated based on the Rule of 78s,
the simple interest method or the actuarial method, (iv) shall contain customary
and enforceable provisions, such that the rights and remedies of the holder
thereof shall be adequate for realization against the collateral of the benefits
of the security and (v) shall provide for, in the event that such Receivable is
prepaid, a prepayment that fully pays the Principal Balance and includes accrued
but unpaid interest in an amount calculated by using an interest rate at least
equal to its APR.
(b) Schedule of Receivables. The information set forth in the Schedule of
Receivables shall be true and correct in all material respects as of the opening
of business on the Cutoff Date, and no selection procedures adverse to the
Certificateholders shall have been utilized in selecting the Receivables from
those automobile and light duty truck receivables of TMCC which met the
selection criteria set forth in this Section and this Agreement.
(c) Compliance with Law. Each Receivable and each sale of the related
Financed Vehicle shall have complied at the time it was originated or made, and
shall comply at the time of execution of this Agreement, 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 Billing Act, the Fair Credit
Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade
Commission Act, the ▇▇▇▇▇▇▇▇-▇▇▇▇ Warranty Act, Federal Reserve Board
Regulations B, M and Z (to the extent applicable), state adaptations of the
National Consumer Act and of the Uniform Consumer Credit Code and other consumer
credit, equal credit opportunity and disclosure laws.
(d) Binding Obligation. Each Receivable shall constitute the legal, valid
and binding payment obligation in writing of the related Obligor, enforceable by
the holder thereof in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium and other similar
laws affecting the enforcement of creditors' rights in general and by general
principles of equity, regardless of whether such enforceability shall be
considered in a proceeding in equity or at law.
(e) No Bankrupt Obligors. None of the Receivables shall be due, to
the best knowledge of the Seller, from any Obligor who is presently the
subject of a bankruptcy proceeding or is bankrupt or is insolvent.
(f) No Government Obligors. None of the Receivables shall be due
from the United States or any state, or from any agency, department or
instrumentality of the United States or any state or local government.
(g) Employee Obligors. None of the Receivables shall be due from any
employee of the Seller, TMCC or any of their respective affiliates.
(h) Security Interest in Financed Vehicles. Immediately prior to the sale,
assignment and transfer thereof, each Receivable shall be secured by a validly
perfected first priority security interest in the related Financed Vehicle in
favor of TMCC as secured party or all necessary and appropriate action with
respect to such Receivable shall have been taken to perfect a first priority
security interest in such Financed Vehicle in favor of TMCC as secured party.
(i) Receivables in Force. No Receivable shall have been satisfied,
subordinated or rescinded, nor shall any Financed Vehicle have been released in
whole or in part from the lien granted by the related Receivable.
(j) No Waivers. No provision of a Receivable shall have been waived in
such a manner that such Receivable fails to meet all of the other
representations and warranties made by the Seller herein with respect thereto.
(k) No Amendments. No Receivable shall have been amended or modified in
such a manner that the total number of Scheduled Payments has been increased or
that the related Amount Financed has been increased or that such Receivable
fails to meet all of the other representations and warranties made by the Seller
herein with respect thereto.
(l) No Defenses. No facts shall be known to the Seller which would give
rise to any right of rescission, setoff, counterclaim or defense, nor shall the
same have been asserted or threatened, with respect to any Receivable.
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(m) No Liens. To the knowledge of the Seller, no liens or claims shall
have been filed, including liens for work, labor or materials relating to a
Financed Vehicle, that shall be liens prior to, or equal or coordinate with, the
security interest in such Financed Vehicle granted by the related Receivable.
(n) No Default; No Repossession. Except for payment defaults that,
as of the Cutoff Date, have been continuing for a period of not more than
days, no default, breach, violation or event permitting acceleration under the
terms of any Receivable shall have occurred as of the Cutoff Date; no continuing
condition that with notice or the lapse of time would constitute a default,
breach, violation or event permitting acceleration under the terms of any
Receivable shall have arisen; the Seller shall not have waived any of the
foregoing; and no Financed Vehicle has been repossessed without reinstatement as
of the Cutoff Date.
(o) Insurance. At the time of origination of each Receivable, each Obligor
was required under the terms of such Receivable to obtain and maintain physical
damage insurance covering the related Financed Vehicle.
(p) Good Title. It is the intention of the Seller that the transfer and
assignment herein contemplated, taken as a whole, constitute a sale of the
Receivables from the Seller to the Trust and that the beneficial interest in and
title to the Receivables not be part of the debtor's estate in the event of the
filing of a bankruptcy petition by or against the Seller under any bankruptcy
law. No Receivable has been sold, transferred, assigned or pledged by the Seller
to any Person other than the Trust, and no provision of a Receivable shall have
been waived, except as provided in clause (j) above; immediately prior to the
transfer and assignment herein contemplated, the Seller had good and marketable
title to each Receivable free and clear of all Liens and rights of others;
immediately upon the transfer and assignment thereof, the Trust shall have good
and marketable title to each Receivable, free and clear of all Liens and rights
of others; and the transfer and assignment herein contemplated has been
perfected under the UCC.
(q) Lawful Assignment. No Receivable shall have been originated in, or
shall be subject to the laws of, any jurisdiction under which the sale, transfer
and assignment of such Receivable under this Agreement or pursuant to a transfer
of the related certificate of title shall be unlawful, void or voidable.
(r) All Filings Made. All filings (including UCC filings) necessary in any
jurisdiction to provide third parties with notice of the transfer and assignment
herein contemplated, to perfect the sale of the Receivables from the Seller to
the Trustee and to give the Trustee on behalf of the Trust a first priority
perfected security interest in the Receivables shall have been made.
(s) One Original. There shall be only one original executed copy of
each Receivable.
(t) Chattel Paper. Each Receivable constitutes "chattel paper" as
defined in the UCC.
(u) Maturity of Receivables. Each Receivable shall have an original
maturity of not less than _____ months nor greater than o months and, as of the
Cutoff Date, a remaining maturity of not less than _____ months nor greater than
o months.
(v) Finance Charge. Each Receivable provides for an APR equal to or
greater than ____% and equal to or less than ____%.
(w) Principal Balance. Each Receivable had an original principal
balance of not less than $_______ nor more than $_______ and an unpaid
principal balance, as of the Cutoff Date, of not less than $_______ nor more
than $_______.
(x) No Overdue Payments. No Receivable shall have a Scheduled
Payment that is more than _____ days past due as of the Cutoff Date.
(y) Location of Receivable Files. Each Receivable File shall be kept at
one of the locations listed in the Schedule of Receivables or at such other
office as shall be specified to the Trustee by 30 days' prior written notice.
(z) Payments on the Receivables. Each Receivable shall provide for level
monthly payments that fully amortize the Amount Financed by maturity, except
that the payment in the first or last month in the life of the Receivable may be
minimally different from the level payment.
(aa) Origination Date. Each Receivable was originated on or before
_____________.
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(bb) No Special Financing. No Receivable was originated under a
special financing program.
(cc) No Force-Placed Insurance. No Financed Vehicle was subject to
force-placed insurance as of the Cutoff Date.
SECTION 2.05 REPURCHASE OF RECEIVABLES UPON BREACH. Upon discovery by the
Seller or the Servicer or upon the actual knowledge of a Responsible Officer of
the Trustee of a breach of any of the representations and warranties of the
Seller set forth in this Agreement that materially and adversely affects the
interests of the Certificateholders in any Receivable, the party discovering
such breach shall give prompt written notice to the others. As of the last day
of the second Collection Period following the Collection Period in which it
discovers or receives notice of such breach (or, at the Seller's election, the
last day of the first Collection Period following the Collection Period in which
it discovers or receives notice of such breach), the Seller shall, unless such
breach shall have been cured in all material respects, repurchase such
Receivable and, if necessary, the Seller shall enforce the obligation of TMCC
under the Receivables Purchase Agreement to repurchase such Receivable from the
Seller. This repurchase obligation shall obtain for all representations and
warranties of the Seller contained in this Agreement whether or not the Seller
has knowledge of the breach at the time of the breach or at the time the
representations and warranties were made. In consideration of the repurchase of
any such Receivable, on the Business Day immediately preceding the related
Distribution Date, the Seller shall remit the Warranty Purchase Payment of such
Receivable to the Collection Account in the manner specified in Section 4.05 and
shall be entitled to receive the Released Warranty Amount. In the event that any
Liens or claims shall have been filed, including Liens for work, labor or
materials relating to a Financed Vehicle, that shall be prior to, or equal or
coordinate with, the lien granted by the related Receivable, which Liens or
claims shall not have been satisfied or otherwise released in full as of the
Closing Date, and such breach materially and adversely affects the interests of
the Trust in such Receivable, the Seller shall repurchase such Receivable on the
terms and in the manner specified above.
Upon any such repurchase, the Trustee on behalf of the Trust shall,
without further action, be deemed to transfer, assign, set-over and otherwise
convey to the Seller, all right, title and interest of the Trustee on behalf of
the Trust in, to and under such repurchased Receivable, all monies due or to
become due with respect thereto and all proceeds thereof. The Trustee shall
execute such documents and instruments of transfer and assignment and take such
other actions as shall be reasonably requested by the Seller to effect the
conveyance of such Receivable pursuant to this Section. The sole remedy of the
Trustee, the Trust or the Certificateholders with respect to a breach of the
Seller's representations and warranties pursuant to this Agreement or with
respect to the existence of any such Liens or claims shall be to require the
Seller to repurchase the related Receivable pursuant to this Section and to
enforce TMCC's obligation to the Seller to repurchase such Receivables pursuant
to the Receivables Purchase Agreement. The Trustee shall have no duty to conduct
any affirmative investigation as to the occurrence of any condition requiring
the repurchase of any Receivable pursuant to this Section.
SECTION 2.06 DUTIES OF SERVICER AS CUSTODIAN.
(a) Safekeeping. The Servicer, in its capacity as custodian, shall hold
the Receivable Files on behalf of the Trustee for the use and benefit of all
present and future Certificateholders, and maintain such accurate and complete
accounts, records and computer systems pertaining to each Receivable File as
shall enable the 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 it exercises with respect to the receivable files of
comparable automobile and light duty truck receivables that the Servicer
services for itself or others. The Servicer shall conduct, or cause to be
conducted, periodic examinations of the files of receivables owned or serviced
by it which shall include 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 the Schedule of eceivables or
at such other office as shall be specified to the Trustee by 30 days' prior
written notice. The Servicer shall make available to the Trustee or its duly
authorized representatives, attorneys or auditors the Receivable Files and the
related accounts, records and computer systems maintained by the Servicer at
such times as the Trustee shall reasonably instruct.
(c) Release of Documents. Upon instruction from the Trustee, the Servicer
shall release any document in the Receivable Files to the Trustee or its agent
or designee, as the case may be, at such place or places as the
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Trustee may designate, as soon as practicable. The Servicer shall not be
responsible for any loss occasioned by the failure of the Trustee to return any
document or any delay in doing so.
SECTION 2.07 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 a Responsible Officer of the
Trustee. A certified copy of a bylaw or of a resolution of the board of
directors of the Trustee shall constitute conclusive evidence of the authority
of any such Responsible Officer to act and shall be considered in full force and
effect until receipt by the Servicer of written notice to the contrary given by
the Trustee.
SECTION 2.08 INDEMNIFICATION OF CUSTODIAN. The Servicer, as custodian of
the Receivable Files, shall indemnify the Trustee for any and all liabilities,
obligations, losses, compensatory damages, payments, costs or expenses of any
kind whatsoever (including reasonable attorney's fees and expenses incurred in
connection with defending against any such claim) that may be imposed on,
incurred or asserted against the Trustee as the result of any improper act or
omission in any way relating to the maintenance and custody of the Receivable
Files by the Servicer, as custodian; 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.
SECTION 2.09 EFFECTIVE PERIOD AND TERMINATION. The Servicer's appointment
as custodian of the Receivable Files shall become effective as of the Cutoff
Date and shall continue in full force and effect until terminated pursuant to
this Section. If the Servicer shall resign as Servicer pursuant to Section 7.05
or if all of the rights and obligations of the Servicer have been terminated
pursuant to Section 8.02, the appointment of the Servicer as custodian of the
Receivable Files shall be terminated by the Trustee, or by Certificate Owners
representing in the aggregate not less than 51% of the voting interests of the
Class A Certificates and Class B Certificates, acting 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 8.02. The Trustee may terminate the
Servicer's appointment as custodian of the Receivable Files with cause at any
time immediately upon written notification to the Servicer. As soon as
practicable after any termination of such appointment, the Servicer shall
deliver the Receivable Files to the Trustee or its agent at such place or places
as the Trustee may reasonably designate. Notwithstanding the termination of the
Servicer as custodian of the Receivable Files, the Trustee agrees that upon any
such termination, the Trustee shall provide, or cause its agent to provide,
access to the Receivable Files to the Servicer, upon reasonable advance written
request and during normal business hours, for the purpose of carrying out its
duties and responsibilities with respect to the servicing of the Receivables
pursuant to this Agreement.
SECTION 2.10 USAGE OF TERMS. With respect to all terms in this Agreement,
the singular includes the plural and the plural the singular; words importing
any gender include the other genders; references to "writing" include printing,
typing, lithography and other means of reproducing words in a visible form;
references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement; references to
Persons include their permitted successors and assigns; and the term "including"
means "including without limitation."
SECTION 2.11 CUTOFF DATE AND RECORD DATE. All references to the Record
Date prior to the first Record Date in the life of the Trust shall be to the
Cutoff Date.
SECTION 2.12 SECTION REFERENCES. All section references shall be
to Sections in this Agreement.
SECTION 2.13 AGENT FOR SERVICE. The agent for service for the Seller shall
be its President, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and
the agent for service for the Servicer shall be its Senior Vice President, ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 3.01 DUTIES OF SERVICER. The Servicer, as agent for the Trust,
shall manage, service, administer and make collections on and in respect of the
Receivables with reasonable care, using that degree of skill and attention that
the Servicer exercises with respect to all comparable automobile and light duty
truck receivables that it services for itself or others. The Servicer's duties
shall include collecting and posting of all payments, responding to inquiries of
Obligors or by federal, state or local government authorities with respect to
the
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Receivables, investigating delinquencies, sending payment information to
Obligors, reporting tax information to Obligors in accordance with its customary
practices, policing the collateral, accounting for collections, furnishing
monthly and annual statements to the Trustee with respect to distributions,
generating federal income tax information, making Advances and performing the
other duties specified herein. The Servicer shall follow its customary
standards, policies and procedures and shall have full power and authority,
acting alone, to do any and all things in connection with such managing,
servicing, administration and collection that it may deem necessary or
desirable.
Without limiting the generality of the foregoing, the Servicer shall be
authorized and empowered by the Trustee to execute and deliver, on behalf of
itself, the Trust, the Trustee or the Certificateholders or any of them, any and
all instruments of satisfaction or cancellation, or of partial or full release
or discharge and all other comparable instruments, with respect to the
Receivables and the Financed Vehicles. The Servicer is hereby authorized to
commence, in its own name or in the name of the Trust, a legal proceeding to
enforce a Defaulted Receivable pursuant to Section 3.04 or to commence or
participate in a legal proceeding (including without limitation a bankruptcy
proceeding) relating to or involving a Receivable, including a Defaulted
Receivable. If the Servicer commences or participates in such a legal proceeding
in its own name, the Trustee shall thereupon be deemed to have automatically
assigned, solely for the purpose of collection on behalf of the party retaining
an interest in such Receivable, such Receivable and the other property conveyed
to the Trust pursuant to Section 2.01 with respect to such Receivable to the
Servicer for purposes of commencing or participating in any such proceeding as a
party or claimant, and the Servicer is authorized and empowered by the Trustee
to execute and deliver in the Servicer's name any notices, demands, claims,
complaints, responses, affidavits or other documents or instruments in
connection with any such proceeding. If in any enforcement suit or legal
proceeding it shall be held that the Servicer may not enforce a Receivable on
the grounds that it shall not be a real party in interest or a holder entitled
to enforce such Receivable, the Trustee on behalf of the Trust shall, at the
Servicer's expense and written direction, take reasonable steps to enforce such
Receivable, including bring suit in its name or the name of the
Certificateholders. The Trustee shall furnish the Servicer with any powers of
attorney and other documents and take any other steps which the Servicer may
deem reasonably necessary or appropriate to enable the Servicer to carry out its
servicing and administrative duties under this Agreement.
SECTION 3.02 COLLECTION OF RECEIVABLE PAYMENTS. 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 customary collection procedures as it follows with respect to
comparable automobile or light duty truck receivables that it services for
itself or others. The Servicer shall be authorized to grant extensions, rebates
or adjustments on a Receivable in accordance with the customary servicing
standards of the Servicer without the prior consent of the Trustee; provided,
however, that if, as a result of any change in the related APR, increase in the
total number of Scheduled Payments, extension of payments such that the
Receivable will be outstanding later than the Final Scheduled Maturity Date, or
other modification of the terms of a Receivable, the amount of any Scheduled
Payment due in a subsequent Collection Period is reduced, the Servicer shall be
obligated to either repurchase such Receivable pursuant to Section 3.08 or to
make an Advance in respect of such Receivable in each subsequent Collection
period equal to the amount by which such Scheduled Payment has been reduced. In
addition, in the event that any such rescheduling or extension of a Receivable
modifies the terms of such Receivable in such a manner as to release the
security interest in the related Financed Vehicle or constitute a cancellation
of such Receivable and the creation of a new automobile or light duty truck
receivable, the Servicer shall purchase such Receivable pursuant to Section
3.08, and the receivable created shall not be included in the Trust. The
Servicer may, in accordance with its customary servicing procedures, waive any
prepayment charge, late payment charge or any other fees that may be collected
in the ordinary course of servicing the Receivables.
SECTION 3.03 REBATES ON FULL PREPAYMENTS. In the event that the amount of
a full Prepayment by an Obligor under a Precomputed Receivable, after adjustment
for the applicable Rebate, is less than the amount that would be payable under
the actuarial method if a full Prepayment were made at the end of the billing
month under such Precomputed Receivable, either because the Rebate calculated
under the terms of such Precomputed Receivable is greater than the amount
calculable under the actuarial method or because the Servicer's customary
servicing procedure is to credit a greater Rebate, the Servicer, as part of its
servicing duties, shall remit such difference to the Trust by deposit into the
Collection Account pursuant to Section 4.05.
SECTION 3.04 REALIZATION UPON RECEIVABLES. On behalf of the Trust, the
Servicer shall use its best efforts, consistent with its customary servicing
procedures, to repossess or otherwise comparably convert the ownership of any
Financed Vehicle that it has reasonably determined should be repossessed or
otherwise converted
24
following a default under the Receivable secured by the Financed Vehicle (and
shall specify such Receivables to the Trustee no later than the Determination
Date following the end of the Collection Period in which the Servicer shall have
made such determination). The Servicer shall follow such practices and
procedures as it shall deem necessary or advisable and as shall be customary and
usual in its servicing of automobile and light duty truck receivables, which
practices and procedures may include reasonable efforts to realize upon any
Dealer Recourse, selling the related Financed Vehicle at public or private sale
and other actions by the Servicer in order to realize upon such a Receivable.
The Servicer shall be entitled to recover its reasonable Liquidation Expenses
with respect to each Defaulted Receivable. All Net Liquidation Proceeds realized
in connection with any such action with respect to a Receivable shall be
deposited by the Servicer in the Collection Account in the manner specified in
Section 4.02. The foregoing is subject to the proviso that, in any case in which
the Financed Vehicle shall have suffered damage, the Servicer shall not expend
funds in connection with any repair or towards the repossession of such Financed
Vehicle unless it shall determine in its discretion that such repair and/or
repossession shall increase the Liquidation Proceeds of the related Receivable
by an amount greater than the amount of such expenses.
SECTION 3.05 MAINTENANCE OF PHYSICAL DAMAGE INSURANCE POLICIES. The
Servicer shall, in accordance with its customary servicing procedures and
underwriting standards, require that each Obligor shall have obtained physical
damage insurance covering each Financed Vehicle as of the origination of the
related Receivable.
SECTION 3.06 MAINTENANCE OF SECURITY INTERESTS IN FINANCED VEHICLES. The
Servicer shall, in accordance with its customary servicing procedures and at its
own expense, take such steps as are necessary to maintain perfection of the
security interest created by each Receivable in the related Financed Vehicle.
The Trustee hereby authorizes the Servicer, and the Servicer hereby agrees, to
take such steps as are necessary to again perfect such security interest on
behalf of the Trust in the event of the relocation of a Financed Vehicle or for
any other reason. In the event that the assignment of a Receivable to the Trust
is insufficient, without a notation on the related Financed Vehicle's
certificate of title, to grant to the Trust a first priority perfected security
interest in the related Financed Vehicle, the Servicer hereby agrees to serve as
the agent of the Trust for the purpose of perfecting the security interest of
the Trust in such Financed Vehicle and agrees that the Servicer's listing as the
secured party on the certificate of title is in this capacity as agent of the
Trust.
SECTION 3.07 COVENANTS OF SERVICER. The Servicer shall make the following
covenants on which the Trustee shall rely in accepting the Receivables in trust
and authenticating the Certificates.
(a) Liens in Force. Except as contemplated by this Agreement, the
Servicer shall not release in whole or in part any Financed Vehicle from
the security interest securing the related Receivable.
(b) No Impairment. The Servicer shall do nothing to impair the
rights of the Certificateholders in the Receivables.
(c) No Amendments. Except as provided in Section 3.02, the Servicer
shall not amend or otherwise modify any Receivable such that the total
number of Scheduled Payments, the Amount Financed or the APR is altered or
extends the maturity of such Receivable beyond the Final Scheduled
Maturity Date.
SECTION 3.08 PURCHASE OF RECEIVABLES UPON BREACH. Upon discovery by the
Seller, the Servicer or the Trustee of a breach of any of the covenants of the
Servicer set forth in Section 3.07 that materially and adversely affects the
interests of the Certificateholders in a Receivable, or if an improper
extension, rescheduling or modification of a Receivable is made by the Servicer
as described in Section 3.02, the party discovering such breach shall give
prompt written notice to the others. As of the last day of the second Collection
Period following the Collection Period in which it discovers or receives notice
of such breach (or, at the Servicer's election, the last day of the first
Collection Period following the Collection Period in which it discovers or
receives notice of such breach), the Servicer shall, unless such breach or
impropriety shall have been cured in all material respects, purchase from the
Trust such Receivable. In consideration of the purchase of any such Receivable,
on the Business Day immediately preceding the related Distribution Date the
Servicer shall remit the Administrative Purchase Payment to the Collection
Account in the manner specified in Section 4.05, and shall be entitled to
receive the Released Administrative Amount. Upon such deposit of the
Administrative Purchase Payment, the Servicer shall for all purposes of this
Agreement be deemed to have released all claims for reimbursement of Outstanding
Advances made in respect of such Receivable. The sole remedy of the Trustee, the
Trust or the Certificateholders against the Servicer with respect to a breach
pursuant to Section 3.02 or 3.07 shall be to require the Servicer to purchase
the related Receivables pursuant to this Section, except as otherwise provided
in Section 7.02. The Trustee shall have no
25
duty to conduct any affirmative investigation as to the occurrence of any
condition requiring the repurchase of any Receivable pursuant to this Section
except as otherwise provided in Section 7.02.
SECTION 3.09 TOTAL SERVICING FEE; PAYMENT OF CERTAIN EXPENSES BY SERVICER.
As compensation for the performance of its obligations hereunder, the Servicer
shall be entitled to receive on each Distribution Date, out of Available
Interest, the Total Servicing Fee. The Basic Servicing Fee in respect of a
Collection Period shall be calculated based on a 360 day year comprised of
twelve 30-day months. Except to the extent otherwise provided herein, the
Servicer shall be required to pay all expenses incurred by it in connection with
its activities under this Agreement (including fees and disbursements of the
Trustee and independent accountants, taxes imposed on the Servicer, expenses
incurred in connection with distributions and reports to Certificateholders and
all other fees and expenses not expressly stated under this Agreement to be for
the account of the Certificateholders).
SECTION 3.10 SERVICER'S CERTIFICATE. On or before each Determination Date,
the Servicer shall deliver to the Trustee and each Rating Agency a Servicer's
Certificate executed by the President or any Vice President or principal
accounting officer of the Servicer substantially in the form attached hereto as
Exhibit A (and setting forth such additional information as requested by the
Trustee or any Rating Agency from time to time which information the Servicer is
able to reasonably provide) containing all information necessary to make the
distributions required by Sections 4.06 and 4.07 in respect of the Collection
Period immediately preceding the date of such Servicer's Certificate and all
information necessary for the Trustee to send statements to Certificateholders
pursuant to Section 4.10(a). The Servicer shall also specify to the Trustee, no
later than the Determination Date following the last day of a Collection Period
as of which the Seller shall be required to repurchase or the Servicer shall be
required to purchase a Receivable, the identity of any such Receivable and the
identity of any Receivable which the Servicer shall have determined to be a
Defaulted Receivable during such Collection Period. Receivables purchased or to
be purchased by the Servicer or the Seller and Receivables that the Servicer has
determined during such Collection Period to be Defaulted Receivables and with
respect to which payment of the Administrative Purchase Payment or Warranty
Purchase Payment has been provided from whatever source as of the last day of
such Collection Period shall be identified by the related Obligor's account
number (as specified in the Schedule of Receivables).
SECTION 3.11 ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF DEFAULT.
(a) The Servicer shall deliver to the Trustee, on or before December
31 of each year, beginning with [ __________ ], 200_, an Officer's
Certificate of the Servicer, stating that (i) a review of the activities
of the Servicer during the preceding 12-month period ended [ __________ ]
(or other applicable period in the case of the first such Officer's
Certificate) and of its performance under this Agreement has been made
under such officer's supervision, and (ii) to such officer's knowledge,
based on such review, the Servicer has fulfilled all its obligations under
this Agreement throughout such period, or, if there has been a default in
the fulfillment of any such obligation, specifying each such default known
to such officer and the nature and status thereof.
(b) The Servicer shall deliver to the Trustee, promptly after having
obtained knowledge thereof, but in no event later than five Business Days
thereafter, an Officer's Certificate specifying the nature and status of
any event which with the giving of notice or lapse of time, or both, would
become an Event of Default.
SECTION 3.12 ANNUAL ACCOUNTANTS' REPORT. The Servicer shall cause a firm
of independent accountants (who may also render other services to the Servicer
or to the Seller) to deliver to the Trustee on or before [ __________ ] of each
year, beginning with beginning with [ __________ ], 200_, an Officer's
Certificate of the Servicer, stating that (i) a review of the activities of the
Servicer during the preceding 12-month period ended [ __________ ] (or other
applicable period in the case of the first such report or letter) to the effect
that such accountants have reviewed certain records and documents relating to
the servicing of the Receivables under this Agreement (using procedures
specified in such report or letter) and as a result of such review, and in
connection with such procedures, they are reporting such exceptions, if any, as
shall be set forth therein. Such report or letter shall also indicate that the
firm is independent with respect to the Seller and the Servicer within the
meaning of the Code of Professional Ethics of the American Institute of
Certified Public Accountants.
SECTION 3.13 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
RECEIVABLES. The Servicer shall provide to the Trustee reasonable access to the
documentation regarding the Receivables. The Servicer shall provide such access
to any Certificateholder only in such cases where a Certificateholder is
required by applicable statutes or regulations to review such documentation. In
each case, such access shall be afforded
26
without charge but only upon reasonable request and during normal business hours
at the respective offices of the Servicer. Nothing in this Section shall
derogate from 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 as provided in this Section as a result of such
obligation shall not constitute a breach of this Section.
SECTION 3.14 AMENDMENTS TO SCHEDULE OF RECEIVABLES. If the Servicer,
during a Collection Period, assigns to a Receivable an account number that
differs from the original account number identifying such Receivable on the
Schedule of Receivables, the Servicer shall deliver to the Seller and the
Trustee on or before the Distribution Date relating to such Collection Period an
amendment to the Schedule of Receivables reporting the newly assigned account
number, together with the old account number of each such Receivable. The first
such delivery of amendments to the Schedule of Receivables to the Trustee shall
include monthly amendments reporting account numbers appearing on the Schedule
of Receivables with the new account numbers assigned to such Receivables during
any prior Collection Period.
SECTION 3.15 REPORTS TO CERTIFICATEHOLDERS AND RATING AGENCIES.
(a) The Trustee shall provide to any Certificateholder or
Certificate Owner who so requests in writing a copy of any (i) Servicer's
Certificate, (ii) annual statement as to compliance described in Section
3.11(a), (iii) annual accountants' report described in Section 3.12 or
(iv) statement to Certificateholders pursuant to Section 4.10(a). The
Trustee may require such Certificateholder or Certificate Owner to pay a
reasonable sum to cover the cost of the Trustee's complying with such
request.
(b) The Trustee shall forward to each Rating Agency a copy of each
(i) Servicer's Certificate, (ii) annual statement as to compliance
described in Section 3.11(a), (iii) Officer's Certificate of the Servicer
described in Section 3.11(b), (iv) annual accountants' report pursuant to
Section 3.12, (v) statement to Certificateholders pursuant to Section
4.10(a), (vi) Trustee's Certificate delivered by the Trustee pursuant to
Section 9.02 or 9.03 and (vii) other report it may receive pursuant to
this Agreement at its address specified in Section 11.05 or in this
Agreement.
ARTICLE IV
ACCOUNTS; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
SECTION 4.01 ACCOUNTS.
(a) The Servicer shall establish the Collection Account and Payahead
Account in the name of the Trustee for the benefit of the
Certificateholders. Except as otherwise provided in this Agreement, each
such account shall be an account initially established with the Trustee
and maintained with the Trustee so long as (i) the commercial paper or
other short-term unsecured debt obligations of the Trustee are rated "P-1"
or better by Moody's, or if not rated by Moody's then otherwise approved
by Moody's, and "A-1+" or better by Standard & Poor's if rated by Standard
& Poor's, or if not rated by Standard & Poor's then otherwise approved by
Standard & Poor's, in each case at the time of any deposit therein, or
(ii) such account is a segregated trust account located in the corporate
trust department of the Trustee bearing a designation clearly indicating
that the funds deposited therein (other than interest or investment
earnings thereon) are held in trust for the benefit of the
Certificateholders, and the Trustee has a long-term deposit rating from
Moody's (so long as ▇▇▇▇▇'▇ is a Rating Agency) of at least "A1" (or such
lower rating as Moody's shall approve in writing) and corporate trust
powers under applicable federal and state laws and is organized under the
laws of the United States or any state thereof, the District of Columbia
or the Commonwealth of Puerto Rico. Except as otherwise provided in this
Agreement, in the event that the Trustee no longer meets either of the
foregoing requirements, then the Servicer shall, with the Trustee's
assistance as necessary, cause the Collection Account and Payahead Account
to be moved to a bank or trust company that satisfies either of such
requirements.
(b) For so long as the depository institution or trust company then
maintaining the Collection Account and Payahead Account meets the
requirements of Section 4.01(a)(i) or (a)(ii), all amounts held in these
accounts shall, to the extent permitted by applicable laws, rules and
regulations, be invested, as directed in writing by the Servicer, in
Eligible Investments; otherwise such amounts shall be maintained in cash.
Earnings on investment of funds in these accounts (net of losses and
investment
27
expenses) shall be paid to the Servicer on each Distribution Date as
servicing compensation, and any losses and investment expenses shall be
charged against the funds on deposit in the related account.
(c) For so long as o is the Trustee, the Collection Account and
Payahead Account shall be maintained with __________ as described in
clause (ii) of the second sentence of Section 4.01(a). In the event that
the long-term debt rating of the Trustee does not satisfy clause (ii) of
the second sentence of Section 4.01(a), the Servicer shall, with the
assistance of the Trustee as necessary, cause the Collection Account and
Payahead Account to be moved to an institution or an account otherwise
satisfying the requirements of Section 4.01(a).
(d) Subject to the foregoing, the Servicer, on behalf of the
Trustee, shall establish and maintain as the Collection Account an
Eligible Deposit Account in the name of and under the exclusive control of
the Trustee, bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Certificateholders. On
the Closing Date, the Trustee will transfer, or cause to be transferred,
to such Collection Account all funds or investments on deposit in the
Collection Account established pursuant to the Trust Agreement for the
benefit of the Certificateholders, and all of the proceeds thereof, and
will transfer all of its right, title and interest in the Collection
Account, all funds or investments held or to be held therein and all
proceeds thereof, whether or not on behalf of the Certificateholders, to
the Trustee for the benefit of the Certificateholders.
SECTION 4.02 COLLECTIONS.
(a) Except as otherwise provided in this Agreement, the Servicer
shall remit daily to the Collection Account all payments received by or on
behalf of the Obligors on or in respect of the Receivables (other than, in
the case of Precomputed Receivables, payments constituting Payments Ahead)
and all Net Liquidation Proceeds within two Business Days after receipt
thereof. Notwithstanding the foregoing, for so long as (i) TMCC is the
Servicer, (ii) either (a) TMCC's short-term unsecured debt is rated P-1 by
Moody's and A-1 by Standard & Poor's (so long as Moody's and Standard &
Poor's are Rating Agencies), or (b) certain arrangements are made that
have been approved in writing by each Rating Agency and (iii) an Event of
Default shall not have occurred and be continuing (collectively, the
"Monthly Remittance Conditions"), the Servicer shall not be required to
remit such collections to the Collection Account on the foregoing daily
basis but shall be entitled to retain such collections, without
segregation from its other funds, until the Business Day before each
Distribution Date at which time the Servicer shall remit all such
collections in respect of the related Collection Period to the Collection
Account in immediately available funds. Commencing with the first day of
the first Collection Period that begins at least two Business Days after
the day on which any Monthly Remittance Condition ceases to be satisfied
and for so long as any Monthly Remittance Conditions is not satisfied, all
collections then held by the Servicer shall be immediately deposited into
the Collection Account and all future collections on or in respect of the
Receivables and all Net Liquidation Proceeds shall be remitted by the
Servicer to the Collection Account on a daily basis within two Business
Days after receipt thereof.
(b) Except as otherwise provided in this Agreement, the Servicer
shall deposit all Payments Ahead in the Collection Account within two
Business Days after receipt thereof, which Payments Ahead shall be
transferred to the Payahead Account pursuant to Section 4.06(a)(ii).
Notwithstanding the foregoing, so long as all Monthly Remittance
Conditions are satisfied, the Servicer will not be required to deposit
Payments Ahead in the Collection Account or the Payahead Account within
two Business Days after receipt thereof but shall be entitled to retain
such Payments Ahead, without segregation from its other funds, until such
time as the Servicer shall be required to remit Applied Payments Ahead to
the Collection Account pursuant to Section 4.06(a)(i). Commencing with the
first day of the first Collection Period that begins at least two Business
Days after the day on which any Monthly Remittance Condition ceases to be
satisfied and for so long as all Monthly Remittance Conditions are not
satisfied, all Payments Ahead then held by the Servicer shall be
immediately deposited into the Payahead Account and all future Payments
Ahead shall be remitted by the Servicer to the Payahead Account within two
Business Days after receipt thereof.
(c) The Servicer shall give the Trustee and each Rating Agency
written notice of the failure of any Monthly Remittance Condition (and any
subsequent curing of a failed Monthly Remittance Condition) as soon as
practical after the occurrence thereof. Notwithstanding the failure of any
Monthly
28
Remittance Condition, the Servicer may utilize an alternative collection
or Payment Ahead remittance schedule (which may be the remittance schedule
previously utilized prior to the failure of such Monthly Remittance
Condition), if the Servicer provides to the Trustee written confirmation
from each Rating Agency that such alternative remittance schedule will not
result in the qualification, reduction or withdrawal of the rating then
assigned to any Class of Rated Certificates.
SECTION 4.03 APPLICATION OF COLLECTIONS. As of the Business Day
immediately preceding the related Distribution Date, all collections for the
related Collection Period shall be applied by the Servicer as follows:
(a) With respect to each Receivable (other than an Administrative
Receivable or a Warranty Receivable), payments made by or on behalf of the
Obligor which are not Supplemental Servicing Fees shall be applied first
to reimburse the Servicer for Outstanding Advances made with respect to
such Receivable (each such payment, an "Overdue Payment"). Next, the
amount of any payment in excess of Supplemental Servicing Fees and
Outstanding Advances with respect to such Receivable shall be applied to
the Scheduled Payment with respect to such Receivable. If the amount of
such payment remaining after the applications described in the two
preceding sentences (i) equals (together with any Deferred Prepayment) the
unpaid principal balance of such Receivable, it shall be applied to prepay
the principal balance of such Receivable, or (ii) is less than the unpaid
principal balance of such Receivable, it shall constitute a Payment Ahead
with respect to such Receivable.
(b) With respect to each Administrative Receivable and Warranty
Receivable, payments made by or on behalf of the Obligor shall be applied
in the same manner, except that any Released Administrative Amount or
Released Warranty Amount shall be remitted to the Servicer or the Seller,
as applicable. A Warranty Purchase Payment or an Administrative Purchase
Payment shall be applied to reduce Outstanding Advances and such Warranty
Purchase Payment or Administrative Purchase Payment, as applicable, shall
be applied to the Scheduled Payment, in each case to the extent that the
payments by the Obligor shall be insufficient, and then to prepay the
unpaid principal balance of such Receivable in full.
SECTION 4.04 ADVANCES.
(a) As of last day of a Collection Period, if the payments during
such Collection Period by or on behalf of the Obligor on or in respect of
a Precomputed Receivable (other than an Administrative Receivable or a
Warranty Receivable) after application under Section 4.03(a) shall be less
than the Scheduled Payment (determined as of the Closing Date), whether as
a result of any modification or extension granted to the Obligor or
otherwise, then the Deferred Prepayment, if any, with respect to such
Precomputed Receivable shall be applied by the Servicer to the extent of
the shortfall, and such Deferred Prepayment shall be reduced accordingly.
Subject to the provisions of the last sentence of this paragraph, the
Servicer shall deposit an amount equal to such shortfall (each, a
"Precomputed Advance") in the Collection Account on the Business Day
immediately preceding the related Distribution Date. In addition, as of
last day of a Collection Period, if the payments during such Collection
Period by or on behalf of the Obligor on or in respect of a Simple
Interest Receivable (other than an Administrative Receivable or a Warranty
Receivable) after application under Section 4.03(a) shall be less than the
Scheduled Payment (determined as of the Closing Date), whether as a result
of any modification or extension granted to the Obligor or otherwise, then
an amount equal to the product of the Principal Balance of such Receivable
as of the first day of the related Collection Period and one-twelfth of
its Annual Percentage Rate minus the amount of interest actually received
on such Receivable during the Collection Period (each, a "Simple Interest
Advance") shall be deposited by the Servicer into the Collection Account
on the Business Day immediately preceding the related Distribution Date.
If such a calculation in respect of a Simple Interest Receivable results
in a negative number, an amount equal to such negative amount shall be
paid to the Servicer in reimbursement of any Outstanding Advances in
respect of Simple Interest Receivables. In addition, in the event that a
Simple Interest Receivable becomes a Liquidated Receivable, the amount of
accrued and unpaid interest thereon (but not including interest for the
current Collection Period) shall, up to the amount of Outstanding Advances
in respect of Simple Interest Receivables in respect thereof, be withdrawn
from the Collection Account and paid to the Servicer in reimbursement of
such Outstanding Advances. No Advances will be made with respect to the
Principal Balance of Simple Interest Receivables. The Servicer shall not
be required to make an Advance (other than a Simple Interest Advance in
respect of an interest shortfall arising from the Prepayment of a Simple
Interest Receivable) to the extent that the Servicer, in its sole
discretion, shall determine that such Advance is unlikely to be recovered
from
29
subsequent payments made by or on behalf of the related Obligor,
Liquidation Proceeds, by the Administrative Purchase Payment or by the
Warranty Purchase Payment with respect to such Receivable or otherwise.
(b) The Servicer shall be entitled to reimbursement for Outstanding
Advances, without interest, with respect to a Receivable from the
following sources with respect to such Receivable: (i) subsequent payments
made by or on behalf of the related Obligor, (ii) Liquidation Proceeds,
(iii) the Administrative Purchase Payment, and (iv) the Warranty Purchase
Payment; provided, however, that in the case of Advances made pursuant to
Section 3.02, the Servicer shall be entitled to reimbursement only from
amounts received in respect of such Receivable that are in excess of the
amount of the Scheduled Payment in the related Collection Period.
(c) To the extent that during any Collection Period any funds
described above in Section 4.04(b) with respect to a Receivable as to
which the Servicer previously has made an unreimbursed Advance are
received by the Trustee or the Servicer, and the Servicer determines that
any Outstanding Advances with respect to such Receivable are unlikely to
be recovered from payments made on or with respect to such Receivable
(each, a "Nonrecoverable Advance"), then, on the related Distribution
Date, upon the Servicer providing the Seller and the Trustee with an
Officer's Certificate setting forth the basis for its determination of any
such amount, the Trustee shall promptly remit to the Servicer (i) from
Available Interest an amount equal to the portion of such Nonrecoverable
Advance allocable to interest and (ii) from Available Principal an amount
equal to the portion of such Nonrecoverable Advance allocable to
principal, in each case without interest, in accordance with Section
4.06(c)(i). In lieu of causing the Trustee to remit any such amounts or
the amounts described in clauses (i) through (iv) in Section 4.04(b), the
Servicer may deduct such amounts from deposits otherwise to be made into
the Collection Account.
SECTION 4.05 ADDITIONAL DEPOSITS.
(a) The following additional deposits shall be made to the
Collection Account: (i) the Seller shall remit the aggregate Warranty
Purchase Payments with respect to Warranty Receivables pursuant to Section
2.05 or the amount required upon the optional termination of the Trust by
the Seller or the Servicer, or any successor to the Servicer, pursuant to
Section 10.02; (ii) the Servicer shall remit (A) the amount required to be
remitted in respect of certain full Prepayments pursuant to Section 3.03,
(B) the aggregate Advances pursuant to Sections 3.02, 3.08 and 4.04(a),
and (C) the aggregate Administrative Purchase Payments with respect to
Administrative Receivables pursuant to Sections 3.02 and 3.08; and (iii)
the Trustee shall transfer any Yield Maintenance Deposit from the Yield
Maintenance Account to the Collection Account pursuant to Sections 4.06
(in assuring the availability therein of the related Available Interest)
and 4.08(b) and shall transfer the amounts described in Sections 4.06 and
4.07(b) from the Reserve Fund to the Collection Account pursuant to
Section 4.07(b).
(b) All deposits required to be made pursuant to this Section by the
Seller or the Servicer, as the case may be, may be made in the form of a
single deposit and shall be made in immediately available funds, no later
than 5:00 P.M., New York City time, on the Business Day immediately
preceding the related Distribution Date. At the direction of the Servicer,
the Trustee shall invest such amounts in Eligible Investments maturing not
later than [3:00 P.M.] New York City Time, on the related Distribution
Date.
SECTION 4.06 DISTRIBUTIONS.
(a) On each Distribution Date (or, if both the Accounts are not
maintained by the Trustee, on the Business Day immediately preceding each
Distribution Date), the Trustee shall cause to be made the following
transfers and distributions in immediately available funds in the amounts
set forth in the Servicer's Certificate for such Distribution Date:
(i) from the Payahead Account (or directly from the Servicer
in the case of Payments Ahead held by the Servicer pursuant to
Section 4.02(b) or (c)) to the Collection Account, the aggregate
Applied Payments Ahead; and
(ii) if the Servicer is not permitted to hold Payments Ahead
pursuant to Section 4.02(b) or (c), from the Collection Account to
the Payahead Account, the aggregate Payments Ahead for the related
Collection Period.
30
(b) On each Determination Date, the Servicer shall calculate the
Available Interest, the Available Principal, the Class A Distributable
Amount, the Class B Distributable Amount, the amount to be distributed to
Certificateholders of each Class and all other distributions to be made on
the related Distribution Date.
(c) The rights of the Class B Certificateholders to receive
distributions in respect of the Class B Certificates shall be and hereby
are subordinated to the rights of the Class A Certificateholders to
receive distributions in respect of the Class A Certificates to the extent
provided in this Section. On each Distribution Date, the Trustee shall
make the following distributions from the Collection Account in the
following order of priority and in the amounts set forth in the Servicer's
Certificate for such Distribution Date; provided, however, that except as
otherwise provided in Sections 4.05(a) or 4.06(a), such distributions
shall be made only from those funds deposited in the Collection Account
for the related Collection Period:
(i) to the Servicer from Available Interest or Available
Principal, any payments in respect of Nonrecoverable Advances
required pursuant to Section 4.04(c);
(ii) to the Servicer, from Available Interest (after giving
effect to any reduction in Available Interest described in clause
(i) above), the Total Servicing Fee (including any unpaid Total
Servicing Fees from one or more prior Collection Periods);
(iii) to the Class A Certificateholders of record, from
Available Interest (after giving effect to the reduction in
Available Interest described in clauses (i) and (ii) above), an
amount equal to the sum of the Class A Interest Distributable Amount
and any outstanding Class A Interest Carryover Shortfall from the
immediately preceding Distribution Date and, if such Available
Interest is insufficient, the Class A Certificateholders will
receive such shortfall first, from the Class B Percentage of
Available Principal and second, if such amounts are still
insufficient, from monies on deposit in the Reserve Fund;
(iv) to the Class B Certificateholders of record, from
Available Interest (after giving effect to the reduction in
Available Interest described in clauses (i), (ii) and (iii) above),
an amount equal to the sum of the Class B Interest Distributable
Amount and any outstanding Class B Interest Carryover Shortfall from
the immediately preceding Distribution Date and, if such Available
Interest is insufficient, the Class B Certificateholders will
receive such shortfall from monies on deposit in the Reserve Fund;
(v) to the Class A Certificateholders of record, from
Available Principal (after giving effect to any reduction in
Available Principal described in clauses (i) and (iii) above), an
amount equal to the sum of the Class A Principal Distributable
Amount and any outstanding Class A Principal Carryover Shortfall
from the immediately preceding Distribution Date and, if such
Available Principal is insufficient, the Class A Certificateholders
will receive such shortfall first, from Available Interest (after
giving effect to the reduction in Available Interest described in
clauses (i) through (iv) above) and second, if such amounts are
still insufficient, from monies on deposit in the Reserve Fund; and
(vi) to the Class B Certificateholders of record, from
Available Principal (after giving effect to the reduction in
Available Principal described in clauses (i), (iii) and (v) above),
an amount equal to the sum of the Class B Principal Distributable
Amount and any outstanding Class B Principal Carryover Shortfall
from the immediately preceding Distribution Date and, if such
Available Principal is insufficient, the Class B Certificateholders
will receive such shortfall first, from Available Interest (after
giving effect to the reduction in Available Interest described in
clauses (i) through (v) above) and second, if such amounts are still
insufficient, from monies on deposit in the Reserve Fund.
(d) On each Distribution Date, the Trustee shall deposit any Excess
Amounts into the Reserve Fund until the amount on deposit therein equals
the Specified Reserve Fund Balance and shall distribute the remainder, if
any, to the Seller.
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(e) Subject to Section 10.01 respecting the final payment upon
retirement of each Certificate, the Servicer shall on each Distribution
Date instruct the Trustee to distribute to each Certificateholder of any
Class of record on the related Record Date by check mailed to such
Certificateholder at the address of such Holder appearing in the
Certificate Register (or, if DTC, its nominee or a Clearing Agency is the
relevant Certificateholder, by wire transfer of immediately available
funds or pursuant to other arrangements), the amount to be distributed to
such Certificateholder pursuant to such Holder's Certificates.
SECTION 4.07 RESERVE FUND.
(a) (i) In order to effectuate the subordination provided for herein
and to assure that sufficient amounts to make required distributions to
Certificateholders will be available, the Seller shall establish and
maintain with the Trustee a trust account: the "Reserve Fund" which will
include the money and other property deposited and held therein pursuant
to Section 4.06(d) and this Section. Except as otherwise provided in this
Agreement, the Reserve Fund shall (A) be a segregated trust account
initially established with the Trustee and maintained with the Trustee so
long as the commercial paper or other short-term unsecured debt
obligations of the Trustee have the Required Rating and (B) in the event
that the commercial paper or other short-term unsecured debt obligations
of the Trustee no longer have the Required Rating, the Servicer shall,
with the assistance of the Trustee as necessary, cause the Reserve Fund to
be moved to (1) a segregated deposit account in a bank or trust company,
the commercial paper or other short-term unsecured debt obligations of
which shall have the Required Rating, or (2) a segregated trust account
bearing a designation clearly indicating the funds deposited therein are
held in trust for the benefit of the Class A Certificateholders and the
Class B Certificateholders located in the corporate trust department of a
depository institution or trust company (which may include the Trustee)
having a long-term deposit rating from Moody's (so long as ▇▇▇▇▇'▇ is a
Rating Agency) of at least ___ (or such lower rating as Moody's shall
approve in writing) and corporate trust powers under applicable federal
and state laws and organized under the laws of the United States or any
state thereof, the District of Columbia or the Commonwealth of Puerto
Rico.
On or prior to the Closing Date, the Seller shall deposit an amount
equal to the Reserve Fund Initial Deposit into the Reserve Fund. The
Reserve Fund shall not be part of the Trust but instead will be held for
the benefit of the Holders of the Class A Certificates and the Class B
Certificates. The Seller hereby acknowledges that the Reserve Fund Initial
Deposit (and any investment earnings thereon) are owned directly by it,
and the Seller hereby agrees to treat the same as its assets (and
earnings) for federal income tax and all other purposes. On each
Distribution Date, Excess Amounts will be deposited into the Reserve Fund
by the Trustee to the extent set forth in Section 4.06(d).
(ii) In order to give effect to the subordination provided for
herein and to assure availability of the amounts maintained in the Reserve
Fund, the Seller hereby sells, conveys and transfers to the Trustee, as
collateral agent, and its successors and assigns, the Reserve Fund Initial
Deposit and all proceeds thereof and hereby pledges to the Trustee as
collateral agent, and its successors and assigns, all other amounts
deposited in or credited to the Reserve Fund from time to time under this
Agreement, all earnings and distributions thereon and proceeds thereof
(other than proceeds constituting interest or net investment earnings
attributable to the investment of the Reserve Fund at the direction of the
Servicer) subject, however, to the limitations set forth below, and solely
for the purpose of securing and providing for payment of the Class A and
Class B Distributable Amounts, together with any Class A and Class B
Interest Carryover Shortfalls and Class A and Class B Principal Carryover
Shortfalls, in accordance with Section 4.06 and this Section to have and
to hold all the aforesaid property, rights and privileges unto the
Trustee, its successors and assigns, in trust for the uses and purposes,
and subject to the terms and provisions, set forth in this Section. The
Trustee hereby acknowledges such transfer and accepts the trust hereunder
and shall hold and distribute the Reserve Fund in accordance with the
terms and provisions of this Section.
(b) Consistent with the limited purposes for which such trust are
granted, on each Distribution Date the amount on deposit in the Reserve
Fund shall be available for, and applied to make, distributions as
provided in Section 4.06. In addition, on each Distribution Date on which
the amount on deposit in the Reserve Fund (after giving effect to all
deposits thereto or withdrawals therefrom on such Distribution Date) is
greater than the Specified Reserve Fund Balance, the Trustee will
distribute any
32
remaining amounts to the Seller. Upon any such distribution to the Seller,
the Certificateholders will have no further rights in, or claims to, such
amount.
(c) (i) Amounts held in the Reserve Fund shall be invested in the
manner specified in Section 4.01(b). Such investments shall not be sold or
disposed of prior to their maturity. All such investments shall be made in
the name of the Trustee, its Financial Intermediary or its nominee, in
either case as collateral agent, and all income and gain realized thereon
shall be solely for the benefit of the Seller and shall be payable by the
Trustee to the Seller on each Distribution Date. Realized losses, if any,
on investment of the Reserve Fund shall be charged first against
undistributed investment earnings attributable to the Reserve Fund and
then against the Reserve Fund.
(ii) With respect to the Reserve Fund, the Seller and the
Trustee agree that:
(A) any Reserve Fund property that is held in deposit accounts
shall be held solely in the name of the Trustee, as collateral
agent, at the Trustee (in a segregated trust account if the deposits
of the Trustee do not have the Required Rating) or at one or more
depository institutions which are eligible to maintain the Reserve
Fund as described in Section 4.07(a)(i); such deposit account shall
be subject to the exclusive custody and control of the Trustee, and
the Trustee shall have sole signature authority with respect
thereto;
(B) any Reserve Fund property that constitutes Physical
Property shall be delivered to the Trustee, as collateral agent, in
accordance with paragraph (i) of the definition of the term
"Delivery" and shall be held, pending maturity or disposition,
solely by the Trustee, as collateral agent or a financial
intermediary (as such term is defined in Section 8-313(4) of the
UCC) acting solely for the Trustee, as collateral agent;
(C) any Reserve Fund property that is a book-entry security
held through the Federal Reserve pursuant to federal book-entry
regulations shall be delivered in accordance with paragraph (ii) of
the definition of the term "Delivery" and shall be maintained by the
Trustee, as collateral agent, pending maturity or disposition,
through continued book-entry registration of such Reserve Fund as
described in such paragraph; and
(D) any Reserve Fund property that is an "uncertificated
security" under Article Eight of the UCC and that is not governed by
clause (C) above shall be delivered to the Trustee, as collateral
agent, in accordance with paragraph (iii) of the definition of the
term "Delivery" and shall be maintained by the Trustee, as
collateral agent, pending maturity or disposition, through continued
registration of the Trustee's or its Financial Intermediary's (or
its custodian's or its nominee's) ownership of such security, in its
capacity as collateral agent.
Effective upon Delivery of the Reserve Fund property in the form of
Physical Property, book-entry securities or uncertificated securities, the
Trustee shall be deemed to have purchased such Reserve Fund property for value,
in good faith and without notice of any adverse claim thereto.
(iii) Each of the Seller and the Servicer agrees to take or cause to
be taken such further actions, to execute, deliver and file or cause to be
executed, delivered and filed such further documents and instruments
(including, without limitation, any UCC financing statements or this
Agreement) as may be determined to be necessary, in an Opinion of Counsel
to the Seller delivered to the Trustee, in order to perfect the interests
created by this Section and otherwise fully to effectuate the purposes,
terms and conditions of this Section. The Seller and/or the Servicer, as
the case may be, shall:
(A) promptly execute, deliver and file any financing
statements, amendments, continuation statements, assignments,
certificates and other documents with respect to such interests and
perform all such other acts as may be necessary in order to perfect
or to maintain the perfection of the Trustee's security interest;
and
(B) make the necessary filings of financing statements or
amendments thereto within ten Business Days after the occurrence of
any of the following: (1) any change in their respective corporate
names or any trade names, (2) any change in the location of their
respective chief executive offices or principal places of business
and (3) any merger or consolidation or other
33
change in their respective identities or corporate structures; and
shall promptly notify the Trustee of any such filings.
(iv) The Trustee shall not enter into any subordination or
intercreditor agreement with respect to the Reserve Fund.
(d) Upon termination of the Trust pursuant to Section 10.01, any
amounts on deposit in the Reserve Fund, after payment of all amounts due
to the Certificateholders, shall be paid to the Seller.
SECTION 4.08 YIELD MAINTENANCE ACCOUNT. (a) (i) In order to assure that
sufficient amounts to make required distributions of interest to
Certificateholders will be available, the Servicer shall establish and maintain
with the Trustee a trust account: the "Yield Maintenance Account" which will
include the money and other property deposited and held therein pursuant to this
Section. Except as otherwise provided in this Agreement, the Yield Maintenance
Account shall (A) be a segregated trust account initially established with the
Trustee and maintained with the Trustee so long as the commercial paper or other
short-term unsecured debt obligations of the Trustee have the Required Rating
and (B) in the event that the commercial paper or other short-term unsecured
debt obligations of the Trustee no longer have the Required Rating, the Servicer
shall, with the assistance of the Trustee as necessary, cause the Yield
Maintenance Account to be moved to (1) a segregated deposit account in a bank or
trust company, the commercial paper or other short-term unsecured debt
obligations of which shall have the Required Rating, or (2) a segregated trust
account bearing a designation clearly indicating the funds deposited therein are
held in trust for the benefit of the Class A Certificateholders and the Class B
Certificateholders located in the corporate trust department of a depository
institution or trust company (which may include the Trustee) having a long-term
deposit rating from Moody's (so long as ▇▇▇▇▇'▇ is a Rating Agency) of at least
___ (or such lower rating as Moody's shall approve in writing) and corporate
trust powers under applicable federal and state laws and organized under the
laws of the United States or any state thereof, the District of Columbia or the
Commonwealth of Puerto Rico.
On or prior to the Closing Date, the Seller [or third party] shall deposit
an amount equal to the Yield Maintenance Account Initial Deposit into the Yield
Maintenance Account. In addition, on each subsequent Distribution Date, the
Seller [or third party] shall, pursuant to the Yield Maintenance Agreement [and
the Collateral Security Agreement] deposit an amount equal to the Additional
Yield Maintenance Amount into the Yield Maintenance Account. The Yield
Maintenance Account shall not be part of the Trust but instead will be held for
the benefit of the Holders of the Class A Certificates and the Class B
Certificates. The [Seller hereby acknowledges][third party, pursuant to the
Collateral Security Agreement and the Yield Maintenance Agreement], has
acknowledged] that the Yield Maintenance Account Initial Deposit, all Additional
Yield Maintenance Amounts and any investment earnings thereon are owned directly
by it, and the [Seller hereby agrees][third party has thereunder agreed] to
treat the same as its assets (and earnings) for federal income tax and all other
purposes.
(ii) In order to assure availability of the amounts maintained
in the Yield Maintenance Account, the [third party has, pursuant to
the Yield Maintenance Agreement and the Collateral Security
Agreement, sold, conveyed and transferred] [Seller hereby sells,
conveys and transfers] to the Trustee, as collateral agent, and its
successors and assigns, the Yield Maintenance Account Initial
Deposit and all proceeds thereof and [pursuant to the Yield
Maintenance Agreement and the Collateral Security Agreement has
pledged][hereby pledges] to the Trustee as collateral agent, and its
successors and assigns, all other amounts deposited in or credited
to the Yield Maintenance Account from time to time under the Yield
Maintenance Agreement, all earnings and distributions thereon and
proceeds thereof (other than proceeds constituting interest or net
investment earnings attributable to investment of the Yield
Maintenance Account at the direction of the Servicer) subject,
however, to the limitations set forth below, and solely for the
purpose of securing and providing for payment of each Yield
Maintenance Deposit, if applicable, comprising a portion of
Available Interest to be distributed in accordance with Section 4.06
and this Section on any Distribution Date, to have and to hold all
the aforesaid property, rights and privileges unto the Trustee, its
successors and assigns, in trust for the uses and purposes, and
subject to the terms and provisions, set forth in this Section. The
Trustee hereby acknowledges such transfer and accepts the trust
hereunder and shall hold and distribute the Yield Maintenance
Account in accordance with the terms and provisions of this Section.
(b) Consistent with the limited purposes for which such trusts are
granted, on each Distribution Date the amount of the related Yield
Maintenance Deposit, if any, to the extent amounts on
34
deposit in the Yield Maintenance Account are sufficient therefor, shall be
available for distribution as provided in Section 4.06 (in determining and
distributing Available Interest) and, on each Distribution Date, if the
amount on deposit in the Yield Maintenance Account (after giving effect to
all deposits thereto or withdrawals therefrom on such Distribution Date)
is greater than the Required Yield Maintenance Amount, the Trustee will
distribute any remaining amounts to the Seller [or third party]. Upon any
such distribution to the Seller [or third party], the Certificateholders
will have no further rights in, or claims to, such amount.
(c) (i) Amounts held in the Yield Maintenance Account shall be
invested in the manner specified in Section 4.01(b). Such investments
shall not be sold or disposed of prior to their maturity. All such
investments shall be made in the name of the Trustee, its Financial
Intermediary or its nominee, in either case as collateral agent, and all
income and gain realized thereon shall be solely for the benefit of the
Seller [or third party] and shall be payable by the Trustee to the Seller
[or third party] on each Distribution Date. Realized losses, if any, on
investment of the Yield Maintenance Account shall be charged first against
undistributed investment earnings attributable to the Yield Maintenance
Account and then against the Yield Maintenance Account.
(ii) With respect to the Yield Maintenance Account, [the
Seller and the Trustee agree] [, in the Yield Maintenance Agreement
and the Collateral Security Agreement, the Seller, the third party
and the Trustee have agreed] that:
(A) any Yield Maintenance Account property that is held
in deposit accounts shall be held solely in the name of the
Trustee, as collateral agent, at the Trustee (in a segregated
trust account if the deposits of the Trustee do not have the
Required Rating) or at one or more depository institutions which
are eligible to maintain the Yield Maintenance Account as
described in Section 4.07(a)(i); such deposit account shall be
subject to the exclusive custody and control of the Trustee, and
the Trustee shall have sole signature authority with respect
thereto;
(B) any Yield Maintenance Account property that
constitutes Physical Property shall be delivered to the Trustee,
as collateral agent, in accordance with paragraph (i) of the
definition of the term "Delivery" and shall be held, pending
maturity or disposition, solely by the Trustee, as collateral
agent or a financial intermediary (as such term is defined in
Section 8-313(4) of the UCC) acting solely for the Trustee, as
collateral agent;
(C) any Yield Maintenance Account property that is a
book-entry security held through the Federal Reserve pursuant to
federal book-entry regulations shall be delivered in accordance
with paragraph (ii) of the definition of the term "Delivery" and
shall be maintained by the Trustee, as collateral agent, pending
maturity or disposition, through continued book-entry
registration of such Yield Maintenance Account as described in
such paragraph; and
(D) any Yield Maintenance Account property that is an
"uncertificated security" under Article Eight of the UCC and that
is not governed by clause (C) above shall be delivered to the
Trustee, as collateral agent, in accordance with paragraph (iii)
of the definition of the term "Delivery" and shall be maintained
by the Trustee, as collateral agent, pending maturity or
disposition, through continued registration of the Trustee's or
its Financial Intermediary's (or its custodian's or its
nominee's) ownership of such security, in its capacity as
collateral agent.
Effective upon Delivery of the Yield Maintenance Account property in the
form of Physical Property, book-entry securities or uncertificated securities,
the Trustee shall be deemed to have purchased such Yield Maintenance Account
property for value, in good faith and without notice of any adverse claim
thereto.
(iii) Each of the Seller and the Servicer agrees [and,
pursuant to the Yield Maintenance Agreement and the Collateral
Security Agreement, the third party has agreed,] to take or cause to
be taken such further actions, to execute, deliver and file or cause
to be executed, delivered and filed such further documents and
instruments (including, without limitation, any UCC financing
statements or this Agreement) as may be determined to be necessary,
in an
35
Opinion of Counsel to [the Seller] [the third party] delivered to
the Trustee, in order to perfect the interests created by this
Section and otherwise fully to effectuate the purposes, terms and
conditions of this Section. The [third party][Seller and/or the
Servicer], as the case may be, shall:
(A) promptly execute, deliver and file any financing
statements, amendments, continuation statements, assignments,
certificates and other documents with respect to such interests
and perform all such other acts as may be necessary in order to
perfect or to maintain the perfection of the Trustee's security
interest; and
(B) make the necessary filings of financing statements
or amendments thereto within ten Business Days after the
occurrence of any of the following: (1) any change in their
respective corporate names or any trade names, (2) any change in
the location of their respective chief executive offices or
principal places of business and (3) any merger or consolidation
or other change in their respective identities or corporate
structures; and shall promptly notify the Trustee of any such
filings.
(iv) The Trustee shall not enter into any subordination or
intercreditor agreement with respect to the Yield Maintenance
Account.
(d) Upon termination of the Trust pursuant to Section 10.01, any
amounts on deposit in the Yield Maintenance Account, after payment of all
amounts due to the Certificateholders, shall be paid to the [Seller][third
party].
SECTION 4.09 NET DEPOSITS. For so long as TMCC shall be, the Seller, the
Servicer and the Trustee may make any remittances pursuant to this Article net
of amounts to be distributed by the applicable recipient to such remitting
party. Nonetheless, each such party shall account for all of the above described
remittances and distributions as if the amounts were deposited and/or
transferred separately.
SECTION 4.10 STATEMENTS TO CERTIFICATEHOLDERS.
(a) On each Distribution Date, the Trustee shall include with each
distribution to each Certificateholder of record, a statement, prepared by
the Servicer, based on information in the Servicer's Certificate furnished
pursuant to Section 3.10, setting forth for the related Collection Period
the following information as of the related Record Date or such
Distribution Date, as the case may be:
(i) the amount of such distribution allocable to
principal on each Class of Certificates;
(ii) the amount of such distribution allocable to interest
on each Class of Certificates;
(iii) the Pool Balance as of the close of business on the
last day of such Collection Period;
(iv) the amount of the Basic Servicing Fee paid to the
Servicer with respect to the related Collection Period and the
amount of any Supplemental Servicing Fee received by the Servicer
with respect to such Collection Period;
(v) the amount of the Interest and Principal Carryover
Shortfalls with respect to each Class of Certificates, if any, on
such Distribution Date and the change in such amounts from the
immediately preceding Distribution Date;
(vi) the Class A Certificate Balance, the Class B Certificate
Balance and the Pool Factor with respect to each Class of
Certificates as of such Distribution Date, in each case after giving
effect to distributions in respect of principal reported under
clause (i) above;
(vii) the amount otherwise distributable to the Class B
Certificateholders that is distributed to the Class A
Certificateholders on such Distribution Date;
36
(viii) the balance on deposit in the Reserve Fund, after
giving effect to distributions made on such Distribution Date, and
the change in such balance from the immediately preceding
Distribution Date;
(ix) the aggregate amount of Payments Ahead on deposit in the
Payahead Account or held by the Servicer and the change in such
amount from the immediately preceding Distribution Date;
(x) the amount of Outstanding Advances made in respect of such
Collection Period and the amount of unreimbursed Advances on such
Distribution Date; and
(xi) the Specified Reserve Fund Balance, the amount on deposit
in the Reserve Fund, any Required Yield Maintenance Amount and Yield
Maintenance Amount as of such Distribution Date, in each case after
giving effect to all distributions, deposits and withdrawals made on
such Distribution Date.
(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 a statement or statements prepared by the Servicer to
each Person who at any time during such calendar year shall have been a
Holder of a Class A or Class B Certificate that reiterates the amounts set
forth in clauses (i), (ii), (iv) and (v) above for each Distribution Date
during the preceding calendar year and that specifies in the aggregate the
amounts set forth in clauses (i), (ii), (iv) and (v) above for such
calendar year for purposes of such Certificateholder's preparation of
federal income tax returns. In addition, the Servicer shall furnish to the
Trustee for distribution to each such Person at such time any other
information that the Servicer actually knows is necessary under applicable
law for the preparation of such income tax returns.
ARTICLE V
THE CERTIFICATES
SECTION 5.01 THE CERTIFICATES. The Class A Certificates and the Class B
Certificates shall be substantially in the form attached hereto as Exhibit C or
Exhibit D, as the case may be. Each Class of Certificates shall be issuable in
minimum denominations of $1,000 and integral multiples in excess thereof;
provided, however, that one Class A Certificate and one Class B Certificate may
be issued in a denomination that includes any remaining portion of the Original
Class A Certificate Balance and the Original Class B Certificate Balance,
respectively (each, a "Residual Certificate"). The Certificates shall be
executed on behalf of the Trust by manual or facsimile signature of a
Responsible Officer and authenticated on behalf of the Trustee by the manual or
facsimile signature of a Responsible Officer. Certificates bearing the manual or
facsimile signatures of individuals who were, at the time when such signatures
were affixed, authorized to sign on behalf of the Trustee shall be valid and
binding obligations of the Trust, notwithstanding that such individuals or any
of them 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. All Certificates shall be dated the date of their authentication.
SECTION 5.02 AUTHENTICATION AND DELIVERY OF CERTIFICATES. The Trustee
shall cause to be authenticated and delivered to or upon the order of the
Seller, in exchange for the Receivables and the other assets of the Trust,
simultaneously with the sale, assignment and transfer to the Trust of the
Receivables, and the constructive delivery to the Trustee on behalf of the Trust
of the Receivable Files and the other components of the Trust, Certificates duly
authenticated by the Trustee, in authorized denominations equaling in the
aggregate the Original Pool Balance and evidencing the entire ownership of the
Trust. No Certificate shall be entitled to any benefit under this Agreement, or
be valid for any purpose, unless there appears on such Certificate a certificate
of authentication substantially in the form set forth in the form of such
Certificate attached hereto as Exhibit C or Exhibit D, as the case may be,
executed by the Trustee by manual or facsimile signature, and such certificate
upon any Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered under this Agreement.
SECTION 5.03 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
(a) The Certificate Registrar shall maintain a Certificate Register
in which, subject to such reasonable regulations as it may prescribe, the
Certificate Registrar shall provide for the registration of
37
Certificates and transfers and exchanges of Certificates as provided in
this Agreement. The Trustee is hereby initially appointed Certificate
Registrar for the purpose of registering Certificates and transfers and
exchanges of Certificates as provided in this Agreement In the event that,
subsequent to the Closing Date, the Trustee notifies the Servicer that it
is unable to act as Certificate Registrar, the Servicer shall appoint
another bank or trust company, having an office or agency located in the
[Borough of Manhattan], The City of New York, agreeing to act in
accordance with the provisions of this Agreement applicable to it, and
otherwise acceptable to the Trustee, to act as successor Certificate
Registrar under this Agreement.
(b) Upon surrender for registration of transfer of any Certificate
at the Corporate Trust Office, the Trustee on behalf of the Trust shall
execute, and the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Certificates of
the same Class in authorized denominations of a like aggregate principal
amount.
(c) At the option of a Certificateholder, Certificates may be
exchanged for other Certificates of the same Class of authorized
denominations of a like aggregate principal amount, upon surrender of the
Certificates to be exchanged at any such office or agency. Whenever any
Certificates are so surrendered for exchange the Trustee on behalf of the
Trust shall execute, authenticate and deliver the Certificates that the
Certificateholder making the exchange is entitled to receive. Every
Certificate presented or surrendered for registration of transfer or
exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar duly executed by
the Holder thereof or his attorney duly authorized in writing.
(d) 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.
(e) All Certificates surrendered for registration of transfer or
exchange shall be canceled and subsequently destroyed by the Trustee.
(f) Registration of transfer and sale of the Class B Certificates
shall be subject to the further conditions specified in Section 5.04.
(g) Each purchaser of a Class A Certificate that is Plan (as defined
in Section 5.04(a)(i)) that is a purchaser of a Class A Certificate or of
a beneficial interest therein shall be deemed to have represented and
warranted, by accepting such Certificate or beneficial interest, that such
purchaser is an "accredited investor" as defined in Rule 501(a) under the
Securities Act.
SECTION 5.04 REGISTRATION OF TRANSFER AND EXCHANGE OF CLASS B
CERTIFICATES.
(a) No transfer of a Class B Certificate shall be made unless the
Trustee shall have received a representation from the transferee of such
Certificate acceptable to and in form and substance satisfactory to the
Trustee (in the event such Certificate is a Definitive Certificate, such
requirement will be satisfied only by the Trustee's receipt of a
representation letter from the transferee substantially in the form of
Exhibit E) to the effect that:
(i) such transferee (A) is not an employee benefit plan or
arrangement subject to Section 406 of ERISA or a plan subject to
Section 4975 of the Code (a "Plan"), nor a person acting on behalf
of a Plan nor using the assets of a Plan to effect such transfer,
and (B) is not an insurance company purchasing a Class B Certificate
with funds contained in an "insurance company general account" or
"insurance company separate account" (as defined in Section V(e) of
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) as to
which there is a Plan with respect to which the amount of such
general account's reserves and liabilities for the contracts held by
or on behalf of such Plan and all other Plans maintained by the same
employer (or affiliate thereof as defined in Section V(a)(1) of PTCE
95-60) of by the same employee organization exceed 10% of the total
of all reserves and liabilities of such general account (as such
amounts are determined under Section I(a) of PTCE 95-60) at the date
of acquisition; or
(ii) is a Plan or a person acting on behalf of a Plan or using
the assets of a Plan to effect such transfer, or is an insurance
company purchasing a Class B Certificate with funds contained in an
insurance company general account or insurance company separate
account,
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having attached thereto an opinion of counsel satisfactory to the
Trustee, which opinion shall not be an expense of either the Trustee
or the Trust Fund, addressed to the Trustee, to the effect that the
purchase or holding of such Class B Certificate will not result in
the assets of the Trust Fund being deemed to be "plan assets" and
subject to the prohibited transaction provisions of ERISA and the
Code and will not subject the Trustee to any obligation in addition
to those expressly undertaken in this Agreement or to any liability.
For purposes of the preceding sentence, with respect to a
Class B Certificate that is a Book-Entry Certificate, in the event
the Transferee Certificate is not furnished, the representations
contained in clause (i) above shall be deemed to have been made to
the Trustee by the transferee's (including an initial acquiror's)
acceptance of such Certificate. Notwithstanding anything else to the
contrary herein, any purported transfer of a Class B Certificate or
beneficial interest therein to or on behalf of an employee benefit
plan subject to ERISA or to the Code or to an insurance company
purchasing with funds from a general account or insurance company
separate account not exempt pursuant to PTCE 95-60 without the
delivery to the Trustee of an opinion of counsel satisfactory to the
Trustee as described in clause (ii) above shall be void and of no
effect.
(b) To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person
for any registration of transfer of any ERISA-Restricted Certificate that
is in fact not permitted by this Section 23.01(b) or for making any
payments due on such Certificate to the Holder thereof or taking any other
action with respect to such Holder under the provisions of the Pooling and
Servicing Agreement so long as the transfer was registered by the Trustee
in accordance with the foregoing requirements.
SECTION 5.05 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If (i) any
mutilated Certificate is surrendered to the Certificate Registrar, or the
Certificate Registrar receives evidence to its satisfaction of the destruction,
loss or theft of any Certificate, and (ii) there is delivered to the Certificate
Registrar and the Trustee such security or indemnity as may be required by them
to save each of them harmless, then, in the absence of notice that such
Certificate has been acquired by a bona fide purchaser, the Trustee on behalf of
the Trust shall execute and the Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor and fractional undivided interest.
In connection with the issuance of any new Certificate under this Section, the
Trustee may require the payment by the Holder of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto.
If, after the delivery of such replacement Certificate or payment of a
destroyed, lost or stolen Certificate, a bona fide purchaser of the original
Certificate in lieu of which such replacement Certificate was issued presents
for payment such original Certificate, the Seller and the Trustee shall be
entitled to recover such replacement Certificate (or such payment) from the
Person to whom it was delivered or any Person taking such replacement
Certificate from such Person to whom such replacement Certificate was delivered
or any assignee of such Person, except a bona fide purchaser, and shall be
entitled to recover upon the security or indemnity provided therefor to the
extent of any loss, damage, cost or expense incurred by the Seller or the
Trustee in connection therewith.
SECTION 5.06 PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Trustee, the Certificate Registrar
and any of their respective agents may treat the Person in whose name any
Certificate is registered as the owner of such Certificate for the purpose of
receiving distributions pursuant to Section 4.06 and for all other purposes
whatsoever, and neither the Trustee, the Certificate Registrar nor any of their
respective agents shall be affected by any notice to the contrary.
SECTION 5.07 ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES.
The Certificate Registrar shall furnish or cause to be furnished to the
Servicer, within 15 days after receipt by the Certificate Registrar of a written
request therefor from the Servicer, a list of the names and addresses of the
Certificateholders as of the most recent Record Date. If three or more
Certificateholders, or one or more Holders of Class A or Class B Certificates
evidencing not less than 25% of the Voting Interests thereof (hereinafter
referred to as "Applicants"), apply in writing to the Trustee, and such
application states that the Applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates and such application is accompanied by a copy of the
communication that such Applicants propose to transmit, then the Trustee shall,
within five Business Days after the receipt of such application, afford such
Applicants access, during normal business hours, to the current list of
Certificateholders. Every Certificateholder, by receiving and holding a
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Certificate, agrees with the Servicer and the Trustee that neither the Servicer
nor the Trustee shall be held accountable by reason of the disclosure of any
such information as to the names and addresses of the Certificateholders under
this Agreement, regardless of the source from which such information was
derived.
SECTION 5.08 MAINTENANCE OF OFFICE OR AGENCY. The Trustee shall maintain
in The City of New York, an office or offices or agency or agencies 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 shall designate the
Corporate Trust Office as its office for such purposes. The Trustee shall give
prompt written notice to the Seller, the Servicer and to Certificateholders of
any change in the location of the Certificate Register or any such office or
agency.
SECTION 5.09 TEMPORARY CERTIFICATES. Pending the preparation of definitive
Certificates of either Class, the Trustee, on behalf of the Trust, may execute,
authenticate and deliver, temporary Certificates of either Class that are
printed, lithographed, typewritten, mimeographed or otherwise produced, in any
authorized denomination, substantially of the tenor of the definitive
Certificates of either Class in lieu of which they are issued. If temporary
Certificates of either Class are issued, the Seller will cause definitive
Certificates of either Class to be prepared without unreasonable delay. After
the preparation of definitive Certificates of either Class, the temporary
Certificates of either Class shall be exchangeable for definitive Certificates
of either Class upon surrender of the temporary Certificates of either Class at
the office or agency to be maintained as provided in Section 5.08, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates of either Class, the Trustee on behalf of the Trust shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of definitive Certificates of either Class in authorized
denominations. Until so exchanged the temporary Certificates of either Class
shall in all respects be entitled to the same benefits under this Agreement as
definitive Certificates of either Class.
SECTION 5.10 BOOK-ENTRY CERTIFICATES. The Class A and Class B
Certificates, upon original issuance (except for the Residual Certificates) will
be issued in minimum denominations of $1,000 and integral multiples thereof, and
initially shall be issued as Book-Entry Certificates, to be delivered to DTC,
the initial Clearing Agency, by, or on behalf of, the Seller. The certificate or
certificates delivered to DTC evidencing such Certificates shall initially be
registered on the Certificate Register in the name of CEDE & CO., the nominee of
the initial Clearing Agency, and no Certificate Owner will receive a definitive
certificate representing such Certificate Owner's interest in the Class A or
Class B Certificates, except as provided in Section 5.12. Subject to Section
5.12, unless and until definitive, fully registered Certificates of either Class
(the "Definitive Certificates") have been issued to Certificate Owners pursuant
to Section 5.12:
(i) the provisions of this Section shall be in full force
and effect;
(ii) the Seller, the Servicer, the Certificate Registrar and
the Trustee may deal with the Clearing Agency for all purposes
(including the making of distributions on the Certificates and the
giving of instructions or directions hereunder) as the authorized
representative of the Certificate Owners;
(iii) to the extent that the provisions of this Section
conflict with any other provisions of this Agreement, the provisions
of this Section shall control;
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency (or through procedures established by
the Clearing Agency) and shall be limited to those established by
law and agreements between such Certificate Owners and the Clearing
Agency and/or the Clearing Agency Participants. Unless and until
Definitive Certificates are issued pursuant to Section 5.12, the
initial Clearing Agency will make book-entry transfers among the
Clearing Agency Participants and receive and transmit distributions
of principal and interest on the Certificates to such Clearing
Agency Participants; and
(v) whenever this Agreement requires or permits actions to be
taken based upon instructions or directions of Holders of
Certificates evidencing a specified percentage of the Voting
Interests of either Class or both Classes the Clearing Agency shall
be deemed to represent such percentage only to the extent that it
has received instructions to such effect from Certificate Owners
and/or Clearing Agency Participants owning or representing,
respectively, such required
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percentage of the beneficial interest in such Certificates and has
delivered such instructions to the Trustee.
SECTION 5.11 NOTICES TO CLEARING AGENCY. Whenever notice or other
communication to the Class A or Class B Certificateholders is required under
this Agreement, other than to the Holder of a Residual Certificate, unless and
until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 5.12, the Trustee and the Servicer shall give all such
notices and communications specified herein to be given to Holders of
Certificates to the Clearing Agency.
SECTION 5.12 DEFINITIVE CERTIFICATES. If (i)(A) the Seller advises the
Trustee in writing that the Clearing Agency is no longer willing or able to
properly discharge its responsibilities as described in the Letter of
Representations (a form of which is attached hereto as Exhibit F) and (B) the
Trustee or the Seller is unable to locate a qualified successor, (ii) the Seller
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 Default, Certificate Owners representing in the aggregate not less
than 51% of the voting interests of the Class A Certificates and Class B
Certificates, acting as a single Class, advise the Trustee and the Clearing
Agency through the Clearing Agency Participants in writing that the continuation
of a book-entry system through the Clearing Agency is no longer in the best
interests of the Certificate Owners, then the Trustee shall notify all
Certificate Owners, through the Clearing Agency, 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 of the Class A or Class B
Certificates by the Clearing Agency, accompanied by registration instructions
from the Clearing Agency for registration, the Trustee shall issue the
Definitive Certificates and deliver such Definitive Certificates in accordance
with the instructions of the Clearing Agency. Neither the Seller, the
Certificate Registrar nor the Trustee shall be liable for any delay in delivery
of such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Certificates, the
Trustee shall recognize the Holders of the Definitive Certificates as Class A or
Class B Certificateholders hereunder. The Trustee shall not be liable if the
Trustee or the Seller is unable to locate a qualified successor Clearing Agency.
ARTICLE VI
THE SELLER
SECTION 6.01 REPRESENTATIONS OF SELLER. The Seller shall make the
following representations on which the Trustee shall rely in accepting the
Receivables in trust and executing and authenticating the Certificates. The
representations shall speak as of the execution and delivery of this Agreement
and shall survive the sale of the Receivables to the Trustee.
(a) Organization And Good Standing. The Seller shall have been duly
organized and shall be validly existing as a limited liability company in
good standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such
properties shall be currently owned and such business is presently
conducted, and had at all relevant times, and shall now have, power,
authority and legal right to acquire, own and sell the Receivables.
(b) Due Qualification. The Seller shall be duly qualified to do
business as a foreign limited liability company in good standing, and
shall have obtained all necessary licenses and approvals in all
jurisdictions in which the ownership or lease of property or the conduct
of its business shall require such qualifications.
(c) Power and Authority. The Seller shall have the power and
authority to execute and deliver this Agreement and to carry out its
terms; the Seller shall have full power and authority to sell and assign
the property to be sold and assigned to and deposited with the Trustee as
part of the Trust and shall have duly authorized such sale and assignment
to the Trustee by all necessary action; and the execution, delivery and
performance of this Agreement shall have been duly authorized by the
Seller by all necessary company action.
(d) Valid Sale; Binding Obligations. This Agreement shall evidence a
valid sale, transfer and assignment of the Receivables, enforceable
against creditors of and purchasers from the Seller; and shall constitute
a legal, valid and binding obligation of the Seller enforceable in
accordance with its terms,
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except as enforceability may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting creditors' rights generally
or by general equity principles.
(e) No Violation. The consummation of the transactions contemplated
by this Agreement and the fulfillment of the terms of this __________
Agreement shall not conflict with, result in any breach of any of the
terms and provisions of, nor constitute (with or without notice or lapse
of time) a default under, the limited liability company agreement of the
Seller or any indenture, agreement or other instrument to which the Seller
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 this
Agreement), nor violate any law or, to the best of the Seller's knowledge,
any order, rule or regulation applicable to the Seller of any court or of
any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Seller or its
properties which breach, default, conflict, lien or violation would have a
material adverse effect on the earnings, business affairs or business
prospects of the Seller.
(f) No Proceedings. There is no action, suit or proceeding before or
by any court or governmental agency or body, domestic or foreign, now
pending, or to the Seller's knowledge, threatened, against or affecting
the Seller: (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 might materially
and adversely affect the performance by the Seller of its obligations
under, or the validity or enforceability of, this Agreement or the
Certificates, or (iv) relating to the Seller and which might adversely
affect the federal income tax attributes of the Certificates.
SECTION 6.02 LIABILITY OF SELLER; INDEMNITIES. The Seller shall be liable
in accordance with this Agreement only to the extent of the obligations in this
Agreement specifically undertaken by the Seller in such capacity under this
Agreement and shall have no other obligations or liabilities hereunder.
SECTION 6.03 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, SELLER; CERTAIN LIMITATIONS.
(a) Any corporation (i) into which the Seller may be merged or
consolidated, (ii) which may result from any merger, conversion or
consolidation to which the Seller shall be a party, or (iii) which may
succeed to all or substantially all of the business of the Seller, which
corporation in any of the foregoing cases executes an agreement of
assumption to perform every obligation of the Seller under this Agreement,
shall be the successor to the Seller under this Agreement without the
execution or filing of any document or any further act on the part of any
of the parties to this Agreement, except that if the Seller in any of the
foregoing cases is not the surviving entity, then the surviving entity
shall execute an agreement of assumption to perform every obligation of
the Seller hereunder. The Seller shall provide notice of any merger,
consolidation or succession pursuant to this Section to each Rating Agency
and shall receive from each Rating Agency a letter to the effect that such
merger, consolidation or succession will not result in a qualification,
downgrading or withdrawal of the then-current ratings on the Rated
Certificates.
(b) (i) Subject to paragraph (ii) below, the purpose of the
Seller shall be to engage in any lawful activity for which a limited
liability company may be organized under the Delaware Limited
Liability Company Act.
(ii) Notwithstanding paragraph (b)(i) above, the purpose of
the Seller shall be limited to the following purposes, and
activities incident to and necessary or convenient to accomplish the
following purposes: (A) to acquire from time to time from the
Servicer, all right, title and interest in and to receivables or
leases arising out of or relating to the sale or lease of new or
used motor vehicles (including automobiles and light trucks) or
industrial equipment, wholesale loans secured by new or used motor
vehicles (including automobiles and light duty trucks) or industrial
equipment, moneys due thereunder, security interests in the vehicles
or industrial equipment financed thereby, proceeds from claims on
insurance policies related thereto and related rights (collectively,
"Automobile Receivables"); (B) to acquire, own, hold, service, sell,
assign, pledge and otherwise deal with the Automobile Receivables,
collateral securing the Automobile Receivables, related insurance
policies, agreements with the Servicer and any proceeds or further
rights associated with any of the foregoing; (C) to transfer
Automobile
42
Receivables to grantor trusts or owner trusts (the "Additional
Trusts") pursuant to pooling and servicing agreements or similar
agreements (the "Additional Agreements") to be entered into by and
among the Servicer, as servicer, the Seller and the trustee named
therein; (D) to sell any class of asset-backed certificates or other
securities issued by the Additional Trusts under the related
Additional Agreements ("Offered Certificates"); (E) to hold and
enjoy all of the rights and privileges of any Offered Certificates
issued by the Additional Trusts to the Seller under the related
Additional Agreements; (F) to perform its obligations under the
Additional Agreements; and (G) to engage in any activity and to
exercise any powers permitted to corporations under the laws of the
State of California that are related or incidental to the foregoing
and necessary, convenient or advisable to accomplish the foregoing.
(iii) So long as any outstanding debt of the Seller or Offered
Certificates are rated by any nationally recognized statistical
rating agency, the Seller shall not issue unsecured notes or
otherwise borrow money unless (A) the Seller has made a written
request to the related nationally recognized rating agency to issue
unsecured notes or incur borrowings and such notes or borrowings are
rated by the related nationally recognized rating agency the same as
or higher than the rating afforded any outstanding rated debt or
Offered Certificates, or (B) (1) such notes or borrowings are fully
subordinated (and which shall provide for payment only after payment
in respect of all outstanding rated debt and/or Offered
Certificates) and are nonrecourse against any assets of the Seller
other than the assets pledged to secure such notes or borrowings,
(2) such notes or borrowings do not constitute a claim against the
Seller in the event the assets pledged to secure such notes or
borrowings are insufficient to pay such notes or borrowings, (3)
holders of such notes or borrowings agree that they have no rights
in any assets of the Seller other than the assets pledged to secure
such notes or borrowings, (4) to the extent that any holder of such
notes or borrowings is deemed to have any interest in any assets of
the Seller other than the assets pledged to secure such notes or
borrowings, holders of such notes or borrowings agree that their
interest is subordinate to claims or rights of holders of other
debts issued by the Seller, and that such agreement constitutes a
subordination agreement for purposes of Section 510(a) of the
Bankruptcy Code, and (5) where such notes or borrowings are secured
by the rated debt or Offered Certificates, such notes or borrowings
are fully subordinated (and which shall provide for payment only
after payment in respect of all outstanding rated debt and/or
Offered Certificates) to such rated debt or Offered Certificates.
(c) Notwithstanding any other provision of this Section and any
provision of law, the Seller shall not do any of the following:
(i) engage in any business or activity other than as set
forth in clause (b) above;
(ii) without the affirmative vote of a majority of the members
of the Board of Managers of the Seller (which must include the
affirmative vote of all duly appointed Independent Managers, as
required by the limited liability company agreement of the Seller),
(A) dissolve or liquidate, in whole or in part, or institute
proceedings to be adjudicated bankrupt or insolvent, (B) consent to
the institution of bankruptcy or insolvency proceedings against it,
(C) file a petition seeking or consent to reorganization or relief
under any applicable federal or state law relating to bankruptcy,
(D) consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the corporation
or a substantial part of its property, (E) make a general assignment
for the benefit of creditors, (F) admit in writing its inability to
pay its debts generally as they become due, or (G) take any company
action in furtherance of the actions set forth in clauses (A)
through (F) above, provided, however, that no director may be
required by any shareholder of the Seller to consent to the
institution of bankruptcy or insolvency proceedings against the
Seller so long as it is solvent; or
(iii) merge or consolidate with any other corporation, company
or entity or sell all or substantially all of its assets or acquire
all or substantially all of the assets or capital stock or other
ownership interest of any other corporation, company or entity
(except for the acquisition of Automobile Receivables of TMCC and
the sale of Automobile Receivables to one or more trusts in
accordance with the terms of clause (b)(ii) above, which shall not
be otherwise restricted by this Section 6.03(c)).
43
SECTION 6.04 LIMITATION ON LIABILITY OF SELLER AND OTHERS. The Seller and
any manager or officer or employee or agent of the Seller may rely in good faith
on the advice of counsel or on any document of any kind, prima facie properly
executed and submitted by any Person respecting any matters arising under this
Agreement. The Seller shall not be under any obligation to appear in, prosecute
or defend any legal action that is not incidental to its obligations as Seller
of the Receivables under this Agreement and that in its opinion may involve it
in any expense or liability.
SECTION 6.05 SELLER MAY OWN CERTIFICATES. The Seller and any Person
controlling, controlled by or under common control with the Seller may in its
individual or any other capacity become the owner or pledgee of Certificates
with the same rights as it would have if it were not the Seller or an affiliate
thereof except as otherwise specifically provided in the definition of the term
"Certificateholder." Certificates so owned by or pledged to the Seller or such
controlling or commonly controlled Person shall have an equal and proportionate
benefit under the provisions of this Agreement, without preference, priority or
distinction as among all of the Certificates, except as set forth herein with
respect to certain rights to vote, consent or give directions to the Trustee as
a Holder.
SECTION 6.06 NO TRANSFER. The Seller hereby covenants that, except as
otherwise provided in this Agreement, it will not transfer, pledge or assign to
any Person any part of its right to receive any Excess Amounts pursuant to
Section 4.06(d)(iii) unless it has first delivered to the Trustee and each
Rating Agency an Opinion of Counsel in form and substance satisfactory to the
Trustee stating that such transfer will not (i) adversely affect the status of
the Trust as a grantor trust pursuant to subpart E, part I of subchapter J of
the Code and (ii) cause the Reserve Fund to be taxable as a corporation under
the Code. The Seller shall give written notice to each Rating Agency of any
proposed transfer, pledge or assignment to any Person of all or any part of its
right to receive Excess Amounts pursuant to Section 4.06(d)(iii).
ARTICLE VII
THE SERVICER
SECTION 7.01 REPRESENTATIONS OF SERVICER. The Servicer shall make the
following representations on which the Trustee shall rely in accepting the
Receivables in trust and executing and authenticating the Certificates. The
representations shall speak as of the execution and delivery of this Agreement
and shall survive the sale of the Receivables to the Trustee.
(a) Organization and Good Standing. The Servicer shall have been
duly organized and shall be validly existing as a corporation in good
standing under the laws of the State of California, with corporate power
and authority to own its properties and to conduct its business as such
properties shall be currently owned and such business is presently
conducted, and had at all relevant times, and shall now have, corporate
power, authority and legal right to acquire, own, sell and service the
Receivables and to hold the Receivable Files as custodian on behalf of the
Trustee.
(b) Due Qualification. The Servicer shall be duly qualified to do
business as a foreign corporation in good standing, and shall have
obtained all necessary licenses and approvals in all jurisdictions in
which the ownership or lease of property or the conduct of its business
(including the servicing of the Receivables as required by this Agreement)
shall require such qualifications.
(c) Power and Authority. The Servicer shall have the corporate power
and authority to execute and deliver this Agreement and to carry out its
terms; and the execution, delivery and performance of this Agreement shall
have been duly authorized by the Servicer by all necessary corporate
action.
(d) Binding Obligations. This Agreement shall constitute a legal,
valid and binding obligation of the Servicer enforceable in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting
creditors' rights generally or by general principles of equity.
(e) No Violation. The consummation of the transactions contemplated
by this Agreement and the fulfillment of the terms of this Agreement shall
not conflict with, result in any breach of any of the terms and provisions
of, nor constitute (with or without notice or lapse of time) a default
under, the articles of incorporation or bylaws of the Servicer, or
conflict with or breach any of the material terms or provisions
44
of, or constitute (with or without notice or lapse of time) a default
under, any indenture, agreement or other instrument to which the Servicer
is a party or by which it 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 this
Agreement); nor violate any law or, to the best of the Servicer's
knowledge, any order, rule or regulation applicable to the Servicer of any
court or of any federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the Servicer
or its properties; which breach, default, conflict, lien or violation
would have a material adverse effect on the earnings, business affairs or
business prospects of the Servicer.
(f) No Proceedings. There is no action, suit or proceeding before or
by any court or governmental agency or body, domestic or foreign, now
pending, or to the Servicer's knowledge, threatened, against or affecting
the Servicer: (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 might materially
and adversely affect the performance by the Servicer of its obligations
under, or the validity or enforceability of, this Agreement or the
Certificates or (iv) relating to the Servicer and which might adversely
affect the federal income tax attributes of the Certificates.
SECTION 7.02 LIABILITY OF SERVICER; INDEMNITIES.
(a) The Servicer shall be liable in accordance herewith only to the
extent of the obligations specifically undertaken by the Servicer under
this Agreement and shall have no other obligations or liabilities under
this Agreement. Such obligations shall include the following:
(i) the Servicer shall defend, indemnify and hold harmless the
Trustee, the Trust and the Certificateholders from and against any
and all costs, expenses, losses, damages, claims and liabilities,
including reasonable fees and expenses of counsel and expenses of
litigation arising out of or resulting from the use or operation by
the Servicer or any affiliate thereof of any Financed Vehicle;
(ii) the Servicer shall indemnify, defend and hold harmless
the Trustee and the Trust from and against any taxes that may at any
time be asserted against the Trustee or the Trust with respect to
the transactions contemplated in this Agreement, including, without
limitation, any sales, gross receipts, general corporation, tangible
or intangible personal property, privilege or license taxes (but not
including any taxes asserted with respect to, and as of the date of,
the sale of the Receivables to the Trust or the issuance and
original sale of the Certificates, or asserted with respect to
ownership of the Receivables, or federal or other income taxes
arising out of distributions on the Certificates) and costs and
expenses in defending against the same;
(iii) the Servicer shall indemnify, defend and hold harmless
the Trustee, the Trust and the Certificateholders from and against
any and all costs, expenses, losses, claims, damages and liabilities
to the extent that such cost, expense, loss, claim, damage or
liability arose out of, and was imposed upon the Trustee, the Trust
or the Certificateholders through the negligence, willful
misfeasance or bad faith of the Servicer in the performance of its
duties under this Agreement or by reason of reckless disregard of
its obligations and duties under this Agreement; and
(iv) the Servicer shall indemnify, defend and hold harmless
the Trustee from and against all costs, expenses, losses, claims,
damages and liabilities arising out of or incurred in connection
with the acceptance or performance of the trusts and duties
contained in this Agreement, except to the extent that such cost,
expense, loss, claim, damage or liability: (A) shall be due to the
willful misfeasance, bad faith or negligence of the Trustee (B)
shall arise from the breach by the Trustee of any of its
representations or warranties set forth in Section 9.14, (C) relates
to any tax other than the taxes with respect to which either the
Seller or the Servicer shall be required to indemnify the Trustee,
or (D) shall arise out of or be incurred in connection with the
performance by the Trustee of the duties of a Successor Servicer
under this Agreement.
(b) Indemnification under this Section shall include, without
limitation, reasonable fees and expenses of counsel and expenses of
litigation. If the Servicer has made any indemnity payments pursuant
45
to this Section and the recipient thereafter collects any of such amounts
from others, the recipient shall promptly repay such amounts collected to
the Servicer, without interest, so long as no amounts are outstanding to
the Trustee.
(c) The provisions of this Section shall survive the resignation or
removal of the Trustee and the termination of this Agreement.
SECTION 7.03 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS
OF, THE SERVICER. Any corporation (i) into which the Servicer may be merged or
consolidated, (ii) which may result from any merger, conversion or consolidation
to which the Servicer shall be a party or (iii) which may succeed to all or
substantially all of the business of the Servicer, which corporation in any of
the foregoing cases executes an agreement of assumption to perform every
obligation of the Servicer under this Agreement, shall be the successor to the
Servicer under this Agreement without the execution or filing of any paper or
any further act on the part of any of the parties to this Agreement. The
Servicer shall provide notice of any merger, consolidation or succession
pursuant to this Section to the Trustee and each Rating Agency.
SECTION 7.04 LIMITATION ON LIABILITY OF SERVICER AND OTHERS.
(a) Neither the Servicer nor any of its directors, officers,
employees or agents shall be under any liability to the Trust, the Trustee
or the Certificateholders, except as provided in this Agreement, for any
action taken or for refraining from the taking of any action pursuant to
this Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Servicer or any such person against any
liability that would otherwise be imposed by reason of willful
misfeasance, bad faith or negligence in the performance of duties or by
reason of reckless disregard of obligations and duties under this
Agreement. The Servicer and any director, officer, employee or agent of
the Servicer may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising under this Agreement.
(b) Except as provided in this Agreement, the Servicer shall not be
under any obligation to appear in, prosecute, or defend any legal action
that shall not be incidental to its 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 Servicer may
undertake any reasonable action that it may deem necessary or desirable in
respect of this Agreement and the rights and duties of the parties to this
Agreement and the interests of the Certificateholders under this
Agreement.
(c) The Servicer and any director, officer, employee or agent of the
Servicer may rely in good faith on the advice of counsel or on any
document of any kind prima facie properly executed and submitted by any
Person respecting any matters arising under this Agreement. The Servicer
shall not be under any obligation to appear in, prosecute, nor 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 7.05 SERVICER NOT TO RESIGN. Subject to the provisions of Section
7.03, TMCC shall not resign from the obligations and duties hereby imposed on it
as Servicer under this Agreement except upon determination that the performance
of its duties under this Agreement shall no longer be permissible under
applicable law. Notice of any such determination permitting the resignation of
TMCC shall be communicated to the Trustee 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 Trustee or a successor
Servicer shall have assumed the responsibilities and obligations of TMCC in
accordance with Section 8.03.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.01 EVENTS OF DEFAULT. For purposes of this Agreement,
each of the following shall constitute an "Event of Default":
(a) any failure by the Servicer to deliver to the Trustee the
Servicer's Certificate for the related Collection Period, or any failure
by the Servicer (or, so long as the Servicer is TMCC, the Seller) to
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deliver to the Trustee, for distribution to Certificateholders, any
proceeds or payment required to be so delivered under the terms of the
Certificates or this Agreement, in each case that continues unremedied for
a period of three Business Days after discovery by an officer of the
Servicer (or, so long as the Servicer is TMCC, the Seller) or written
notice has been given (i) to the Servicer by the Trustee or (ii) to the
Trustee and the Servicer (or, so long as the Servicer is TMCC, the Seller)
by holders of Certificates evidencing not less than 25% of the Voting
Interests of the Class A Certificate and the Class B Certificates, voting
together as a single class; or
(b) failure on the part of the Servicer (or so long as the Servicer
is TMCC, the Seller) duly to observe or to perform in any material respect
any other covenants or agreements of the Servicer (or so long as the
Servicer is TMCC, the Seller) set forth in the Certificates or in this
Agreement, which failure shall (i) materially and adversely affect the
rights of the Trust and (ii) continue unremedied for a period of 90 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 or the Seller,
as the case may be, by the Trustee or (B) to the Trustee and the Servicer
or the Seller, as the case may be, by holders of Certificates evidencing
not less than 25% of the Voting Interests of the Class A Certificate and
the Class B Certificates, voting together as a single class; or
(c) the entry of a decree or order by a court or agency or
supervisory authority having jurisdiction in the premises for the
appointment of a trustee in bankruptcy, conservator, receiver or
liquidator for the Servicer (or, so long as the Servicer is TMCC, the
Seller) in any bankruptcy, insolvency, readjustment of debt, marshalling
of assets and liabilities or similar proceedings, or for the winding up or
liquidation of their respective affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 90 consecutive
days; or
(d) the consent by the Servicer (or, so long as the Servicer is
TMCC, the Seller) to the appointment of a trustee in bankruptcy,
conservator or receiver or liquidator in any bankruptcy, insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings of or relating to the Servicer (or, so long as the Servicer is
TMCC, the Seller) of or relating to substantially all of their property,
or the Servicer (or, so long as the Servicer is TMCC, the Seller) shall
admit in writing its inability to pay its debts generally as they become
due, file a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its obligations.
SECTION 8.02 CONSEQUENCES OF AN EVENT OF DEFAULT. If an Event of Default
shall occur and be continuing, so long as such Event of Default has not been
cured or waived, either the Trustee or the Holders of Certificates evidencing
not less than 51% of the voting interests of the Class A Certificates and the
Class B Certificates, voting together as a single class (but excluding for
purposes of such calculation and action all Certificates held by TMCC, TAFR LLC,
or any of their affiliates), by notice then given in writing to the Servicer
(and to the Trustee if given by Certificateholders), may terminate all of the
rights and obligations of the Servicer under this Agreement. On or after the
receipt by the Servicer of such written notice, all authority and power of the
Servicer under this Agreement, whether with respect to the Certificates, the
Receivables or otherwise, shall, without further action, pass to and be vested
in the Trustee pursuant to and under this Section or such Successor Servicer as
may be appointed under Section 8.03; and, without limitation, the Trustee shall
be hereby authorized and empowered to execute and deliver, on behalf of the
predecessor Servicer, as attorney-in-fact or otherwise, any and all documents
and other instruments, and to do or accomplish all other acts or things
necessary or appropriate to effect the purposes of such notice of termination,
whether to complete the transfer and endorsement of the 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, without limitation, 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 have been deposited by the predecessor
Servicer, in the Accounts or the Reserve Fund or thereafter received with
respect to the Receivables and all Payments Ahead that shall at that time be
held by the predecessor Servicer. All reasonable costs and expenses (including
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.
Notwithstanding the foregoing, in the event the predecessor Servicer is the
Trustee, the original Servicer hereunder shall reimburse the Trustee for all
reasonable costs and expenses as described in the immediately preceding
sentence.
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SECTION 8.03 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR SERVICER. On and
after the time the Servicer receives a notice of termination pursuant to Section
8.02 or tenders its resignation pursuant to Section 7.05, the Trustee shall, by
an instrument in writing, assume the rights and responsibilities of the Servicer
in its capacity as Servicer under this Agreement and the transactions set forth
or provided for in this Agreement, and shall be subject to all the
responsibilities, restrictions, duties and liabilities relating thereto placed
on the Servicer by the terms and provisions of this Agreement. As compensation
therefor, the Trustee shall be entitled to such compensation (whether payable
out of the Collection Account or otherwise) as the Servicer would have been
entitled to under this Agreement if no such notice of termination or resignation
had been given. Notwithstanding the foregoing, the Trustee may, if it shall be
unwilling so to act, or shall, if it is legally 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 includes the servicing of automobile and/or light duty truck
receivables, as the successor to the Servicer under this Agreement, provided
that the appointment of any such successor to the Servicer will not result in
the qualification, reduction or withdrawal of the rating then assigned to any
Class of Rated Certificates by either Rating Agency. In connection with such
appointment and assumption, the Trustee may make such arrangements for the
compensation of such successor out of payments on or in respect of the
Receivables as it and such successor shall agree; provided, however, that no
such compensation shall be in excess of that permitted the original Servicer
under this Agreement. The Trustee and such Successor Servicer shall take such
action, consistent with this Agreement, as shall be necessary to effectuate any
such succession. The Trustee shall not be relieved of its duties as Successor
Servicer under this Section until the newly appointed Servicer shall have
assumed the responsibilities and obligations of the Servicer under this
Agreement.
SECTION 8.04 NOTIFICATION TO CERTIFICATEHOLDERS. Upon a Responsible
Officer of the Trustee obtaining actual knowledge of (i) the occurrence of an
Event of Default and the expiration of any cure period applicable thereto or
(ii) any termination of, or appointment of a successor to, the Servicer pursuant
to this Section, the Trustee shall give prompt written notice thereof to
Certificateholders at their respective addresses appearing in the Certificate
Register and to each Rating Agency. Such notices will be deemed to have been
given on the date of such mailing.
If required by the Luxembourg Stock Exchange, for so long as the Class A
Certificates are listed on the Luxembourg Stock Exchange, notices to holders of
the Class A Certificates will be given by publication in a leading daily
newspaper of general circulation in Luxembourg or, if publication in Luxembourg
is not practical, in Europe. Such publication is expected to be made in the
LUXEMBOURGER WORT. If required by The Stock Exchange of Hong Kong Limited, for
so long as the Class A Certificates are listed on The Stock Exchange of Hong
Kong Limited, notices to holders of the Class A Certificates will be given in a
leading daily newspaper of general circulation in the English language in Hong
Kong. Such publication is expected to be made in the SOUTH CHINA MORNING POST.
Such notices will be deemed to have been given on the date of such publication.
SECTION 8.05 WAIVER OF PAST DEFAULTS. The Holders of Certificates
evidencing not less than 51% of the voting interests of the Class A Certificates
and the Class B Certificates, voting together as a single class (but excluding
for purposes of such calculation and action all Certificates held by TMCC, TAFR
LLC, or any of their affiliates), may, waive any Event of Default or 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 the Certificate or Payahead Accounts or the Reserve Fund in accordance with
this Agreement or in respect of a covenant or provision of this Agreement that
under Section 11.01 cannot be modified or amended without the consent of the
Holder of each Certificate. Upon any such waiver of a past default, such default
shall cease to exist, and any Event of Default arising therefrom shall be deemed
to have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereon
except to the extent expressly so waived.
SECTION 8.06 REPAYMENT OF ADVANCES. If a Successor Servicer replaces the
Servicer, the predecessor Servicer shall be entitled to receive reimbursement
for Outstanding Advances pursuant to Sections 4.03 and 4.04, in the manner
specified in Section 4.06, with respect to all Advances made by the predecessor
Servicer.
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ARTICLE IX
THE TRUSTEE
SECTION 9.01 DUTIES OF TRUSTEE.
(a) The Trustee, both prior to and after the occurrence of an Event
of Default, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. If, to the actual knowledge of a
Responsible Officer of the Trustee, an Event of Default has occurred and
has not been cured or waived, the Trustee shall exercise such of the
rights and powers vested in it by this Agreement, and 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 8.03, the Trustee in performing such duties shall use the
degree of skill and attention customarily exercised by a servicer with
respect to automobile and/or light duty truck receivables that it services
for itself or others.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee that shall be specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them
to determine whether they conform to the requirements of this Agreement.
(c) 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 misfeasance;
provided, however, that:
(i) prior to the occurrence of an Event of Default actually
known to a Responsible Officer of the Trustee, and after the curing
or waiving of all such Events of Default 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 permissive right of the Trustee to do things enumerated
in this Agreement shall not be construed as a duty and, in the
absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates
or opinions furnished to the Trustee and conforming to the
requirements of this Agreement;
(ii) the Trustee shall not be personally liable for an error
of judgment made in good faith by a Responsible Officer of the
Trustee, unless it shall be proved that the Trustee was negligent in
performing its duties in accordance with the terms of this
Agreement; and
(iii) the Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken in good faith
in accordance with the direction of the Holders of Class A
Certificates or Class B Certificates evidencing not less than 25% of
the Voting Interests of the related Class relating to the time,
method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Agreement.
(d) The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of
its duties under this Agreement, or in the exercise of any of its rights
or powers, if there shall be reasonable grounds for believing that the
repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it, and none of the provisions
contained in this Agreement shall in any event require the Trustee to
perform, or be responsible for the manner of performance of, any of the
obligations of the Servicer 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.
(e) 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 to impair the value
of any Receivable.
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(f) All information obtained by the Trustee regarding the Obligors
and the Receivables, whether upon the exercise of its rights under this
Agreement or otherwise, shall be maintained by the Trustee in confidence
and shall not be disclosed to any other Person, unless such disclosure is
required by this Agreement or any applicable law or regulation.
SECTION 9.02 TRUSTEE'S CERTIFICATE. On or as soon as practicable after
each date on which the Servicer shall purchase Administrative Receivables or the
Seller shall repurchase Warranty Receivables, the Trustee shall submit to the
Servicer or the Seller, as applicable, a Trustee's Certificate (substantially in
the form attached hereto as Exhibit B), identifying the purchaser and the
Receivables so purchased, executed by the Trustee and completed as to its date
and the date of this Agreement, and accompanied by a copy of the Servicer's
Certificate for the related Collection Period. The Trustee's Certificate
submitted with respect to such Distribution Date shall operate, as of such
Distribution Date, as an assignment, without recourse, representation or
warranty, to the Seller or the Servicer, as the case may be, of all the
Trustee's right, title and interest in and to such Administrative Receivable or
Warranty Receivable and to the other property conveyed to the Trust pursuant to
Section 2.01 with respect to such Administrative Receivable or Warranty
Receivable, and all security and documents relating thereto, such assignment
being an assignment outright and not for security.
SECTION 9.03 TRUSTEE'S ASSIGNMENT OF ADMINISTRATIVE RECEIVABLES AND
WARRANTY RECEIVABLES. With respect to all Administrative Receivables and all
Warranty Receivables, the Trustee shall, by a Trustee's Certificate
(substantially in the form attached hereto as Exhibit B) assign, without
recourse, representation or warranty, to the Seller or the Servicer as
applicable, all the Trustee's right, title and interest in and to each such
repurchased Receivable and the other property conveyed to the Trust pursuant to
Section 2.01 with respect to such Receivable, and all security and any documents
relating thereto, such assignment being an assignment outright and not for
security; and the Seller or the Servicer, as applicable, shall thereupon own
each such Receivable, and all such related security and documents, free of any
further obligation to the Trustee or the Certificateholders with respect
thereto. If in any enforcement suit or legal proceeding it is held that the
Servicer may not enforce a repurchased Receivable on the ground that it is not a
real party in interest or a holder entitled to enforce the Receivable, the
Trustee on behalf of the Trust shall, at the Servicer's written direction and
expense, take such reasonable steps as the Trustee deems necessary to enforce
the Receivable, including bringing suit in the Trust's name or the names of the
Certificateholders.
SECTION 9.04 CERTAIN MATTERS AFFECTING THE TRUSTEE.
(a) Except as otherwise provided in Section 9.01:
(i) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order,
appraisal, bond 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 advice of
counsel or Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken or
suffered or omitted by it under this Agreement in good faith and in
accordance with such advice of counsel or Opinion of 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 reasonable security or indemnity against the costs, expenses
and liabilities that may be incurred therein or thereby; nothing
contained in this Agreement shall, however, relieve the Trustee of
the obligations, upon the occurrence of an Event of Default actually
known to a Responsible Officer of the Trustee (that shall not have
been cured or waived), to exercise such of the rights and powers
vested in it by this Agreement, and to use the same degree of care
and skill in their exercise as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs;
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(iv) the Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to
be authorized or within the discretion or rights or powers conferred
upon it by this Agreement;
(v) prior to the occurrence of an Event of Default and after
the curing or waiving of all Events of Default that may have
occurred, the Trustee shall not be bound to make any investigation
into the facts of matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, approval, bond or other paper or document, unless requested
in writing to do so by Holders of Certificates evidencing not less
than 25% of the Voting Interests of a 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
such investigation 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 reasonable indemnity
against such cost, expense or liability as a condition to so
proceeding; the reasonable expense of every such examination shall
be paid by the Seller or, if paid by the Trustee, shall be
reimbursed by the Seller upon demand; and nothing in this clause
shall derogate from the obligation of the Servicer to observe any
applicable law prohibiting disclosure of information regarding the
Obligors; and
(vi) the Trustee may execute any of the trusts or powers under
this Agreement or perform any duties under this Agreement either
directly or by or through agents or attorneys or a custodian and
shall not be liable or responsible for the misconduct or negligence
of any of its agents or attorneys or a custodian appointed with due
care by the Trustee.
(b) No Certificateholder will have any right to institute any
proceeding with respect to this Agreement, unless such Holder shall have
given to the Trustee written notice of default and (i) the Event of
Default arises from the Servicer's failure to remit collections or
payments when due or (ii) the Holders Certificates evidencing not less
than 25% of the Voting Interests of a Class have made written request upon
the Trustee to institute such proceeding in its own name as Trustee
thereunder, and have offered to the Trustee reasonable indemnity, and the
Trustee for 30 days has neglected or refused to institute any such
proceedings.
SECTION 9.05 LIMITATION ON TRUSTEE'S LIABILITY. The Trustee shall make no
representations as to the validity or sufficiency of this Agreement or of the
Certificates (other than the execution by the Trustee on behalf of the Trust of,
or the certificate of authentication on, the Certificates), or of any Receivable
or related document. The Trustee shall have no obligation to perform any of the
duties of the Seller or the Servicer unless explicitly set forth in this
Agreement. The Trustee shall at no time have any responsibility or liability for
or with respect to the legality, validity and enforceability of any security
interest in any Financed Vehicle or any Receivable, or the perfection and
priority of such a security interest or the maintenance of any such perfection
and priority, or for or with respect to the efficacy of the Trust or its ability
to generate the payments to be distributed to Certificateholders under this
Agreement, including without limitation, the existence, condition, location and
ownership of any Financed Vehicle; the existence and enforceability of any
physical damage or credit life or credit disability insurance; the existence and
contents of any Receivable or any computer or other record thereof; the validity
of the assignment of any Receivable to the Trust or of any intervening
assignment; the completeness of any Receivable; the performance or enforcement
of any Receivable; the compliance by the Seller or the Servicer with any
covenant or the breach by the Seller or the Servicer of any warranty or
representation made under this Agreement or in any related document and the
accuracy of any such warranty or representation 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 shall remain responsible as
Trustee for any Trust property that it may hold); the acts or omissions of the
Seller, the Servicer or any Obligor; any action of the Servicer taken in the
name of or as the agent of the Trustee; or any action by the Trustee taken at
the instruction of the Servicer; provided, however, that the foregoing shall not
relieve the Trustee of its obligation to perform its duties under this
Agreement. Except with respect to a claim based on the failure of the Trustee to
perform its duties under this Agreement or based on the Trustee's negligence or
willful misconduct, bad faith or negligence, no recourse shall be had for any
claim based on any provision of this Agreement, the Certificates or any
Receivable or assignment thereof against the institution serving as 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, and any such claim shall be asserted solely against
the Trust or any indemnitor who shall furnish indemnity as provided in this
Agreement. The Trustee shall not be accountable for the use or application by
the Seller of any of the Certificates or
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of the proceeds of such Certificates, or for the use or application of any funds
paid to the Servicer in respect of the Receivables. The Trustee shall have no
responsibility for filing any financing or continuation statement in any public
office at any time or to otherwise perfect or maintain the perfection of any
security interest or lien granted to it hereunder (unless the Trustee shall have
become the successor Servicer) or to prepare or file any Securities and Exchange
Commission filing for the Trust or to record this Agreement.
It is expressly understood and agreed by the parties hereto that (i) each
of this Agreement and the Certificates is executed and delivered by the Trustee,
not in its individual capacity but solely as trustee of the Trust in the
exercise of its powers and authority conferred and vested in it, (ii) each of
the representations (other than the representations and warranties of the
Trustee set forth in Section 9.14), undertakings and agreements herein made on
the part of the Trust is made and intended not as a representation, undertaking
or agreement by the Trustee in its individual capacity, but is made and intended
for the purpose of binding only the Trust and (iii) under no circumstances shall
the Trustee in its individual capacity be personally liable for the breach or
failure of any obligation, representation, warranty or covenant made or
undertaken by the Trust under this Agreement or the Certificates.
The Trustee will not be responsible for any losses incurred in connection
with investments in Eligible Investments made in accordance with the terms of
this Agreement, other than losses arising out of the Trustee's negligence, bad
faith or willful misconduct.
SECTION 9.06 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 the Trustee.
SECTION 9.07 TRUSTEE'S FEES AND EXPENSES. The Servicer covenants and
agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, reasonable compensation (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
for all services rendered by it in the execution of the trusts created by this
Agreement and in the exercise and performance of any of the powers and duties of
the Trustee under this Agreement, and the Servicer shall pay or reimburse the
Trustee upon its request for all reasonable expenses, disbursements and advances
(including the reasonable compensation and the expenses and disbursements of its
counsel and of all persons not regularly in its employ) incurred or made by the
Trustee 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 or that is the responsibility of
Certificateholders under this Agreement. Additionally, the Servicer, pursuant to
Section 7.02, shall indemnify the Trustee with respect to certain matters.
SECTION 9.08 INDEMNITY OF TRUSTEE AND SUCCESSOR SERVICER. Upon the
appointment of a Successor Servicer pursuant to Section 8.03, such Successor
Servicer and the Trustee and their respective agents and employees shall be
indemnified by the Trust and held harmless against any loss, liability, or
expense (including reasonable attorney's fees and expenses) arising out of or
incurred in connection with the acceptance of performance of the trusts and
duties contained in this Agreement to the extent that (i) the Successor Servicer
or the Trustee, as the case may be, shall not be indemnified for such loss,
liability or expense by the Servicer pursuant to Section 8.02; (ii) such loss,
liability, or expense shall not have been incurred by reason of the Successor
Servicer's or the Trustee's wilful misfeasance, bad faith or negligence; and
(iii) such loss, liability or expense shall not have been incurred by reason of
the Successor Servicer's or the Trustee's breach of its respective
representations and warranties pursuant to Sections 8.03, 9.09 and 9.14,
respectively.
The Successor Servicer and/or the Trustee shall be entitled to the
indemnification provided by this Section only to the extent all amounts due the
Servicer and all holders of Certificates issued by the Trust with respect to any
Distribution Date pursuant to Sections 4.06 and 4.07 have been paid in full and
all amounts required to be deposited in the Reserve Fund with respect to any
Distribution Date pursuant to Section 4.07 have been so deposited.
SECTION 9.09 ELIGIBILITY REQUIREMENTS FOR TRUSTEE.
Except as otherwise provided in this Agreement, the Trustee under this
Agreement shall at all times be a corporation having its corporate trust office
in the same state (or the District of Columbia or the Commonwealth of Puerto
Rico) as the location of the Corporate Trust Office as specified in this
Agreement; organized and doing business under the laws of such state (or the
District of Columbia or the Commonwealth of Puerto Rico) or the United States;
authorized under such laws to exercise corporate trust powers; having a combined
capital and surplus of at least $50,000,000 and subject to supervision or
examination by federal or state authorities; and having a long-
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term deposit rating no lower than ___ by Moody's (if ▇▇▇▇▇'▇ is a Rating
Agency), or be otherwise acceptable to each Rating Agency, as evidenced by a
letter to such effect from each of them (which acceptance may be evidenced in
the form of a letter, dated on or shortly before the Closing Date, assigning an
initial rating to the Rated Certificates).
If the Trustee 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, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, the Trustee shall resign immediately in the manner
and with the effect specified in Section 9.10.
SECTION 9.10 RESIGNATION OR REMOVAL OF TRUSTEE.
(a) The Trustee may at any time resign and be discharged from the
trusts created by this Agreement by giving written notice thereof to the
Servicer. Upon receiving such notice of resignation, the Servicer shall
promptly appoint a successor Trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the resigning Trustee
and one copy to the successor Trustee. If no successor Trustee shall have
been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor
Trustee.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 9.09 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 a bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Servicer may remove the Trustee. If
it shall remove the Trustee under the authority of the immediately
preceding sentence, the Servicer shall promptly appoint a successor
Trustee by written instrument, in duplicate, one copy of which instrument
shall be delivered to the Trustee so removed and one copy to the successor
Trustee, and payment of all fees owed to the outgoing Trustee.
(c) Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor
Trustee as provided in Section 9.11. The Servicer shall give each Rating
Agency notice of any such resignation or removal of the Trustee and
appointment and acceptance of a successor Trustee.
SECTION 9.11 SUCCESSOR TRUSTEE. Any successor Trustee appointed as
provided in Section 9.10 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 the rights, powers,
duties and obligations of its predecessor under this Agreement, with like effect
as if originally named as Trustee. The predecessor Trustee shall deliver to the
successor Trustee all documents and statements held by it under this Agreement;
and the Servicer and the predecessor Trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for fully and
certainly vesting and confirming in the successor Trustee all such rights,
powers, duties and obligations. No successor Trustee shall accept appointment as
provided in this Section unless at the time of such acceptance such successor
Trustee shall be eligible under the provisions of Section 9.09. Upon acceptance
of appointment by a successor Trustee as provided in this Section, the Servicer
shall mail notice of the successor of such Trustee under this Agreement to all
Certificateholders at their addresses as shown in the Certificate Register and
shall give notice by mail to each Rating Agency. If the Servicer fails 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 9.12 MERGER OR CONSOLIDATION OF TRUSTEE. Any corporation (i) into
which the Trustee may be merged or consolidated, (ii) which may result from any
merger, conversion, or consolidation to which the Trustee shall be a party or
(iii) which may succeed to all or substantially all the corporate trust business
of the Trustee, which corporation executes an agreement of assumption to perform
every obligation of the Trustee under this Agreement, shall be the successor of
the Trustee hereunder, provided such corporation shall be eligible pursuant to
Section 9.09, without the execution or filing of any instrument or any further
act on the part of any of the parties
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hereto, anything herein to the contrary notwithstanding. Notice of any such
merger shall be given by the Trustee to each Rating Agency.
SECTION 9.13 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust or any Financed Vehicle may at the time be located, the Servicer
and the Trustee acting jointly shall have the power and shall execute and
deliver all instruments to appoint one or more Persons approved by the Trustee
to act as co-trustee, jointly with the Trustee, or separate trustee or separate
trustees, of all or any part of the Trust, and to vest in such Person, in such
capacity and for the benefit of the Certificateholders, such title to the Trust,
or any part thereof, and, subject to the other provisions of this Section, 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 the case an Event of Default 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 9.09 and no notice of a
successor Trustee pursuant to Section 9.11 and no notice to Certificateholders
of the appointment of any co-trustee or separate trustee shall be required
pursuant to Section 9.11.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred upon and exercised or
performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed
(whether as Trustee under this Agreement or as successor to the
Servicer under this Agreement), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to
the Trust or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such separate trustee or
co-trustee, but solely at the direction of the Trustee;
(ii) no trustee under this Agreement shall be personally
liable by reason of any act or omission of any other trustee under
this Agreement; and
(iii) the Servicer and the Trustee acting jointly (or during
the continuation of an Event of Default, the Trustee alone) may at
any time accept the resignation of or remove any separate trustee or
co-trustee.
Any notice, request or other writing given to the Trustee shall be deemed
to have been given to each of the then separate trustees and co-trustees, as
effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Section. 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,
including, but not limited to, 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.
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. Notwithstanding anything to the contrary in this Agreement,
the appointment of any separate trustee or co-trustee shall not relieve the
Trustee of its obligations and duties under this Agreement.
SECTION 9.14 REPRESENTATIONS AND WARRANTIES OF TRUSTEE. The
Trustee shall make the following representations and warranties on which the
Seller and Certificateholders may rely:
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(i) Organization and Good Standing. The Trustee is a
national banking corporation duly organized, existing and in good
standing;
(ii) Power and Authority. The Trustee has full power,
authority and right to execute, deliver and perform this Agreement
and has taken all necessary action to authorize the execution,
delivery and performance by it of this Agreement;
(iii) No Violation. The execution, delivery and performance by
the Trustee of this Agreement (a) shall not violate any provision of
any law governing the banking and trust powers of the Trustee or, to
the best of the Trustee's knowledge, any order, writ, judgment, or
decree of any court, arbitrator, or governmental authority
applicable to the Trustee or any of its assets, (b) shall not
violate any provision of the corporate charter or by-laws of the
Trustee, and (c) shall not violate any provision of, or constitute,
with or without notice or lapse of time, a default under, or result
in the creation or imposition of any Lien on any properties included
in the Trust pursuant to the provisions of any mortgage, indenture,
contract, agreement or other undertaking to which it is a party,
which violation, default or Lien could reasonably be expected to
materially and adversely affect the Trustee's performance or ability
to perform its duties under this Agreement or the transactions
contemplated in this Agreement;
(iv) No Authorization Required. The execution, delivery and
performance by the Trustee of this Agreement shall not require the
authorization, consent, or approval of, the giving of notice to, the
filing or registration with, or the taking of any other action in
respect of, any governmental authority or agency regulating the
banking and corporate trust activities of the Trustee; and
(v) Duly Executed. This Agreement shall have been duly
executed and delivered by the Trustee and shall constitute the
legal, valid, and binding agreement of the Trustee, enforceable in
accordance with its terms, except as enforceability may be limited
by bankruptcy, insolvency, reorganization, moratorium and other
similar laws affecting creditors' rights generally or by general
principles of equity.
SECTION 9.15 TAX RETURNS. In the event the Trust shall be required to file
tax returns, the Servicer shall prepare or shall cause to be prepared any tax
returns required to be filed by the Trust and shall remit such returns to the
Trustee for signature at least five days before such returns are due to be
filed. The Trustee, upon request, shall furnish the Servicer with all such
information known to the Trustee as may be reasonably required in connection
with the preparation of all tax returns of the Trust, and shall, upon request,
execute such returns.
SECTION 9.16 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.
SECTION 9.17 SUIT FOR ENFORCEMENT. If an Event of Default shall occur and
be continuing, the Trustee, in its discretion may, subject to the provisions of
Section 9.01, proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Agreement or in aid of the execution of
any power granted in this Agreement or for the enforcement of any other legal,
equitable or other remedy as the Trustee, being advised by counsel, shall deem
most effectual to protect and enforce any of the rights of the Trustee or the
Certificateholders.
SECTION 9.18 RIGHTS OF CERTIFICATEHOLDERS TO DIRECT TRUSTEE. Holders of
Certificates evidencing not less the 25% of the Voting Interests of a Class (but
excluding for purposes of such calculation and action all Certificates held by
TMCC, TAFR LLC, or any of their affiliates) shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee;
provided, however, that subject to Section 9.01, the Trustee shall have the
right to decline to follow any such direction if the Trustee being advised by
counsel determines that the action so directed may not
55
lawfully be taken, or if the Trustee in good faith shall, by a Responsible
Officer, determine that the proceedings so directed would be illegal or subject
it to personal liability or be unduly prejudicial to the rights of
Certificateholders not parties to such direction; and provided further that
nothing in this Agreement shall impair the right of the Trustee to take any
action deemed proper by the Trustee and which is not inconsistent with such
direction by the Certificateholders.
ARTICLE X
TERMINATION
SECTION 10.01 TERMINATION OF THE TRUST.
(a) The Trust and the respective obligations and responsibilities of
the Seller, the Servicer and the Trustee shall terminate upon (i) the
purchase as of any Distribution Date by the Seller or Servicer, or any
successor to the Servicer, at its option of the corpus of the Trust as
described in Section 10.03, (ii) the payment to Certificateholders of all
amounts required to be paid to them pursuant to this Agreement, [or (iv) a
Swap Termination Event as provided in Section 10.02] (iii) the maturity or
liquidation of the last Receivable and the disposition of all property
held as part of the Trust; provided, however, that in no event shall the
trust created by this Agreement continue beyond the expiration of 21 years
from the death of the last survivor of the descendants of ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, the late ambassador of the United States to the Court of St.
▇▇▇▇▇, living on the date of this Agreement. The Servicer shall promptly
notify the Trustee and each Rating Agency of any prospective termination
pursuant to this Section.
(b) Notice of any termination, specifying the Distribution Date upon
which the Certificateholders must surrender their Certificates to the
Trustee for payment of the final distribution and retirement of the
Certificates, shall be given promptly by the Trustee (at the written
direction of the Servicer) by letter to Certificateholders mailed not
later than the 15th day and not earlier than the 30th day prior to the
date on which such final distribution is expected to occur specifying (i)
the Distribution Date upon which final payment of the Certificates shall
be made upon presentation and surrender of Certificates at the office of
the Trustee therein specified, (ii) the amount of any such final payment
and (iii) if applicable, 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. The Trustee shall give such notice to the
Certificate Registrar (if other than the Trustee) at the time such notice
is given to Certificateholders. In the event such notice is given, the
Seller, the Servicer, or any successor to the Servicer, or the Trustee, as
the case may be, shall make deposits into the Collection Account in
accordance with Section 4.05, or, in the case of an optional purchase of
Receivables pursuant to Section 10.02, shall deposit the amount specified
in Section 10.02. 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 4.06.
(c) In the event that all of the Certificateholders shall not
surrender their Certificates for retirement 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 retirement and receive the final
distribution with respect thereto. If within one year after the second
notice all the Certificates shall not have been surrendered for
retirement, the Trustee may take appropriate steps, or may appoint an
agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the
cost thereof shall be paid out of the funds and other assets that remain
subject to this Agreement. Any funds remaining in the Trust after
exhaustion of such remedies shall be distributed by the Trustee to the
California Special Olympics.
SECTION 10.02 OPTIONAL PURCHASE OF ALL RECEIVABLES. On each Distribution
Date following the last day of a Collection Period as of which the Pool Balance
shall be less than the Optional Purchase Percentage (expressed as a seven-digit
decimal figure) multiplied by the Original Pool Balance, the Seller shall have
the option to purchase the corpus of the Trust; provided that the option to
purchase provided in this Section shall not be exercised if the final
distribution to Certificateholders would be less than the aggregate outstanding
principal amount of the Certificates plus the sum of (i) the Class A Interest
Distributable Amount for the related Distribution Date, (ii) any unpaid Class A
Interest Carryover Shortfall, (iii) the Class B Interest Distributable Amount
for the related
56
Distribution Date and (iv) any unpaid Class B Interest Carryover Shortfall. To
exercise such option, the Seller or the Servicer, or any successor to the
Servicer, as the case may be, shall notify the Trustee in writing, no later than
the tenth day of the month preceding the month in which the Distribution Date as
of which such purchase is to be effected and shall, on or before the
Distribution Date on which such purchase is to occur, deposit pursuant to
Section 4.06 in the Collection Account an amount equal to the aggregate
Administrative Purchase Payments for the Receivables (including Defaulted
Receivables), plus the appraised value of any other property held by the Trust
(less liquidation expenses to be incurred in connection with the recovery
thereof), such value to be determined by an appraiser mutually agreed upon by
the Seller, the Servicer and the Trustee, and shall succeed to all interests in
and to the Trust. Notwithstanding the foregoing, if ▇▇▇▇▇'▇ is a Rating Agency,
the Seller or the Servicer, as the case may be, may not effect any such purchase
if the long-term unsecured debt obligations of the related entity are rated less
than ___, unless the Trustee shall have received an Opinion of Counsel that such
purchase will not constitute a fraudulent conveyance, or ▇▇▇▇▇'▇ is otherwise
satisfied, as evidenced by written notice from Moody's to the Trustee. Upon such
deposit of the amount necessary to purchase the corpus of the Trust, the
Servicer shall for all purposes of this Agreement be deemed to have released all
claims for reimbursement of Outstanding Advances made in respect of the
Receivables. The payment shall be made in the manner specified in Section 4.06,
and shall be distributed pursuant to Section 4.07. In the event that both the
Seller and the Servicer, or any successor to the Servicer, elect to purchase the
Receivables pursuant to this Section, the party first notifying the Trustee
(based on the Trustee's receipt of such notice) shall be permitted to purchase
the Receivables.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01 AMENDMENT.
(a) This Agreement may be amended by the Seller, the Servicer and
the Trustee, without the consent of any of the Certificateholders, (i) to
cure any ambiguity, to correct or supplement any provision in this
Agreement which may be inconsistent with any other provision of this
Agreement, to add, change or eliminate any other provision of this
Agreement with respect to matters or questions arising under this
Agreement that shall not be inconsistent with the provisions of this
Agreement or to add or provide for any credit enhancement and (ii) to
change the formula for determining the Specified Reserve Fund Balance, any
Required Yield Maintenance Amount or the manner in which the Reserve Fund
or any Yield Maintenance Account is funded or to amend or modify any
provisions of this Agreement relating to the remittance schedule with
respect to collections deposited into the Collection Account or the
Payahead Account pursuant to Section 4.02; provided, however, that any
such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interests of the Certificateholders and
provided, further, that in connection with any amendment pursuant to
clause (ii) above the Servicer shall deliver to the Trustee a letter from
each Rating Agency to the effect that such amendment will not cause the
then-current rating on the Rated Certificates to be qualified, reduced or
withdrawn.
(b) This Agreement may also be amended from time to time by the
Seller, the Servicer and the Trustee, with the consent of Holders of the
Class A Certificates and the Class B Certificates, acting together as a
single Class (but excluding for purposes of such calculation and action
all Certificates held by TMCC, TAFR LLC, or any of their affiliates),
evidencing not less than 51% of the Voting Interests of each Class of
Certificates (which consent of any Holder of a Certificate given pursuant
to this Section or pursuant to any other provision of this Agreement shall
be conclusive and binding on such Holder and on all future Holders of such
Certificate and of any Certificate issued upon the transfer thereof or in
exchange thereof or in lieu thereof whether or not notation of such
consent is made upon the Certificate), for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of this Agreement, or of modifying in any manner the rights of
either Class of Certificateholders; provided, however, that no such
amendment shall (i) except as otherwise provided in Section 11.01(a),
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 or the applicable Pass
Through Rate, Reserve Fund Balance or any Yield Maintenance Amount or (ii)
reduce the aforesaid percentage of the Voting Interests of the
Certificates of either Class required to consent to any such amendment,
without the consent of the Holders of all Certificates of the relevant
Class then outstanding.
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(c) Prior to the 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) Promptly after the execution of any such amendment or consent,
the Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder. It shall not be necessary
for the consent of Certificateholders pursuant to Section 11.01(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.
The manner of obtaining such consents and of evidencing the authorization
by Certificateholders of the execution thereof shall be subject to such
reasonable requirements as the Trustee may prescribe.
(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. 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 11.02 PROTECTION OF TITLE TO TRUST.
(a) Each of the Seller and the Servicer or both shall execute and
file such financing statements and cause to be executed and filed such
continuation and other 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 Receivables and in the proceeds thereof. Each of the Seller and the
Servicer 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) Neither the Seller nor the Servicer shall change its name,
identity or corporate structure in any manner that would, could or might
make any financing statement or continuation statement filed by the Seller
in accordance with paragraph (a) above seriously misleading within the
meaning of Section 9-402(7) of the UCC, unless it shall have given the
Trustee at least 60 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 Seller and the Servicer shall 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 services
Receivables and its principal executive office within the United States.
(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
Accounts and any Payments Ahead held by the Servicer 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 back-up
archives) that refer to any Receivable indicate clearly the interest of
the Trust in such Receivable and that the Receivable is owned by the
Trustee. Indication of the Trustee's ownership of a Receivable shall be
deleted from or modified on the Servicer's computer systems when, and only
when, the Receivable has been paid in full, repurchased or assigned
pursuant to this Agreement.
(f) If at any time the Seller or the Servicer shall propose to sell,
grant a security interest in, or otherwise transfer any interest in
automobile and/or light duty truck receivables to any prospective
purchaser, lender or other transferee, the Servicer shall give to such
prospective purchaser, lender or other transferee computer tapes, records
or print-outs (including any restored from back-up archives) that, if they
refer in any manner whatsoever to any Receivable, indicate clearly that
such Receivable has been sold and is owned by the Trustee unless such
Receivable has been paid in full, repurchased or assigned pursuant to this
Agreement.
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(g) The Servicer shall permit the Trustee and its agents at any time
to inspect, audit and make copies of and abstracts from the Servicer's
records regarding any Receivables then or previously included in the
Trust.
(h) Upon request, the Servicer shall furnish to the Trustee, within
five Business Days, a list of all Receivables (by contract number and name
of Obligor) then held as part of the Trust, together with a reconciliation
of such list to the Schedule of Receivables 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 promptly after the
execution and delivery of each amendment to any financing statement, an
Opinion of Counsel either (i) 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 (ii) stating that, in the opinion of such Counsel,
no such action is necessary to preserve and protect such interest.
(j) The Seller shall, to the extent required by applicable law,
cause the Certificates to be registered with the Commission pursuant to
Section 12(b) or Section 12(g) of the Exchange Act within the time periods
specified in such Sections.
(k) This Agreement may be executed simultaneously in any number of
counterparts, each of which shall be deemed to be an original, and all of
which shall constitute but one and the same instrument.
SECTION 11.03 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.
(a) The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or the Trust, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting
or to take any action or commence any proceeding in any court for a
partition or winding up of the Trust, nor otherwise affect the rights,
obligations and liabilities of the parties to this Agreement or any of
them.
(b) No Certificateholder shall have any right to vote (except as
provided in Sections 8.05 and 11.01) 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 Certificateholders from time to time as partners or members
of an association; nor shall any Certificateholder be under any liability
to any third person by reason of any action 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 also the Holders of Certificates
evidencing not less the 25% of the Voting Interests of the related Class
shall have made written request upon the Trustee to institute such action,
suit or proceeding in its own name as Trustee under this Agreement and
shall have offered to the Trustee such reasonable indemnity as it may
require against the costs, expenses, and liabilities to be incurred
therein or thereby, and the Trustee, for 30 days after its receipt of such
notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit, or proceeding and during such 30-day
period, no request or waiver inconsistent with such written request has
been given to the Trustee pursuant to this Section or Section 9.05; it
being understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that
no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions
of this Agreement to affect, disturb, or prejudice the rights of the
Holders of any other of the Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any
right under this Agreement, except in the manner provided in this
Agreement and for the equal, ratable, and common benefit of all
Certificateholders. For the protection and enforcement of the provisions
of this Section, each and every Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
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SECTION 11.04 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York and the
obligations, rights and remedies of the parties under this Agreement shall be
determined in accordance with such laws.
SECTION 11.05 NOTICES. All demands, notices and communications under this
Agreement shall be in writing, personally delivered or mailed by certified mail,
return receipt requested, and shall be deemed to have been duly given upon
receipt (i) in the case of the Seller or the Servicer, to the agent for service
as specified in this Agreement, or at such other address as shall be designated
by the Seller or the Servicer in a written notice to the Trustee; (ii) in the
case of the Trustee, at the Corporate Trust Office; (iii) in the case of
Standard & Poor's, at [address], Attention: Asset Backed Surveillance
Department; and (iv) in the case of ▇▇▇▇▇'▇, at [address]Attention: ABS
Monitoring Department; and (v) in the case of Duff & ▇▇▇▇▇▇, at [address]. Any
notice required or permitted to be mailed to a Certificateholder shall be given
by first class mail, postage prepaid, at the address of such Holder as shown in
the Certificate Register. Any notice so mailed within the time prescribed in
this Agreement shall be conclusively presumed to have been duly given, whether
or not the Certificateholder shall receive such notice.
SECTION 11.06 SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid or unenforceable in any jurisdiction, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement 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 11.07 ASSIGNMENT. Notwithstanding anything to the contrary
contained in this Agreement, except as provided in Sections 6.03 and 7.03 and as
provided in the provisions of this Agreement concerning the resignation of the
Servicer, this Agreement may not be assigned by the Seller or the Servicer
without the prior written consent of Holders of Certificates evidencing not less
than 51% of the Voting Interests of the Class A Certificates and the Class B
Certificates, voting together as a single Class.
SECTION 11.08 CERTIFICATES NONASSESSABLE AND FULLY PAID.
Certificateholders shall not be personally liable for obligations of the Trust.
The interests represented by the Certificates shall be nonassessable for any
losses or expenses of the Trust or for any reason whatsoever, and, upon the
authentication thereof by the Trustee pursuant to Section 5.02 or 5.03, the
Certificates are and shall be deemed fully paid.
SECTION 11.09 NO PETITION. Each of the Servicer and the Trustee (not in
its individual capacity but solely as Trustee) covenants and agrees that prior
to the date which is one year and one day after the date upon which each Class
of Certificates has been paid in full, it will not at any time file, join in any
filing of, or cooperate with or encourage others to file any bankruptcy,
reorganization arrangement, insolvency or liquidation proceeding or other
proceedings under any federal or state bankruptcy or similar law against the
Seller. This Section 11.09 shall survive the termination of this Agreement or
the termination of the Servicer or the Trustee, as the case may be, under this
Agreement.
Each Certificateholder hereby covenants and agrees that it will not at any
time file, join in any filing of, or cooperate with or encourage others to file
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law against the Seller in connection with any obligations
relating to the Certificates.
--------------
60
IN WITNESS WHEREOF, the parties have caused this Pooling and Servicing
Agreement to be duly executed by their respective officers as of the day and
year first above written.
TOYOTA AUTO FINANCE RECEIVABLES LLC,
as Seller
By:
-------------------------------------
Name:
Title:
TOYOTA MOTOR CREDIT CORPORATION,
as Servicer
By:
-------------------------------------
Name:
Title:
[NAME OF TRUSTEE],
as Trustee
By:
-------------------------------------
Name:
Title:
61
EXHIBIT A
FORM OF SERVICER'S CERTIFICATE
PURSUANT TO SECTION 3.10 OF
POOLING AND SERVICING AGREEMENT
TOYOTA AUTO RECEIVABLES _________
GRANTOR TRUST
SERVICER'S CERTIFICATE FOR THE MONTH OF _______, _________
PRINCIPAL AND INTEREST COLLECTIONS
Beginning Pool Balance................................................. (1)$
Beginning Pool Factor [(1)/--].......................................... (2)
Principal Collected.................................................... (3)$
Interest Collected..................................................... (4)$
Less: Beginning Purchased Accrued
Interest Repaid.................................................. (5)
Plus: Purchased Accrued Interest--.....................................
End of Collection Period......................................... (6)
Net decrease/(increase) in Purchased
Accrued Interest [(5)-(6)]..................................... (7)$
Plus: Non-Reimbursable Interest Payment................................ (8)
Total Interest Received
[(4)-(5)+(6)+(8)]................................................ (9)$
Additional Deposits (4.06)
(i) Repurchase Amounts..................................... (10)
(ii) Liquidation Proceeds................................... (11)
Total Additional Deposits.............................................. (12)$
Total Available Funds [(3)+(9)+(12)]................................... (13)
A-1
TOYOTA AUTO RECEIVABLES ___ GRANTOR TRUST
SERVICER'S CERTIFICATE
FOR THE MONTH OF ____, ___
DISTRIBUTIONS:
CLASS A CLASS B TOTAL
Class Percentage % % 100.00%
------------ -------------- -------------
Pool Factor
------------ -------------- -------------
________Beginning Pool Balance
------------ -------------- -------------
________Ending Pool Balance
------------ -------------- -------------
Collected Principal (3)
------------ -------------- -------------
Collected Interest (9)
------------ -------------- -------------
Defaulted Receivables (13)
------------ -------------- -------------
Servicing Fee [(_________/12)x(1)] ( ) ( ) ( )
------------ -------------- -------------
Total Available Funds
------------ -------------- -------------
PAYMENTS TO CERTIFICATEHOLDERS
------------ -------------- -------------
Monthly Principal Payment
[(15)-(16)
------------ -------------- -------------
Interest Distributable Amount
[(15)x(__%/12]
------------ -------------- -------------
Total payments to
Certificateholders
------------ -------------- -------------
Amount due Class B but paid to
Class A
(subordination)
------------ -------------- -------------
Class A Interest Carryover
Shortfall
------------ -------------- -------------
Class B Interest Carryover
Shortfall
------------ -------------- -------------
Class A Principal Carryover
Shortfall
------------ -------------- -------------
Class B Principal Carryover
Shortfall
------------ -------------- -------------
Amounts to be paid to the Seller
------------ -------------- -------------
Payments from/(to) the Reserve Fund
------------ -------------- -------------
Reserve Fund Balance
------------ -------------- -------------
Specified Reserve Fund Balance
------------ -------------- -------------
Yield Maintenance Amount
------------ -------------- -------------
Required Yield Maintenance Amount
------------ -------------- -------------
A-2
TOYOTA AUTO RECEIVABLES ___ GRANTOR TRUST
SERVICER'S CERTIFICATE
FOR THE MONTH OF ____, ___
RECONCILIATION OF THE RESERVE FUND
Beginning Reserve Fund Balance.................................(45) $
Reserve Fund Prior to Payments to Seller.......................(48) $
Specified Reserve Fund Balance: (1) $
-------
Required Amount................................................(49)
Amount of Excess Spread released [(48)-(49)]...................(50)
A-3
TOYOTA AUTO RECEIVABLES ___ GRANTOR TRUST
SERVICER'S CERTIFICATE
FOR THE MONTH OF ____, ___
DELINQUENT ACCOUNTS
PERCENT OF
PERIOD OF DELINQUENCY UNITS AMOUNT POOL
30 - 59 days.......................... $ 0.00%
60 - 89 days.......................... 0.00%
90 days or more....................... 0.00% (A)
---------- ----------- ------------
Total $ 0.00%
----------- ------------
Repossession Inventory............. $ (B)
---------- ----------- ------------
Delinquency Percentage
(less than 1.5%?)
[(A)+(B)/(1)]............... %
------------
REALIZED LOSS ANALYSIS (SECTION 5.02)\
QUARTER
MONTH MONTH MONTH TOTAL
Realized Losses/(Recoveries) (X)..... $ $ $ $
Beginning Pool Balance (mils) (Y).... $ $ $ $
Realized Loss Percentage
(less than 1.5%?) [(X)/(Y)) *4]...... %
----------
Realized Losses Since Inception...... $
----------
Change in Realized Losses............ $
----------------- -------- ----------
PROCEEDS FROM INSURANCE AND DEALER
REPURCHASES
Proceeds received during the
month from physical damage
insurance....... $
----------------- -------- ----------
Proceeds received during the
month from Dealer repurchase
obligations relating to
Defaulted Receivables........
$
----------
A-4
EXHIBIT B
FORM OF TRUSTEE'S CERTIFICATE
PURSUANT TO SECTION 9.02 OR 9.03
OF THE POOLING AND SERVICING
AGREEMENT
_____________, as trustee (the "Trustee") of the Toyota Auto Receivables
______ Grantor Trust created pursuant to the Pooling and Servicing Agreement
(the "Agreement"), dated as of _________ , _____ , among Toyota Auto Finance
Receivables LLC, as Seller, Toyota Motor Credit Corporation, as Servicer, and
the Trustee, does hereby sell, transfer, assign and otherwise convey to the
[Seller][Servicer], without any recourse, representation or warranty, all of the
Trustee's right, title and interest in and to all of the Receivables identified
in the attached Servicer's Certificate as "Repurchased Receivables," which are
to be repurchased by the [Seller pursuant to Section 2.05 or 10.02] [Servicer
pursuant to Section 3.08 or 10.02] of the Agreement, and all security and
documents relating thereto.
Capitalized terms used herein that are not otherwise defined shall have
the meanings ascribed thereto in the Agreement.
IN WITNESS WHEREOF, I have hereunto set my hand this___th day of _____,
__.
------------------------------------
as Trustee
By:
-------------------------------------
Title:
B-1
EXHIBIT C
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 ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF 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.
TOYOTA AUTO RECEIVABLES 200_-_
GRANTOR TRUST __% ASSET BACKED CERTIFICATE, CLASS A
evidencing a fractional undivided interest in the Trust, as
defined below, the property of which includes a pool of retail
installment sale contracts secured by the new and used automobiles and
light duty trucks financed thereby and sold to the Trust by Toyota Auto
Finance Receivables LLC. The Final Scheduled Distribution Date is
_________.
(This Certificate does not represent an interest in or obligation of
Toyota Auto Finance Receivables LLC, Toyota Motor Credit Corporation or
any of their respective affiliates)
Cusip
Number R-A1 $
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a o ($o)
nonassessable, fully-paid, fractional undivided interest in the Toyota Auto
Receivables 200_-_ Grantor Trust (the "Trust") formed by Toyota Auto Finance
Receivables LLC, a Delaware limited liability company (the "Seller"). The Trust
was created pursuant to a Pooling and Servicing Agreement, dated as of o (the
"Agreement"), among the Seller, Toyota Motor Credit Corporation, as Servicer,
and o, as trustee (the "Trustee"). A summary of certain of the pertinent
provisions of the Agreement 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 issued under
the Agreement and designated as "Toyota Auto Receivables 200_-_ Grantor Trust o%
Asset Backed Certificates, Class A" (the "Class A Certificates"). Also issued
under the Agreement are Certificates designated as "Toyota Auto Receivables
200_-_ Grantor Trust o% Asset Backed Certificates, Class B" (the "Class B
Certificates" and, together with the Class A Certificates, the "Certificates").
The Class B Certificates are subordinated to the Class A Certificates to the
extent described in the Agreement. The aggregate undivided interest in the Trust
evidenced by all Class A Certificates is o%. This Class A Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Class A Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound. The property of the
Trust includes, among other things, a pool of retail installment sale contracts
(the "Receivables") for the new and used automobiles and light duty trucks
financed thereby (the "Financed Vehicles"), certain monies due under the
Receivables on and after the Cutoff Date, security interests in the Financed
Vehicles, certain bank accounts and the proceeds thereof, proceeds from claims
on physical damage, credit life and disability insurance policies covering the
Financed Vehicles, the Receivables or the related Obligors, an assignment of the
Seller's rights under the Receivables Purchase Agreement and the right of the
Seller to receive the proceeds of any Dealer Recourse relating to the
Receivables.
Under the Agreement, there will be distributed on the o day of each month
or, if such day is not a Business Day, the next succeeding Business Day (each, a
"Distribution Date"), commencing on o, to the Person in whose name this Class A
Certificate is registered at the close of business on the last calendar day
immediately preceding the related Distribution Date or, if Definitive
Certificates are issued, the last day of the immediately preceding calendar
month (each, a "Record Date"), such Class A Certificateholder's percentage
interest in the Class A
C-1
Distributable Amount for such Distribution Date actually distributed, together
with any outstanding Class A Interest Carryover Shortfall and any outstanding
Class A Principal Carryover Shortfall, all to the extent and as more
specifically set forth in the Agreement.
Distributions on this Class A Certificate will be made by the Trustee by
check or money order mailed to the related Class A Certificateholder of record
in the Certificate Register without the presentation or surrender of this Class
A Certificate or the making of any notation hereon except that with respect to
Class A Certificates registered in the name of Cede & Co., the nominee for The
Depository Trust Company, distributions will be made in the form of immediately
available funds. Except as otherwise provided in the Agreement and
notwithstanding the foregoing, the final distribution on this Class A
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A
Certificate at the office or agency maintained for that purpose by the Trustee
in the Borough of Manhattan, The City of New York.
The Certificates do not represent an obligation of, or an interest in, the
Seller, the Servicer or any of their respective affiliates. Under no
circumstances shall o in its individual capacity be personally liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Trust under the Agreement or the Certificates. Each of the
Agreement and this Certificate has been executed and delivered by o, not in its
individual capacity but solely as trustee of the Trust. Each of the
representations (other than the representations and warranties of the Trustee
set forth in Section 9.14), undertakings and agreements made by o in the
Agreement is made on the part of the Trust and intended not as a representation,
undertaking or agreement by o in its individual capacity, but is made and
intended for the purpose of binding only the Trust. The Certificates are limited
in right of payment to certain collections and recoveries respecting the
Receivables and the monies on deposit in the Reserve Fund [and the Yield
Maintenance Account,] all as more specifically set forth in the Agreement. A
copy of the Agreement may be examined during normal business hours at the
principal office of the Trustee, and at such other places, if any, designated by
the Trustee, by any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
parties thereto and the rights of the Certificateholders under the Agreement at
any time by the Seller, the Servicer and the Trustee with the consent of the
Holders of Certificates evidencing not less than 51% of the Voting Interests of
each Class of Certificates acting together as a single Class (but excluding for
purposes of such calculation and action all Certificates held by TMCC, TAFR LLC,
or any of their affiliates). Any such consent by the Holder of this Class A
Certificate shall be conclusive and binding on such Holder and on all future
Holders of this Class A Certificate and of any Class A Certificate issued upon
the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Class A Certificate. The Agreement
also permits the amendment thereof, in certain circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Class A Certificate is registrable in the
Certificate Register upon surrender of this Class A Certificate for registration
of transfer at the offices or agencies maintained by the Trustee in its capacity
as Certificate Registrar, or by any successor Certificate Registrar, in The City
of New York, accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar 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.
The Class A Certificates are issuable only as registered Certificates
without coupons in denominations of $1,000 and integral multiples thereof
(except for one Class A Certificate in a smaller minimum denomination
representing any remaining portion of the Original Class A Certificate Balance).
As provided in the Agreement and subject to certain limitations therein set
forth, Class A Certificates are exchangeable for new Class A Certificates of
authorized denominations evidencing the same aggregate principal amount, 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 charges payable in
connection therewith.
Prior to due presentation of this Class A Certificate for transfer, the
Trustee, the Certificate Registrar and any of their respective agents may treat
the Person in whose name this Class A Certificate is registered as the owner
hereof for the purposes of receiving distributions and for all other purposes,
and neither the Trustee, the Certificate Registrar nor any such agent shall be
affected by any notice to the contrary.
C-2
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 or the
maturity or liquidation of the last Receivable and the disposition of all
property held as part of the Trust. The Seller or the Servicer, or any successor
to the Servicer, may, at its option, purchase the corpus of the Trust at a price
specified in the Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement of the Certificates; however,
such right of purchase is exercisable only on a Distribution Date following the
last day of the month in which the Pool Balance is 10% or less of the Original
Pool Balance.
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the Trustee, by manual signature, this Class A
Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this Class A Certificate to be duly executed.
TOYOTA AUTO RECEIVABLES 200_-_
Dated: o GRANTOR TRUST
By:
--------------------------------------
not in its individual capacity
but solely as Trustee
By:
--------------------------------------
Authorized Officer
This is one of the Certificates referred to in the within-mentioned
Agreement.
------------------------------------------
as Trustee
By:
--------------------------------------
Authorized Officer
C-3
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
_______________________________________________________________________________
(Please print or typewrite name and address, including postal zip code, of
assignee)
_______________________________________________________________________________
The within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_____________________________ Attorney to transfer said Certificate on the books
of the Certificate Registrar, with full power of substitution in the premises.
Dated:
-------------------------------------
Signature Guaranteed:
--------------
* NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS IT
APPEARS UPON THE FACE OF THE WITHIN CERTIFICATE IN EVERY PARTICULAR, WITHOUT
ALTERATION, ENLARGEMENT OR ANY CHANGE WHATEVER. SUCH SIGNATURE MUST BE
GUARANTEED BY A MEMBER FIRM OF THE NEW YORK STOCK EXCHANGE OR A COMMERCIAL BANK
OR TRUST COMPANY.
C-4
EXHIBIT D
FORM OF CLASS B CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF 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.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS
THE TRANSFEREE (A) REPRESENTS TO THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT AN
EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED, OR SECTION 4975 OF THE CODE OR A PERSON ACTING ON BEHALF OF A
PLAN OR USING THE ASSETS OF A PLAN TO EFFECT SUCH PURCHASE (2) AN INSURANCE
COMPANY PURCHASING SUCH CERTIFICATE OR INTEREST FROM FUNDS IN A GENERAL ACCOUNT
OR SEPARATE ACCOUNT (WITH CERTAIN LIMITATIONS) OR (B) DELIVERS AN OPINION OF
COUNSEL, EACH IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO
HEREIN. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED
TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT
TO ERISA OR TO THE CODE OR A PERSON ACTING ON BEHALF OF A PLAN OR USING THE
ASSETS OF A PLAN TO EFFECT SUCH PURCHASE OR TO AN INSURANCE COMPANY FOR AMOUNTS
IN A NON-EXEMPT INSURANCE COMPANY GENERAL ACCOUNT OR SEPARATE ACCOUNT WITHOUT
DELIVERING THE OPINION OF COUNSEL DESCRIBED ABOVE SHALL BE VOID AND OF NO
EFFECT.
TOYOTA AUTO RECEIVABLES 200_-_ GRANTOR TRUST
___% ASSET BACKED CERTIFICATE, CLASS B
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of retail installment sale
contracts secured by the new and used automobiles and light duty trucks
feinanced thereby and sold to the Trust by Toyota Auto Finance
Receivables LLC. The Final Scheduled Distribution Date is
____________.
(This Certificate does not represent an interest in or obligation of
Toyota Auto Finance Receivables LLC, Toyota Motor Credit Corporation or
any of their respective affiliates)
Cusip
Number R--B1 $
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a o ($o)
nonassessable, fully-paid, fractional undivided interest in the Toyota Auto
Receivables 200_-_ Grantor Trust (the "Trust") formed by Toyota Auto Finance
Receivables LLC, a Delaware limited liability company (the "Seller"). The Trust
was created pursuant to a Pooling and Servicing Agreement dated as of o (the
"Agreement") among the Seller, Toyota Motor Credit Corporation, as Servicer, and
o, as trustee (the "Trustee"). A summary of certain of the pertinent provisions
of the Agreement 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 issued under
the Agreement and designated as "Toyota Auto Receivables 200_-_ Grantor Trust o%
Asset Backed Certificates, Class B" (the "Class B
D-1
Certificates"). Also issued under the Agreement are Certificates designated as
"Toyota Auto Receivables 200_-_ Grantor Trust_% Asset Backed Certificates, Class
A" (the "Class A Certificates" and, together with the Class B Certificates, the
"Certificates"). The Class B Certificates are subordinated to the Class A
Certificates to the extent described in the Agreement. The aggregate undivided
interest 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 the Holder of this Class B
Certificate by virtue of the acceptance hereof assents and by which such Holder
is bound. The property of the Trust includes, among other things, a pool of
retail installment sale contracts (the "Receivables") for the new and used
automobiles and light duty trucks financed thereby (the "Financed Vehicles"),
certain monies due under the Receivables on and after the Cutoff Date, security
interests in the Financed Vehicles, certain bank accounts and the proceeds
thereof, proceeds from claims on physical damage, credit life and disability
insurance policies covering the Financed Vehicles, the Receivables or the
related Obligors, an assignment of the Seller's rights under the Receivables
Purchase Agreement and the right of the Seller to receive the proceeds of any
Dealer Recourse relating to the Receivables.
Under the Agreement, there will be distributed on the o day of each month
or, if such day is not a Business Day, the next succeeding Business Day (each, a
"Distribution Date"), commencing ono, to the Person in whose name this Class B
Certificate is registered at the close of business on the last calendar day
immediately preceding the related Distribution Date or, if Definitive
Certificates are issued, the last day of the month immediately preceding the
month of such distribution (each, a "Record Date"), such Class B
Certificateholder's percentage interest in an amount equal to the Class B
Distributable Amount for such Distribution Date actually distributed, together
with any outstanding Class B Interest Carryover Shortfall and any outstanding
Class B Principal Carryover Shortfall, all to the extent and as more
specifically set forth in the Agreement.
Distributions on this Class B Certificate will be made by the Trustee by
check or money order mailed to the related Class B Certificateholder of record
in the Certificate Register without the presentation or surrender of this Class
B Certificate or the making of any notation hereon. Except as otherwise provided
in the Agreement and notwithstanding the above, the final distribution on this
Class B Certificate will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this Class B
Certificate at the office or agency maintained for that purpose by the Trustee
in the Borough of Manhattan, The City of New York.
The Certificates do not represent an obligation of, or an interest in, the
Seller, the Servicer or any of their respective affiliates. Under no
circumstances shall _ in its individual capacity be personally liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Trust under the Agreement or the Certificates. Each of the
Agreement and this Certificate has been executed and delivered by o, not in its
individual capacity but solely as trustee of the Trust. Each of the
representations (other than the representations and warranties of the Trustee
set forth in Section 9.14), undertakings and agreements made by _ in the
Agreement is made on the part of the Trust and intended not as a representation,
undertaking or agreement by _ in its individual capacity, but is made and
intended for the purpose of binding only the Trust. The Certificates are limited
in right of payment to certain collections and recoveries respecting the
Receivables and the monies on deposit in the Reserve Fund [and the Yield
Maintenance Account,] all as more specifically set forth in the Agreement. A
copy of the Agreement may be examined during normal business hours at the
principal office of the Trustee, and at such other places, if any, designated by
the Trustee, by any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
parties thereto and the rights of the Certificateholders under the Agreement at
any time by the Seller, the Servicer and the Trustee with the consent of the
Holders of Certificates evidencing not less than 51% of the Voting Interests of
each Class of Certificates acting together as a single Class (but excluding for
purposes of such calculation and action all Certificates held by TMCC, TAFR LLC,
or any of their affiliates). Any such consent by the Holder of this Class B
Certificate shall be conclusive and binding on such Holder and on all future
Holders of this Class B Certificate and of any Class B Certificate issued upon
the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Class B Certificate. The Agreement
also permits the amendment thereof, in certain circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Class B Certificate is registrable in the
Certificate Register upon surrender of this Class B Certificate for registration
of transfer at the offices or agencies maintained by the Trustee in its capacity
as Certificate Registrar, or by any
D-2
successor Certificate Registrar, in The City of New York, accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar 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.
No transfer of a Class B Certificate shall be made unless the Trustee
shall have received a representation from the transferee of such Certificate
acceptable to and in form and substance satisfactory to the Trustee (in the
event such Certificate is a Definitive Certificate, such requirement will be
satisfied only by the Trustee's receipt of a representation letter from the
transferee to the effect that:
(i) such transferee (A) is not an employee benefit plan or
arrangement subject to Section 406 of ERISA or a plan subject to Section
4975 of the Code (a "Plan"), nor a person acting on behalf of a Plan nor
using the assets of a Plan to effect such transfer, and (B) is not an
insurance company purchasing a Class B Certificate with funds contained in
an "insurance company general account" or an "insurance company separate
account" (as defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTCE 95-60")) as to which there is a Plan with respect
to which the amount of such general account's reserves and liabilities for
the contracts held by or on behalf of such Plan and all other Plans
maintained by the same employer (or affiliate thereof as defined in
Section V(a)(1) of PTCE 95-60) of by the same employee organization exceed
10% of the total of all reserves and liabilities of such general account
(as such amounts are determined under Section I(a) of PTCE 95-60) at the
date of acquisition; or
(ii) is a Plan or a person acting on behalf of a Plan or using the
assets of a Plan to effect such transfer or is an insurance company
purchasing a Class B Certificate with funds contained in an insurance
company general account OR separate account, having attached thereto an
opinion of counsel satisfactory to the Trustee, which opinion shall not be
an expense of either the Trustee or the Trust Fund, addressed to the
Trustee, to the effect that the purchase or holding of such Class B
Certificate will not result in the assets of the Trust Fund being deemed
to be "plan assets" and subject to the prohibited transaction provisions
of ERISA and the Code and will not subject the Trustee to any obligation
in addition to those expressly undertaken in this Agreement or to any
liability.
With respect to a Class B Certificate that is a Book-Entry Certificate, in
the event the representation letter referred to in the preceding sentence is not
furnished, the representations contained in clause (i) above shall be deemed to
have been made to the Trustee by the transferee's (including an initial
acquiror's) acceptance of such Certificate. Notwithstanding anything else to the
contrary herein, any purported transfer of a Class B Certificate to or on behalf
of an employee benefit plan subject to ERISA or to the Code or a person acting
on behalf of a Plan or using the assets of a Plan to effect such transfer or to
an insurance company purchasing with funds from a general account or separate
account not exempt pursuant to PTCE 95-60 without the delivery to the Trustee of
an opinion of counsel satisfactory to the Trustee as described in clause (ii)
above shall be void and of no effect.
The Class B Certificates are issuable only as registered Certificates
without coupons in denominations of $1,000 and integral multiples thereof
(except for one Class B Certificate in a smaller minimum denomination
representing any remaining portion of the Original Class B Certificate 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 principal amount, 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 charges payable in
connection therewith.
Prior to due presentation of this Class B Certificate for transfer, the
Trustee, the Certificate Registrar and any of their respective agents may treat
the Person in whose name this Class B Certificate is registered as the owner
hereof for the purpose of receiving distributions and for all other purposes,
and neither the Trustee, the Certificate Registrar nor 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 or the
maturity or liquidation of the last Receivable and the disposition of all
property held as part of the Trust. The Seller or the Servicer, or any successor
to the Servicer, may, at its option, purchase the corpus of the Trust at a price
specified in the Agreement, and such purchase of the Receivables and other
property of the Trust will effect early retirement of the Certificates; however,
such right of purchase is exercisable only on a Distribution Date following the
last day of the month in which the Pool Balance is 10% or less of the Original
Pool Balance.
D-3
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the Trustee, by manual signature, this Class B
Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this Class B Certificate to be duly executed.
TOYOTA AUTO RECEIVABLES 200_-_
Dated: GRANTOR TRUST
By:
--------------------------------------
not in its individual capacity
but solely as Trustee
By:
--------------------------------------
Authorized Officer
This is one of the Certificates referred to in the within-mentioned
Agreement.
as Trustee
By:
-------------------------------------
Authorized Officer
D-4
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
--------------------------------------------------------------------------------
(Please print or typewrite name and address, including postal zip code, of
assignee)
--------------------------------------------------------------------------------
he within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_____________________________ Attorney to transfer said Certificate on the books
of the Certificate Registrar, with full power of substitution in the premises.
Dated:
--------------------------------------
Signature Guaranteed
--------------------------------------
--------------
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
D-5
EXHIBIT E
FORM OF
TRANSFEREE CERTIFICATE
TOYOTA AUTO RECEIVABLES 200_-_ GRANTOR TRUST
O% ASSET BACKED CERTIFICATES, CLASS B
I, [Name], hereby represent and warrant to o, as trustee (the "Trustee")
of the above-named trust, as follows:
1. I am [an officer of [Name of Transferee],] the proposed transferee
("Transferee") of an Ownership Interest in a Class B Certificate (the
"Certificate") issued pursuant to the Pooling and Servicing Agreement (the
"Agreement") dated as of o, relating to the above-referenced securities, each
among Toyota Auto Finance Receivables LLC, as seller (the "Seller"), Toyota
Motor Credit Corporation, as servicer and the Trustee. Capitalized terms used
but not defined herein shall have the meanings ascribed thereto in the
Agreement. [Transferee has authorized me to make the following representations
and warranties on behalf of Transferee.]
2. The Transferee agrees to require a Transfer Certificate substantially
in the form of this Transfer Certificate from any Person to whom the Transferee
attempts to Transfer its interest in the Certificate and in connection with any
Transfer by a Person for whom the Transferee is acting as nominee, trustee or
agent. The Transferee will not Transfer its interest or cause any interest to be
Transferred to any Person that the Transferee knows cannot truthfully complete a
Transfer Affidavit.
3. CHECK APPROPRIATE BOX:
[ ] The Transferee (A) is not an employee benefit plan or arrangement
subject to Section 406 of ERISA or a plan subject to Section 4975 of the Code (a
"Plan"), nor a person acting on behalf of a Plan nor using the assets of a Plan
to effect such transfer, and (B) is not an insurance company purchasing a Class
B Certificate with funds contained in an "insurance company general account" or
an "insurance company separate account" (as defined in Section V(e) of
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) as to which there
is a Plan with respect to which the amount of such general account's reserves
and liabilities for the contracts held by or on behalf of such Plan and all
other Plans maintained by the same employer (or affiliate thereof as defined in
Section V(a)(1) of PTCE 95-60) of by the same employee organization exceed 10%
of the total of all reserves and liabilities of such general account (as such
amounts are determined under Section I(a) of PTCE 95-60) at the date of
acquisition; or
[ ] The Transferee is a Plan or a person acting on behalf of a Plan or
using the assets of a Plan to effect such transfer or is an insurance company
purchasing a Class B Certificate with funds contained in an insurance company
general account or separate account, but has attached hereto an opinion of
counsel addressed to the Trustee to the effect that the purchase or holding of
such Class B Certificate will not result in the assets of the Trust Fund being
deemed to be "plan assets" and subject to the prohibited transaction provisions
of ERISA and the Code and will not subject the Trustee to any obligation in
addition to those expressly undertaken in the Agreement or to any liability.
IN WITNESS WHEREOF, the undersigned has caused this instrument to be
executed this ___ day of __________, 20__.
--------------------------------------
Print Name of Transferee
[By:
--------------------------------------
Name:
Title:]
E-1
EXHIBIT F
FORM OF LETTER OF REPRESENTATIONS
[OMITTED]
F-1
SCHEDULE A
SCHEDULE OF RECEIVABLES
A-1