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TOYOTA LEASING, INC.
AND
U.S. BANK NATIONAL ASSOCIATION, AS 1998-C SECURITIZATION TRUSTEE
TOYOTA AUTO LEASE TRUST 1998-C
AUTO LEASE ASSET-BACKED CERTIFICATES
1998-C SECURITIZATION TRUST AGREEMENT
Dated as of December 1, 1998
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TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
1.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
1.02 Article and Section References. . . . . . . . . . . . . . . . . . . . . .2
ARTICLE II CREATION OF TRUST; ESTABLISHMENT OF SUBI SECURITIES
ACCOUNT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
2.01 Creation of Trust; Establishment of SUBI Securities Account . . . . . . .3
2.02 Conveyance of 1998-C SUBI Certificate . . . . . . . . . . . . . . . . . .3
2.03 Acceptance by 1998-C Securitization Trustee . . . . . . . . . . . . . . .4
2.04 Transfer of Collections . . . . . . . . . . . . . . . . . . . . . . . . .4
ARTICLE III ALLOCATIONS, APPLICATIONS AND PAYMENTS; THE
RESERVE FUND; STATEMENTS TO CERTIFICATEHOLDERS. . . . . . . . . . . . .5
3.01 Allocations, Applications and Payments. . . . . . . . . . . . . . . . . .5
3.02 1998-C SUBI Certificateholders' Account; The Reserve Fund . . . . . . . 20
3.03 Statements to Certificateholders. . . . . . . . . . . . . . . . . . . . 26
ARTICLE IV THE CERTIFICATES . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
4.01 The Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
4.02 Authentication and Delivery of Certificates . . . . . . . . . . . . . . 29
4.03 Registration of Transfer and Exchange of Certificates . . . . . . . . . 30
4.04 Mutilated, Destroyed, Lost or Stolen Certificates . . . . . . . . . . . 34
4.05 Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . 34
4.06 Access to List of Certificateholders' Names and Addresses . . . . . . . 34
4.07 Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . 35
4.08 Temporary Certificates. . . . . . . . . . . . . . . . . . . . . . . . . 35
4.09 Book-Entry Certificates . . . . . . . . . . . . . . . . . . . . . . . . 36
4.10 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
4.11 Definitive Certificates . . . . . . . . . . . . . . . . . . . . . . . . 37
4.12 Tax Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
4.13 ERISA Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE V THE TRANSFEROR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
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PAGE
5.01 Representations of Transferor . . . . . . . . . . . . . . . . . . . . . 39
5.02 Liability of Transferor: Indemnities. . . . . . . . . . . . . . . . . . 41
5.03 Merger or Consolidation of, or Assumption of the Obligations
of, Transferor; Certain Limitations . . . . . . . . . . . . . . . . . . 41
5.04 Limitation on Liability of Transferor and Others. . . . . . . . . . . . 43
5.05 Transferor May Own Investor Certificates. . . . . . . . . . . . . . . . 43
5.06 No Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
5.07 Tax Matters Partner . . . . . . . . . . . . . . . . . . . . . . . . . . 43
5.08 Maturity Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ARTICLE VI THE 1998-C SECURITIZATION TRUSTEE. . . . . . . . . . . . . . . . . . . 44
6.01 Duties of the 1998-C Securitization Trustee . . . . . . . . . . . . . . 44
6.02 Certain Matters Affecting the 1998-C Securitization Trustee . . . . . . 45
6.03 1998-C Securitization Trustee Not Liable for Certificates or
Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
6.04 1998-C Securitization Trustee May Own Certificates. . . . . . . . . . . 48
6.05 1998-C Securitization Trustee's Fees and Expenses . . . . . . . . . . . 48
6.06 Eligibility Requirements for 1998-C Securitization Trustee. . . . . . . 48
6.07 Resignation or Removal of 1998-C Securitization Trustee . . . . . . . . 48
6.08 Successor 1998-C Securitization Trustee . . . . . . . . . . . . . . . . 49
6.09 Merger or Consolidation of 1998-C Securitization Trustee. . . . . . . . 50
6.10 Appointment of Co-Trustee or Separate Trustee . . . . . . . . . . . . . 50
6.11 Representations and Warranties of Trustee . . . . . . . . . . . . . . . 51
6.12 Tax Returns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
6.13 Trustee May Enforce Claims Without Possession of Certificates . . . . . 52
6.14 Suit for Enforcement. . . . . . . . . . . . . . . . . . . . . . . . . . 52
6.15 Rights of Certificateholders to Direct Trustee. . . . . . . . . . . . . 52
6.16 No Petition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
6.17 Negative Pledge . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
ARTICLE VII TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
7.01 Termination of the 1998-C Securitization Trust. . . . . . . . . . . . . 53
7.02 Optional Purchase of 1998-C SUBI. . . . . . . . . . . . . . . . . . . . 55
ARTICLE VIII ACCUMULATION EVENTS AND SWAP TERMINATIONS. . . . . . . . . . . . . . 56
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PAGE
8.01 Accumulation Events . . . . . . . . . . . . . . . . . . . . . . . . . . 56
8.02 Swap Terminations, Events of Default and Termination Events . . . . . . 56
ARTICLE IX MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . 57
9.01 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
9.02 Protection of Title to Trust. . . . . . . . . . . . . . . . . . . . . . 59
9.03 Limitation on Rights of Certificateholders. . . . . . . . . . . . . . . 60
9.04 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
9.05 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
9.06 Severability of Provisions: Counterparts. . . . . . . . . . . . . . . . 62
9.07 Assignment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
9.08 Certificates Nonassessable and Fully Paid . . . . . . . . . . . . . . . 62
9.09 Inventory Advances. . . . . . . . . . . . . . . . . . . . . . . . . . . 62
ARTICLE X AGENT FOR SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
10.01 Agent for Service of Transferor . . . . . . . . . . . . . . . . . . . . 63
10.02 Agent of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
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PAGE
EXHIBITS:
Exhibit A-1 Form of Class A-1 Certificate. . . . . . . . . . . . . . . . .A-1
Exhibit A-2 Form of Class A-2 Certificate. . . . . . . . . . . . . . . .A-2-1
Exhibit A-3 Form of Class A-3 Certificate. . . . . . . . . . . . . . . .A-3-1
Exhibit B Form of Class B Certificate. . . . . . . . . . . . . . . . . .B-1
Exhibit C Form of Transferor Certificate . . . . . . . . . . . . . . . .C-1
Exhibit D Form of Rule 144A Transferee Certificate . . . . . . . . . . .D-1
Exhibit E Form of Non-Rule 144A Transferee Certificate . . . . . . . . .E-1
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1998-C SECURITIZATION TRUST AGREEMENT
THIS 1998-C SECURITIZATION TRUST AGREEMENT, dated as of December 1,
1998, is made with respect to the formation of the TOYOTA AUTO LEASE TRUST
1998-C (the "1998-C Securitization Trust"), between TOYOTA LEASING, INC. a
California corporation ("Transferor" or, in its capacity as transferor
hereunder, the "Transferor"), U.S. Bank National Association, a national
banking association, as trustee (the "1998-C Securitization Trustee").
RECITALS
A. The Toyota Lease Trust (the "Titling Trust") is governed by the
Amended and Restated Trust and Servicing Agreement dated as of October 1,
1996 (the "Titling Trust Agreement") among Toyota Motor Credit Corporation, a
California corporation, as grantor, initial beneficiary and servicer ("TMCC"
and in its capacity as servicer, the "Servicer"), TMTT, Inc., a Delaware
corporation, as trustee (the "Titling Trustee") and, for the limited purposes
stated therein, First Bank National Association (now known as U.S. Bank
National Association), a national banking association, as trust agent.
Pursuant to the Co-Trustee Agreement, Delaware Trust Capital Management, Inc.
will act as co-trustee of the Titling Trust. The Titling Trust acquires and
holds title to various automobiles, light-duty trucks, related lease
contracts and certain other assets in accordance with the terms of the
Titling Trust Agreement. Capitalized terms used and not defined in these
Recitals have the meanings given in Article I below.
B. Concurrently herewith, TMCC, the Titling Trustee U.S. Bank National
Association (formerly known as First Bank National Association) ("U.S. Bank")
have entered into the 1998-C SUBI Supplement to the Titling Trust Agreement
dated as of December 1, 1998 (the "1998-C SUBI Supplement") pursuant to which
the Titling Trust, at the direction of TMCC, will create and issue a special
unit of beneficial interest in the Titling Trust (the "1998-C SUBI"), whose
beneficiaries generally will be entitled to the net cash flow arising from
the related SUBI Portfolio (such SUBI Portfolio, the "1998-C SUBI
Portfolio"). The 1998-C SUBI will be evidenced by (i) one certificate (the
"1998-C SUBI Certificate") evidencing beneficial interests in the assets of
the 1998-C SUBI other than proceeds of the Residual Value Insurance Policies,
(whether or not such proceeds are attributable to the 1998-C Leased Vehicles
and the ▇▇▇▇-▇ ▇▇▇▇▇▇▇▇▇) and (ii) one certificate (the "1998-C SUBI
Insurance Certificate") evidencing beneficial interests in the assets of the
1998-C SUBI that are proceeds of the Residual Value Insurance Policies
attributable to the 1998-C Leased Vehicles and the 1998-C Contracts (which
assets are net of claims adjustment expenses). The 1998-C SUBI Certificate
and the 1998-C SUBI Insurance Certificate collectively represent a 100%
beneficial interest in the 1998-C SUBI.
C. Concurrently herewith, the Titling Trustee (on behalf of the
Titling Trust), and the Servicer and U.S. Bank also have entered into a
1998-C SUBI Servicing Supplement to the Titling Trust Agreement dated as of
December 1, 1998 (the "1998-C SUBI Servicing Supplement"), pursuant to which
the terms of the Titling Trust Agreement will be supplemented insofar as they
apply to the 1998-C SUBI Portfolio, providing for further servicing
obligations that will benefit the holders of the 1998-C SUBI Certificate.
1
D. Concurrently herewith, TMCC and the Transferor have entered into
the 1998-C SUBI Certificate Purchase and Sale Agreement dated as of December
1, 1998 (the "SUBI Certificate Purchase and Sale Agreement"), pursuant to
which TMCC sold to the Transferor, without recourse, all of TMCC's right,
title and interest in and to the 1998-C SUBI, the 1998-C SUBI Certificate and
the 1998-C SUBI Insurance Certificate, all monies due thereon and the right
to realize on any property subject to the 1998-C SUBI, and all proceeds
thereof, for the consideration stated therein. The parties hereto
acknowledge that the Transferor is not transferring or conveying to the
1998-C Securitization Trust or the 1998-C Securitization Trustee any right to
or interest in the 1998-C SUBI Insurance Certificate.
E. The parties hereto desire that U.S. Bank, as securities
intermediary (the "SUBI Securities Intermediary"), establish a securities
account (as defined in Section 8-102 of the UCC) in the name of U.S. Bank, as
1998-C Securitization Trustee (the "1998-C SUBI Securities Account") to which
the 1998-C SUBI Certificate will be transferred pursuant to this 1998-C
Securitization Trust Agreement.
F. The parties desire to enter into this 1998-C Securitization Trust
Agreement to create the 1998-C Securitization Trust, to provide for the
issuance by the 1998-C Securitization Trust of certain Certificates and to
provide for the exchange of those Certificates for the 1998-C SUBI
Certificate in connection with a Securitized Financing by the Transferor.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.01 DEFINITIONS.
For all purposes of this 1998-C Securitization Trust Agreement, except as
otherwise expressly provided or unless the context otherwise requires, (a)
unless otherwise defined herein, all capitalized terms used herein shall have
the meanings attributed to them in the Annex of Definitions attached to the
Titling Trust Agreement or the Annex of Supplemental Definitions attached to the
1998-C SUBI Supplement; PROVIDED, HOWEVER, that in the event a term is defined
both in the Annex of Definitions and in the Annex of Supplemental Definitions,
the definition in the Annex of Supplemental Definitions shall prevail, (b)
defined terms include (i) all genders and (ii) the plural as well as the
singular, (c) all references to words such as "herein", "hereof" and the like
shall refer to this 1998-C Securitization Trust Agreement as a whole and not to
any particular article or section within this 1998-C Securitization Trust
Agreement, (d) the term "include" and all variations thereon shall mean "include
without limitation", and (e) the term "or" shall include "and/or".
2
1.02 ARTICLE AND SECTION REFERENCES.
Except as otherwise specified herein, all article and section references
shall be to Articles and Sections in this 1998-C Securitization Trust Agreement.
ARTICLE II
CREATION OF TRUST; ESTABLISHMENT OF SUBI SECURITIES ACCOUNT
2.01 CREATION OF TRUST; ESTABLISHMENT OF SUBI SECURITIES ACCOUNT.
(a) CREATION OF TRUST. Upon the execution of this 1998-C
Securitization Trust Agreement by the parties hereto, there is hereby created
the Toyota Auto Lease Trust 1998-C.
(b) ESTABLISHMENT OF 1998-C SUBI SECURITIES ACCOUNT.
(i) Pursuant to a separate agreement dated December 1, 1998,
between the 1998-C Securitization Trust and the SUBI Securities
Intermediary, a securities account (as such term is defined in
Section 8-501(a) of the UCC) (the "1998-C SUBI Securities Account") will
be established and maintained with U.S. Bank, in its capacity as SUBI
Securities Intermediary, for the benefit of the Toyota Auto Lease Trust
1998-C.
(ii) The Transferor shall direct the SUBI Securities
Intermediary to credit to the 1998-C SUBI Securities Account the
interests in the 1998-C SUBI Certificate transferred, assigned, or
otherwise conveyed by the Transferor as described in Section 2.02 of this
1998-C Securitization Trust Agreement.
2.02 CONVEYANCE OF 1998-C SUBI CERTIFICATE.
(a) CONVEYANCE TO 1998-C SECURITIZATION TRUSTEE. In consideration of
the 1998-C Securitization Trustee's delivery to the Transferor of executed and
authenticated Investor Certificates, in authorized denominations in the
aggregate equal to the Initial Class A-1 Certificate Balance, Initial Class A-2
Certificate Balance, Initial Class A-3 Certificate Balance and Initial Class B
Certificate Balance, and of the executed and authenticated Transferor
Certificate, the Transferor does hereby transfer, assign and otherwise convey to
the 1998-C Securitization Trustee, in trust for the benefit of the
Certificateholders, to the full extent of the Transferor's interest therein,
without recourse (subject to the Transferor's obligations herein):
(i) all of the right, title and interest of the Transferor in
and to the 1998-C SUBI Certificate, the rights in and benefits of the
1998-C SUBI evidenced by the 1998-C SUBI Certificate and all monies due
thereon and paid thereon or in respect thereof;
(ii) the right to realize upon any property that may be deemed
to secure the foregoing;
3
(iii) all rights accruing to the holder of the 1998-C SUBI
Certificate under the Titling Trust Agreement, the 1998-C SUBI Supplement
and the 1998-C SUBI Servicing Supplement; and
(iv) all proceeds of the foregoing; provided that all monies and
payments due or payable under any Residual Value Insurance Policies
applicable to the 1998-C Leased Vehicles and the 1998-C Contracts and the
right to receive such payments and monies, as evidenced by the 1998-C
SUBI Insurance Certificate, are retained by the Transferor and are not
hereby transferred, assigned or otherwise conveyed to the 1998-C
Securitization Trustee nor will they, under any circumstances, be subject
to the lien of the 1998-C Securitization Trust or any claim by 1998-C
Securitization Trustee.
(b) GRANT OF SECURITY INTEREST. The Transferor also does hereby grant
to the 1998-C Securitization Trustee a security interest in all of the foregoing
(exclusive of the monies and payments referred to in the proviso in Section
2.02(a)(iv)), and the 1998-C Securitization Trustee shall have all the rights,
powers and privileges thereto and therein of a secured party under the New York
UCC.
(c) TERMINATION. The rights and powers granted herein to the
1998-C Securitization Trustee have been granted in order to perfect its
security interests in the assets referred to in Section 2.02(a), are powers
coupled with an interest and will neither be affected by the bankruptcy of
any other person or entity nor by the lapse of time. The obligations of the
SUBI Securities Intermediary hereunder shall continue in effect until the
security interests of the 1998-C Securitization Trustee in the 1998-C SUBI
Securities Account have been terminated pursuant to the terms of this
Securitization Trust Agreement and the 1998-C Securitization Trustee has
notified the SUBI Securities Intermediary of such termination in writing. In
the event of a termination of this 1998-C Securitization Trust Agreement
pursuant to Section 7.01(a)(i) or (iii), or upon repurchase of the 1998-C
SUBI pursuant to Section 7.02, the 1998-C Securitization Trustee is hereby
authorized to convey all interests in the 1998-C SUBI Certificate and in the
1998-C SUBI evidenced thereby to the Transferor. In the event of a
termination of this 1998-C Securitization Trust Agreement pursuant to Section
7.01(a)(iv) or (v), the 1998-C Securitization Trustee is hereby authorized to
convey all interests in the 1998-C SUBI Certificate and in the 1998-C SUBI
evidenced thereby to the purchaser thereof. The 1998-C Securitization
Trustee is hereby authorized and directed to seek a buyer for the 1998-C SUBI
Certificate on the occurrence of a Swap Termination in connection with the
related liquidation of the 1998-C Securitization Trust, in each case pursuant
to Section 8.02. The 1998-C Securitization Trustee shall not be responsible
for or have any liability with respect to any losses incurred in connection
with any such liquidation, other than as a result of its own negligence or
willful misfeasance.
2.03 ACCEPTANCE BY 1998-C SECURITIZATION TRUSTEE.
The 1998-C Securitization Trustee does hereby accept all consideration
conveyed by the Transferor pursuant to Section 2.02 and declares that the 1998-C
Securitization Trustee shall hold such consideration in trust as herein set
forth for the benefit of the Certificateholders, subject to the terms and
provisions of this 1998-C Securitization Trust Agreement.
4
In accepting the 1998-C SUBI Certificate, the 1998-C Securitization
Trustee does hereby release all claims to the Titling Trust Assets allocated to
the UTI Sub-Trust or to any Other SUBI Sub-Trust and, in the event that such
release is not given effect, to fully subordinate all claims it may be deemed to
have against the Titling Trust Assets allocated thereto.
2.04 TRANSFER OF COLLECTIONS.
The parties hereto acknowledge that the Titling Trustee, on behalf of the
Titling Trust, has made a complete transfer to the 1998-C Securitization Trustee
of the Collections in respect of the 1998-C SUBI Assets contained in all
accounts maintained by the Titling Trustee (excluding proceeds of the Residual
Value Insurance Policies, as evidenced by the 1998-C SUBI Insurance Certificate,
which are the sole property of the Transferor) and, except as provided in this
1998-C SUBI Securitization Trust Agreement, the 1998-C SUBI Supplement and the
1998-C SUBI Servicing Supplement, neither the Titling Trustee nor the Servicer
has any right to direct such funds to a third party or to receive such funds
(other than to receive such funds pursuant to an investment thereof in Permitted
Investments on which such party is the obligor).
ARTICLE III
ALLOCATIONS, APPLICATIONS AND PAYMENTS; THE RESERVE FUND;
STATEMENTS TO CERTIFICATEHOLDERS
3.01 ALLOCATIONS, APPLICATIONS AND PAYMENTS.
(a) DETERMINATION OF INTEREST RATES; DETERMINATION OF INTEREST PAYMENT
AMOUNTS; SERVICER'S CERTIFICATES.
(i) For the initial Interest Payment Period, the Class A-1
Rate, Class A-2 Rate, Class A-3 Rate and Class B Rate shall be determined
by straight line interpolation (based on the actual number of days in the
initial Interest Payment Period) such rate to be calculated by the
[Trustee] two Business Days prior to the Closing Date. For each
subsequent Interest Payment Period the 1998-C Securitization Trustee will
make the following determinations:
(A) On the second Interest Determination Business Day
(defined below) preceding the first day of each Interest Payment
Period, (the "Interest Determination Date"), for each Class of
Class A Certificates, the 1998-C Securitization Trustee will
determine the London interbank offered rate for U.S. Dollar
deposits having maturities of three months ("three month LIBOR")
or, if such Interest Payment Period commences on or after the
related Targeted Maturity Date, one month ("one-month LIBOR"), in
each case as at 11:00 a.m. (London time) on the Interest
Determination Date in question. Such offered rate will be that
which appears on the display designated as Telerate Page 3750 on
the Dow ▇▇▇▇▇ Telerate Service (or such other page or service as
may replace it for the purpose of displaying London interbank
offered rates of major banks for U.S. Dollar deposits).
5
(B) If for any reason the relevant page is unavailable
or such offered rate does not appear, the 1998-C Securitization
Trustee shall determine the rates at which three-month deposits
(or one-month deposits, if applicable) in U.S. Dollars are offered
by four major banks in the London interbank market (the "Reference
Banks") at approximately 11:00 a.m. (London time) on the Interest
Determination Date to prime banks in the London interbank market
commencing on the first day of the relevant Interest Payment
Period. The 1998-C Securitization Trustee shall request the
principal London office of each of the Reference Banks to provide
a quotation of its rate. If at least two quotations are provided
as requested, the 1998-C Securitization Trustee shall determine
the arithmetic mean of the quotations. If fewer than two
quotations are provided as requested, the 1998-C Securitization
Trustee shall determine the arithmetic mean of the rates quoted by
major banks in New York City, at approximately 11:00 a.m. (New
York City time) on the first day of the relevant Interest Payment
Period for three-month loans (or one-month loans, if applicable)
in U.S. Dollars to leading European banks commencing on that date.
The rate so determined by the 1998-C Securitization Trustee will
be "three-month LIBOR" (or "one-month LIBOR" as applicable) for
such Interest Payment Period.
(ii) The 1998-C Securitization Trustee shall as soon as
practicable after 11:00 a.m. (London time) on each Interest Determination
Date determine the Class A-1 Rate, Class A-2 Rate, Class A-3 Rate and
Class B Rate, the actual number of days in the related Interest Payment
Period and the Interest Payment Amount for each Class of Certificates.
(iii) If on any relevant Certificate Payment Date for the Class
A-1 Certificates, the Class A-2 Certificates, the Class A-3 Certificates
or the Class B Certificates, the aggregate of amounts payable to the Swap
Counterparty as described below in Section 3.01(e)(i)(A) is less than the
relevant Class A-1 Swap Interest Amount, Class A-2 Swap Interest Amount,
Class A-3 Swap Interest Amount or Class B Swap Interest Amounts as the
case may be, then on the relevant Determination Date, the Servicer shall
calculate the Class A-1 Interest Payment Amount, Class A-2 Interest
Payment Amount, Class A-3 Interest Payment Amount or Class B Interest
Payment Amount, as the case may be, during the relevant Interest Payment
Period by reducing such amounts by the same proportion as the related
Class A-1 Swap Interest Shortfall Amount, Class A-2 Swap Interest
Shortfall Amount, Class A-3 Swap Interest Shortfall Amount or Class B
Swap Interest Shortfall Amount, as the case may be, represents of such
Class A-1 Swap Interest Amount, Class A-2 Swap Interest Amount, Class A-3
Swap Interest Amount and/or Class B Swap Interest Amount.
(iv) If on any Certificate Payment Date subsequent to a
Certificate Payment Date upon which a Proportional Reduction occurred, as
defined in Section 3.01(a)(iii), amounts have been or are allocable
pursuant to Section 3.01(c)(ii) on Monthly Allocation Dates after
preceding Certificate Payment Date (including on the current Certificate
Payment Date), the Servicer shall calculate the Class A-1 Interest
Payment Amount, Class A-2 Interest Payment Amount, Class A-3 Interest
Payment Amount and Class B Interest Payment Amount for the current
Certificate Payment Date by (1) multiplying the percentages that amounts
allocated pursuant to Section 3.01(c)(ii) represent of the current Class
A-1 Swap
6
Interest Amount, Class A-2 Swap Interest Amount, Class A-3 Swap
Interest Amount and/or Class B Swap Interest Amount times (2) the amount
of interest the 1998-C Securitization Trustee has calculated has accrued
during the related Interest Payment Period on the Class A-1 Certificates,
Class A-2 Certificates, Class A-3 Certificates or Class B Certificates,
as the case may be (without regard for the availability of amounts so
allocable pursuant to Section 3.01(c)(ii), and (3) adding such product to
the amount of interest so calculated to have accrued during such Interest
Payment Period. The Servicer shall include the Class A-1 Interest
Payment Amount, Class A-2 Interest Payment Amount, Class A-3 Interest
Payment Amount and Class B Interest Payment Amount in the Servicer's
Certificate for each relevant Certificate Payment Date as provided in
Section 3.01(a)(v) below.
(v) On each Determination Date, the Servicer shall deliver to
the 1998-C Securitization Trustee a Servicer's Certificate which sets
forth, among other things, the amount of Interest Collections and
Principal Collections allocable to the 1998-C SUBI, the Investor
Percentage, the Transferor Percentage, the Certificate Factor for each
Class, the amount of Advances (which includes Inventory Advances) and
Maturity Advances, if any, to be made by or reimbursed to the Servicer,
the aggregate amount, if any, to be withdrawn from the Reserve Fund and
the Servicing Fee and other servicing compensation payable to the
Servicer with respect to the preceding Collection Period and related
Monthly Allocation Date. On or prior to each Determination Date, the
Servicer shall also determine the Specified Reserve Fund Balance and the
amounts to be allocated and applied or paid in respect of the Investor
Interest and Transferor Interest and in respect of other amounts to be
released from the Trust.
(b) SOURCE OF DEPOSITS.
(i) If, based on the Servicer's Certificate prepared by the Servicer,
funds are to be deposited into the 1998-C SUBI Certificateholders' Account, the
1998-C Securitization Trustee shall make such deposit from the following
sources, in the following order of priorities:
(A) from net investment earnings on Permitted Investments made
on prior Monthly Allocation Dates of funds in the 1998-C SUBI
Certificateholders' Account in respect of the Class A-1 Notional Interest
Accrual Amount, the Class A-2 Notional Interest Accrual Amount, the Class
A-3 Notional Interest Accrual Amount and the Class B Notional Interest
Amount; and
(B) applicable amounts in the 1998-C SUBI Collection Account or
the Reserve Fund, as applicable.
(ii) Provided that (A) the Transferor has not exercised its option to
repurchase the 1998-C SUBI and (B) a Swap Termination has not occurred, on each
relevant Monthly Allocation Date that is a Certificate Payment Date, all amounts
to be paid to Certificateholders, the Transferor or other Persons, shall be made
from the 1998-C SUBI Collection Account. On each Monthly Allocation Date, the
1998-C Securitization Trustee will withdraw, to the extent necessary, the
amounts specified herein from the 1998-C SUBI Certificateholders' Account and/or
the Reserve
7
Fund and deposit such amounts into the 1998-C SUBI Collection Account in
order to make the applications and payments indicated herein.
(c) ALLOCATIONS AND APPLICATIONS IN RESPECT OF INTEREST. The
Certificates of each Class will bear interest at the rate specified therein,
and such interest will accrue for each related Interest Period on the basis
of twelve months, each assumed to consist of thirty days, and a year assumed
to consist of 360 days. Provided that the Transferor has not exercised its
option to repurchase the 1998-C SUBI pursuant to Section 7.02 herein, and
provided that the Trust has not been liquidated, pursuant to Section 7.01
herein, on each Monthly Allocation Date, based solely upon the information
set forth in the Servicer's Certificate, the 1998-C Securitization Trustee
shall make the following allocations of Available Interest in the following
amounts (to the extent sufficient therefor) and in the following order of
priority:
(i) an amount equal to the amount of the Class A-1 Notional
Interest Accrual Amount, the Class A-2 Notional Interest Accrual Amount
and the Class A-3 Notional Interest Accrual Amount for the related
Monthly Interest Period, on a pro rata basis;
(ii) an amount equal to the amount of any unreimbursed Class A-1
Interest Carryover Shortfall Amount, Class A-2 Interest Carryover
Shortfall Amount and Class A-3 Interest Shortfall Amount, on a pro rata
basis.
(iii) an amount equal to the [Class B Notional Interest Accrual
Amount] [during the related Monthly Interest Period, plus any [Adjustable
Rate] [Fixed Rate] Class B Interest Carryover Shortfall Amount;
(iv) to the Servicer, an amount equal to the Investor Percentage
of (a) the Servicing Fee for the related Collection Period and (b) the
aggregate of the Investor Percentage of the accrued but unpaid Servicing
Fees in respect of any prior Collection Periods;
(v) to the Servicer, an amount equal to the Investor Percentage
of the Capped Contingent and Excess Liability Premiums that have not yet
been reimbursed to the Servicer;
(vi) to the Titling Trustee (or the Servicer, if such amounts
were previously advanced by the Servicer), an amount equal to the
Investor Percentage of Capped Titling Trust Administrative Expenses;
(vii) to the 1998-C Securitization Trustee (or the Servicer, if
such amounts were previously advanced by the Servicer), an amount equal
to the Investor Percentage of Capped Securitization Trust Administrative
Expenses;
(viii) an amount equal to the sum of (a) the aggregate Loss
Amounts allocable to the Adjusted Class A-1 Certificate Balance, the
Adjusted Class A-2 Certificate Balance and the Adjusted Class A-3
Certificate Balance on such Monthly Allocation Date plus (b) the
aggregate Certificate Principal Loss Amounts allocated to the Adjusted
Class A-1
8
Certificate Balance, the Adjusted Class A-2 Certificate Balance
and the Adjusted Class A-3 Certificate Balance on any prior Monthly
Allocation Date (on a pro rata basis based on the aggregate amounts of
such Loss Amounts and Certificate Principal Loss Amounts previously
allocated to each such Class), in each case to the extent not reimbursed
on such date through the application of amounts withdrawn from the
Reserve Fund or Transferor Amounts and not reimbursed pursuant to this
clause (viii) on any prior date;
(ix) an amount equal to the aggregate amount of Loss Amounts
allocable to the Adjusted Class B Certificate Balance on such Monthly
Allocation Date and not reimbursed pursuant to this clause or through the
application of amounts withdrawn from the Reserve Fund and Transferor
Amounts, plus the aggregate amount of Certificate Principal Loss Amounts
allocated to the Adjusted Class B Certificate Balance on any prior
Monthly Allocation Date and not previously reimbursed pursuant to this
clause (x);
(x) an amount equal to the excess of the Specified Reserve Fund
Balance over the amount then on deposit in the Reserve Fund;
(xi) to the Titling Trustee (or the Servicer, if such amounts
were previously advanced by the Servicer), an amount equal to the
Investor Percentage of Uncapped Titling Trust Administrative Expenses;
(xii) to the 1998-C Securitization Trustee (or the Servicer, if
such amounts were previously advanced by the Servicer), an amount equal
to the Investor Percentage of Uncapped Securitization Trust
Administrative Expenses; and
(xiii) the balance, if any, shall constitute Excess Amounts.
(d) SOURCES OF APPLICATIONS AND PAYMENTS. Applications and/or
payments of amounts allocated pursuant to the priorities set forth in Section
3.01(c) above will be made from the following sources in the following order of
priority:
(i) Available Interest, to the extent thereof;
(ii) in the case of Section 3.01(c) clauses (i), (ii), (iii),
(viii), (ix) or (ix), amounts withdrawn from the Reserve Fund to the
extent of the lesser of (A) the amount on deposit in the Reserve Fund on
the related Deposit Date and available therefor and (B) the amount, if
any, by which the aggregate of amounts allocable and applicable or
payable pursuant to such clauses (i), (ii), (iii), (viii) or (ix) exceeds
the amount of Available Interest available to make such allocation and
application or payment based on the foregoing priorities; PROVIDED,
HOWEVER, that amounts allocated to the Class B Reserve Amount shall be
utilized only if there are no other amounts then on deposit in the
Reserve Fund and shall be available exclusively for payment of accrued
and unpaid interest with respect to the Class B Certificates, and on the
Class B Targeted Maturity Date, for reduction of the Adjusted Class B
Certificate Balance until the Adjusted Class B Certificate Balance has
been reduced to zero; and PROVIDED, FURTHER, that if such Monthly
Allocation Date is a relevant Certificate Payment Date that is on or
after the Class B Targeted Maturity Date, amounts then
9
remaining amounts on deposit in the Reserve Fund shall be used to repay
any unreimbursed Maturity Advances and to reduce the Adjusted Certificate
Balance of each Class of Investor Certificates then outstanding to zero,
to the extent available therefor; and
(iii) in the case of Section 3.01(c) clauses (i) through (ix)
and, to the extent set forth in Sections 3.01(i)(ii) and 3.01(i)(iii),
Transferor Amounts.
(e) INTEREST PAYMENTS TO CLASS A CERTIFICATEHOLDERS.
(A) Subject to Sections 3.01(i), (k) and (l), the 1998-C
Securitization Trustee shall make payments to the Swap
Counterparty of (1) amounts allocated pursuant to clauses (i) and
(ii) of Section 3.01(c) above (whether from amounts held in the
1998-C SUBI Collection Account or 1998-C SUBI Certificateholders'
Account) and (2) the net investment income earned on Permitted
Investments with respect to funds deposited into the 1998-C
Certificateholders' Account on prior Monthly Allocation Dates in
respect of the Adjusted Class A-1 Certificate Balance, Adjusted
Class A-2 Certificate Balance or Adjusted Class A-3 Certificate
Balance, as the case may be, (a) on each Monthly Allocation Date
in March, June, September and December, commencing in March 1999,
until the related Targeted Maturity Date, as well as (b) on the
related Targeted Maturity Date and (c) if the Adjusted Class
Certificate Balance of such Class has not been reduced to zero on
its Targeted Maturity Date, on each Monthly Allocation Date
following such Targeted Maturity Date until such Adjusted Class
Certificate Balance is reduced to zero, in each case to the extent
of amounts available therefor.
In exchange for amounts so paid to the Swap Counterparty
pursuant to the Swap Agreement, the Swap Counterparty generally is
obligated to pay to or as directed by the 1998-C Securitization
Trustee (on behalf of and for the benefit of the Class A-1
Certificateholders, the Class A-2 Certificateholders and/or the
Class A-3 Certificateholders, as the case may be) amounts equal to
the amount of interest calculated by the 1998-C Securitization
Trustee to have accrued on the Class A-1 Certificates, Class A-2
Certificates or Class A-3 Certificates, as the case may be, during
the relevant Interest Period ) (subject .to any Proportional
Reduction or Proportional Increase as provided below).
(B) Upon receipt of such amounts from the Swap
Counterparty, the 1998-C Securitization Trustee shall pay such
amounts to the Class A-1 Certificateholders, Class A-2
Certificateholders and Class A-3 Certificateholders (subject to
any Proportional Reduction or Proportional Increase as provided
below), (1) on each Monthly Allocation Date in March and
September, commencing in March 1999, until the related Targeted
Maturity Date, as well as (2) on the related Targeted Maturity
Date and (3) if the Adjusted Class Certificate Balance of such
Class has not been reduced to zero on its Targeted Maturity Date,
on each Monthly Allocation Date following such Targeted Maturity
Date until such Adjusted Class Certificate Balance is reduced to
zero, in each cash to the extent of amounts
10
available therefor. Subject to Sections 3.01(i), (k) and (l), in
connection with a Swap Termination or any exercise by the
Transferor of its option to repurchase the 1998-C SUBI Certificate
pursuant to Section 7.02, on the Monthly Allocation Date following
the receipt by the 1998-C Securitization Trustee of the proceeds
of such liquidation or sale to the Transferor, payments of
interest will be made to the Class A-1 Certificateholders,
Class A-2 Certificateholders and Class A-3 Certificateholders,
respectively, from such proceeds, to the extent available therefor
pursuant to Section 3.01(o).
(C) If on any relevant Certificate Payment Date for the
Class A-1 Certificates, the Class A-2 Certificates or the Class
A-3 Certificates, the aggregate of amounts payable to the Swap
Counterparty as described above in Section 3.01(e)(i)(A) is less
than the relevant Class A-1 Swap Interest Amount, Class A-2 Swap
Interest Amount or Class A-3 Swap Interest Amount, as the case may
be, the 1998-C Securitization Trustee shall pay the Class A-1
Certificateholders, Class A-2 Certificateholders and/or Class A-3
Certificateholders, as the case may be, amounts reduced in
proportion to the calculation of Proportional Reduction in Section
3.01(a)(iii) above.
(D) If on any Certificate Payment Date subsequent to a
Certificate Payment Date upon which a Proportional Reduction
occurred, the corresponding payment due from the Swap Counterparty
to the 1998-C Securitization Trust (under the Swap Agreement) on
any Certificate Payment Date in exchange for amounts payable by
the 1998-C Securitization Trust to the Swap Counterparty in
respect of interest on the Class A-1 Certificates, Class A-2
Certificates and Class A-3 Certificates will be increased
proportionately in the same proportion as such reimbursement of
such Swap Interest Shortfall Amount represents of such Class A-1
Swap Interest Amount, Class A-2 Swap Interest Amount or Class A-3
Swap Interest Amount, as the case may be. The 1998-C
Securitization Trustee shall pay the Class A-1 Certificateholders,
Class A-2 Certificateholders and/or Class A-3 Certificateholders,
as the case may be, such amounts increased in proportion to the
calculation of Proportional Increase in Section 3.01(a)(iv) above.
(f) INTEREST PAYMENTS TO CLASS B CERTIFICATEHOLDERS.
(A) Subject to Sections 3.01(i), (k) and (l), the 1998-C
Securitization Trustee shall make payments to the Swap
Counterparty, of (1) amounts allocated pursuant to clauses (iii)
and (iv) of Section 3.01(c) above and (2) the net investment
income earned on Permitted Investments with respect to funds
deposited into the 1998-C Certificateholders' Account on prior
Monthly Allocation Dates in respect of the Adjusted Class B
Certificate Balance, (a) on each Monthly Allocation Date in March,
June, September and December, commencing in March 1999, until the
related Targeted Maturity Date, as well as (b) on the related
Targeted Maturity Date and (c) if the Adjusted Class B Certificate
Balance has not been reduced to zero on its Targeted Maturity
Date, on each Monthly Allocation Date following such
11
Targeted Maturity Date until such Adjusted Class B Certificate
Balance is reduced to zero, in each case to the extent of amounts
available therefor.
In exchange for amounts so paid to the Swap Counterparty
pursuant to the Swap Agreement, the Swap Counterparty generally is
obligated to pay to or as directed by the 1998-C Securitization
Trustee (on behalf of and for the benefit of the Class B
Certificateholders) amounts equal to the amount of interest
calculated by the 1998-C Securitization Trustee payable as
interest calculated by the 1998-C Securitization Trustee to have
accrued on the Class B Certificates during the relevant Interest
Period, subject to any Proportional Reduction or Proportional
Increase as provided below.
(B) Upon receipt of such amounts from the Swap
Counterparty, the 1998-C Securitization Trustee shall pay such
amounts to the Class B Certificateholders, subject to any
Proportional Reduction or Proportional Increase as provided below,
(1) on each Monthly Allocation Date in March and September,
commencing in March 1999, until the related Targeted Maturity
Date, as well as (2) on the related Targeted Maturity Date and (3)
if the Adjusted Class B Certificate Balance has not been reduced
to zero on its Targeted Maturity Date, on each Monthly Allocation
Date following such targeted Maturity Date until the Adjusted
Class B Certificate Balance is reduced to zero, in each case to
the extent of amounts available therefor. Subject to Sections
3.01(i), (k) and (l), in connection with a Swap Termination or any
exercise by the Transferor of its option to repurchase the 1998-C
SUBI Certificate pursuant to Section 7.02, on the Monthly
Allocation Date following the receipt by the 1998-C Securitization
Trustee of the proceeds of such liquidation or sale to the
Transferor, payments of interest will be made to the Class B
Certificateholders from such proceeds, to the extent available
therefor pursuant to Section 3.01(o).
(C) If on any relevant Certificate Payment Date for the
Class B Certificates, the aggregate of amounts payable to the Swap
Counterparty as described above in Section 3.01(e)(i)(A) is less
than the relevant Class B Swap Interest Amount, the 1998-C
Securitization Trustee shall pay the Class B Certificateholders
amounts reduced in proportion to the calculation of Proportional
Reduction in Section 3.01(a)(iii) above.
(D) If on any Certificate Payment Date subsequent to a
Certificate Payment Date upon which a Proportional Reduction
occurred, the corresponding payment due from the Swap Counterparty
to the 1998-C Securitization Trust (under the Swap Agreement) on
any Certificate Payment Date in exchange for amounts payable by
the 1998-C Securitization Trust to the Swap Counterparty in
respect of interest on the Class B Certificates will be increased
proportionately in the same proportion as such reimbursement of
such Swap Interest Shortfall Amount represents of such Class B
Swap Interest Amount. The 1998-C Securitization
12
Trustee shall pay the Class B Certificateholders such amounts
increased in proportion to the calculation of Proportional
Increase in Section 3.01(a)(iv) above.
(g) PAYMENTS TO SERVICER, SECURITIZATION TRUSTEE AND TITLING TRUSTEE.
On each Monthly Allocation Date, the 1998-C Securitization Trustee shall pay to
the Servicer the amounts allocated pursuant to clauses (iv) and (v) of Section
3.01(c) above. On each Monthly Allocation Date, the 1998-C Securitization
Trustee shall pay to the Titling Trustee the amounts allocated pursuant to
clauses (vi) and (xi) of Section 3.01(c) above, except that if the Servicer
previously has made Advances in respect of such amounts, such payment will
instead be made to the Servicer up to the amount of such Advances not previously
reimbursed. On each Monthly Allocation Date, the 1998-C Securitization Trustee
will be entitled to withdraw from the 1998-C SUBI Collection Account for its own
benefit and use, the amounts allocated pursuant to clauses (vii) and (xii) of
Section 3.01(c) above, except that if the Servicer previously has made Advances
in respect of such amounts, the 1998-C Securitization Trustee shall instead pay
such amounts to the Servicer up to the amount of such Advances not previously
reimbursed.
Notwithstanding the foregoing, in accordance with the provisions of
Section 7.01(c) of the Titling Trust Agreement and Section 4.02(a) of the 1998-C
SUBI Servicing Supplement, for so long as TMCC is the Servicer and each Monthly
Remittance Condition is satisfied, the Servicer will be entitled to make
deposits of Collections into the 1998-C SUBI Collection Account net of amounts
payable or reimbursable to the Servicer as compensation amounts, in respect of
Advances or otherwise (including in respect of amounts advanced by the Servicer
in respect of amounts otherwise payable to the 1998-C Securitization Trustee or
to the Titling Trustee or Trust Agent), and net of amounts payable or
reimbursable (and actually so paid or reimbursed directly by the Servicer) in
respect of Titling Trust. To the extent the Servicer makes deposits net of any
such amounts, the Servicer will cause each relevant Servicer's Certificate to
correctly and accurately account for such amounts in providing all information
with respect to allocations, applications and payments to be made pursuant to
Section 3.01 of the 1998-C Securitization Trust Agreement on the same basis as
though such amounts were in fact deposited into the 1998-C SUBI Collection
Account. Moreover, the Servicer will, in each relevant Servicer's Certificate,
instruct the 1998-C Securitization Trustee not to make any distribution to the
Servicer, Transferor or Titling Trustee to the extent that the Servicer has made
any deposit net of a corresponding amount. The 1998-C Securitization Trustee
will have no obligation with respect to or liability for following any such
instruction by the Servicer.
(h) DEPOSITS INTO AND RELEASES FROM THE RESERVE FUND.
(i) On each Monthly Allocation Date, the 1998-C Securitization
Trustee shall withdraw from the 1998-C SUBI Collection Account and
deposit into the Reserve Fund the amount allocated pursuant to clause
(xi) of Section 3.01(c) above.
(ii) On each Monthly Allocation Date, the 1998-C Securitization
Trustee shall distribute to the Transferor, to the extent thereof, (A)
any net investment income from investment of funds in the Reserve Fund
and (B) any amounts in excess of the Specified Reserve Fund Balance on
such date; provided that no such release will be made if
13
Transferor Amounts are being held in the Reserve Fund because the
Servicer is required to deliver certifications concerning ERISA matters
as set forth in Section 3.01(i) below.
(i) PAYMENTS TO TRANSFEROR; TRANSFEROR AMOUNTS. (i) On each Monthly
Allocation Date, the 1998-C Securitization Trustee shall make the following
payments in respect of the Transferor Interest in the following order of
priority:
(A) to the Transferor, from and in reduction of the amounts of
Principal Collections otherwise to be deposited into the 1998-C SUBI
Collection Account or 1998-C SUBI Certificateholders' Account, an amount
equal to the aggregate amount of any unreimbursed Maturity Advances, as
specified in the related Servicer's Certificate (notwithstanding anything
herein to the contrary, such payment is to be made prior to any other
application or payment of amounts described in Section 3.01(e), Section
3.01(f) or Section 3.01(l));
(B) to the Transferor, an amount as Transferor Amounts equal to
the Transferor Percentage of Collections, to the extent any portion of
such amount is not required to be applied to cover certain shortfalls as
described in this Section, or in Sections 3.01(d), 3.01(l) or 3.01(n)
below;
(C) to the Transferor, Excess Amounts, payable as follows:
(1) if such Monthly Allocation Date relates to a
Collection Period the last day of which is during the Revolving
Period, the amount allocated as Excess Amounts pursuant to clause
(xiv) of Section 3.01(c) PROVIDED, HOWEVER, that in the event TMCC
is and continues to be required to deliver the certifications
concerning ERISA matters specified in Section 5.03(b) of the
1998-C SUBI Servicing Supplement, any such Excess Amounts that
would be released to the Transferor as described above shall
instead be deposited into the Reserve Fund, whether or not the
then applicable Specified Reserve Fund Balance has been met; and
(2) if such Monthly Allocation Date relates to a
Collection Period the last day of which is after the Revolving
Period, the balance of any such Excess Amounts after the 1998-C
Securitization Trustee has first deposited such amounts, up to but
not exceeding the Accelerated Principal Distribution Amount, into
the 1998-C SUBI Certificateholders' Account or SUBI Collection
Account (if such Monthly Allocation Date is a relevant Certificate
Payment Date) PROVIDED, HOWEVER, that in the event TMCC is and
continues to be required to deliver the certifications concerning
ERISA matters specified in Section 5.03(b) of the 1998-C SUBI
Servicing Supplement, any such Excess Amounts that would be
released to the Transferor as described above shall instead be
deposited into the Reserve Fund, whether or not the then
applicable Specified Reserve Fund Balance has been met.
(ii) Notwithstanding the foregoing, on each Monthly Allocation
Date for which there is a Required Amount, after giving effect to all
allocations, applications and payments required to be made and all
required deposits to or withdrawals from the Reserve Fund on
14
such Monthly Allocation Date, amounts that otherwise would be payable
to the Transferor in respect of Transferor Amounts will be deposited in
the Reserve Fund until the amount on deposit therein equals the Specified
Reserve Fund Balance with the remainder to be paid to the Transferor by
the 1998-C Securitization Trustee as follows:
(A) if such Monthly Allocation Date relates to a
Collection Period the last day of which is during the Revolving
Period, Transferor Amounts relating to the Transferor Percentage
of Interest Collections; and
(B) if such Monthly Allocation Date relates to a
Collection Period the last day of which is after the Revolving
Period, (I) the Transferor Amounts relating to the Transferor
Percentage of Interest Collections and (II) if and to the extent
that the Transferor Interest will be equal to or greater than
zero, after all required allocations, applications and payments
have been made on such Monthly Allocation Date, the remaining
Transferor Amounts relating to the Transferor Percentage of
Principal Collections.
(C) Any amounts that would otherwise be payable to the
Transferor pursuant to the preceding paragraph, but not paid to
the Transferor because the Transferor Interest would be less than
or equal to zero, shall instead be held in the 1998-C SUBI
Collection Account until:
(1) applied to cover the Class A-1
Notional Interest Accrual Amount, the Class A-2 Notional
Interest Accrual Amount, the Class A-3 Notional Interest
Accrual Amount, any Class A-1 Swap Interest Carryover
Shortfall Amount, Class A-2 Swap Interest Carryover
Shortfall Amount, Class A-3 Swap Interest Carryover
Shortfall Amount, interest accrued on the Adjusted Class B
Certificate Balance, any Class B Swap Interest Carryover
Shortfall Amount or any interest accrued on unreimbursed
Certificate Principal Loss Amounts previously allocated to
the Adjusted Class B Certificate Balance;
(2) applied in reduction of the Adjusted
Class A-1 Certificate Balance, Adjusted Class A-2
Certificate Balance, Adjusted Class A-3 Certificate Balance
and the Adjusted Class B Certificate Balance until each
such Certificate Balance has been reduced to zero;
(3) the Transferor Interest again exceeds
zero.
(iii) Amounts properly received by the Transferor pursuant to
this Section 3.01 shall be free of any claim of the 1998-C Securitization
Trust, the 1998-C Securitization Trustee or the Investor
Certificateholders and shall not be available to the 1998-C
Securitization Trustee or the 1998-C Securitization Trust for the purpose
of making deposits to the Reserve Fund or making payments to the Investor
Certificateholders, nor shall the Transferor be required to refund any
amount properly received by it.
15
(j) INVESTMENT OF AVAILABLE AMOUNTS. Amounts allocated pursuant to
Section 3.01(c) and to be applied or paid to the Class A Certificates and the
Class B Certificates pursuant to Sections 3.01(e), (f) and (l) and not paid
on any Monthly Allocation Date will be deposited into the 1998-C
Certificateholders' Account on such date and invested in Permitted
Investments as follows:
(i) during the Revolving Period, amounts allocated and applied
pursuant to clauses (i), (ii), (iii), (viii) and (ix) of Section 3.01(c)
above will be invested in Permitted Investments maturing on or prior to
the succeeding relevant Certificate Payment Date and bearing interest at
the related Required Rates;
(ii) following the termination of the Revolving Period on any
Monthly Allocation Date that is not a Certificate Payment Date, both
Available Interest allocated and applied pursuant to clauses (i), (ii),
(iii), (viii) and (ix) of Section 3.01(c) above and all amounts allocable
and applicable in respect of the Adjusted Class A-1 Certificate Balance,
the Adjusted Class A-2 Certificate Balance, Adjusted Class A-3
Certificate Balance and the Adjusted Class B Certificate Balance
(including reimbursements of Loss Amounts or Certificate Principal Loss
Amounts) will be invested in Permitted Investments maturing on or prior
to the succeeding relevant Certificate Payment Date, and bearing interest
at the related Required Rates.
(k) INVESTMENT IN SUBSEQUENT CONTRACTS AND SUBSEQUENT LEASED VEHICLES.
Notwithstanding anything in this Agreement to the contrary, on any Monthly
Allocation Date related to a Collection Period the last day of which is during
the Revolving Period:
(i) The amounts to be applied or paid pursuant to the
priorities set forth in clauses (viii) and (ix) of Section 3.01(c) above
that are allocated to reimburse Loss Amounts or Certificate Principal
Loss Amounts (whether from Available Interest, amounts withdrawn from the
Reserve Fund or Transferor Amounts) and amounts allocated for deposit
into the 1998-C Certificateholders' Account from Principal Collections
pursuant to Section 3.01(l)(ii) below shall not be deposited in the
1998-C SUBI Certificateholders' Account, but shall be treated as and be
deemed to be Principal Collections that are part of the Investor
Percentage of Principal Collections for purposes of Section 3.02 of the
1998-C SUBI Servicing Supplement and this Section 3.01 and available for
reinvestment in Subsequent Contracts and Subsequent Leased Vehicles; and
(ii) Transferor Amounts relating to the Transferor Percentage of
Principal Collections (other than such amounts allocated to cover
shortfalls as described above under Sections 3.01(d) and 3.01(i) above)
shall be available for reinvestment in Subsequent Contracts and
Subsequent Leased Vehicles; provided, however, that on any Monthly
Allocation Date related to a Collection Period the last day of which is
after the Revolving Period, such amounts will constitute Transferor
Amounts and shall be applied and paid as described in Section 3.01(i)
above.
16
(l) ALLOCATIONS IN RESPECT OF ADVANCES; APPLICATIONS AND PAYMENTS OF
PRINCIPAL.
(i) Provided that a Swap Termination has not occurred, on each Monthly
Allocation Date, based on the related Servicer's Certificate, the 1998-C
Securitization Trustee shall allocate an amount equal to the amount of any
unreimbursed Advances (which includes Inventory Advances) and Nonrecoverable
Advances and shall pay to the Servicer the amount of any unreimbursed Advances
and Nonrecoverable Advances so allocated (unless the Servicer has deposited
Collections net of such amounts pursuant to Section 3.01(g) above) from (i)
Principal Collections, to the extent available therefor and (ii) Interest
Collections, to the extent of any insufficiency.
(ii) After the above allocations have been made, on any relevant
Monthly Allocation Date, the 1998-C Securitization Trustee shall apply the
Investor Percentage of remaining Principal Collections plus any Accelerated
Principal Distribution Amount (A) in reimbursement to the Transferor for
unreimbursed Maturity Advances and (B) for deposit into the 1998-C SUBI
Certificateholders' Account in respect of the Adjusted Class A-1 Certificate
Balance (until the Adjusted Class A-1 Certificate Balance is reduced to zero),
the Adjusted Class A-2 Certificate Balance (until the Adjusted Class A-2
Certificate Balance is reduced to zero), the Adjusted Class A-3 Certificate
Balance (until the Adjusted Class A-3 Certificate Balance is reduced to zero) or
the Adjusted Class B Certificate Balance (until the Adjusted Class B Certificate
Balance is reduced to zero), in that order.
(iii) On each Certificate Payment Date that coincides with or follows
the related Targeted Maturity Date for any Class of Certificates, payments in
reduction of the Adjusted Class A-1 Certificate Balance, Adjusted Class A-2
Certificate Balance, Adjusted Class A-3 Certificate Balance or Adjusted Class B
Certificate Balance shall be made as follows and in the following order of
priority:
(A) with respect to the Class A-1 Certificates, all amounts on
deposit in the 1998-C SUBI Collection Account and the 1998-C SUBI
Certificateholders' Account from amounts allocated for reduction of the
Adjusted Class A-1 Certificate Balance in accordance with Section 3.01(c)
(after giving effect to any application of amounts withdrawn from the
Reserve Fund or Transferor Amounts available for such application
pursuant to Section 3.01(d)) will be paid to the Class A-1
Certificateholders until the Adjusted Class A-1 Certificate Balance is
reduced to zero;
(B) with respect to the Class A-2 Certificates, all amounts on
deposit in the 1998-C SUBI Collection Account and the 1998-C SUBI
Certificateholders' Account from amounts allocated for reduction of the
Adjusted Class A-2 Certificate Balance in accordance with Section 3.01(c)
(after giving effect to any application of amounts withdrawn from the
Reserve Fund and Transferor Amounts available for such application
pursuant to Section 3.01(d)) will be paid to Class A-2 Certificateholders
until the class A-2 Certificate Balance is reduced to zero;
(C) with respect to the Class A-3 Certificates, all amounts on
deposit in the 1998-C SUBI Collection Account and the 1998-C SUBI
Certificateholders' Account from amounts allocated for reduction of the
Adjusted Class A-3 Certificate Balance in
17
accordance with Section 3.01(c) (after giving effect to any application
of amounts withdrawn from the Reserve Fund and Transferor Amounts
available for such application pursuant to Section 3.01(d)) will be paid
to Class A-3 Certificateholders until the Adjusted Class A-3 Certificate
Balance is reduced to zero; and
(D) with respect to the Class B Certificates, all amounts on
deposit in the 1998-C SUBI Collection Account and the 1998-C SUBI
Certificateholders' Account from amounts allocated for reduction of the
Adjusted Class B Certificate Balance in accordance with Section 3.01(c)
(after giving effect to any application of amounts withdrawn from the
Reserve Fund and Transferor Amounts available for such application
pursuant to Section 3.01(d)) will be paid to the Class B
Certificateholders.
(iv) Notwithstanding the foregoing, (A) if the assets of the Trust
are liquidated following a Swap Termination pursuant to Sections 7.01 and
8.02, payments in reduction of the Adjusted Class A-1 Certificate Balance,
the Adjusted Class A-2 Certificate Balance, the Adjusted Class A-3
Certificate Balance or the Adjusted Class B Certificate Balance shall be made
from the proceeds of such liquidation based upon the priorities set forth in
Section 3.01(o) on the Monthly Allocation Date following the receipt by the
1998-C Securitization Trustee of the proceeds of such liquidation (which date
may be prior to the related Targeted Maturity Date) and (B) in connection
with the exercise by the Transferor of its option to repurchase the 1998-C
SUBI Certificate pursuant to Section 7.02, payments in reduction of the
Adjusted Class B Certificate Balance shall be made from the proceeds of such
sale to the Transferor on the Monthly Allocation Date following the receipt
by the 1998-C Securitization Trustee of the proceeds of such sale (which date
may be prior to the related Targeted Maturity Date).
(m) MATURITY ADVANCES. To the extent that the Adjusted Class A-1
Certificate Balance is not reduced to zero on the Class A-1 Targeted Maturity
Date, the Adjusted Class A-2 Certificate Balance is not reduced to zero on the
Class A-2 Targeted Maturity Date, the Adjusted Class A-3 Certificate Balance is
not reduced to zero on the Class A-3 Targeted Maturity Date or the Adjusted
Class B Certificate Balance is not reduced to zero on the Class B Targeted
Maturity Date, the Transferor will have the option to make a Maturity Advance in
any amount up to the amount of such deficiency; PROVIDED, HOWEVER that the
Transferor must give the Servicer and the 1998-C Securitization Trustee no fewer
than two Business Days' written notice of its intention to do so. Amounts
received by the Servicer or 1998-C Securitization Trustee in respect of any
Maturity Advance shall be deposited promptly by such recipient into the 1998-C
SUBI Collection Account for application on the relevant Certificate Payment Date
that follows the date such Maturity Advance is made and such notice is given.
(n) LOSS AMOUNTS AND CERTIFICATE PRINCIPAL LOSS AMOUNTS. (i) Loss
Amounts allocated to the Investor Certificates on any Monthly Allocation Date
will be allocated in the following order of priority:
(A) in reduction of the Adjusted Class B Certificate
Balance, until the Adjusted Class B Certificate Balance is reduced
to zero; and
(B) in reduction of the Adjusted Class A-1 Certificate
Balance, the Adjusted Class A-2 Certificate Balance and the
Adjusted Class A-3 Certificate Balance pro rata (based on such
Adjusted Class A-1 Certificate Balance, Adjusted Class A-2
Certificate Balance and Adjusted Class A-3 Certificate Balance as
of the
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last day of the related Collection Period) until the Adjusted
Certificate Balance of each such Class is reduced to zero.
(ii) Loss Amounts will be reimbursable on the Monthly Allocation
Date on which they are allocated, and Certificate Principal Loss Amounts
will be reimbursable on future Monthly Allocation Dates, in each case
from Available Interest, amounts withdrawn from the Reserve Fund and
Transferor Amounts pursuant to Sections 3.01(c), (d) and (i); PROVIDED,
HOWEVER, that no such reimbursements will be made for any Class of
Certificates after the first relevant Certificate Payment Date on which
the Adjusted Class B Certificate Balance, the Adjusted Class A-1
Certificate Balance, the Adjusted Class A-2 Certificate Balance, the
Adjusted Class A-3 Certificate Balance or the Adjusted Class B
Certificate Balance, as the case may be, is reduced to zero.
(iii) Certificate Principal Loss Amounts which are not reimbursed
as provided herein will bear interest at the Class A-1 Rate, Class A-2
Rate, Class A-3 Rate or Class B Rate, as the case may be, until
reimbursed or until the Adjusted Class B Certificate Balance, the
Adjusted Class A-1 Certificate Balance, the Adjusted Class A-2
Certificate Balance or the Adjusted Class A-3 Certificate Balance, as the
case may be, is reduced to zero, and allocations and payments in respect
thereof will be made pursuant to Section 3.01(c).
(o) PAYMENTS FOLLOWING SWAP TERMINATION. (i) Notwithstanding the
priorities set forth in Section 3.01 above, following any Swap Termination and
liquidation of the assets of the 1998-C Securitization Trust pursuant to Section
8.02, the net proceeds of the liquidation of the assets of the 1998-C Trust will
be paid pursuant to the following payment priorities on the Monthly Allocation
Date following the receipt of such proceeds:
(1) to pay to the Transferor, an amount equal to the
amount of any unreimbursed Maturity Advances;
(2) to pay to the 1998-C Securitization Trustee and
Titling Trustee, an amount equal to the amount of any Capped or
Uncapped Administrative Expense not yet reimbursed;
(3) to pay to the Servicer, an amount equal to the
amount of any unreimbursed Advances made by it or any Capped or
Uncapped Administrative Expenses advanced by it and not yet
reimbursed, and any other Servicing compensation due to it;
(4) to pay to the Class A Certificateholders, as
applicable, on a pro rata basis, based on the respective amounts
of interest so accrued on each such Class, an amount equal to the
sum of the Class A-1 Swap Interest Amount, the Class A-2 Swap
Interest Amount and the Class A-3 Swap Interest Amount through the
date of such payment (with a single corresponding Interest Payment
Period from the most recent relevant Certificate Payment Date for
each Class of Class A Certificates through such date) and an
amount equal to the sum of the unreimbursed Class A-1 Swap
Interest Carryover Shortfall Amount, Class A-2 Swap Interest
Carryover
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Shortfall Amount and Class A-3 Swap Interest Carryover Shortfall
Amount through the date of such payment (with a single
corresponding Interest Payment Period from the most recent
relevant Certificate Payment Date for each Class of Class A
Certificates through such date);
(5) to pay to the Class B Certificateholders, an amount
equal to the [Class B Swap Interest Amount and any Class B Swap
Shortfall Amount] [Class B Fixed Rate Interest Accrual Amount and
any Fixed Rate Class B Interest Carryover Shortfall Amount]
through the date of such payment (with a single corresponding
Interest Payment Period from the most recent relevant Certificate
Payment Date through such date) plus an amount equal to interest
received at the related Required Rate during such period on
amounts deposited in the Certificateholder's Account in respect of
the Adjusted Class B Certificate Balance on prior Monthly
Allocation Dates;
(6) to pay to the Class A Certificateholders, an amount
equal to the sum of (i) the Adjusted Class A-1 Certificate Balance
plus any unreimbursed Certificate Principal Loss Amounts allocated
thereto, (ii) the Adjusted Class A-2 Certificate Balance plus any
unreimbursed Certificate Principal Loss Amounts allocated thereto
and (iii) the Adjusted Class A-3 Certificate Balance plus any
unreimbursed Certificate Principal Loss Amounts allocated thereto
to be paid to the Class A-1 Certificateholders, Class A-2
Certificateholders and Class A-3 Certificateholders on a pro rata
basis, based on the amounts described in clauses (1), (2) and (3)
above;
(7) to pay to the Class B Certificateholders, an amount
equal to the Adjusted Class B Certificate Balance plus any
unreimbursed Certificate Principal Loss Amounts allocated thereto;
and
(8) to pay to the Transferor any remaining proceeds.
(ii) Any swap termination payment payable by the Swap
Counterparty to the Trust pursuant to the Swap Agreement in respect of
the Class A Certificates will be applied to cover any shortfall in the
amounts allocable and payable pursuant to the foregoing clauses (1), (2),
(3), (4), (6), (5) and (7), in that order, with any remainder to be paid
pursuant to clause (8) above. Notwithstanding the foregoing priorities,
to the extent that the Trust is required to make any swap termination
payment to the Swap Counterparty in respect of the Class A Certificates,
the amount thereof shall be made available from (and therefore shall
reduce) amounts otherwise allocable and payable pursuant to the foregoing
clauses (6), (4), (8), (7), (5), (3), (2) and (1) in that order.
(iii) Any swap termination payment payable by the Swap
Counterparty to the Trust pursuant to the Swap Agreement in respect of
the Adjustable Rate Class B Certificates will be applied to cover any
shortfall in the amounts allocable and payable pursuant to the foregoing
clauses (1), (2), (3), (5) (to the extent allocable and payable to the
Adjustable Rate Class B Certificates), (7) (to the extent allocable and
payable to the Adjustable Rate Class B Certificates), (4), (5) (to the
extent allocable and payable to the
20
Fixed Rate Class B Certificates), (6) and (7) (to the extent allocable
and payable to the Fixed Rate Class B Certificates), in that order,
with any remainder to be paid pursuant to clause (8) above.
Notwithstanding the foregoing priorities, to the extent that the Trust
is required to make any swap termination payment to the Swap Counterparty
in respect of the Adjustable Rate Class B Certificates, the amount
thereof shall be made available from (and therefore shall reduce) amounts
otherwise allocable and payable pursuant to the foregoing clauses (7)
(to the extent allocable and payable to the Adjustable Rate Class B
Certificates), (5) (to the extent allocable and payable to the Adjustable
Rate Class B Certificates), (8), (7) (to the extent allocable and payable
to the Fixed Rate Class B Certificates), (6), (5) (to the extent
allocable and payable to the Fixed Rate Class B Certificates), (4) (3),
(2) and (1) in that order.
(p) SUBORDINATION. The rights of the Class B Certificateholders to
receive allocations, applications and payments in respect of certain amounts of
Available Interest, amounts withdrawn from the Reserve Fund and Transferor
Amounts shall be and hereby are subordinated to the rights of the Class A-1
Certificateholders, the Class A-2 Certificateholders and the Class A-3
Certificateholders to receive the allocations, applications and payments in
respect thereof to the extent dictated by the payment priorities set forth in
this Section 3.01.
(q) PROCEEDS OF RESIDUAL VALUE INSURANCE POLICIES. In the event that
any proceeds of the Residual Value Insurance Policies are transferred to an
account maintained by the Titling Trustee or the 1998-C Securitization Trustee,
such amounts shall be distributed to the holder of the 1998-C SUBI Insurance
Certificate by the Titling Trustee, or the 1998-C Securitization Trustee, as
applicable, on the succeeding Monthly Allocation Date as directed in writing by
the Servicer.
3.02 1998-C SUBI CERTIFICATEHOLDERS' ACCOUNT; THE RESERVE FUND.
(a) ESTABLISHMENT OF 1998-C SUBI CERTIFICATEHOLDERS' ACCOUNT. A
separate trust account to be known as the "1998-C SUBI Certificateholders'
Account" will be established and shall be maintained with the 1998-C
Securitization Trustee which will include the money and other property deposited
and held therein pursuant to Section 3.01 and this Section. The 1998-C SUBI
Certificateholders' Account shall be an Eligible Account. If for any reason the
1998-C SUBI Certificateholders' Account is no longer an Eligible Account, the
1998-C Securitization Trustee shall promptly cause the 1998-C SUBI
Certificateholders' Account to be moved to another institution or otherwise
changed so that the 1998-C SUBI Certificateholders' Account becomes an Eligible
Account.
Pursuant to Section 4.02(j) of the 1998-C SUBI Servicing Supplement, on
each Monthly Allocation Date the Servicer shall direct the 1998-C Securitization
Trustee in writing to cause the funds in the 1998-C SUBI Certificateholders'
Account to be invested in Permitted Investments bearing interest at the
applicable Required Rates, which are expected to be TMCC Demand Notes so long as
the TMCC Demand Notes are Permitted Investments. Such Permitted Investments
shall mature in such a manner that the amount required to be distributed on the
next succeeding Certificate Payment Date will be available on such next
succeeding Certificate Payment Date. If such investments mature prior to the
succeeding relevant Monthly Allocation Date, the Servicer
21
will direct the 1998-A Securitization Trustee to invest such amounts in
Permitted Investments that are not TMCC Demand Notes and that will mature on
the succeeding relevant Monthly Allocation Date, and the net investment
income with respect to such investments, but only such investments, will be
distributable to the Transferor on such succeeding relevant Monthly
Allocation Date. All amounts held in the 1998-C SUBI Certificateholders'
Account shall be invested by the 1998-C Securitization Trustee in Permitted
Investments at the written direction of the Servicer until distributed or
otherwise applied in accordance with the 1998-C Securitization Trust
Agreement.
Except as provided in the preceding paragraph, earnings (net of
investment losses) on the investment of funds deposited into the 1998-C SUBI
Certificateholders' Account in respect of the Class A-1 Notional Interest
Accrual Amount, any Class A-1 Swap Interest Carryover Shortfall Amounts, the
Class A-2 Notional Interest Accrual Amount, any Class A-2 Swap Interest
Carryover Shortfall Amounts, the Class A-3 Notional Interest Accrual Amount,
any Class A-3 Swap Interest Carryover Shortfall Amounts, the Class B Notional
Interest Accrual Amount and any Class B Swap Interest Shortfall Amount, shall
be part of Available Interest. Such net investment earnings need not be
withdrawn from the 1998-C SUBI Certificateholders' Account and redeposited as
Available Interest, but may be retained in the 1998-C SUBI
Certificateholders' Account and applied as provided in this 1998-C
Securitization Trust Agreement. The 1998-C Securitization Trustee shall
incur no liability relating to any investments made pursuant to this Section
3.02(a) absent its own negligence or willful misfeasance.
In the event that a Trust Officer of the 1998-C Securitization Trustee
has actual knowledge that Standard & Poor's has downgraded TMCC's short-term
debt to a rating less than A-1+ or Standard & Poor's has downgraded TMCC's
long-term debt to a rating of less than AA, ▇▇▇▇▇'▇ has downgraded TMCC's
short-term debt to a rating less than P-1 or ▇▇▇▇▇'▇ downgrades TMCC's
long-term debt to a rating less than Aa3, the 1998-C Securitization Trustee
shall determine whether (i) at such time one or more Permitted Investments
other than TMCC Demand Notes having substantially the same maturities and
similar demand features as the TMCC Demand Notes and bearing interest at the
relevant Required Rates are available and (ii) investment in such other
Permitted Investments rather than in TMCC Demand Notes will not cause a
Rating Agency to reduce or withdraw its rating of any Class of Investor
Certificates. In making such determinations, the 1998-C Securitization
Trustee shall be entitled to rely (as to clause (i)) on the advice of ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated, or a nationally recognized firm of independent
accountants, and (as to clause (ii)) shall inquire directly of the Rating
Agencies based on the specific securities, if any, identified pursuant to the
foregoing. If the 1998-C Securitization Trustee concludes that both
conditions are satisfied, or a Trust Officer of the 1998-C Securitization
Trustee has actual knowledge that a Swap Termination has occurred, the 1998-C
Securitization Trustee will exercise its right under the Indenture to demand
payment in full of all outstanding TMCC Demand Notes.
(b) ESTABLISHMENT OF THE RESERVE FUND. The Transferor shall
establish and maintain with the 1998-C Securitization Trustee a separate
trust account to be known as the "Reserve Fund", which will include the money
and other property deposited and held therein pursuant to Section 3.01(c) and
this Section. Funds in the Reserve Fund shall be the property of the
Transferor and not the property of the 1998-C Securitization Trust. The
Transferor hereby grants to the 1998-C Securitization Trustee for the benefit
of the Investor Certificateholders a security interest in all
22
funds (including Permitted Investments) in the Reserve Fund (including the
Reserve Fund Initial Deposit) and the proceeds thereof, and the 1998-C
Securitization Trustee shall have all of the rights of a secured party under
the UCC with respect thereto; provided that all income from the investment of
funds in the Reserve Fund and the right to receive such income are retained
by the Transferor and are not transferred, assigned or otherwise conveyed to
the 1998-C Securitization Trustee hereunder. The Reserve Fund shall be an
Eligible Account and initially shall be established with the 1998-C
Securitization Trustee. If for any reason the Reserve Fund is no longer an
Eligible Account, the 1998-C Securitization Trustee shall promptly cause the
Reserve Fund to be moved to another institution or otherwise changed so that
the Reserve Fund becomes an Eligible Account.
All amounts held in the Reserve Fund shall be invested by the 1998-C
Securitization Trustee, as directed in writing by the Servicer pursuant to
Section 4.02(j) of the 1998-C SUBI Servicing Supplement, in Permitted
Investments. Earnings on investment of funds in the Reserve Fund shall be
paid to the Transferor on each Monthly Allocation Date, subject to Section
3.01(h)(ii), and losses and any investment expenses shall be charged against
the funds on deposit therein. The 1998-C Securitization Trustee shall incur
no liability for the selection of investments or for losses thereon absent
its own negligence or willful misfeasance. The 1998-C Securitization Trustee
shall have no liability in respect of losses incurred as a result of the
liquidation of any investment prior to its stated maturity date or the
failure of the Servicer to provide timely written investment directions.
(c) RESERVE FUND SECURITIES INTERMEDIARY. The 1998-C
Securitization Trustee hereby confirms that (i) the 1998-C Securitization
Trustee is acting, with respect to its duties under this Section 3.02, as a
"securities intermediary" as defined in Section 8-102 of the UCC (in such
capacity, the "Reserve Fund Securities Intermediary"), (ii) has established
the Reserve Fund as a "securities account" as such term is defined in Section
8-501(a) of the UCC, (iii) the Reserve Fund Securities Intermediary shall,
subject to the terms of this Agreement, treat the 1998-C Securitization
Trustee as entitled to exercise the rights that comprise any financial asset
credited to the Reserve Fund, and (iv) all securities or other property
underlying any financial assets credited to the Reserve Fund shall be
registered in the name of the Reserve Fund Securities Intermediary, endorsed
to the Reserve Fund Securities Intermediary or in blank or credited to
another securities account maintained in the name of the Reserve Fund
Securities Intermediary for the benefit of 1998-C Securitization Trustee and
in no case will any financial asset credited to the Reserve Fund be
registered in the name of any other person, payable to the order of any other
person, or specially endorsed to any other person, except to the extent the
foregoing have been specially endorsed by the Transferor to the 1998-C
Securitization Trustee. The 1998-C Securitization Trustee shall incur no
liability relating to any investments made pursuant to this Section 3.02(c)
absent its own negligence or willful misfeasance.
(d) FINANCIAL ASSETS ELECTION. The 1998-C Securitization Trustee
hereby agrees that the Reserve Fund and each item of property (whether
investment property, financial asset, security or instrument), other than
cash, credited to the Reserve Fund shall be treated as a "financial asset"
within the meaning of Section 8-102(A)(9) of the UCC.
23
(e) ENTITLEMENT ORDERS. If at any time the Reserve Fund Securities
Intermediary shall receive an "entitlement order" (within the meaning of
Section 8-102(A)(8) of the UCC) issued by the 1998-C Securitization Trustee
and relating to the Reserve Fund, the Reserve Fund Securities Intermediary
shall comply with such entitlement order without further consent by any other
person. The 1998-C Securitization Trustee hereby agrees only to issue
entitlement orders at the written direction of the Servicer. The Reserve
Fund Securities Intermediary shall have no obligation to act, and shall be
fully protected in refraining from acting, in respect of the financial assets
credited to the Reserve Fund in the absence of such an entitlement order.
(f) SUBORDINATION OF LIEN; WAIVER OF SET-OFF. In the event that
the 1998-C Securitization Trustee has or subsequently obtains a security
interest in the Reserve Fund or any security entitlement credited thereto by
agreement, operation of law or otherwise, the 1998-C Securitization Trustee
hereby agrees that such security interest shall be subordinate to the
security interest of the Transferor. The financial assets and other items
deposited to the Reserve Fund will not be subject to deduction, set-off,
banker's lien, or any other right in favor of any person other than the
Transferor provided, however, that notwithstanding anything herein to the
contrary, the 1998-C Securitization Trustee shall have a lien senior to that
of the Transferor for any and all amounts required for the payment of the
purchase price of a financial asset, which purchase has been placed but not
yet cleared or settled. Any such deductions shall not be deemed to refer to
deductions for payment of the purchase price in securities transactions not
yet settled or cleared.
(g) CONFLICTING ORDERS. The 1998-C Securitization Trustee, in such
capacity, has not entered into and, until termination of this 1998-C
Securitization Trust Agreement, will not enter into, any agreement with any
other person relating to the Reserve Fund or any financial assets credited
thereto pursuant to which it has agreed to comply with entitlement orders (as
defined in Section 8-102(a)(8) of the UCC) of such person. No financial
asset will be registered in the name of the 1998-C Securitization Trustee, in
such capacity, payable to its order, or specially endorsed to it, except to
the extent such financial asset has been endorsed to the Reserve Fund
Securities Intermediary or in blank.
(h) DEPOSITS INTO THE RESERVE FUND. On or prior to the Closing
Date, the Transferor shall deposit an amount equal to the Reserve Fund
Initial Deposit into the Reserve Fund, of which amount $__________ shall be
allocated as the Class B Reserve Amount. Amounts on deposit in the Reserve
Fund shall be supplemented from time to time by the deposit therein of
amounts described in Section 3.01(c)(x), and under section 3.01(i); PROVIDED,
HOWEVER, that no such subsequent amounts shall be allocated to the Class B
Reserve Amount. On each Monthly Allocation Date the amounts on deposit in
the Reserve Fund shall be available for allocation and application or payment
as provided in Section 3.01; PROVIDED THAT, subject to the provisions of
Section 3.01, on each Certificate Payment Date, if the amount on deposit in
the Reserve Fund (after giving effect to all deposits thereto or withdrawals
therefrom on such Monthly Allocation Date) is greater than the Specified
Reserve Fund Balance, the 1998-C Securitization Trustee will pay any such
excess amount to the Transferor as and to the extent described in Section
3.01, whereupon such excess amount shall no longer be available to the 1998-C
Securitization Trustee or the Investor Certificateholders.
24
(i) PAYMENTS FOLLOWING TERMINATION OF TRUST. On each related
Stated Maturity Date and upon termination of the 1998-C Securitization Trust
pursuant to Section 7.01, any amounts on deposit in the Reserve Fund shall be
available for payment of any remaining amounts due on such date to reimburse
Maturity Advances or other unreimbursed Advances or pay accrued and unpaid
compensation payable to the Servicer through such date, for payment to the
Investor Certificateholders, and for payment of any remaining amounts due to
the 1998-C Securitization Trustee or the Titling Trustee. Upon termination
of the 1998-C Securitization Trust pursuant to Section 7.01, after payment of
such amounts due, any amounts remaining on deposit in the Reserve Fund shall
be paid to the Transferor. Upon termination of the 1998-C Securitization
Trust, the 1998-C Securitization Trustee shall release from the lien of this
1998-C Securitization Trust Agreement the Reserve Fund and any financial
assets held therein, and shall execute any requisite filing under the UCC as
provided by the Transferor to evidence such release and the release of any
security interest of the 1998-C Securitization Trust or the 1998-C
Securitization Trustee therein.
(j) The Securities Intermediary undertakes to perform such duties
and only such duties as are specifically set forth in this Section 3.02. The
Reserve Fund Securities Intermediary, in such capacity, shall not have any
duties or responsibilities except those expressly set forth in this Section
3.02 or be a trustee for or have any fiduciary obligation to any party hereto.
(k) The duties and obligations of the Reserve Fund Securities
Intermediary, in such capacity, shall be determined solely by the express
provisions of this Section 3.02, and the Reserve Fund Securities Intermediary
shall take such action with respect to this Section 3.02 as it shall be
directed hereunder, and the Reserve Fund Securities Intermediary, in such
capacity, shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Section 3.02 and as
specifically directed by the 1998-C Securitization Trustee, and no implied
covenants or obligations shall be read into this Section 3.02 against the
Reserve Fund Securities Intermediary; and in the absence of bad faith on the
part of the Reserve Fund Securities Intermediary, the Reserve Fund Securities
Intermediary 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 Reserve Fund Securities Intermediary which conform
to the requirements of this Section 3.02.
(l) The Reserve Fund Securities Intermediary, in such capacity,
shall not be liable for any error of judgment made in good faith by an
officer or officers of the Reserve Fund Securities Intermediary, acting as
such, unless it shall be determined that the Reserve Fund Securities
Intermediary, or any such officer or officers, was negligent in ascertaining
the pertinent facts, or otherwise acted with negligence or willful
misfeasance, and the Reserve Fund Securities Intermediary shall not be liable
with respect to any action taken or omitted to be taken by it in good faith
in accordance with any direction of the 1998-C Securitization Trustee given
under this 1998-C Securitization Trust Agreement.
(m) None of these provisions of this 1998-C Securitization Trust
Agreement shall require the Reserve Fund Securities Intermediary to expend or
risk its own funds or otherwise to incur any liability, financial or
otherwise, in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers if it shall have reasonable grounds
for believing that
25
repayment of such funds or indemnity satisfactory to it against such risk or
liability is not assured to it.
(n) The Reserve Fund Securities Intermediary may conclusively rely
and shall be fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval or other paper or document actually
believed by it to be genuine and to have been signed or presented by the
proper party or parties.
(o) Whenever in the administration of the provisions of this
Section 3.02, the Reserve Fund Securities Intermediary shall deem it
necessary or desirable that a matter be proved or established prior to taking
or suffering any action to be taken hereunder, the Reserve Fund Securities
Intermediary shall be entitled to receive from the Transferor a certificate
of an officer thereof stating that the matter is established as fact and such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence or bad faith on the part of the
Reserve Fund Securities Intermediary, be deemed to be conclusively proved and
established by a certificate signed by one of the Trust Officers of the
1998-C Securitization Trustee and delivered to the Reserve Fund Securities
Intermediary, and such certificate, in the absence of negligence or willful
misfeasance on the part of the Reserve Fund Securities Intermediary, shall be
full warrant to the Reserve Fund Securities Intermediary for any action
taken, suffered or omitted by it under the provisions of this Section 3.02 on
the basis thereof.
(p) The Reserve Fund Securities Intermediary may consult with
counsel and the advice or any opinion of counsel shall be full and complete
authorization and protection in respect of any action taken or omitted by it
hereunder in good faith and in accordance with such advice or opinion of
counsel.
(q) The Reserve Fund Securities Intermediary shall not be bound to
make any investigation into the facts or matters stated in any resolution,
order, certificate, statement, instrument, opinion, report, notice, request,
consent, entitlement order, approval or other paper or document.
(r) The Reserve Fund Securities Intermediary shall have no
obligation to invest or reinvest any cash held in the Reserve Fund in the
absence of timely and specific written investment direction from the 1998-C
Securitization Trustee. In no event shall the Reserve Fund Securities
Intermediary be liable for the selection of investments or for investment
losses incurred as a result of the liquidation of any investment prior to its
stated maturity or the failure of the 1998-C Securitization Trustee to
provide timely written investment direction.
(s) The Reserve Fund Securities Intermediary may at any time resign
by giving 30 days written notice of resignation to the 1998-C Securitization
Trustee and the Transferor. Upon receiving such notice of resignation, the
1998-C Securitization Trustee shall promptly appoint a successor and, upon
the acceptance by the successor of such appointment, release the resigning
Reserve Fund Securities Intermediary from its obligations hereunder by
written instrument, a copy of which instrument shall be delivered to each of
the 1998-C Securitization Trustee, the resigning Reserve Fund Securities
Intermediary and the successor. If no successor shall have been so appointed
and have accepted appointment within 45 days after the giving of such notice
of
26
resignation, the resigning Reserve Fund Securities Intermediary may petition
any court of competent jurisdiction for the appointment of a successor.
(t) The parties each (for itself and any person or entity claiming
through it) hereby release, waive, discharge, exculpate and covenant not to
▇▇▇ the Reserve Fund Securities Intermediary for any action taken or omitted
under this Section 3.02 except to the extent caused by the Reserve Fund
Securities Intermediary's negligence or willful misfeasance. Anything in
this 1998-C Securitization Trust Agreement to the contrary notwithstanding,
in no event shall the Reserve Fund Securities Intermediary be liable for
special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Reserve Fund
Securities Intermediary has been advised of the likelihood of such loss or
damage (unless so advised prior to taking any such action) and regardless of
the form of action.
(u) The Servicer, in its capacity as such, shall indemnify, defend
and hold harmless the Reserve Fund Securities Intermediary and its officers,
directors, employees, representatives and agents, from and against and
reimburse the Reserve Fund Securities Intermediary for any and all claims,
expenses, obligations, liabilities, losses, damages, injuries (to person,
property, or natural resources), penalties, stamp or other similar taxes,
actions, suits, judgments, reasonable costs and expenses (including
reasonable attorney's and agent's fees and expenses) directly or indirectly
relating to, or arising from, claims against the Reserve Fund Securities
Intermediary by reason of its participation in the transactions contemplated
by this Section 3.02, including without limitation all reasonable costs
required to be associated with claims for damages to persons or property, and
reasonable attorneys' and consultants' fees and expenses and court costs
except to the extent caused by the Reserve Fund Securities Intermediary's
negligence or willful misfeasance. The provisions of this Section 3.02(u)
shall survive the termination of this 1998-C Securitization Trust Agreement
or the earlier resignation or removal of the Reserve Fund Securities
Intermediary.
3.03 STATEMENTS TO CERTIFICATEHOLDERS.
(a) On each Determination Date, commencing in October, 1998, the
Servicer will prepare and forward to the Titling Trustee, the 1998-C
Securitization Trustee and the Luxembourg Stock Exchange, and the 1998-C
Securitization Trustee will make available to each Certificateholder on each
Monthly Allocation Date, a statement setting forth with respect to the
related Monthly Allocation Date or the related Collection Period, among other
things, the following:
(i) the Investor Percentage and Transferor Percentage in effect
with respect to the related Collection Period;
(ii) the Certificate Distribution Amount);
(iii) the amount of the Certificate Distribution Amount allocable
to (A) the Class A-1 Notional Interest Accrual Amount, the Class A-2
Notional Interest Accrual Amount, the Class A-3 Notional Interest Accrual
Amount and the Class B Notional Interest Accrual Amount [Class B Fixed
Rate Interest Accrual Amount]; (B) any unreimbursed Class A-1 Swap
Interest Carryover Shortfall Amount, Class A-2 Swap Interest Carryover
Shortfall
27
Amount, Class A-3 Swap Interest Carryover Shortfall Amount and any
[Class B Swap Interest Carryover Shortfall Amount] [Class B Interest
Carryover Shortfall Amount]; and (C) the reduction of the Adjusted Class
A-1 Certificate Balance, the Adjusted Class A-2 Certificate Balance, the
Adjusted Class A-3 Certificate Balance and the Adjusted Class B
Certificate Balance, separately identifying any Maturity Advances;
(iv) the Adjusted Class A-1 Certificate Balance, the Adjusted
Class A-2 Certificate Balance, the Adjusted Class A-3 Certificate Balance
and Adjusted Class B Certificate Balance, in each case as of such Monthly
Allocation Date and after giving effect to the allocation and application
or payment of the Certificate Distribution Amount;
(v) the aggregate amount, if any, of the reimbursement of Loss
Amounts included in the Certificate Distribution Amount and the amount
thereof allocated to the Adjusted Class A-1 Certificate Balance, the
Adjusted Class A-2 Certificate Balance, the Adjusted Class A-3
Certificate Balance and the Adjusted Class B Certificate Balance;
(vi) the amount of the Certificate Distribution Amount allocable
to reimbursement of Certificate Principal Loss Amounts and the amount
thereof allocated to the Adjusted Class A-1 Certificate Balance, the
Adjusted Class A-2 Certificate Balance, the Adjusted Class A-3
Certificate Balance and the Adjusted Class B Certificate Balance;
(vii) the amount, if any, of the remaining unreimbursed
Certificate Principal Loss Amounts, after giving effect to the allocation
and application or payment of the Certificate Distribution Amount;
(viii) the Investor Percentage of the Servicing Fee and any
amounts remaining unpaid in respect thereof from any prior Monthly
Allocation Date;
(ix) the amount of any Required Amount included in the
Certificate Distribution Amount and the balance on deposit in the Reserve
Fund on such Monthly Allocation Date, after giving effect to withdrawals
therefrom and deposits thereto on such Monthly Allocation Date, the
change in such balance from the immediately preceding Monthly Allocation
Date, and the Specified Reserve Fund Balance as of the date of such
report;
(x) the amount of Transferor Amounts, if any, included in the
Certificate Distribution Amount;
(xi) the Aggregate Net Investment Value as of the end of such
Collection Period;
(xii) the aggregate amount of Payments Ahead received by the
Servicer and being held thereby or on deposit in the SUBI Collection
Account in respect of future Collection Periods and the change in such
amount from the immediately preceding Monthly Allocation Date;
28
(xiii) the amount of Advances and Maturity Advances made, and the
amount of unreimbursed Advances and Maturity Advances outstanding after
giving effect to the allocation or distribution of the Certificate
Distribution Amount; and
(xiv) Whether the "Residual Value Test" is satisfied, separately
stating (A) whether with respect to the related Collection Period the
number of Leased Vehicles returned to the Servicer relating to Contracts
that became Matured Contracts and that were sold during such period is
greater than 25% of all Contracts that, as of their respective
origination dates, had been scheduled to become Matured Contracts during
such period (provided that at least 500 such Contracts had been scheduled
to become Matured Contracts during such Collection Period), and (B)
whether the average Net Matured Leased Vehicle Proceeds during the three
immediately preceding calendar months is less than 75% of the average
Residual Values of Leased Vehicles disposed of or liquidated during such
period.
(b) The Servicer shall prepare certain reports during the Revolving
Period that reflect or include certain statistical information with respect to
Subsequent Lease Contracts and Subsequent Leased Vehicles allocated as SUBI
Assets during the Revolving Period. Such reports will be delivered by the
Servicer to the 1998-C Securitization Trustee and the Luxembourg Stock Exchange
within 20 days of the last day of the Collection Period during which Subsequent
Contracts and Subsequent Leased Vehicles are added to the 1998-C SUBI Sub-Trust
such that the aggregate Discounted Principal Balance and Subsequent Contracts
and Subsequent Leased Vehicles added since the Closing Date exceeds 10% of the
Aggregate Net Investment Value as of the Cut-Off Date or, for each subsequent
such report, exceeds 10% of the Aggregate Net Investment Value as of the date of
the prior report. Each such report will be delivered by the Servicer to the
1998-C Securitization Trustee and each Paying Agent and made available to each
person who makes a written request therefor.
(c) Any person may obtain a copy [of any statement required by this
Section], of any Servicer's Certificate required pursuant to Section 5.01(b) of
the 1998-C SUBI Servicing Supplement, any annual report of Independent
Accountants required pursuant to Section 5.02 of the 1998-C SUBI Servicing
Supplement, and of any annual Officer's Certificate required pursuant to Section
5.03 of the 1998-C SUBI Servicing Supplement, upon written request to the 1998-C
Securitization Trustee at the Corporate Trust Office.
(d) Within a reasonable period of time after the end of each calendar
year, but not later than the latest date permitted by law, the 1998-C
Securitization Trustee shall mail to each Person who at any time during such
calendar year shall have been a Holder of a Class B Certificate, a statement or
statements, based on the Servicer's Certificate prepared by the Servicer, which
in the aggregate contain the sum of the amounts set forth in clauses (iii),
(vii) and (viii) in Section 3.03(a) for such calendar year or, in the event such
Person shall have been a Holder of a Class B Certificate during a portion of
such calendar year, for the applicable portion of such year, for the purposes of
such Certificateholder's preparation of income tax returns. In addition, the
Servicer shall furnish to the 1998-C Securitization Trustee for distribution to
such Person at such time any other information reasonably necessary under
applicable law for the preparation of such income tax returns.
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ARTICLE IV
THE CERTIFICATES
4.01 THE CERTIFICATES.
(a) The Class A-1 Certificates, the Class A-2 Certificates, the Class
A-3 Certificates, the Class B Certificates and the Transferor Certificate shall
be substantially in the form of Exhibits ▇-▇, ▇-▇, ▇-▇, B and C, respectively,
to this 1998-C Securitization Trust Agreement. The Class A-1 Certificates, the
Class A-2 Certificates and the Class A-3 Certificates shall be issuable in
minimum denominations of $1,000 and integral multiples of $1 in excess thereof
and the Class B Certificates shall be issuable in minimum denominations of
$500,000 and integral multiples of $1,000 in excess thereof (provided that no
Class B Certificate may be issued or transferred in a denomination that would
cause there to be, immediately after such issuance or transfer, one hundred
(100) or more Class B Certificateholders); provided, however, that one Class A-1
Certificate, one Class A-2 Certificate, one Class A-3 Certificate and one Class
B Certificate may be issued in a denomination that includes any remaining
portion of the Initial Class A-1 Certificate Balance, the Initial Class A-2
Certificate Balance, the Initial Class A-3 Certificate Balance and the Initial
Class B Certificate Balance, respectively (each, a "Residual Certificate"). A
single Transferor Certificate shall be issued. The Certificates shall be
executed on behalf of the 1998-C Securitization Trust by manual or facsimile
signature of an officer or other authorized signatory of the 1998-C
Securitization Trustee. 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 1998-C Securitization Trustee shall not be
rendered invalid, 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.
(b) The Investor Certificates shall represent fractional undivided
interests in the 1998-C Securitization Trust, including the right to receive the
Investor Percentage of Interest Collections and Principal Collections and the
other amounts at the times and in the amounts specified in this 1998-C
Securitization Trust Agreement. The Transferor Certificate shall represent the
interest in the 1998-C Securitization Trust not represented by the Investor
Certificates.
(c) No Certificate shall be entitled to any benefit under this 1998-C
Securitization Trust Agreement, or be valid for any purpose, unless there
appears on such Certificate a certificate of authentication substantially in the
form set forth in Exhibit ▇-▇, ▇-▇, ▇-▇, B or C to this 1998-C Securitization
Trust Agreement, as the case may be, executed by the 1998-C Securitization
Trustee or an authentication agent appointed for such purpose by the 1998-C
Securitization Trustee, by manual or facsimile signature. Such certificate of
authentication upon any Certificate shall be the sole conclusive evidence that
such Certificate has been duly authenticated and delivered under this 1998-C
Securitization Trust Agreement. The 1998-C Securitization Trustee is hereby
authorized to appoint an authentication agent to execute any or all such
certificates of authentication on behalf of the 1998-C Securitization Trustee.
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4.02 AUTHENTICATION AND DELIVERY OF CERTIFICATES.
(a) In exchange for, and simultaneously with the sale, assignment and
transfer to the 1998-C Securitization Trustee of the 1998-C SUBI (exclusive of
all monies and payments due or payable under any Residual Value Insurance
Policies and the right to receive such amounts), the 1998-C SUBI Certificate and
the other assets of the 1998-C Securitization Trust, the 1998-C Securitization
Trustee shall cause to be executed, authenticated and delivered to or upon the
order of the Transferor Investor Certificates in authorized denominations
equaling in the aggregate the sum of the Initial Class A-1 Certificate Balance,
the Initial Class A-2 Certificate Balance, the Initial Class A-3 Certificate
Balance and the Initial Class B Certificate Balance, and the Transferor
Certificate, each duly authenticated by the 1998-C Securitization Trustee or any
authentication agent appointed thereby, and evidencing the entire ownership of
the 1998-C Securitization Trust.
4.03 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 Certificates and
transfers and exchanges of Certificates as provided in this 1998-C
Securitization Trust Agreement; provided, however, that Bankers Trust Luxembourg
S.A. shall provide for transfers and exchanges of the Definitive Certificates,
if any. The 1998-C Securitization Trustee is hereby initially appointed
Certificate Registrar for the purpose of registering Certificates and transfers
and exchanges of Certificates as provided in this 1998-C Securitization Trust
Agreement. In the event that, subsequent to the Closing Date, the 1998-C
Securitization 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 1998-C
Securitization Trust Agreement applicable to it, and otherwise acceptable to the
1998-C Securitization Trustee, to act as successor Certificate Registrar under
this 1998-C Securitization Trust Agreement.
The Transferor Certificate shall be owned by the Transferor and may not
be transferred, as provided by Section 5.06.
(b) No transfer of the Class B Certificates shall be made unless such
resale or transfer is made (i) pursuant to an effective Registration Statement
under the Securities Act, (ii) in a transaction (other than a transaction in
clause (iv) below) exempt from the registration requirements of the Securities
Act and applicable state and foreign securities laws, (iii) to the Transferor or
(iv) to a Person who the transferor of such Class B Certificate reasonably
believes is a qualified institutional buyer within the meaning of Rule 144A
under the Securities Act and that is aware that the resale or other transfer is
being made in reliance on Rule 144A or to an institutional "accredited investor"
as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act (an
"Institutional Accredited Investor"). In the event that a transfer is to be
made as described in clause (ii) of the preceding sentence, the prospective
transferee shall deliver or cause to be delivered an Opinion of Counsel in form
and substance satisfactory to the 1998-C Securitization Trustee and the
Transferor to the effect that such transfer may be made without registration
under the Securities Act or any
31
applicable state or foreign securities laws. In the event that a transfer is
to be made to an institutional accredited investor as described in clause
(iv), the 1998-C Securitization Trustee shall require that the transferee
execute a representation letter acceptable to and in form and substance
satisfactory to the 1998-C Securitization Trustee (provided that the form
attached as Exhibit E shall be deemed acceptable if it is completed in a
manner acceptable to the 1998-C Securitization Trustee) certifying to the
1998-C Securitization Trustee the facts surrounding such transfer, which
representation letter shall not be an expense of the 1998-C Securitization
Trustee, the Transferor or the Servicer. In the case of a transfer under
either clause (ii) or clause (iv), the Holder of a Class B Certificate
desiring to effect such transfer shall, and does hereby agree to, indemnify
the 1998-C Securitization Trustee, the Transferor and the Servicer against
any liability that may result if the transfer is not so exempt or is not made
in accordance with the Securities Act and such state and foreign securities
laws. Neither the Transferor, the Servicer nor the 1998-C Securitization
Trustee is under any obligation to register the Class B Certificates under
the Securities Act or any applicable state or foreign securities laws.
Prospective purchasers of the Class B Certificates are hereby notified that
the seller of any Class B Certificates may be relying on the exemption from
the registration requirements of Section 5 of the Act provided by Rule 144A
under the Act.
The Class B Certificates or a beneficial interest therein may not be
transferred unless the 1998-C Securitization Trustee has received a certificate
to the effect that if the transferee is a partnership, grantor trust or S
corporation for federal income tax purposes (a "Flow-Through Entity"), any Class
B Certificates owned by such Flow-Through Entity will represent less than 50% of
the value of all the assets owned by such Flow-Through Entity and no special
allocation of income, gain, loss, deduction or credit from such Class B
Certificates will be made among the beneficial owners of such Flow-Through
Entity.
Subject to the last sentence of this paragraph, no Class B Certificate
or beneficial interest therein may be transferred to a transferee who is an
employee benefit plan, trust or account, subject to ERISA, or subject to Section
4975 of the Code, or a governmental plan defined in Section 3(32) of ERISA
subject to any federal, state or local law which is, to a material extent,
similar to the foregoing provisions of ERISA or the Code and is not an entity,
including an insurance company separate account or an insurance company general
account if the assets in any such accounts constitute "Plan Assets" for the
purposes of regulation Section 2510.3101 of ERISA, whose underlying assets
include Benefit Plan assets by reason of a Benefit Plan's investment in the
entity. If any Paying Agent or a Trust Officer of the 1998-C Securitization
Trustee has actual knowledge of any such transfer, such transfer shall be deemed
null and void. Unless the 1998-C Securitization Trustee shall have received
either (a) a certificate from the transferee making the representations with
respect to such ERISA matters set forth in Exhibit D hereto or (b) an opinion of
counsel concerning such ERISA matters as set forth in Exhibit D hereto, the
1998-C Securitization Trustee shall not permit a transfer of Class B
Certificates to such transferee.
32
The Transferor shall, whenever the 1998-C Securitization Trust is not
subject to Section 13 or 15(d) of the Exchange Act, make available, upon
request, to any holder of such Class B Certificates in connection with any sale
thereof and any prospective purchaser of Class B Certificates from such holder
the information specified in Rule 144A(d)(4) under the Securities Act.
In addition, no resale or other transfer of the Class B Certificates or
any interest therein shall be permitted unless immediately after giving effect
to such resale or other transfer, there would be fewer than 100 Class B
Certificateholders.
The Class B Certificates, this 1998-C Securitization Trust Agreement and
related documents may be amended or supplemented from time to time to modify
restrictions on and procedures for resale and other transfer of such Class B
Certificates to reflect any change in applicable law or regulation (or the
interpretation thereof) or practices relating to the resale or transfer of
restricted securities generally.
(c) Upon surrender for registration of transfer of any Certificate at
the Corporate Trust Office of the 1998-C Securitization Trustee in its capacity
as Certificate Registrar, or at the office of the agent of the 1998-C
Securitization Trustee as Certificate Registrar, who shall initially be U.S.
Bank National Association located at One Illinois Center, ▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and, with respect to the Definitive
Certificates, Bankers Trust Luxembourg S.A. for so long as any Class A
Certificates are listed on the Luxembourg and Stock Exchange, or the appropriate
office of any successor Certificate Registrar, the 1998-C Securitization Trust
shall execute, and the 1998-C Securitization 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.
(d) At the option of a Certificateholder, Certificates may be
exchanged for other Certificates of the same Class of authorized denominations
of a like aggregate Percentage Interest, upon surrender of the Certificates to
be exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange, the 1998-C Securitization Trust shall execute, and the
1998-C Securitization Trustee shall 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 1998-C Securitization Trustee and the Certificate Registrar duly executed by
the Holder thereof or his attorney duly authorized in writing.
No service charge shall be imposed on any Holder for any registration of
transfer or exchange of Certificates, but the 1998-C Securitization Trustee may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer or exchange of Certificates.
All Certificates surrendered for registration of transfer and exchange
shall be cancelled and subsequently destroyed by the 1998-C Securitization
Trustee.
No Class B Certificate shall be listed for trading on any recognized
securities exchange.
33
(e) Each purchaser of a Class B Certificate that does not deliver a
transfer certificate in the form of Exhibit E hereto will be deemed to have
represented to and agreed with the parties hereto (or, in the case of
purchases by agents or fiduciaries acting for beneficial owners of an account
for which such agents or fiduciaries exercise complete investment discretion,
such agents or fiduciaries will be deemed to have confirmed to the parties
hereto on behalf of such beneficial owners) as follows (terms used below that
are defined in Rule 144A under the Securities Act are used as defined
therein):
(i) The purchaser understands that the Class B Certificate has
not been registered under the Securities Act, or the securities laws of
any state or foreign jurisdiction.
(ii) The purchaser is acquiring the Class B Certificate for its
own account (or for the account of a "qualified institutional buyer")
only for investment and not for any other person, and not with a view to,
or for resale in connection with, a distribution that would constitute a
violation of the Securities Act or any state or foreign securities laws
(subject to the understanding that disposition of the purchaser's
property will remain at all times within its control). The purchaser is
not an affiliate of the Transferor, the 1998-C Securitization Trustee or
any of their respective affiliates.
(iii) The purchaser agrees that the Class B Certificate must be
held indefinitely by it unless (i) subsequently registered under the
Securities Act or (ii) an exemption from the registration requirements of
the Securities Act is available.
(iv) The purchaser agrees that it will not transfer or exchange
any Class B Certificate unless such transfer or exchange is made in
accordance with the provisions of this Section 4.03.
(v) The purchaser is a qualified institutional buyer as defined
in Rule 144A of the Securities Act and is aware that the sale to it is
being made in reliance on Rule 144A, it is acquiring the Class B
Certificate for its own account or for the account of a qualified
institutional buyer and it understands that such Class B Certificate may
be resold, pledged or transferred only (i) to a person who the purchaser
reasonably believes is a qualified institutional buyer that purchases for
its own account or for the account of a qualified institutional buyer to
whom notice is given that the resale, pledge or transfer is being made in
reliance on Rule 144A or (ii) pursuant to another exemption from
registration under the Securities Act and applicable state and foreign
securities laws.
(vi) Neither the purchaser nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of any Class B
Certificate, any interest in any Class B Certificate or any other similar
security of the Transferor or the 1998-C Securitization Trust to, or
solicited any offer to buy or accept a transfer, pledge or other
disposition of any Class B Certificate, any interest in any Class B
Certificate or any other similar security of the Transferor or the 1998-C
Securitization Trust with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or
taken any other action, which would constitute a distribution of the
Class B Certificates under the Securities Act or which would render the
disposition of any Class B
34
Certificate a violation of Section 5 of the Securities Act or any state
or foreign securities law, require registration or qualification pursuant
thereto, or require registration of the 1998-C Securitization Trust or
the Transferor as an "investment company" under the Investment Company
Act of 1940, as amended, nor will it act, nor has it authorized or will
it authorize any person to act, in such manner with respect to the
Class B Certificates.
(vii) The purchaser understands that there is no market, nor is
there any assurance that a market will develop, for the Class B
Certificates and that the Transferor and the 1998-C Securitization Trust
have no obligation to make or facilitate any such market (or to otherwise
repurchase the Class B Certificate from the purchaser) under any
circumstances.
(viii) The purchaser has consulted with its own legal counsel,
independent accountants and financial advisors to the extent it deems
necessary regarding the tax consequences to it of ownership of the Class
B Certificate, is aware that its taxable income with respect to the Class
B Certificate in any accounting period may not correspond to the cash
flow (if any) from the Class B Certificate for such period, and is not
purchasing the Class B Certificate in reliance on any representations of
the Transferor or its counsel with respect to tax matters.
(ix) The purchaser has reviewed the Private Placement Memorandum
dated _______________, 1998 (the "Private Placement Memorandum"),
including the prospectus attached thereto, and has had the opportunity to
ask questions and receive answers concerning the terms and conditions of
the transaction contemplated by the Private Placement Memorandum and to
obtain additional information necessary to verify the accuracy and
completeness of any information furnished to the purchaser or to which
the purchaser had access.
(x) The purchaser understands that the Class B Certificates
will bear legends substantially as set forth herein.
(xi) The purchaser agrees to be bound by all the terms and
conditions of the Class B Certificates provided in this 1998-C
Securitization Trust Agreement.
4.04 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar (or Bankers Trust Luxembourg S.A. with respect to the Definitive
Certificates), or the Certificate Registrar (or Bankers Trust Luxembourg S.A.)
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (ii) there is delivered to the Certificate Registrar (or
Bankers Trust Luxembourg S.A. with respect to the Definitive Certificates) and
the 1998-C Securitization Trustee such security or indemnity as may be required
by them to save each of them and the 1998-C Securitization Trust harmless, then,
in the absence of notice that such Certificate has been acquired by a bona fide
purchaser, the 1998-C Securitization Trustee on behalf of the 1998-C
Securitization Trust shall execute and the 1998-C Securitization 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
Percentage Interest. In connection with the issuance of any new Certificate
under
35
this Section, the 1998-C Securitization 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. Any duplicate Certificate issued
pursuant to this Section shall constitute complete and indefeasible evidence
of ownership in the 1998-C Securitization Trust, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at
any time, and any such lost, stolen or destroyed Certificate shall, upon
issuance of any such duplicate Certificate, be null, void and of no effect.
4.05 PERSONS DEEMED OWNERS.
Prior to due presentation of a Certificate for registration of transfer,
the 1998-C Securitization 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 3.01 and for all other purposes whatsoever,
and neither the 1998-C Securitization Trustee, the Certificate Registrar nor any
of their respective agents shall be affected by any notice to the contrary.
4.06 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, in such form as the Servicer may
reasonably require, of the names and addresses of the Certificateholders as of
the most recent Record Date. If three or more Certificateholders or holders of
Investor Certificates evidencing not less than 25% of the aggregate Percentage
Interests of any Class (hereinafter referred to as "Applicants") apply in
writing to the 1998-C Securitization Trustee, and such application states that
the Applicants desire to communicate with other Investor Certificateholders with
respect to their rights under this 1998-C Securitization Trust Agreement or
under the Certificates and such application is accompanied by a copy of the
communication that such Applicants propose to transmit, then the 1998-C
Securitization 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 Investor Certificateholders. Every Certificateholder, by
receiving and holding a Certificate, agrees with the Servicer and the 1998-C
Securitization Trustee that neither the Servicer nor the 1998-C Securitization
Trustee shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Certificateholders under the
Agreement, regardless of the source from which such information was derived.
4.07 MAINTENANCE OF OFFICE OR AGENCY.
The 1998-C Securitization Trustee shall maintain in the Borough of
Manhattan, The City of New York, an office or offices or agency or agencies
where Certificates may be surrendered for registration of transfer or exchange.
The initial such agency shall be c/o U.S. Bank Trust National Association, ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and, with respect to the
Definitive Certificates shall be Bankers Trust Luxembourg S.A., ▇▇ ▇▇▇▇▇▇▇▇▇
▇.▇. ▇▇▇▇▇▇▇▇▇, ▇-▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, for so long as any Class A Certificates are
listed on the Luxembourg Stock Exchange; provided that a copy of any such
Certificate surrendered shall be sent to the 1998-C
36
Securitization Trustee at the Corporate Trust Office. The 1998-C
Securitization Trustee shall give prompt written notice to the Transferor,
the Servicer and the Certificateholders of any change in the location of any
such office or agency. Notices and demands to or upon the 1998-C
Securitization Trustee in respect of the Certificates and this 1998-C
Securitization Trust Agreement shall not be sent to such office or agency,
but shall be sent as set forth in Section 10.02.
4.08 TEMPORARY CERTIFICATES.
Pending the preparation of definitive Class A-1 Certificates, Class A-2
Certificates or Class A-3 Certificates, the 1998-C Securitization Trust may
execute, and the 1998-C Securitization Trustee may authenticate and deliver,
temporary Class A-1 Certificates, Class A-2 Certificates or Class A-3
Certificates that are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Class A-1 Certificates, Class A-2 Certificates or Class A-3
Certificates in lieu of which they are issued. If temporary Class A-1
Certificates, Class A-2 Certificates or Class A-3 Certificates are issued, the
Transferor will cause definitive Class A-1 Certificates, Class A-2 Certificates
or Class A-3 Certificates to be prepared without unreasonable delay. After the
preparation of definitive Class A-1 Certificates, Class A-2 Certificates or
Class A-3 Certificates, the temporary Class A-1 Certificates, Class A-2
Certificates or Class A-3 Certificates shall be exchangeable for definitive
Class A-1 Certificates, Class A-2 Certificates or Class A-3 Certificates upon
surrender of the temporary Class A-1 Certificates, Class A-2 Certificates, or
Class A-3 Certificates at the office or agency to be maintained as provided in
Section 4.07, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Class A Certificates, the 1998-C Securitization Trust
shall execute and the 1998-C Securitization Trustee shall authenticate and
deliver in exchange therefor, a like principal amount of definitive Class A
Certificates in authorized denominations. Until so exchanged the temporary
Class A Certificates shall in all respects be entitled to the same benefits
under the Agreement as definitive Class A Certificates.
4.09 BOOK-ENTRY CERTIFICATES.
The Class A-1 Certificates, the Class A-2 Certificates and the Class A-3
Certificates, upon original issuance will be issued in the form of one or more
typewritten certificates representing the Book-Entry Certificates, to be
delivered to DTC, the initial Clearing Agency, by, or on behalf of, the
Transferor. The certificate or certificates delivered to DTC evidencing such
Class A-1 Certificates, Class A-2 Certificates and Class A-3 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-1 Certificates, the Class A-2 Certificates or the Class A-3
Certificates, except as provided in Section 4.11. Unless otherwise specified in
this 1998-C Securitization Trust Agreement, unless and until definitive, fully
registered Class A-1 Certificates, Class A-2 Certificates, and Class A-3
Certificates (the "Definitive Certificates") have been issued to Certificate
Owners pursuant to Section 4.11:
(i) the provisions of this Section shall be in full force and
effect;
37
(ii) the Transferor, the Servicer, the Certificate Registrar and
the 1998-C Securitization Trustee may deal with the Clearing Agency for
all purposes (including the making of distributions on the Class A-1
Certificates, the Class A-2 Certificates and the Class A-3 Certificates)
as the authorized representative of the Certificate Owners; to the extent
that the provisions of this Section conflict with any other provisions of
the Agreement, the provisions of this Section shall control;
(iii) the rights of Certificate Owners shall be exercised only
through (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 4.11, 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 Class A-1
Certificates, the Class A-2 Certificates and the Class A-3 Certificates
to such Clearing Agency Participants; and
(iv) whenever this 1998-C Securitization Trust Agreement
requires or permits actions to be taken based upon instructions or
directions of Holders of Class A-1 Certificates, Class A-2 Certificates
or Class A-3 Certificates evidencing a specified aggregate Percentage
Interest thereof the Clearing Agency shall be deemed to represent such
percentage (if and to the extent that it will act on behalf of
Certificate Owners and/or Clearing Agency Participants) 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 percentages of the beneficial interest in
Class A-1 Certificates, Class A-2 Certificates or Class A-3 Certificates
and has delivered such instructions to the 1998-C Securitization Trustee.
4.10 NOTICES.
Whenever notice or other communication to the Class A-1
Certificateholders, Class A-2 Certificateholders or the Class A-3
Certificateholders is required under this 1998-C Securitization Trust Agreement,
other than to the Holder of the Residual Certificate with respect to the Class
A-1 Certificates, the Class A-2 Certificates or the Class A-3 Certificates,
respectively, unless and until Definitive Certificates shall have been issued to
Certificate Owners pursuant to Section 4.11, the 1998-C Securitization Trustee
and the Servicer shall give all such notices and communications specified herein
to be given to Holders of the Class A-1 Certificates, the Class A-2 Certificates
or the Class A-3 Certificates to the Clearing Agency. Whenever notice or other
communication to the holders of Definitive Certificates is required under this
1998-C Securitization Trust Agreement, the 1998-C Securitization Trustee and the
Servicer shall give all such notices and communications specified herein to the
Holders of such Definitive Certificates, for so long as any Definitive
Certificates are listed on the Luxembourg Stock Exchange, 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 Definitive Certificates are issued with
respect to any Class of Certificates, such notices will also be mailed to the
addresses of holders thereof at the addresses therefor as they appear in the
Certificate Register
38
maintained by the 1998-C Securitization Trustee prior to such mailing. Such
notices will be deemed to have been given on the date of such publication or
mailing.
4.11 DEFINITIVE CERTIFICATES.
The Class B Certificates shall be issued in definitive form on the
Closing Date. The Class A Certificates shall be issued in book-entry form on
the Closing Date pursuant to Section 4.09 hereof. Definitive Certificates
may be issued representing the Class A Certificates thereafter if: (i)(A)
the Transferor advises the 1998-C Securitization 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 among the
Transferor, the 1998-C Securitization Trustee and the Clearing Agency and (B)
the 1998-C Securitization Trustee or the Transferor is unable to locate a
qualified successor, (ii) the Transferor at its option, advises the 1998-C
Securitization Trustee in writing that it elects to terminate the book-entry
system through the Clearing Agency, or (iii) after the occurrence of a Swap
Termination, Certificate Owners representing beneficial interests in the
Class A-1 Certificates, the Class A-2 Certificates and the Class A-3
Certificates (voting together as a single class) aggregating not less than
51% of the Percentage Interests advise the 1998-C Securitization 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. Following the
occurrence of any such event, the 1998-C Securitization Trustee shall notify
all Certificate Owners of the occurrence thereof and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the 1998-C Securitization Trustee of the Class A-1 Certificates,
the Class A-2 Certificates and the Class A-3 Certificates by the Clearing
Agency, accompanied by registration instructions from the Clearing Agency for
registration, the 1998-C Securitization Trustee shall issue the Definitive
Certificates and deliver such Definitive Certificates in accordance with the
instructions of the Clearing Agency. None of the Transferor, the Certificate
Registrar or the 1998-C Securitization 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 1998-C Securitization Trustee shall recognize the Holders
of the Definitive Certificates as Class A-1 Certificateholders, Class A-2
Certificateholders, Class A-3 Certificateholders and Class B
Certificateholders, as applicable. The 1998-C Securitization Trustee shall
not be liable if the 1998-C Securitization Trustee or the Transferor is
unable to locate a qualified successor Clearing Agency.
Holders of Definitive Certificates in Luxembourg may contact Bankers
Trust Luxembourg S.A. to arrange for receipt of their Definitive
Certificates. Holders of Definitive Certificates in Luxembourg will be able
to effect transfers by delivery of the Definitive Certificates to Bankers
Trust Luxembourg S.A. with instructions for the transfer of all or part
thereof to the proposed transferee thereof. The 1998-C Securitization
Trustee is hereby instructed to maintain a paying agent and transfer agent in
Luxembourg for so long as any Class A Certificates are listed on the
Luxembourg Stock Exchange and the rules of such exchange so require.
39
4.12 TAX TREATMENT.
(a) It is the intention of the Transferor and the Investor
Certificateholders that the Investor Certificates will be indebtedness of the
Transferor for federal, state and local income and franchise tax purposes and
for purposes of any other tax imposed on or measured by income. The
Transferor, the 1998-C Securitization Trustee and each Holder of an Investor
Certificate (or Certificate Owner) by acceptance of its Investor Certificate
(or, in the case of a Certificate Owner, by virtue of such Certificate
Owner's acquisition of a beneficial interest therein) agree to treat the
Investor Certificates (or beneficial interest therein), for purposes of
federal, state and local income or franchise taxes and any other tax imposed
on or measured by income, as secured indebtedness of the Transferor and to
report the transactions contemplated by this 1998-C Securitization Trust
Agreement on all applicable tax returns in a manner consistent with such
treatment. Each Holder of an Investor Certificate agrees that it will cause
any Certificate Owner acquiring an interest in a Certificate through it to
comply with this 1998-C Securitization Trust Agreement as to treatment as
secured indebtedness for federal, state and local income and franchise tax
purposes and for purposes of any other tax imposed on or measured by income.
Each Holder of an Investor Certificate also agrees that it will not be
entitled to any of the tax benefits related to the 1998-C Contracts and
1998-C Leased Vehicles, including any of the depreciation deductions
resulting therefrom.
(b) In the event that, notwithstanding the statement of intentions
and undertakings set forth in Section 4.12(a), it is finally determined that
the Class A-1 Certificates, the Class A-2 Certificates, the Class A-3
Certificates and/or the Class B Certificates do not evidence indebtedness of
the Transferor for all income and franchise tax purposes, but rather
represent an equity interest in the assets of the 1998-C Securitization
Trust, then the Transferor, the 1998-C Securitization Trustee, each Holder of
such Investor Certificate and each Certificate Owner thereof, by virtue of
acquiring a beneficial interest therein, all agree (i) to treat such Investor
Certificates, together with the Transferor Certificate, as representing an
interest in a partnership for all tax purposes, (ii) to treat all payments in
respect of such Investor Certificates (to the extent not a return of capital)
as a "guaranteed payment" thereon made pursuant to Section 707(c) of the
Code, and (iii) to allocate all other items of income, gain, deduction, loss
or credit with respect to the assets and operations of the 1998-C
Securitization Trust to the Transferor.
4.13 ERISA MATTERS.
The Transferor shall cause the Class A-1 Certificates, the Class A-2
Certificates and the Class A-3 Certificates to be registered under Section
12(g) of the Exchange Act within 120 days after December 31, 1998, and, with
respect to each such Class of Class A Certificates, maintain such
registration until the Class Certificate Balance of such Class of Class A
Certificates (after giving effect to any reimbursements of Certificate
Principal Loss Amounts allocated thereto) is reduced to zero.
40
ARTICLE V
THE TRANSFEROR
5.01 REPRESENTATIONS OF TRANSFEROR.
The Transferor hereby makes the following representations on which the
1998-C Securitization Trustee relies in accepting the 1998-C SUBI and 1998-C
SUBI Certificate in trust and authenticating the Certificates. The
representations speak as of the execution and delivery of this 1998-C
Securitization Trust Agreement, but shall survive the sale, transfer and
assignment of the 1998-C SUBI and 1998-C SUBI Certificate to the 1998-C
Securitization Trustee.
(a) ORGANIZATION AND GOOD STANDING. The Transferor is a
corporation duly incorporated and validly existing and in good standing under
the laws of the State of California, 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 has power, authority and
legal right to acquire, own and sell the 1998-C SUBI and 1998-C SUBI
Certificate.
(b) DUE REGISTRATION. The Transferor is duly registered as a
foreign corporation in good standing, and has obtained all necessary licenses
and approvals in all jurisdictions in which the ownership or lease of
property or the conduct of its business requires such qualifications, except
where the failure to so qualify or to have obtained such licenses and
approvals would not have a material adverse effect on the earnings, business
affairs or business prospects of the Transferor.
(c) POWER AND AUTHORITY. The Transferor has the power and
authority to execute and deliver this 1998-C Securitization Trust Agreement
and to carry out its terms, the Transferor has full power and authority to
sell and assign the property to be sold and assigned to and deposited with
the 1998-C Securitization Trustee as part of the 1998-C Securitization Trust
and has duly authorized such sale and assignment to the 1998-C Securitization
Trustee by all necessary action; and the execution, delivery and performance
of this 1998-C Securitization Trust Agreement have been duly authorized by
the Transferor by all necessary corporate action.
(d) VALID SALE: BINDING OBLIGATIONS. This 1998-C Securitization
Trust Agreement evidences a valid sale, transfer and assignment of the 1998-C
SUBI Certificate and the assets of the 1998-C SUBI evidenced thereby (which
do not include any proceeds of the Residual Value Insurance Policies), and
constitutes a legal, valid and binding obligation of the Transferor
enforceable in accordance with its terms, in each case except as
enforceability may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights in general
and by general principles of equity, regardless of whether such
enforceability shall be considered in a proceeding in equity or at law.
(e) NO VIOLATION. The consummation of the transactions
contemplated by this 1998-C Securitization Trust Agreement and the
fulfillment of the terms of this 1998-C Securitization Trust Agreement do not
conflict with, result in any breach of any of the terms and provisions of,
nor constitute (with or without notice or lapse of time) a default under, the
Articles of Incorporation or Bylaws of the Transferor, or conflict with or
violate any of the material terms or provisions of, or constitute (with or
without notice or lapse of time) a default under, any indenture, agreement or
41
other instrument to which the Transferor is a party or by which it is bound;
nor result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement or other
instrument (other than those contemplated by this 1998-C Securitization Trust
Agreement and any documents related hereto); nor violate any law or, to the
best of the Transferor's knowledge, any order, rule or regulation applicable
to the Transferor of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Transferor 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 Transferor.
(f) NO PROCEEDINGS. There are no proceedings or investigations
pending, or to the Transferor's knowledge, threatened, before any court,
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Transferor or its properties: (i) asserting the
invalidity of this 1998-C Securitization Trust Agreement or the Certificates,
(ii) seeking to prevent the issuance of the Certificates or the consummation
of any of the transactions contemplated by this 1998-C Securitization Trust
Agreement, (iii) seeking any determination or ruling that might materially
and adversely affect the performance by the Transferor of its obligations
under, or the validity or enforceability of, this 1998-C Securitization Trust
Agreement or the Certificates or (iv) relating to the Transferor and which
might adversely affect the federal or Delaware income tax attributes of the
Certificates.
(g) TITLE TO 1998-C SUBI CERTIFICATE. Prior to the transfer
pursuant to this 1998-C Securitization Trust Agreement, the Transferor has
good title to, and is the sole legal and beneficial owner of, the 1998-C SUBI
Certificate, free and clear of all Liens, except as provided for in the
Back-Up Security Agreement.
(h) CONSENTS AND APPROVALS. The Transferor has obtained or made
all necessary licenses, consents, approvals, waivers and notifications of
creditors, lessors and other nongovernmental Persons, in each case in
connection with the execution and delivery of this 1998-C Securitization
Trust Agreement and the consummation of all the transactions herein
contemplated, and the Transferor is not required to obtain the consent of any
other party or the consent, license, approval, or authorization from, or
registration or declaration with, any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity or
enforceability of this 1998-C Securitization Trust Agreement.
5.02 LIABILITY OF TRANSFEROR: INDEMNITIES.
The Transferor shall be liable in accordance with this 1998-C
Securitization Trust Agreement only to the extent of the obligations in this
1998-C Securitization Trust Agreement specifically undertaken by the
Transferor in such capacity under this 1998-C Securitization Trust Agreement
and shall have no other obligations or liabilities hereunder.
42
5.03 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF,
TRANSFEROR; CERTAIN LIMITATIONS.
(a) Any Person (i) into which the Transferor may be merged or
consolidated, (ii) which may result from any merger, conversion or
consolidation to which the Transferor shall be a party or (iii) which may
succeed to all or substantially all of the business of the Transferor, shall
be the successor to the Transferor under this 1998-C Securitization Trust
Agreement without the execution or filing of any document or any further act
on the part of any of the parties to this 1998-C Securitization Trust
Agreement, except that if the Transferor 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 Transferor either generally or
specifically as provided herein. The Transferor shall provide prior notice
of any merger, consolidation or succession pursuant to this Section to each
Rating Agency.
(b) Subject to subparagraph (c) below, the purpose of the
Transferor shall be to engage in any lawful activity for which a corporation
may be organized under the laws of the State of California other than the
banking business, the trust company business or the practice of a profession
that is permitted to be incorporated under the California Corporations Code.
(c) Notwithstanding subparagraph (b) above, the purpose of the
Transferor shall be limited to the following purposes and activities
incidental to and necessary or convenient to accomplish the following
purposes:
(A) to acquire from time to time from TMCC all right, title and
interest in and to the SUBI Certificates evidencing units of beneficial
interest in the SUBI Assets;
(B) to acquire, own, hold, service, sell, assign, pledge and
otherwise deal with the SUBI Certificates and SUBI Assets, related
insurance policies, related agreements with TMCC and any proceeds or
further rights associated with any of the foregoing;
(C) to sell, assign, transfer, convey and/or pledge all or any
part of each such SUBI Certificate to one or more trusts or other persons
or legal entities pursuant to one or more securitization trust
agreements, indentures or similar agreements (the "Agreements") to be
entered into by and among TMCC, as Servicer, the Transferor and each
other pledgee or transferee named therein (the "Transferees");
(D) to sell any series or class of asset-backed certificates or
other securities issued by or evidencing interests in the transferees or
obligations of the transferees or the Transferor under the related
Agreements, including the Investor Certificates ("Securities");
(E) to hold and enjoy all of the rights and privileges of any
Securities so issued under the related Agreements;
(F) to perform its obligations under the Agreements; and
43
(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.
(d) Notwithstanding any other provision of this Section and any
provision of law, the Transferor 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 Directors of the Transferor (which must include the
affirmative vote of all Independent Directors of the Transferor, as
required by the certificate of incorporation of the Transferor), (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 consenting 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 Transferor 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 corporate action in furtherance of the
actions set forth in clauses (A) through (F) above;
(iii) without the affirmative vote of the members of the Board of
Directors of the Transferor (including each Independent Director), 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; PROVIDED that such restrictions shall not
(a) limit the acquisition of the 1998-C SUBI Certificate or the 1998-C
SUBI Insurance Certificate from TMCC, the 1998-C Securitization Trustee
or any other Person, or the acquisition of any other SUBI Certificate
from TMCC or any other Person, or (b) limit the ability of the Transferor
to sell, assign, transfer, convey and/or pledge all or any part of any
SUBI Certificate in accordance with Section 5.03(b)(2) hereof, on which
there shall be no such restriction; or
(iv) so long as any outstanding debt of the Transferor or
Securities are rated by any nationally recognized statistical rating
agency, issue unsecuritized notes or otherwise borrow money unless:
(A) the Transferor 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
Securities; or
(B) such notes or borrowings (1) are fully subordinated
(and which shall provide for payment only after payment in respect
of all outstanding rated debt
44
and/or Securities) or are nonrecourse against any assets of the
Transferor other than the assets pledged to secure such notes
or borrowings, (2) do not constitute a claim against the
Transferor in the event that such assets are insufficient to
pay such notes or borrowings, and (3) where such notes or
borrowings are secured by the rated debt or Securities, are
fully subordinated (and which shall provide for payment only
after payment in respect of all outstanding rated debt and/or
Securities) to such rated debt or Securities.
5.04 LIMITATION ON LIABILITY OF TRANSFEROR AND OTHERS.
The Transferor and any director or officer or employee or agent of the
Transferor 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 1998-C Securitization Trust Agreement.
5.05 TRANSFEROR MAY OWN INVESTOR CERTIFICATES.
Each of the Transferor and any Person controlling, controlled by or
under common control with the Transferor may in its individual or any other
capacity become the owner or pledgee of Investor Certificates with the same
rights as it would have if it were not the Transferor or such an affiliate
thereof except as otherwise specifically provided in the definition of the
term "Certificateholder." Investor Certificates so owned by or pledged to the
Transferor or such controlling or commonly controlled Person shall have an
equal and proportionate benefit under the provisions of this 1998-C
Securitization Trust Agreement, without preference, priority or distinction
as among all of the Investor Certificates. The Transferor will give notice
to each Rating Agency if any such controlling or commonly controlled Person
shall at any time become the owner or pledgee of Investor Certificates.
5.06 NO TRANSFER.
The Transferor on behalf of itself and its successors and assigns
hereby covenants that it will not transfer, pledge or assign to any Person
(a) the Transferor Certificate or any part of its right to receive any Excess
Amounts pursuant to Section 3.01(i) or (b) the 1998-C SUBI Insurance
Certificate, except as expressly set forth in the 1998-C SUBI Supplement.
5.07 TAX MATTERS PARTNER.
In the event that the 1998-C Securitization Trust is recharacterized as a
partnership for tax purposes, the Transferor shall act as "Tax Matters Partner"
(i) to represent the Transferor and the Class B Certificateholders, in their
capacities as partners in a partnership for tax purposes, before taxing
authorities or courts of competent jurisdiction in any tax matters affecting the
1998-C Securitization Trust as a tax partnership; and (ii) to execute any
agreements or other documents relating to or affecting such tax matters,
including agreements or other documents binding the Class B Certificateholders
with respect to such tax matters or otherwise affecting their rights, including,
but not limited to, extending the statute of limitations for assessment of tax
deficiencies against the Class B Certificateholders and adjusting the 1998-C
Securitization Trust's federal, state or local tax
45
returns. In the event of such recharacterization, the Transferor shall
provide written notice of such recharacterization to the 1998-C
Securitization Trustee. The Transferor shall not be liable to the 1998-C
Securitization Trust or to any Certificateholder for any action taken or
omitted by the Transferor with regard to such tax matters or otherwise as a
result of its holding the position of Tax Matters Partner.
5.08 MATURITY ADVANCES.
If, with respect to any Class of Certificates, on the related Targeted
Maturity Date or any subsequent relevant Certificate Payment Date the
aggregate of amounts available in the 1998-C SUBI Certificateholders'
Account, the 1998-C SUBI Collection Account or from other sources to be paid
in respect of the Adjusted Class A-1 Certificate Balance, the Adjusted Class
A-2 Certificate Balance, the Adjusted Class A-3 Certificate Balance or the
Adjusted Class B Certificate Balance pursuant to Section 3.01 of this 1998-C
Securitization Trust Agreement are insufficient to reduce such Adjusted Class
A-1 Certificate Balance, Adjusted Class A-2 Certificate Balance, Adjusted
Class A-3 Certificate Balance or Adjusted Class B Certificate Balance to
zero, as applicable, and to reimburse all unreimbursed Certificate Principal
Loss Amounts previously allocated thereto, the Transferor may, at its sole
option, make a Maturity Advance with respect to such shortfall to the
Servicer or the 1998-C Securitization Trustee for deposit into the 1998-C
SUBI Collection Account.
ARTICLE VI
THE 1998-C SECURITIZATION TRUSTEE
6.01 DUTIES OF THE 1998-C SECURITIZATION TRUSTEE.
(a) The 1998-C Securitization Trustee, both prior to and after the
occurrence of an Event of Servicing Termination under the 1998-C SUBI
Servicing Supplement, undertakes to perform such duties and only such duties
as are specifically set forth in this 1998-C Securitization Trust Agreement.
(b) The 1998-C Securitization Trustee, upon receipt of all
resolutions, certificates, statements, opinions, reports, documents, orders
or other instruments furnished to the 1998-C Securitization Trustee that
shall be specifically required to be furnished pursuant to any provision of
this 1998-C Securitization Trust Agreement, shall examine them to determine
whether they conform on their face to the requirements of this 1998-C
Securitization Trust Agreement.
(c) No provision of this 1998-C Securitization Trust Agreement
shall be construed to relieve the 1998-C Securitization 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) the duties and obligations of the 1998-C Securitization
Trustee shall be determined solely by the express provisions of this
1998-C Securitization Trust Agreement, the 1998-C Securitization Trustee
shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this 1998-C Securitization
Trust
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Agreement, no implied covenants or obligations shall be read into
this 1998-C Securitization Trust Agreement against the 1998-C
Securitization Trustee, the permissive right of the 1998-C Securitization
Trustee to do things enumerated in this 1998-C Securitization Trust
Agreement shall not be construed as a duty and, in the absence of bad
faith on the part of the 1998-C Securitization Trustee, the 1998-C
Securitization 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 1998-C Securitization
Trustee and conforming on their face to the requirements of this 1998-C
Securitization Trust Agreement;
(ii) the 1998-C Securitization Trustee shall not be personally
liable for an error of judgment made in good faith by a Responsible
Officer, unless it shall be proved that the 1998-C Securitization Trustee
was negligent in performing its duties in accordance with the terms of
this 1998-C Securitization Trust Agreement; and
(iii) the 1998-C Securitization 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 Investor
Certificates evidencing not less than 51% of the aggregate Percentage
Interest relating to the time, method and place of conducting any
proceeding for any remedy available to the 1998-C Securitization Trustee,
or exercising any trust or power conferred upon the 1998-C Securitization
Trustee, under this 1998-C Securitization Trust Agreement or the Titling
Trust Agreement (as supplemented by the 1998-C SUBI Supplement).
(d) The 1998-C Securitization 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 1998-C Securitization Trust
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.
(e) All information obtained by the 1998-C Securitization Trustee
regarding the Obligors and the Contracts contained in the 1998-C SUBI,
whether upon the exercise of its rights under this 1998-C Securitization
Trust Agreement or otherwise, shall be maintained by the 1998-C
Securitization Trustee in confidence and shall not be disclosed to any other
Person, unless such disclosure is required by any applicable law or
regulation or pursuant to subpoena.
(f) Pursuant to Section 3.03(a) of the 1998-C SUBI Servicing
Supplement, in the event that the 1998-C Securitization Trustee discovers
that a representation or warranty with respect to a 1998-C Contract was
incorrect as of the time specified with respect to such representation and
warranty and such incorrectness materially and adversely affects such 1998-C
Contract, the 1998-C Securitization Trustee shall give prompt written notice
to the Servicer and the Titling Trustee of such incorrectness.
47
6.02 CERTAIN MATTERS AFFECTING THE 1998-C SECURITIZATION TRUSTEE.
(a) Except as otherwise provided in Section 6.01:
(i) the 1998-C Securitization Trustee may rely and shall be
protected in acting or refraining from acting upon any resolution,
Officer's Certificate, certificate of an authorized signatory,
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 1998-C Securitization Trustee may consult with counsel
and any 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 1998-C Securitization Trust Agreement in good faith and in
accordance with such Opinion of Counsel;
(iii) the 1998-C Securitization Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
1998-C Securitization Trust Agreement or the Titling Trust Agreement (as
supplemented by the 1998-C SUBI Supplement), or to institute, conduct or
defend any litigation under this 1998-C Securitization Trust Agreement or
the Titling Trust Agreement (as supplemented by the 1998-C SUBI
Supplement), or in relation to this 1998-C Securitization Trust Agreement
or the Titling Trust Agreement (as supplemented by the 1998-C SUBI
Supplement), at the request, order or direction of any of the
Certificateholders pursuant to the provisions of this 1998-C
Securitization Trust Agreement or the Titling Trust Agreement (as
supplemented by the 1998-C SUBI Supplement), unless such
Certificateholders shall have offered to the 1998-C Securitization
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that may be incurred therein or thereby;
(iv) the 1998-C Securitization Trustee shall not be personally
liable for any action taken, suffered or omitted by it in good faith and
reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this 1998-C Securitization Trust
Agreement;
(v) the 1998-C Securitization Trustee shall not be bound to
recalculate, reverify, or 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
Investor Certificates evidencing not less than 25% of the aggregate
Percentage Interest of any Class; PROVIDED, HOWEVER, that if the payment
within a reasonable time to the 1998-C Securitization 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 1998-C Securitization
Trustee, not reasonably assured to the 1998-C Securitization Trustee by
the security afforded to it by the terms of this 1998-C Securitization
Trust Agreement, the 1998-C Securitization 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
48
Transferor or, if paid by the 1998-C Securitization Trustee, shall be
reimbursed by the Transferor 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 1998-C Securitization Trustee may execute any of the
trusts or powers under this 1998-C Securitization Trust Agreement or
perform any duties under this 1998-C Securitization Trust Agreement
either directly or by or through agents or attorneys or a custodian.
(b) No Certificateholder will have any right to institute any
proceeding with respect to this 1998-C Securitization Trust Agreement except
upon satisfying the conditions set forth in Section 9.03(c).
6.03 1998-C SECURITIZATION TRUSTEE NOT LIABLE FOR CERTIFICATES OR CONTRACTS.
The 1998-C Securitization Trustee makes no representations as to the
validity or sufficiency of this 1998-C Securitization Trust Agreement or of
the Certificates (other than the execution by the 1998-C Securitization
Trustee on behalf of the 1998-C Securitization Trust of, and the certificate
of authentication on, the Certificates), or of the 1998-C SUBI or 1998-C SUBI
Certificate. The 1998-C Securitization Trustee shall have no obligation to
perform any of the duties of the Transferor unless explicitly set forth in
this 1998-C Securitization Trust Agreement. The 1998-C Securitization
Trustee shall at no time have any responsibility or liability for or with
respect to the legality, validity and enforceability of the 1998-C SUBI or
1998-C SUBI Certificate or any 1998-C Contract, any ownership interest in any
1998-C Leased Vehicle, or the maintenance of any such ownership interest, or
for or with respect to the efficacy of the 1998-C Securitization Trust or its
ability to generate the payments to be distributed to Certificateholders
under this 1998-C Securitization Trust Agreement, including without
limitation the validity of the assignment of the 1998-C SUBI or 1998-C SUBI
Certificate to the 1998-C Securitization Trust or of any intervening
assignment; the existence, condition, location and ownership of any 1998-C
Contract or 1998-C Leased Vehicle; the existence and enforceability of any
physical damage or credit life or credit disability insurance; the existence
and contents of any 1998-C Contract or any computer or other record thereof;
the completeness of any 1998-C Contract; the performance or enforcement of
any 1998-C Contract; the compliance by the Transferor with any covenant or
the breach by the Transferor of any warranty or representation made under
this 1998-C Securitization Trust Agreement or in any related document and the
accuracy of any such warranty or representation prior to the 1998-C
Securitization Trustee's receipt of notice or other discovery of any
noncompliance therewith or any breach thereof; the acts or omissions of the
Transferor or the Servicer; or any action by the 1998-C Securitization
Trustee taken at the instruction of the Servicer PROVIDED, HOWEVER, that the
foregoing shall not relieve the 1998-C Securitization Trustee of its
obligation to perform its duties under this 1998-C Securitization Trust
Agreement. Except with respect to a claim based on the failure of the 1998-C
Securitization Trustee to perform its duties under this 1998-C Securitization
Trust Agreement or based on the 1998-C Securitization Trustee's willful
misconduct, bad faith or negligence, no recourse shall be had for any claim
based on any provision of this 1998-C Securitization Trust Agreement, the
Certificates, the 1998-C SUBI or
49
1998-C SUBI Certificate or assignment thereof against the institution serving
as the 1998-C Securitization Trustee in its individual capacity. The 1998-C
Securitization 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
1998-C Securitization Trust or any indemnitor who shall furnish indemnity as
provided in this 1998-C Securitization Trust Agreement. The 1998-C
Securitization Trustee shall not be accountable for the use or application by
the Transferor of any of the Certificates or of the proceeds of such
Certificates, or for the use or application of any funds paid to the Servicer
in respect of the 1998-C SUBI or 1998-C SUBI Certificate.
6.04 1998-C SECURITIZATION TRUSTEE MAY OWN CERTIFICATES.
The 1998-C Securitization 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 1998-C Securitization Trustee.
6.05 1998-C SECURITIZATION TRUSTEE'S FEES AND EXPENSES.
The 1998-C Securitization 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 1998-C Securitization
Trust Agreement and in the exercise and performance of any of the powers and
duties of the 1998-C Securitization Trustee under this 1998-C Securitization
Trust Agreement, and payment or reimbursement upon its request for all
reasonable expenses, disbursements and advances incurred or made by the
1998-C Securitization Trustee in its capacity as 1998-C Securitization
Trustee in accordance with any of the provisions of this 1998-C
Securitization Trust Agreement (including the reasonable compensation and the
expenses and disbursements of its counsel and of all persons not regularly in
its employ in each case to the extent their services are provided in
connection with the 1998-C Securitization Trustee's administration of this
1998-C Securitization Trust 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 1998-C
Securitization Trust Agreement. Such compensation and reimbursement shall be
paid as set forth in Sections 3.01(c) and (g) hereof.
6.06 ELIGIBILITY REQUIREMENTS FOR 1998-C SECURITIZATION TRUSTEE.
The 1998-C Securitization Trustee under this 1998-C Securitization
Trust Agreement shall at all times be a national banking association or State
banking institution; and organized and doing business under the laws of any
State 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-term deposit rating no lower than Baa3 by Moody's, so long
as ▇▇▇▇▇'▇ is a Rating Agency, or be otherwise acceptable to each Rating
Agency, as evidenced by a letter to such effect from each of them.
If the 1998-C Securitization 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
50
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 1998-C Securitization Trustee shall cease to be eligible in
accordance with the provisions of this Section, the 1998-C Securitization
Trustee shall resign immediately in the manner and with the effect specified
in Section 6.07.
6.07 RESIGNATION OR REMOVAL OF 1998-C SECURITIZATION TRUSTEE.
(a) RESIGNATION. The 1998-C Securitization Trustee may at any time
resign and be discharged from the trusts created by this 1998-C
Securitization Trust Agreement by giving written notice thereof to the
Transferor. Upon receiving such notice of resignation, the Transferor shall
promptly appoint a successor 1998-C Securitization Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to
the resigning 1998-C Securitization 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) REMOVAL. If at any time the 1998-C Securitization Trustee
shall cease to be eligible in accordance with the provisions of Section 6.06
and shall fail to resign after written request therefor by the Transferor, or
if at any time the 1998-C Securitization Trustee shall be legally unable to
act, or shall be adjudged a bankrupt or insolvent, or a receiver of the
1998-C Securitization Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the 1998-C Securitization
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Transferor may remove the 1998-C
Securitization Trustee. If it shall remove the 1998-C Securitization Trustee
under the authority of the immediately preceding sentence, the Transferor
shall promptly appoint a successor 1998-C Securitization Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to
the 1998-C Securitization Trustee so removed and one copy to the successor
1998-C Securitization Trustee, and arrange for the payment of all fees owed
to the outgoing 1998-C Securitization Trustee.
(c) EFFECTIVE DATE OF RESIGNATION OR REMOVAL. Any resignation or
removal of the 1998-C Securitization Trustee and appointment of a successor
1998-C Securitization Trustee pursuant to any of the provisions of this
Section shall not become effective until acceptance of appointment by the
successor 1998-C Securitization Trustee as provided in Section 6.08. The
Servicer shall give each Rating Agency notice of any such resignation or
removal of the 1998-C Securitization Trustee and appointment and acceptance
of a successor Trustee.
6.08 SUCCESSOR 1998-C SECURITIZATION TRUSTEE.
Any successor 1998-C Securitization Trustee appointed as provided in
Section 6.07 shall execute, acknowledge and deliver to the Transferor and to
its predecessor 1998-C Securitization Trustee an instrument accepting such
appointment under this 1998-C Securitization Trust 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
51
fully vested with all the rights, powers, duties and obligations of its
predecessor under this 1998-C Securitization Trust 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 1998-C Securitization Trust Agreement; and the Transferor 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 6.06. Upon acceptance of
appointment by a successor Trustee as provided in this Section, the
Transferor shall cause notice of the successor of such Trustee under this
1998-C Securitization Trust Agreement to be mailed to all Certificateholders
at their addresses as shown in the Certificate Register and shall give notice
by mail to each Rating Agency. If the Transferor fails to mail or cause to
be mailed 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 Transferor.
6.09 MERGER OR CONSOLIDATION OF 1998-C SECURITIZATION TRUSTEE.
Any corporation (i) into which the 1998-C Securitization Trustee may
be merged or consolidated, (ii) which may result from any merger, conversion
or consolidation to which the 1998-C Securitization Trustee shall be a party,
or (iii) which may succeed to the corporate trust business of the 1998-C
Securitization Trustee, shall be the successor of the 1998-C Securitization
Trustee hereunder, provided such corporation shall be eligible pursuant to
Section 6.06, without the execution or filing of any instrument or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding, except that if the 1998-C Securitization Trustee in
any of the foregoing cases is not the surviving entity, then the surviving
entity shall assume and agree to perform every obligation of the 1998-C
Securitization Trustee, either generally or particularly as provided herein.
Notice of any such event shall be given by the 1998-C Securitization Trustee
to each Rating Agency.
6.10 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
(a) Notwithstanding any other provisions of this 1998-C
Securitization Trust Agreement, at any time, for the purpose of meeting any
legal requirements of any jurisdiction in which any part of the 1998-C
Securitization Trust may at the time be located, the Transferor and the
1998-C Securitization Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons to act
jointly with the 1998-C Securitization Trustee, or separate trustee or
separate trustees, of all or any part of the 1998-C Securitization Trust, and
to vest in such Person, in such capacity and for the benefit of the
Certificateholders, such title to the 1998-C Securitization Trust, or any
part thereof, and, subject to the other provisions of this Section, such
powers, duties, obligations, rights and trusts as the Transferor and the
1998-C Securitization Trustee may consider necessary or desirable. If the
Transferor shall not have joined in such appointment within 15 days after the
receipt by it of a request so to do, the 1998-C Securitization Trustee alone
shall have the power to make such appointment. No co-trustee or separate
trustee under this 1998-C Securitization Trust Agreement shall be required to
meet the terms of eligibility as a successor Trustee pursuant to Section
6.06, and no notice of a successor Trustee shall be
52
required pursuant to Section 6.08 and no notice to Certificateholders of the
appointment of any co-trustee or separate trustee shall be required pursuant
to Section 6.08.
(b) Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions
and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the 1998-C Securitization Trustee shall be conferred upon
and exercised or performed by the 1998-C Securitization 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 1998-C Securitization 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, the 1998-C Securitization 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 1998-C Securitization 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 1998-C
Securitization Trustee;
(ii) no trustee under this 1998-C Securitization Trust Agreement
shall be personally liable by reason of any act or omission of any other
trustee under this 1998-C Securitization Trust Agreement; and
(iii) the Transferor and the 1998-C Securitization Trustee acting
jointly may at any time accept the resignation of or remove any separate
trustee or co-trustee.
(c) Any notice, request or other writing given to the 1998-C
Securitization 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 1998-C Securitization Trust 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 1998-C
Securitization Trustee or separately, as may be provided therein, subject to
all the provisions of this 1998-C Securitization Trust Agreement,
specifically including every provision of this 1998-C Securitization Trust
Agreement relating to the conduct of, affecting the liability of, or
affording protection to, the 1998-C Securitization Trustee. Each such
instrument shall be filed with the 1998-C Securitization Trustee and a copy
thereof given to the Transferor and the Servicer.
(d) Any separate trustee or co-trustee may at any time appoint the
1998-C Securitization 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 1998-C Securitization Trust 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
1998-C Securitization Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee. Notwithstanding anything to the
contrary in this 1998-C Securitization Trust Agreement, the appointment of
any separate trustee or co-trustee shall not
53
relieve the 1998-C Securitization Trustee of its obligations and duties under
this 1998-C Securitization Trust Agreement.
6.11 REPRESENTATIONS AND WARRANTIES OF TRUSTEE.
The 1998-C Securitization Trustee makes the following representations
and warranties on which the Transferor and Certificateholders may rely:
ORGANIZATION AND GOOD STANDING. The 1998-C Securitization Trustee is
a national banking association organized, existing and in good standing under
the laws of the United States.
POWER AND AUTHORITY. The 1998-C Securitization Trustee has full
power, authority and right to execute, deliver and perform this 1998-C
Securitization Trust Agreement and has taken all necessary action to
authorize the execution, delivery and performance by it of this 1998-C
Securitization Trust Agreement.
DUE EXECUTION. This 1998-C Securitization Trust Agreement has been
duly executed and delivered by the 1998-C Securitization Trustee.
ENFORCEABILITY. This 1998-C Securitization Trust Agreement
constitutes the legal, valid and binding obligation of the 1998-C
Securitization Trustee, enforceable against it in accordance with its terms
except as the enforceability thereof may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws affecting
enforcement of creditors' rights generally and by general principles of
equity.
6.12 TAX RETURNS.
The 1998-C Securitization Trustee shall, at the written direction of
the Servicer and on behalf of the Transferor, prepare or shall cause to be
prepared any required federal tax information returns (in a manner consistent
with the treatment of the Investor Certificates as indebtedness) and shall
file and distribute such forms as required by law. The Servicer shall
prepare or cause to be prepared any federal and state tax returns that may be
required with respect to the 1998-C Securitization Trust or the assets of the
1998-C Securitization Trust and shall deliver any such returns to the 1998-C
Securitization Trustee for signature at least five days prior to the date
such returns are required by law to be filed. The 1998-C Securitization
Trust shall not elect to be treated as an association under Treasury
Regulations Section 301.7701-3(a) for federal income tax purposes.
6.13 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF CERTIFICATES.
All rights of action and claims under this 1998-C Securitization Trust
Agreement or the Certificates may be prosecuted and enforced by the 1998-C
Securitization 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 1998-C Securitization 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 1998-C
Securitization Trustee, its
54
agents and counsel, be for the ratable benefit of the Certificateholders in
respect of which such judgment has been obtained.
6.14 SUIT FOR ENFORCEMENT.
If an Event of Servicing Termination shall occur and be continuing
under the Titling Trust Agreement, as supplemented by the 1998-C SUBI
Servicing Supplement with respect to the 1998-C SUBI Portfolio, the 1998-C
Securitization Trustee, in its discretion may, subject to the provisions of
Sections 6.01 and 6.02 hereof and Sections 6.01(b) and 6.01(c) of the 1998-C
SUBI Servicing Supplement, proceed to protect and enforce its rights and the
rights of the Certificateholders under this 1998-C Securitization Trust
Agreement, the Titling Trust Agreement and the 1998-C SUBI Servicing
Supplement by a suit, action or proceeding in equity or at law or otherwise,
whether for the specific performance of any covenant or agreement contained
herein or therein or in aid of the execution of any power granted herein or
therein or for the enforcement of any other legal, equitable or other remedy
as the 1998-C Securitization Trustee, being advised by counsel, shall deem
most effectual to protect and enforce any of the rights of the 1998-C
Securitization Trustee or the Certificateholders.
6.15 RIGHTS OF CERTIFICATEHOLDERS TO DIRECT TRUSTEE.
Holders of Investor Certificates evidencing not less than 25% of the
Voting Interests of the Certificates, voting together as a single class,
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the 1998-C Securitization Trustee
under this 1998-C Securitization Trust Agreement (including to direct the
1998-C Securitization Trustee to take or withhold any action with respect to
the TMCC Demand Notes), or exercising any trust or power conferred on the
1998-C Securitization Trustee by this 1998-C Securitization Trust Agreement;
PROVIDED, HOWEVER, that (a) if any greater Percentage Interest is required to
cause any action to be taken under the Titling Trust Agreement or the 1998-C
SUBI Supplement by the 1998-C Securitization Trustee in its capacity as a
transferee of the 1998-C SUBI Certificate, the greater Percentage Interest
shall prevail; (b) subject to Sections 6.01 and 6.02, the 1998-C
Securitization Trustee shall have the right to decline to follow any such
direction if the 1998-C Securitization Trustee being advised by counsel
determines that the action so directed may not lawfully be taken, or if the
1998-C Securitization Trustee in good faith shall 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 (c) nothing in this 1998-C Securitization Trust Agreement
shall impair the right of the 1998-C Securitization Trustee to take any
action deemed proper by the 1998-C Securitization Trustee and which is not
inconsistent with such direction by the Certificateholders.
6.16 NO PETITION.
The 1998-C Securitization Trustee covenants and agrees that prior to the
date which is one year and one day after the last date upon which (a) each Class
of Investor Certificates has been paid in full, and (b) all obligations due
under any other Securitized Financing have been paid in full, the 1998-C
Securitization Trustee will not institute against, or join any other Person in
instituting against the Transferor, TMCC, the Titling Trustee or the Titling
Trust any bankruptcy,
55
reorganization, arrangement, insolvency or liquidation proceeding or other
proceedings under any federal or state bankruptcy or similar law. The
foregoing shall not limit the 1998-C Securitization Trustee's right to file
any claim in or otherwise take actions with respect to any such proceeding
instituted by any Person not under such a constraint. This Section shall
survive the termination of this 1998-C Securitization Trust Agreement or the
resignation or removal of the 1998-C Securitization Trustee under this 1998-C
Securitization Trust Agreement.
6.17 NEGATIVE PLEDGE.
Except as expressly set forth herein with respect to the disposition
of the assets of the 1998-C Securitization Trust in connection with the
termination of the 1998-C Securitization Trust pursuant to Section 7.01, the
1998-C Securitization Trustee shall not sell, assign, pledge, convey or
otherwise transfer to any person the 1998-C SUBI Certificate or any interest
therein.
ARTICLE VII
TERMINATION
7.01 TERMINATION OF THE 1998-C SECURITIZATION TRUST.
(a) The 1998-C Securitization Trust and the respective obligations
and responsibilities of the Transferor and the 1998-C Securitization Trustee
shall terminate upon the earliest of (i) the maturity, sale or other
liquidation, as the case may be, of the last outstanding 1998-C Contract and
1998-C Leased Vehicle evidenced by the 1998-C SUBI and the distribution of
all proceeds thereof (other than proceeds of Residual Value Insurance
Policies), together with all amounts on deposit in all 1998-C SUBI Accounts
and the Reserve Fund in the manner provided in Section 3.01, (ii) the
purchase by the Transferor of the corpus of the 1998-C Securitization Trust
as described in Section 7.02 (except that the 1998-C Securitization Trust
shall continue solely for the limited purposes set forth in (b) and (c)
below), (iii) the day following the Monthly Allocation Date on which the
Class A-1 Certificate Balance, the Class A-2 Certificate Balance, the Class
A-3 Certificate Balance and the Class B Certificate Balance have been reduced
to zero and all Loss Amounts and Certificate Principal Loss Amounts have been
reimbursed, (iv) on the occurrence of a Swap Termination and the subsequent
liquidation of the assets of the 1998-C Securitization Trust and the
distribution of the net proceeds thereof to Certificateholders, the 1998-C
Securitization Trustee, the Titling Trustee and the Transferor pursuant to
Section 3.01(o) of this 1998-C Securitization Trust Agreement, or (v) the
expiration, disposition or termination of the 1998-C SUBI; PROVIDED, HOWEVER,
that in no event shall the trust created by this 1998-C Securitization Trust
Agreement continue beyond the expiration of 21 years from the death of the
last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, late ambassador of the
United States of America to the Court of St. ▇▇▇▇▇', living on the date of
the Agreement. The Transferor shall promptly notify the 1998-C
Securitization Trustee and each Rating Agency of any prospective termination
of the 1998-C Securitization Trust.
(b) Notice of any termination, specifying the Monthly Allocation Date
upon which the Certificateholders may surrender their Certificates to the 1998-C
Securitization Trustee or, in the case of any Definitive Class A Certificates,
to the 1998-C Securitization Trustee or the Paying Agent in Luxembourg, for
payment of the final distribution and retirement of the Certificates, shall
56
be given promptly by the 1998-C Securitization Trustee (i) for so long as any
Class A Certificates are listed on the Luxembourg Stock Exchange, 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) and (ii)
if Definitive Certificates are issued 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 (A) the
Certificate Payment Date upon which final payment of the Certificates shall
be made upon presentation and surrender of Certificates at the Corporate
Trust Office or such other office of the 1998-C Securitization Trustee
therein specified, or, in the case of any Definitive Class A Certificates, to
the 1998-C Securitization Trustee or the Paying Agent in Luxembourg, (B) the
amount of any such final payment and (C) if applicable, that the related
Record Date for such Certificate Payment Date is not applicable, payments
being made only upon presentation and surrender of the Certificates at the
locations therein specified. Such notices will be mailed to the addresses of
the holders thereof as they appear in the Certificate Register maintained by
the Trustee on the Record Date preceding such mailing. Such notices will be
deemed to have been given on the date of such publication or mailing. The
1998-C Securitization Trustee shall give such notice to the Certificate
Registrar (if other than the 1998-C Securitization Trustee) at the time such
notice is given to Certificateholders.
(c) In the event such notice is given, in the case of an optional
purchase of the 1998-C Securitization Trust corpus pursuant to Section 7.02,
the Transferor shall deposit into the 1998-C SUBI Collection Account, the
amount specified in Section 7.02. Upon presentation and surrender of the
Certificates, the 1998-C Securitization Trustee shall cause to be paid to
Certificateholders so surrendering amounts payable on such Certificate
Payment Date pursuant to Section 3.01. No further interest will accrue with
respect to any Investor Certificate from and after the final Certificate
Payment Date with respect thereto.
(d) In the event that all of the Certificateholders shall not have
surrendered their Certificates for retirement within six months after the
date specified in the above-mentioned written notice, the 1998-C
Securitization 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 any Certificates shall not have been surrendered for
retirement, the 1998-C Securitization 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 1998-C Securitization Trust Agreement. Any funds remaining in the
1998-C Securitization Trust after exhaustion of such remedies shall be
distributed by the 1998-C Securitization Trustee at the request of the
Transferor to the Transferor, and such remaining Certificateholders shall
look solely to the Transferor for such funds.
7.02 OPTIONAL PURCHASE OF 1998-C SUBI.
On each Monthly Allocation Date on or after the Class A-3 Targeted
Maturity Date, if either before or after giving effect to any allocations,
applications or payments in respect of principal required to be made on such
Monthly Allocation Date, the Investor Balance shall be less
57
than or equal to $74,998,813.25 (10% of the Aggregate Net Investment Value as
of the Cutoff Date) or amounts sufficient to effectively reduce the Investor
Balance to such amount have been deposited in the 1998-C SUBI Collection
Account on such date, the Transferor shall have the option to purchase the
Investor Certificateholders' interest in the corpus of the 1998-C
Securitization Trust. To exercise such option, the Transferor shall notify
the 1998-C Securitization Trustee and the Servicer, in writing, no later than
the fifteenth day of the month preceding the month in which such purchase is
to be effected, and shall deposit in the 1998-C SUBI Certificateholders'
Account an amount equal to the greater of (i) the Aggregate Net Investment
Value as of the last day of the preceding Collection Period, and (ii) the sum
of (A) the Adjusted Class A-1 Certificate Balance, the Adjusted Class A-2
Certificate Balance, the Adjusted Class A-3 Certificate Balance and the
Adjusted Class B Certificate Balance (B) any accrued and unpaid interest with
respect to the Class A-1 Certificates, Class A-2 Certificates, Class A-3
Certificates and Class B Certificates, including any accrued and unpaid Class
A-1 Swap Interest Carryover Shortfall Amount, Class A-2 Swap Interest
Carryover Shortfall Amount, Class A-3 Swap Interest Carryover Shortfall
Amount and Class B Swap Interest Carryover Shortfall Amount, (C) any unpaid
Class A-1 Certificate Principal Loss Amount, unpaid Class A-2 Certificate
Principal Loss Amount, unpaid Class A-3 Certificate Principal Loss Amount,
unpaid Class B Certificate Principal Loss Amount (and interest accrued
thereon), (D) any unreimbursed Maturity Advances, other Advances or
compensation payable to the Servicer through such date and (E) any
compensation or reimbursements due to the Titling Trustee and the 1998-C
Securitization Trustee hereunder. On such Monthly Allocation Date, upon
receipt of such amount, the 1998-C Securitization Trustee shall distribute
such amounts pursuant to the priorities set forth in Section 3.01, and any
balance shall be distributed to the Transferor. Thereupon the Transferor
shall succeed to all of the Investor Certificateholders' interests in and to
the 1998-C Securitization Trust corpus.
ARTICLE VIII
ACCUMULATION EVENTS AND SWAP TERMINATIONS
8.01 ACCUMULATION EVENTS.
If an Accumulation Event or Swap Termination shall occur during the
Revolving Period, then (but in the case of any event described in
subparagraph (i), (ii), (iii) or (iv) of the definition of "Accumulation
Event" after any applicable grace period set forth in such clause), the
Revolving Period shall terminate and Principal Collections and reimbursed
Loss Amounts and Certificate Principal Loss Amounts will no longer be
reinvested in Subsequent Contracts and Subsequent Leased Vehicles.
8.02 SWAP TERMINATIONS, EVENTS OF DEFAULT AND TERMINATION EVENTS.
(a) Following the occurrence of a Swap Termination, the Transferor
shall promptly give notice to the 1998-C Securitization Trustee of such Swap
Termination. Within 15 days of the receipt by the 1998-C Securitization
Trustee of the notice, the 1998-C Securitization Trustee shall publish a
notice in the Authorized Newspapers that a Swap Termination has occurred and
that the 1998-C Securitization Trustee intends to sell, dispose of or
otherwise liquidate the 1998-C SUBI, the 1998-C SUBI Certificate and the
other property of the 1998-C Securitization Trust in a
58
commercially reasonable manner. Following such publication, the 1998-C
Securitization Trustee shall, unless otherwise prohibited by applicable law
from any such action, sell, dispose of, or otherwise liquidate the 1998-C
SUBI, the 1998-C SUBI Certificate and the other property of the 1998-C
Securitization Trust, in a commercially reasonable manner and on commercially
reasonable terms, which may, but are not required to, include the
solicitation of competitive bids, and shall proceed to consummate the sale,
liquidation or disposition thereof as provided above with the highest bidder.
The Transferor and the Servicer shall be permitted to bid for the 1998-C
Securitization Trust property. The 1998-C Securitization Trustee may obtain
a prior determination from the conservator, receiver, or trustee in
bankruptcy of the Transferor that the terms and manner of any proposed sale,
disposition or liquidation are commercially reasonable. The provisions of
Sections 8.01 and 8.02 shall not be deemed to be mutually exclusive.
(b) If a Trust Officer of the 1998-C Securitization Trust obtains
actual knowledge of an Event of Default or Termination Event (as such terms
are defined in the Swap Agreement), the 1998-C Securitization Trustee shall
promptly publish and deliver notice to the Certificateholders as provided in
Section 4.10 of this 1998-C Securitization Trust Agreement. In the case of
any Tax Event or Tax Event Upon Merger (as defined in the Swap Agreement),
such notice shall specify that unless the 1998-C Securitization Trustee
receives within 30 days of the date of publication of such notice the
direction of Holders of at least 51% of the Voting Interests of the Class A
Certificateholders (acting as a single Class) to elect to terminate the Swap
Agreement and liquidate the assets of the 1998-C Securitization Trust, the
1998-C Securitization Trustee shall not designate an Early Termination Date
(as defined in the Swap Agreement) and, accordingly, such event will not
constitute a Termination Event. In the case of notice of any other such
event as to which the 1998-C Securitization Trust has the option to
designate an Early Termination Date under the Swap Agreement, such notice
shall specify that unless otherwise directed by Holders of at least 51% of the
Voting Interests of the Class A Certificateholders (acting as a single Class)
within the time period specified in such notice (which time period shall be
not more than 30 days from the date such notice is published or delivered by
the 1998-C Securitization Trustee), the 1998-C Securitization Trustee, on
behalf of the 1998-C Securitization Trust, will elect to designate an Early
Termination Date under the Swap Agreement and thereafter to terminate the Swap
Agreement and liquidate the assets of the 1998-C Securitization Trust. Upon
the occurrence of (i) any Event of Default under the Swap Agreement arising
from any action taken, or failure to act, by the Swap Counterparty of which a
Trust Officer or the 1998-C Securitization Trustee has actual knowledge, or (ii)
a Termination Event under the Swap Agreement of which a Trust Officer or the
1998-C Securitization Trustee has actual knowledge (except as described in the
following sentence) with respect to which the Swap Counterparty is an Affected
Party (as defined in the Swap Agreement), the 1998-C Securitization Trustee may
and will, at the direction of 51% of the Voting Interest of the
Certificateholders, by notice to the Swap Counterparty, designate an Early
Termination Date with respect to the Swap Agreement. If a Termination Event
under the Swap Agreement occurs (i) as a result of the insolvency or bankruptcy
of the Transferor or (ii) because the Trust or the Transferor becomes subject
to registration as an "Investment Company" under the Investment Company Act of
1940, the 1998C Securitization Trustee shall terminate the Swap Agreement.
If the 1998-C Securitization Trust or the Swap Counterparty elects to
designate an Early Termination Date and thereafter to terminate the Swap
Agreement and liquidate the assets of the
59
1998-C Securitization Trust, the 1998-C Securitization Trustee will specify
in a further notice to the Class A Certificateholders the date elected, and
shall also deliver such notice to the Luxembourg Stock Exchange. As soon as
the 1998-C Securitization Trustee is reasonably able to do so, it will so
publish and deliver a further notice to each such party specifying the date
on which the net proceeds of such liquidation are to be allocated and applied
or paid pursuant to Section 3.01(o). In the event that a Swap Termination
Event occurs, whether because the 1998-C Securitization Trust elects to
designate or receives appropriate direction from the relevant
Certificateholders to designate an Early Termination Date, or because the
Swap Counterparty elects to designate an Early Termination Date, the 1998-C
Securitization Trustee shall sell or otherwise dispose of the SUBI, the
1998-C SUBI Certificate and such other property of the Trust in accordance
with Section 8.02(c).
(c) The proceeds from the sale, disposition or liquidation of the
1998-C SUBI Certificate and the 1998-C SUBI Assets evidenced thereby pursuant
to Section 8.02(a) or (b) above, shall be payable pursuant to the priorities
set forth in Section 3.01(o) above; PROVIDED, that the Servicer on behalf of
the 1998-C Securitization Trustee shall determine conclusively without
liability for such determination the amount of such proceeds which are
allocable to Interest Collections and the amount of such proceeds which are
allocable to Principal Collections. On the day following the Certificate
Payment Date on which such proceeds are distributed to the Investor
Certificateholders, the 1998-C Securitization Trust shall terminate.
ARTICLE IX
MISCELLANEOUS PROVISIONS
9.01 AMENDMENT.
(a) This 1998-C Securitization Trust Agreement and the other
Transaction Documents may be amended by the respective parties thereto,
without the consent of any of the Certificateholders, (i) to cure any
ambiguity, mistake or error, (ii) to correct or supplement any provisions
herein or therein that may be inconsistent with any provisions hereof or
thereof, (iii) to add, change or eliminate any other provisions hereof or
thereof with respect to matters or questions arising hereunder or thereunder
that shall not be inconsistent with the provisions hereof or thereof, and
(iv) to add or amend any provision therein in connection with permitting
transfers of the Class B Certificates; PROVIDED, HOWEVER, that any such
action shall not, in the good faith judgment of the parties hereto or
thereto, adversely affect in any material respect the interests of the
Certificateholders and the Titling Trustee and the 1998-C Securitization
Trustee shall have received an Opinion of Counsel to the effect that such
action shall not materially and adversely affect the interests of the
Certificateholders PROVIDED, HOWEVER, further, that any amendment eliminating
the Reserve Fund or reducing the Specified Reserve Fund Balance shall also
require the Transferor to deliver to the 1998-C Securitization Trustee an
Opinion of Counsel to the effect that after such amendment, for federal
income tax purposes, the 1998-C Securitization Trust will not be treated as
an association taxable as a corporation and the Class A Certificates will,
and the Class B Certificates should, properly be characterized as
indebtedness that is secured by the assets of the 1998-C Securitization
Trust.
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(b) This 1998-C Securitization Trust Agreement and the other
Transaction Documents may also be amended from time to time by the respective
parties hereto or thereto for the purpose of adding any provisions to or
changing in any manner, or eliminating any of the provisions of this
Agreement or the other Transaction Documents or of modifying in any manner
the right of each Class of Certificateholders, including with respect to (i)
changing the formula for determining the Specified Reserve Fund Balance which
change would result in a decrease in the amount of the Specified Reserve Fund
Balance, (ii) changing the manner by which the Reserve Fund is funded, which
changes could include borrowings by the Transferor to fund all or a portion
of the Reserve Fund Initial Deposit (which borrowings would be payable from
assets or cash flow otherwise payable to the Transferor), (iii) changing the
remittance schedule for collection deposits in the 1998-C SUBI Collection
Account, (iv) changing the definition of "Permitted Investments") or (v) to
obtain or comply with the Requested Exemption, if either (A) the 1998-C
Securitization Trustee has been furnished with a letter from each Rating
Agency to the effect that such amendment would not cause its then-current
rating of any Rated Certificate to be qualified, reduced or withdrawn, or (B)
the 1998-C Securitization Trustee has received the consent of the Holders of
Investor Certificates representing not less than 51% of the Voting Interests
of the Certificates, voting together as a single class (which consent of any
Holder of an Investor Certificate given pursuant to this Section or pursuant
to any other provision of this 1998-C Securitization Trust Agreement shall be
conclusive and binding on such Holder and on all future Holders of such
Investor Certificate and of any Investor 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 Investor Certificate); PROVIDED, HOWEVER, that
no such amendment shall (x) except as otherwise provided in Section 9.01(a),
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on the 1998-C SUBI or any 1998-C SUBI
Certificate or distributions that shall be required to be made on any
Investor Certificate or the applicable Certificate Rate or (y) reduce the
aforesaid percentage of the aggregate Percentage Interest of the Investor
Certificates of each Class required to consent to any such amendment, without
the consent of the Holders of all Certificates of such Class then
outstanding. It shall not be necessary for the consent of Certificate Owners
pursuant to this Section 9.01(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.
(c) The 1998-C Securitization Trustee shall provide each Rating
Agency prior notice of any proposed amendment hereto and copies of an Opinion
of Counsel, if required pursuant to Section 9.01(a), whether or not such
amendment requires its approval. Any notice of any such amendment or
modification as to which notice is required to be given to any Rating Agency
shall contain both the substance and substantial form of the proposed
amendment or modification.
(d) Promptly after the execution of any such amendment or consent,
the 1998-C Securitization Trustee shall furnish written notification of the
substance of such amendment or consent to each Certificateholder. The
failure to send such notification shall not affect the validity of such
amendment. It shall not be necessary for the consent of Certificateholders
pursuant to Section 9.01(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 1998-C Securitization
Trustee may prescribe.
61
(e) The 1998-C Securitization Trustee may enter into an amendment
to the Swap Agreement without the consent of any Certificateholder for the
purpose of (i) curing any ambiguity or mistake, (ii) correcting any defective
provisions or to correct or supplement any provision therein which may be
inconsistent with any other provision therein or with any provision of this
1998-C Securitization Trust Agreement or (iii) adding any other provisions
with respect to matters or questions arising under the Swap Agreement;
provided, in the case of any amendment pursuant to clause (iv) above, that
such amendment will not adversely affect in any material respect the
interests of any Certificateholder; and provided, further, that any such
amendment will be deemed not to adversely affect in any material respect the
interests of any Certificateholder if the 1998-C Securitization Trustee
receives written confirmation from each Rating Agency that its then
outstanding ratings of the Class A Certificates will not be reduced or
withdrawn as a result of such amendment.
(f) Prior to the execution of any amendment to this 1998-C
Securitization Trust Agreement or the Swap Agreement, the 1998-C
Securitization 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 1998-C Securitization Trust Agreement. The 1998-C
Securitization Trustee may, but shall not be obligated to, enter into any
such amendment which affects the 1998-C Securitization Trustee's own rights,
duties or immunities under this 1998-C Securitization Trust Agreement or the
Swap Agreement or otherwise.
9.02 PROTECTION OF TITLE TO TRUST.
(a) The Transferor shall execute and file, or cause to be executed
and filed, such financing statements and 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 1998-C Securitization Trustee under this 1998-C
Securitization Trust Agreement in the 1998-C SUBI, the 1998-C SUBI
Certificate and in the proceeds thereof. The Transferor shall deliver (or
cause to be delivered) to the 1998-C Securitization Trustee file-stamped
copies of, or filing receipts for, any document filed as provided above, as
soon as available following such filing.
(b) If the Transferor 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 Transferor in accordance
with paragraph (a) above seriously misleading it shall give the 1998-C
Securitization Trustee written notice thereof and shall have promptly filed
appropriate amendments to all previously filed financing statements or
continuation statements as contemplated by Sections 9-402(7) and 9-406 of the
UCC as in effect in California on the date hereof or any successor provision
thereof.
(c) The Transferor shall give the 1998-C Securitization Trustee
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
62
or continuation statement or of any new financing statement and shall
promptly make any such filing.
(d) The Transferor shall deliver to the 1998-C Securitization
Trustee promptly after the execution and delivery of each amendment to this
1998-C Securitization Trust Agreement, 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 1998-C Securitization Trustee in
the 1998-C SUBI, 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.
9.03 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.
(a) The death or incapacity of any Certificateholder shall not
operate to terminate this 1998-C Securitization Trust Agreement or the 1998-C
Securitization 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
1998-C Securitization Trust, nor otherwise affect the rights, obligations and
liabilities of the parties to this 1998-C Securitization Trust Agreement or
any of them.
(b) No Certificateholder shall have any right to vote (except as
provided in Section 9.01) or in any manner otherwise control the operation
and management of the 1998-C Securitization Trust, or the obligations of the
parties to this 1998-C Securitization Trust Agreement, nor shall anything set
forth in this 1998-C Securitization Trust 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 1998-C
Securitization Trust Agreement.
(c) No Certificateholder shall have any right by virtue or by
availing itself of any provisions of this 1998-C Securitization Trust
Agreement to institute any suit, action, or proceeding in equity or at law
upon or under or with respect to this 1998-C Securitization Trust Agreement
or any other Transaction Document, unless such Holder previously shall have
given to the 1998-C Securitization Trustee a written notice of default and of
the continuance thereof, as hereinbefore provided, and unless also the
Holders of Investor Certificates evidencing not less than 25% of the
aggregate Voting Interests of the Certificates, considered as a single Class,
shall have made written request upon the 1998-C Securitization Trustee to
institute such action, suit or proceeding in its own name as Trustee under
this 1998-C Securitization Trust Agreement and shall have offered to the
1998-C Securitization Trustee such reasonable indemnity as it may require
against the costs, expenses, and liabilities to be incurred therein or
thereby, and the 1998-C Securitization 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; it being understood and intended, and being expressly
covenanted by each Certificateholder with every other Certificateholder and
the 1998-C Securitization Trustee, that no one or more Holders of
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Certificates shall have any right in any manner whatever by virtue or by
availing itself or themselves of any provisions of this 1998-C Securitization
Trust Agreement or any other Transaction Document 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 1998-C Securitization Trust
Agreement or any other Transaction Document, except in the manner provided in
this 1998-C Securitization Trust 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
1998-C Securitization Trustee shall be entitled to such relief as can be
given either at law or in equity.
9.04 GOVERNING LAW.
THIS 1998-C SECURITIZATION TRUST AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF CALIFORNIA
WITHOUT REGARD TO ANY OTHERWISE APPLICABLE PRINCIPLES OF CONFLICTS OF LAWS.
9.05 NOTICES.
With respect to the Class A Certificates, all demands, notices and
communications under this 1998-C Securitization Trust Agreement shall, for so
long as any Class A Certificates are listed on the Luxembourg Stock Exchange,
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. In
addition, with respect to the Class B Certificates and, if Class A Definitive
Certificates are issued, the Class A Certificates, such notices will be
mailed to the addresses of holders thereof at the addresses therefor as they
appear in the Corporate Register maintained by the 1998-C Securitization
Trustee prior to such mailing. Such notices will be deemed to have been given
on the date of such publication or the date of mailing or (prior to the
issuance of Definitive Certificates) on the date delivered to the Clearing
Agency pursuant to Section 4.10 above.
All demands, notices and communications under this 1998-C
Securitization Trust Agreement to the parties hereto 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 Transferor, to the agent for service as specified in this 1998-C
Securitization Trust Agreement, or at such other address as shall be
designated by the Transferor in a written notice to the 1998-C Securitization
Trustee; (ii) in the case of the 1998-C Securitization Trustee, at the
Corporate Trust Office; (iii) in the case of Standard & Poor's, at ▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Asset Backed
Surveillance Department; and (iv) in the case of ▇▇▇▇▇'▇, at ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: ABS Monitoring Department.
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 1998-C Securitization Trust Agreement shall be
conclusively presumed to have been duly given, whether or not the
Certificateholder shall receive such notice.
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9.06 SEVERABILITY OF PROVISIONS: COUNTERPARTS.
If any one or more of the covenants, agreements, provisions or terms
of this 1998-C Securitization Trust Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this 1998-C Securitization Trust Agreement and shall
in no way affect the validity or enforceability of the other provisions of
this 1998-C Securitization Trust Agreement or of the Certificates or the
rights of the Holders thereof.
This 1998-C Securitization Trust Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts
shall be deemed to be an original, and all of which counterparts shall
constitute but one and the same instrument.
9.07 ASSIGNMENT.
Notwithstanding anything to the contrary contained in this 1998-C
Securitization Trust Agreement, except as provided in Sections 5.03 and 5.06,
this 1998-C Securitization Trust Agreement may not be assigned by the
Transferor without the prior written consent of Holders of Investor
Certificates evidencing not less than 51% of the aggregate Voting Interests
of all Classes of Certificates. The Transferor shall provide a copy of any
such assignment to each Rating Agency.
9.08 CERTIFICATES NONASSESSABLE AND FULLY PAID.
Except as provided in Section 5.02 with regard to the Transferor,
Certificateholders shall not be personally liable for obligations of the
1998-C Securitization Trust. The interests represented by the Certificates
shall be nonassessable for any losses or expenses of the 1998-C
Securitization Trust or for any reason whatsoever, and, upon the execution
and authentication thereof by the 1998-C Securitization Trustee pursuant to
Sections 4.02, 4.03 or 4.04, the Certificates are and shall be deemed fully
paid.
9.09 INVENTORY ADVANCES.
As set forth more fully in the 1998-C SUBI Servicing Supplement, the
Servicer is authorized to make an Inventory Advance if it expects to recover
the full amount thereof in connection with the liquidation of the related
1998-C Leased Vehicles. The 1998-A Securitization Trustee shall not accept
monies from the Servicer that the Servicer has identified or designated as
Inventory Advances in the related Statement to Certificateholders unless it
shall also have received the written representation of the Servicer that the
Servicer expects to recover the full amount thereof in connection with the
liquidation of the related 1998-C Leased Vehicles based on its estimation of
expected Liquidation Proceeds. In estimating the expected Liquidation
Proceeds, the Servicer shall take into account (a) the specific 1998-C Leased
Vehicles that are to be the subject of such Inventory Advance and (b) its own
recent actual experience with the liquidation of vehicles of comparable makes
and models, in each case on a basis consistent with the review and estimates
the Servicer prepares in establishing and revising its own servicing
guidelines.
65
ARTICLE X
AGENT FOR SERVICE
10.01 AGENT FOR SERVICE OF TRANSFEROR.
The agent for service of process for the Transferor shall be its
Corporate Treasury Manager, at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: Corporate Treasury Manager (fax: ▇▇▇-▇▇▇-▇▇▇▇).
10.02 AGENT OF TRUSTEE.
The 1998-C Securitization Trustee shall maintain an office or offices
or agency or agencies where notices and demands to or upon the 1998-C
Securitization Trustee in respect of the Certificates and this 1998-C
Securitization Trust Agreement may be served. The initial such office shall
be the Corporate Trust Office. The 1998-C Securitization Trustee shall give
prompt written notice to the Transferor, the Servicer and Certificateholders
of any change in the location of the Certificate Register or any such office
or agency. Certificates shall be surrendered for transfer or exchange not at
this office, but as set forth in Section 4.07.
[SIGNATURES ON NEXT PAGE]
66
IN WITNESS WHEREOF, the parties have caused this 1998-C
Securitization Trust Agreement to be duly executed by their respective
officers as of _______________________1998.
TOYOTA LEASING, INC.
as Transferor
By:
----------------------------------------
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as 1998-C Securitization Trustee and as
Securities Intermediary
By:
----------------------------------------
Name:
Title:
EXHIBIT A-1
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE 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 LEASE TRUST 1998-C
ADJUSTABLE RATE AUTO LEASE ASSET BACKED CERTIFICATE, CLASS A-1
Evidencing a percentage interest in the distributions allocable to the
Class A-1 Certificates, as defined below.
This Certificate does not represent an obligation of, or an interest in,
Toyota Leasing, Inc., Toyota Motor Credit Corporation, the Titling
Trustee, the 1998-C Securitization Trustee or any of their respective
affiliates.
Initial Class A-1 Certificate Balance: CUSIP #__________
$189,000,000
Number A-1-1 Denomination: $[_______________]
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a _____________
_____________________ DOLLARS ($___________________) nonassessable,
fully-paid, fractional undivided interest in the Toyota Auto Lease Trust
1998-C (the "1998-C Securitization Trust") formed by Toyota Leasing, Inc., a
California corporation, as Transferor (the "Transferor"). The 1998-C
Securitization Trust was created pursuant to a 1998-C Securitization Trust
Agreement dated as of December 1, 1998 (the "Agreement"), between the
Transferor and U.S. Bank National Association, a national banking
association, as trustee (the "1998-C Securitization 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 Lease Trust 1998-C Adjustable
Rate Auto Lease Asset Backed Certificates, Class A-1" (the "Class A-1
Certificates"). Also issued under the Agreement are Certificates designated
as "Toyota Auto Lease Trust 1998-C Adjustable Rate Auto Lease Asset Backed
Certificates, Class A-2" (the "Class A-2 Certificates"), Certificates
designated as "Toyota
A-1-1
Auto Lease Trust 1998-C Adjustable Rate Auto Lease Asset Backed Certificates,
Class A-3" (the "Class A-3 Certificates" and, together with the Class A-1
Certificates and the Class A-2 Certificates, the "Class A Certificates"),
Certificates designated as "Toyota Auto Lease Trust 1998-C Adjustable Rate
Auto Lease Asset Backed Certificates, Class B" (the "Class B Certificates"
and, together with the Class A Certificates, the "Investor Certificates") and
a Certificate evidencing the Transferor Interest (the "Transferor
Certificate" and, together with the Investor Certificates, the
"Certificates"). The Class B Certificates are subordinated to the Class A
Certificates and the Transferor Certificate is subordinated to the Investor
Certificates to the extent described in the Agreement. This Class A-1
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-1
Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
The property of the 1998-C Securitization Trust includes, among other
things, the 1998-C SUBI Certificate evidencing beneficial interests in the
assets of the 1998-C SUBI other than the proceeds of the Residual Value
Insurance Policies. The 1998-C SUBI represents a beneficial interest in a
pool of retail automobile and light duty truck lease contracts ("Contracts")
and the new and used automobiles and light duty trucks leased thereby
("Leased Vehicles") (such pool of Contracts and Leased Vehicles, the "1998-C
SUBI Portfolio") entered into by various automobile and light duty truck
dealers pursuant to contractual arrangements with the Titling Trust. Toyota
Motor Credit Corporation acts as servicer (in that capacity, the "Servicer")
of the 1998-C SUBI Portfolio. During the Revolving Period, Principal
Collections and amounts applied to reimburse Loss Amounts and Certificate
Principal Loss Amounts allocable to the assets of the 1998-C SUBI represented
by the 1998-C SUBI Certificate generally will be reinvested in Subsequent
Contracts and Subsequent Leased Vehicles from among other unallocated
Contracts and Leased Vehicles owned by the Titling Trust. At the time of
reinvestment, such Subsequent Contracts and Subsequent Leased Vehicles will
be allocated to the 1998-C SUBI. Following the Revolving Period, Principal
Collections allocable to the assets of the 1998-C SUBI will be deposited in
the Certificateholders' Account and invested in Permitted Investments (which
are expected to be TMCC Demand Notes) maturing prior to the relevant Targeted
Maturity Date.
Payments in respect of the 1998-C SUBI Certificate will be allocated
between the Investor Certificates and the Transferor Certificate and paid to
the registered Holder of this Certificate as provided in the Agreement.
Except as otherwise provided in the Agreement, interest payments in
respect of this Certificate shall be made quarterly on the 25th day of March,
June, September and December (or if such day is not a Business Day, the next
succeeding Business Day, each such day a "Certificate Payment Date"),
commencing on March 25, 1999, and through the Class A-1 Targeted Maturity
Date and thereafter, if applicable, monthly on each succeeding Certificate
Payment Date until the Adjusted Class A-1 Certificate Balance has been
reduced to zero. Except to the extent provided otherwise in the Agreement,
no principal payments shall be made in respect of the Class A-2 Certificates
until the Class A-1 Certificates have been paid in full, no principal
payments shall be made in respect of the Class A-3 Certificates until the
Class A-2 Certificates have been paid in full and no principal payments will
be made in respect of the Class B Certificates until the Class
A-1-2
A-3 Certificates have been paid in full. Except as otherwise provided in the
Agreement, the principal of the Class A-1 Certificates shall be distributable
on the A-1 Targeted Maturity Date which shall be December 25, 2000 (or if
such day is not a Business Day, on the next succeeding Business Day) and
thereafter, if applicable, monthly on each succeeding Certificate Payment
Date until the Adjusted Class A-1 Certificate Balance has been reduced to
zero. In any event, any remaining unpaid principal of any Class A-1
Certificate shall be due and payable on December 25, 2002 (or if such day is
not a Business Day, on the next succeeding Business Day).
On each Certificate Payment Date, the 1998-C Securitization Trustee
shall pay or cause to be paid to the Person in whose name this Class A-1
Certificate is registered at the close of business on the calendar day
immediately preceding such Certificate Payment Date or, if Definitive
Certificates have been issued, the last Business Day of the immediately
preceding calendar month (the "Record Date"), amounts distributable as
interest on the Class A-1 Certificates pursuant to the terms of the
Agreement, all to the extent and as more specifically set forth in the
Agreement. Payments of principal may be made earlier under certain
circumstances (in connection with the exercise of the Transferor of its right
to purchase the SUBI, described below, or the liquidation of the 1998-C SUBI
following a Swap Termination) or later (depending on payment, delinquency
and loss experience). Distributions on this Class A-1 Certificate will be
made by the 1998-C Securitization Trustee by check mailed to the Class A-1
Certificateholder of record in the Certificate Register without the
presentation or surrender of this Class A-1 Certificate or the making of any
notation hereon except that with respect to Class A-1 Certificates registered
in the name of Cede & Co., the nominee for The Depository Trust Company,
distributions will be made by wire transfer of immediately available funds.
Except as otherwise provided in the Agreement and notwithstanding the
foregoing, the final distribution on this Class A-1 Certificate will be made
after due notice by the 1998-C Securitization Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A-1
Certificate at the Corporate Trust Office of the 1998-C Securitization
Trustee or at the offices of Bankers Trust Luxembourg S.A. (initially at ▇▇
▇▇▇▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇▇▇, ▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇).
It is the intention of the Transferor and the Investor
Certificateholders that the Investor Certificates will be indebtedness for
federal, state and local income and franchise tax purposes and for purposes
of any other tax imposed on or measured by income. The Transferor, the 1998-C
Securitization Trustee and the Holder of this Certificate (or Certificate
Owner) by acceptance of this Certificate (or, in the case of a Certificate
Owner, by virtue of such Certificate Owner's acquisition of a beneficial
interest herein) agree to treat the Investor Certificates (or beneficial
interests therein), for purposes of federal, state and local income or
franchise taxes and any other tax imposed on or measured by income, as
indebtedness and to report the transactions contemplated by the Agreement on
all applicable tax returns in a manner consistent with such treatment. Each
Holder of an Investor Certificate also agrees that it will not be entitled to
any of the tax benefits related to the 1998-C Contracts and 1998-C Leased
Vehicles, including any of the depreciation deductions resulting therefrom.
In the event that, notwithstanding the statement of intentions and
undertakings set forth in Section 4.12(a) of the Agreement and herein, it is
finally determined that the Class A-1 Certificates do not evidence
indebtedness of the Transferor for all income and franchise tax
A-1-3
purposes, but rather represent an equity interest in the assets of the 1998-C
Securitization Trust, then the Holder is deemed to agree (and each
Certificate Owner hereof with respect hereto by virtue of acquiring a
beneficial interest herein is deemed to agree): (i) to treat such
Certificates, together with the Transferor Certificate, as representing an
interest in a partnership for all tax purposes, (ii) to treat all payments in
respect of such Certificates (to the extent not a return of capital) as a
"guaranteed payment" thereon made pursuant to Section 707(c) of the Code, and
(iii) to allocate all other items of income, gain, deduction, loss or credit
with respect to the assets and operations of the 1998-C Securitization Trust
to the Transferor.
The Certificates do not represent an obligation of, or an interest in,
the Transferor, the Servicer, the Titling Trust, the Titling Trustee, the
1998-C Securitization Trustee or any of their respective Affiliates. The
Certificates are limited in right of payment to certain collections and
recoveries respecting the 1998-C SUBI Assets evidenced by the 1998-C SUBI
Certificate and certain monies on deposit in the Reserve Fund and in certain
other accounts established for the benefit of the Certificateholders, in each
case to the extent and as more specifically set forth in the Agreement. By
accepting this Certificate, the Holder hereof (and each Certificate Owner
with respect hereto, by virtue of such Certificate Owner's acquisition of a
beneficial interest herein) waives any claim to any proceeds or assets of the
Titling Trustee and to all of the Titling Trust Assets other than those from
time to time included in the 1998-C SUBI Sub-Trust (except for those
evidenced by the 1998-C SUBI Insurance Certificate) and those proceeds or
assets derived from or earned by such 1998-C SUBI Assets (except for those
evidenced by the 1998-C SUBI Insurance Certificate and the proceeds
therefrom). A copy of the Agreement may be examined during normal business
hours at the Corporate Trust Office of the 1998-C Securitization Trustee, at
the offices of Bankers Trust Luxembourg S.A. (initially at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇▇▇, ▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇) and at such other places, if any, designated by
the 1998-C Securitization 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 Transferor and the 1998-C Securitization Trustee without
the consent of any Certificateholders. In certain limited circumstances, the
Agreement may only be amended with the consent of the Holders of Investor
Certificates evidencing not less than 51% of the aggregate Voting Interest of
all Investor Certificates, voting together as a single class. To be entitled
to vote in respect of an interest in the Class A-1 Certificates, a person
shall be a holder of record of such Class A-1 Certificates as shown on the
books of the Certificate Registrar on the last day of the preceding month, or
a person appointed by such holder by an instrument in writing. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and on all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
As provided in the Agreement and subject to certain limitations therein
set forth, Certificates are exchangeable for new Certificates of the same
Class, in authorized denominations of a like aggregate principal amount, as
requested by the Holder surrendering the same or for register of transfer at
the Corporate Trust Office of the 1998-C Securitization Trustee
A-1-4
in its capacity as Certificate Registrar, or at the office of the agent of
the 1998-C Securitization Trustee in its capacity as Certificate Registrar,
who shall initially be U.S. Bank National Association, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, in the Borough of Manhattan, the City of New
York, and, with respect to the Definitive Certificates only, a transfer agent
appointed in Luxembourg, or at the appropriate office of any successor
Certificate Registrar, accompanied by a written instrument of transfer in
form satisfactory to the 1998-C Securitization 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-1 Certificates
of authorized denominations and of a like aggregate fractional undivided
interest will be issued to the designated transferee. No service charge will
be made for any such registration of transfer or exchange, but the 1998-C
Securitization Trustee may require payment of a sum sufficient to cover any
tax or governmental charges payable in connection therewith.
The Class A-1 Certificates are issuable only as registered Certificates
without coupons in denominations of $1,000 and integral multiples thereof
(except for one Class A-1 Certificate in a smaller minimum denomination
representing any remaining portion of the Initial Class A-1 Certificate
Balance).
Prior to due presentation of this Certificate for registration of
transfer, the 1998-C Securitization Trustee, the Certificate Registrar and
any of their respective agents may treat the Person in whose name this Class
A-1 Certificate is registered as the owner hereof for the purpose of
receiving distributions and for all other purposes, and neither the 1998-C
Securitization Trustee, the Certificate Registrar nor any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and the
1998-C Securitization Trust created thereby shall terminate upon the payment
to Investor Certificateholders of all amounts required to be paid to them
pursuant to the Agreement and the disposition of all property held as part of
the 1998-C Securitization Trust. The Transferor may at its option purchase
the corpus of the 1998-C Securitization Trust at a price specified in the
Agreement, and such purchase of the 1998-C SUBI and 1998-C SUBI Certificate
and other property of the 1998-C Securitization Trust will effect early
retirement of the Certificates; PROVIDED, HOWEVER, such right of purchase is
exercisable only on the Monthly Allocation Date on or after the Class A-3
Targeted Maturity Date, if either before or after giving effect to any
payments of principal required to be made on such Monthly Allocation Date,
the Investor Balance shall be less than or equal to [$______________] (ten
percent of the Aggregate Net Investment Value as of the Cutoff Date).
By accepting this Certificate, the Holder hereof (and each Certificate
Owner with respect hereto, by virtue of acquiring a beneficial interest
herein) covenants and agrees (and each Certificate Owner is deemed to agree)
that prior to the date which is one year and one day after the last date upon
which (a) each Class of Investor Certificates has been paid in full, and (b)
all obligations due under any other Securitized Financing have been paid in
full, the Holder (or Certificate Owner) will not institute against, or join
any other Person in instituting against the Transferor, Toyota Motor Credit
Corporation, the 1998-C Securitization Trustee, the 1998-C
A-1-5
Securitization Trust, the Titling Trustee or the Titling Trust any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding
or other proceedings under any federal or state bankruptcy or similar law.
The foregoing shall not limit the Holder's (or any Certificate Owner's) right
to file any claim in or otherwise take actions with respect to any such
proceeding instituted by any Person not under such a constraint. This
noncompetition covenant shall survive the termination of the Agreement.
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the 1998-C Securitization Trustee, by manual
signature, this Class A-1 Certificate shall not entitle the Holder hereof to
any benefit under the Agreement or be valid for any purpose.
A-1-6
IN WITNESS WHEREOF, the 1998-C Securitization Trustee on behalf of the
1998-C Securitization Trust and not in its individual capacity has caused
this Class A-1 Certificate to be duly executed.
Dated: [_______________], 1998
TOYOTA AUTO LEASE TRUST 1998-C
By: U.S. BANK NATIONAL ASSOCIATION,
as 1998-C Securitization Trustee
By:________________________________
Authorized Officer
Certificate of Authentication
This is one of the Class A-1 Certificates referred to in the
within-mentioned Agreement.
U.S. BANK NATIONAL ASSOCIATION, as
1998-C Securitization Trustee
By:__________________________________
Authorized Officer
A-1-7
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 an "eligible guarantor institution" meeting the requirements
of the Certificate Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE 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 LEASE TRUST 1998-C
ADJUSTABLE RATE AUTO LEASE ASSET BACKED CERTIFICATE, CLASS A-2
Evidencing a percentage interest in the distributions allocable to the
Class A-2 Certificates, as defined below.
This Certificate does not represent an obligation of, or an interest
in, Toyota Leasing, Inc., Toyota Motor Credit Corporation, the Titling
Trustee, the 1998-C Securitization Trustee or any of their respective
affiliates.
Initial Class A-2 Certificate Balance:
$424,500,000 CUSIP ___________
Number A-2-1 Denomination: $[________________]
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a ______________
__________________ DOLLARS ($______________________) nonassessable,
fully-paid, fractional undivided interest in the Toyota Auto Lease Trust
1998-C (the "1998-C Securitization Trust") formed by Toyota Leasing, Inc., a
California corporation, as Transferor (the "Transferor"). The 1998-C
Securitization Trust was created pursuant to a 1998-C Securitization Trust
Agreement dated as of December 1, 1998 (the "Agreement"), between the
Transferor and U.S. Bank National Association, a national banking
association, as trustee (the "1998-C Securitization 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 Lease Trust 1998-C Adjustable
Rate Auto Lease Asset Backed Certificates, Class A-2" (the "Class A-2
Certificates"). Also issued under the Agreement are Certificates designated
as "Toyota Auto Lease Trust 1998-C Adjustable Rate Auto Lease Asset Backed
Certificates, Class A-1" (the "Class A-1 Certificates"), Certificates
designated as "Toyota
A-2-1
Auto Lease Trust 1998-C Adjustable Rate Auto Lease Asset Backed Certificates,
Class A-3" (the "Class A-3 Certificates" and, together with the Class A-1
Certificates and the Class A-2 Certificates, the "Class A Certificates"),
Certificates designated as "Toyota Auto Lease Trust 1998-C Adjustable Rate
Auto Lease Asset Backed Certificates, Class B" (the "Class B Certificates"
and, together with the Class A Certificates, the "Investor Certificates") and
a Certificate evidencing the Transferor Interest (the "Transferor
Certificate" and, together with the Investor Certificates, the
"Certificates"). The Class B Certificates are subordinated to the Class A
Certificates and the Transferor Certificate is subordinated to the Investor
Certificates to the extent described in the Agreement. This Class A-2
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-2
Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
The property of the 1998-C Securitization Trust includes, among other
things, the 1998-C SUBI Certificate evidencing beneficial interests in the
assets of the 1998-C SUBI other than the proceeds of the Residual Value
Insurance Policies. The 1998-C SUBI represents a beneficial interest in a
pool of retail automobile and light duty truck lease contracts ("Contracts")
and the new and used automobiles and light duty trucks leased thereby
("Leased Vehicles") (such pool of Contracts and Leased Vehicles, the "1998-C
SUBI Portfolio") entered into by various automobile and light duty truck
dealers pursuant to contractual arrangements with the Titling Trust. Toyota
Motor Credit Corporation acts as servicer (in that capacity, the "Servicer")
of the 1998-C SUBI Portfolio. During the Revolving Period, Principal
Collections and amounts applied to reimburse Loss Amounts and Certificate
Principal Loss Amounts allocable to the assets of the 1998-C SUBI represented
by the 1998-C SUBI Certificate generally will be reinvested in Subsequent
Contracts and Subsequent Leased Vehicles from among other unallocated
Contracts and Leased Vehicles owned by the Titling Trust. At the time of
reinvestment, such Subsequent Contracts and Subsequent Leased Vehicles will
be allocated to the 1998-C SUBI. Following the Revolving Period, Principal
Collections allocable to the assets of the 1998-C SUBI will be deposited in
the Certificateholders' Account and invested in Permitted Investments (which
are expected to be TMCC Demand Notes) maturing prior to the relevant Targeted
Maturity Date.
Payments in respect of the 1998-C SUBI Certificate will be allocated
between the Investor Certificates and the Transferor Certificate and paid to
the registered Holder of this Certificate as provided in the Agreement.
Except as otherwise provided in the Agreement, interest payments in
respect of this Certificate shall be made quarterly on the 25th day of March,
June, September and December (or if such day is not a Business Day, the next
succeeding Business Day, each such day a "Certificate Payment Date"),
commencing on March 25, 1999, and through the Class A-2 Targeted Maturity
Date and thereafter, if applicable, monthly on each succeeding Certificate
Payment Date until the Adjusted Class A-2 Certificate Balance has been
reduced to zero. Except to the extent provided otherwise in the Agreement,
no principal payments shall be made in respect of the Class A-2 Certificates
until the Class A-1 Certificates have been paid in full, no principal
payments shall be made in respect of the Class A-3 Certificates until the
Class A-2 Certificates have been paid in
A-2-2
full and no principal payments shall be made in respect of the Class B
Certificates until the Class A-3 Certificates have been paid in full. Except
as otherwise provided in the Agreement, the principal of the Class A-2
Certificates shall be distributable on the Class A-2 Targeted Maturity Date
which shall be December 25, 2001 (or if such day is not a Business Day, on
the next succeeding Business Day) and thereafter, if applicable, monthly on
each succeeding Certificate Payment Date until the Adjusted Class A-2
Certificate Balance has been reduced to zero. In any event, any remaining
unpaid principal of any Class A-2 Certificate shall be due and payable on
February 25, 2003 (or if such day is not a Business Day, on the next
succeeding Business Day).
On each Certificate Payment Date, the 1998-C Securitization Trustee
shall pay or cause to be paid to the Person in whose name this Class A-2
Certificate is registered at the close of business on the calendar day
immediately preceding such Certificate Payment Date or, if Definitive
Certificates have been issued, the last Business Day of the immediately
preceding calendar month (the "Record Date"), amounts distributable as
interest on the Class A-2 Certificates pursuant to the terms of the
Agreement, all to the extent and as more specifically set forth in the
Agreement. Payments of principal may be made earlier under certain
circumstances (in connection with the exercise of the Transferor of its right
to purchase the 1998-C SUBI, described below, or the liquidation of the SUBI
following a Swap Termination) or later (depending on payment, delinquency
and loss experience). Distributions on this Class A-2 Certificate will be
made by the 1998-C Securitization Trustee by check mailed to the Class A-2
Certificateholder of record in the Certificate Register without the
presentation or surrender of this Class A-2 Certificate or the making of any
notation hereon except that with respect to Class A-2 Certificates registered
in the name of Cede & Co., the nominee for The Depository Trust Company,
distributions will be made by wire transfer of immediately available funds.
Except as otherwise provided in the Agreement and notwithstanding the
foregoing, the final distribution on this Class A-2 Certificate will be made
after due notice by the 1998-C Securitization Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A-2
Certificate at the Corporate Trust Office of the 1998-C Securitization
Trustee or at the offices of Bankers Trust Luxembourg S.A. (initially at ▇▇
▇▇▇▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇▇▇, ▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇).
It is the intention of the Transferor and the Investor
Certificateholders that the Investor Certificates will be indebtedness for
federal, state and local income and franchise tax purposes and for purposes
of any other tax imposed on or measured by income. The Transferor, the 1998-C
Securitization Trustee and the Holder of this Certificate (or Certificate
Owner) by acceptance of this Certificate (or, in the case of a Certificate
Owner, by virtue of such Certificate Owner's acquisition of a beneficial
interest herein) agree to treat the Investor Certificates (or beneficial
interest therein), for purposes of federal, state and local income or
franchise taxes and any other tax imposed on or measured by income, as
indebtedness of the Transferor and to report the transactions contemplated by
the Agreement on all applicable tax returns in a manner consistent with such
treatment. Each Holder of an Investor Certificate also agrees that it will
not be entitled to any of the tax benefits related to the 1998-C Contracts
and 1998-C Leased Vehicles, including any of the depreciation deductions
resulting therefrom.
In the event that, notwithstanding the statement of intentions and
undertakings set forth in Section 4.12(a) of the Agreement and herein, it is
finally determined that the Class A-2
A-2-3
Certificates do not evidence indebtedness of the Transferor for all income
and franchise tax purposes, but rather represent an equity interest in the
assets of the 1998-C Securitization Trust, then the Holder is deemed to agree
(and each Certificate Owner hereof with respect hereto by virtue of acquiring
a beneficial interest herein is deemed to agree): (i) to treat such
Certificates, together with the Transferor Certificate, as representing an
interest in a partnership for all tax purposes, (ii) to treat all payments in
respect of such Certificates (to the extent not a return of capital) as a
"guaranteed payment" thereon made pursuant to Section 707(c) of the Code, and
(iii) to allocate all other items of income, gain, deduction, loss or credit
with respect to the assets and operations of the 1998-C Securitization Trust
to the Transferor.
The Certificates do not represent an obligation of, or an interest in,
the Transferor, the Servicer, the Titling Trust, the Titling Trustee, the
1998-C Securitization Trustee or any of their respective Affiliates. The
Certificates are limited in right of payment to certain collections and
recoveries respecting the 1998-C SUBI Assets evidenced by the 1998-C SUBI
Certificate and certain monies on deposit in the Reserve Fund and in certain
other accounts established for the benefit of the Certificateholders, in each
case to the extent and as more specifically set forth in the Agreement. By
accepting this Certificate, the Holder hereof (and each Certificate Owner
with respect hereto, by virtue of such Certificate Owner's acquisition of a
beneficial interest herein) waives any claim to any proceeds or assets of the
Titling Trustee and to all of the Titling Trust Assets other than those from
time to time included in the 1998-C SUBI Sub-Trust (except for those
evidenced by the 1998-C SUBI Insurance Certificate) and those proceeds or
assets derived from or earned by such 1998-C SUBI Assets (except for those
evidenced by the 1998-C SUBI Insurance Certificate and the proceeds
therefrom). A copy of the Agreement may be examined during normal business
hours at the Corporate Trust Office of the 1998-C Securitization Trustee, at
the offices of Bankers Trust Luxembourg S.A. (initially at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇▇▇, ▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇) and at such other places, if any, designated by
the 1998-C Securitization 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 Transferor and the 1998-C Securitization Trustee without
the consent of any Certificateholders. In certain limited circumstances, the
Agreement may only be amended with the consent of the Holders of Investor
Certificates evidencing not less than 51% of the aggregate Voting Interest of
all Investor Certificates, voting together as a single class. To be entitled
to vote in respect of an interest in the Class A-2 Certificates, a person
shall be a holder of record of such Class A-2 Certificates as shown on the
books of the Certificate Registrar on the last day of the preceding month, or
a person appointed by such holder by an instrument in writing. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and on all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
As provided in the Agreement and subject to certain limitations therein
set forth, Certificates are exchangeable for new Certificates of the same
Class, in authorized denominations of a like aggregate principal amount, as
requested by the Holder surrendering the
A-2-4
same or for register of transfer at the Corporate Trust Office of the 1998-C
Securitization Trustee in its capacity as Certificate Registrar, or at the
office of the agent of the 1998-C Securitization Trustee in its capacity as
Certificate Registrar, U.S. Bank National Association, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, in the Borough of Manhattan, the City of New
York, and, with respect to the Definitive Certificates only, a transfer agent
appointed in Luxembourg, or at the appropriate office of any successor
Certificate Registrar, accompanied by a written instrument of transfer in
form satisfactory to the 1998-C Securitization 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-2 Certificates
of authorized denominations and of a like aggregate fractional undivided
interest will be issued to the designated transferee. No service charge will
be made for any such registration of transfer or exchange, but the 1998-C
Securitization Trustee may require payment of a sum sufficient to cover any
tax or governmental charges payable in connection therewith.
The Class A-2 Certificates are issuable only as registered Certificates
without coupons in denominations of $1,000 and integral multiples thereof
(except for one Class A-2 Certificate in a smaller minimum denomination
representing any remaining portion of the Initial Class A-2 Certificate
Balance).
Prior to due presentation of this Certificate for registration of
transfer, the 1998-C Securitization Trustee, the Certificate Registrar and
any of their respective agents may treat the Person in whose name this Class
A-2 Certificate is registered as the owner hereof for the purpose of
receiving distributions and for all other purposes, and neither the 1998-C
Securitization 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
1998-C Securitization Trust created thereby shall terminate upon the payment
to Investor Certificateholders of all amounts required to be paid to them
pursuant to the Agreement and the disposition of all property held as part of
the 1998-C Securitization Trust. The Transferor may at its option purchase
the corpus of the 1998-C Securitization Trust at a price specified in the
Agreement, and such purchase of the 1998-C SUBI and 1998-C SUBI Certificate
and other property of the 1998-C Securitization Trust will effect early
retirement of the Certificates; PROVIDED, HOWEVER, such right of purchase is
exercisable only on the Monthly Allocation Date on or after the Class A-3
Targeted Maturity Date, if either before or after giving effect to any
payments of principal required to be made on such Monthly Allocation Date,
the Investor Balance shall be less than or equal to $[ ] (ten
percent of the Aggregate Net Investment Value as of the Cutoff Date).
By accepting this Certificate, the Holder hereof (and each Certificate
Owner with respect hereto, by virtue of acquiring a beneficial interest
herein) covenants and agrees (and each Certificate Owner is deemed to agree)
that prior to the date which is one year and one day after the last date upon
which (a) each Class of Investor Certificates has been paid in full, and (b)
all obligations due under any other Securitized Financing have been paid in
full, the Holder and/or Certificate Owner will not institute against, or join
any other Person in instituting against the
A-2-5
Transferor, Toyota Motor Credit Corporation, the 1998-C Securitization
Trustee, the 1988-B Securitization Trust, the Titling Trustee or the Titling
Trust any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceedings under any federal or state bankruptcy or
similar law. The foregoing shall not limit the Holder's and/or Certificate
Owner's right to file any claim in or otherwise take actions with respect to
any such proceeding instituted by any Person not under such a constraint.
This non-petition covenant shall survive the termination of the Agreement.
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the 1998-C Securitization Trustee, by manual
signature, this Class A-2 Certificate shall not entitle the Holder hereof to
any benefit under the Agreement or be valid for any purpose.
A-2-6
IN WITNESS WHEREOF, the 1998-C Securitization Trustee on behalf of the
1998-C Securitization Trust and not in its individual capacity has caused
this Class A-2 Certificate to be duly executed.
Dated: [ ], 1998
TOYOTA AUTO LEASE TRUST 1998-C
By: U.S. BANK NATIONAL ASSOCIATION, as 1998-C
Securitization Trustee
By: _________________________________________
Authorized Officer
Certificate of Authentication
This is one of the Class A-2 Certificates referred to in the
within-mentioned Agreement.
U.S. BANK NATIONAL ASSOCIATION, as
1998-C Securitization Trustee
By:___________________________________________
Authorized Officer
A-2-7
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 an "eligible guarantor institution" meeting the requirements
of the Certificate Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE 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 LEASE TRUST 1998-C
ADJUSTABLE RATE AUTO LEASE ASSET BACKED CERTIFICATE, CLASS A-3
Evidencing a percentage interest in the distributions allocable to the
Class A-3 Certificates, as defined below.
This Certificate does not represent an obligation of, or an interest
in, Toyota Leasing, Inc., Toyota Motor Credit Corporation, the Titling
Trustee, the 1998-C Securitization Trustee or any of their respective
affiliates.
Initial Class A-3 Certificate Balance: CUSIP #____________
$72,800,000
Number A-3-1 Denomination: $[________________]
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a ____________
_____________________ DOLLARS ($______________) nonassessable, fully-paid,
fractional undivided interest in the Toyota Auto Lease Trust 1998-C (the
"1998-C Securitization Trust") formed by Toyota Leasing, Inc., a California
corporation, as Transferor (the "Transferor"). The 1998-C Securitization
Trust was created pursuant to a 1998-C Securitization Trust Agreement dated
as of December 1, 1998 (the "Agreement"), between the Transferor and U.S.
Bank National Association, a national banking association, as trustee (the
"1998-C Securitization 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 Lease Trust 1998-C Adjustable
Rate Auto Lease Asset Backed Certificates, Class A-3" (the "Class A-3
Certificates"). Also issued under the Agreement are
A-3-1
Certificates designated as "Toyota Auto Lease Trust 1998-C Adjustable Rate
Auto Lease Asset Backed Certificates, Class A-1" (the "Class A-1
Certificates"), Certificates designated as "Toyota Auto Lease Trust 1998-C
Adjustable Rate Auto Lease Asset Backed Certificates, Class A-2" (the "Class
A-2 Certificates" and, together with the Class A-1 Certificates and the Class
A-3 Certificates, the "Class A Certificates"), Certificates designated as
"Toyota Auto Lease Trust 1998-C Adjustable Rate Auto Lease Asset Backed
Certificates, Class B" (the "Class B Certificates" and, together with the
Class A Certificates, the "Investor Certificates") and a Certificate
evidencing the Transferor Interest (the "Transferor Certificate" and,
together with the Investor Certificates, the "Certificates"). The Class B
Certificates are subordinated to the Class A Certificates and the Transferor
Certificate is subordinated to the Investor Certificates to the extent
described in the Agreement. This Class A-3 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-3 Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
The property of the 1998-C Securitization Trust includes, among other
things, the 1998-C SUBI Certificate evidencing beneficial interests in the
assets of the 1998-C SUBI other than the proceeds of the Residual Value
Insurance Policies. The 1998-C SUBI represents a beneficial interest in a
pool of retail automobile and light duty truck lease contracts ("Contracts")
and the new and used automobiles and light duty trucks leased thereby
("Leased Vehicles") (such pool of Contracts and Leased Vehicles, the "1998-C
SUBI Portfolio") entered into by various automobile and light duty truck
dealers pursuant to contractual arrangements with the Titling Trust. Toyota
Motor Credit Corporation acts as servicer (in that capacity, the "Servicer")
of the 1998-C SUBI Portfolio. During the Revolving Period, Principal
Collections and amounts applied to reimburse Loss Amounts and Certificate
Principal Loss Amounts allocable to the assets of the 1998-C SUBI represented
by the 1998-C SUBI Certificate generally will be reinvested in Subsequent
Contracts and Subsequent Leased Vehicles from among other unallocated
Contracts and Leased Vehicles owned by the Titling Trust. At the time of
reinvestment, such Subsequent Contracts and Subsequent Leased Vehicles will
be allocated to the 1998-C SUBI. Following the Revolving Period, Principal
Collections allocable to the assets of the 1998-C SUBI will be deposited in
the Certificateholders' Account and invested in Permitted Investments (which
are expected to be TMCC Demand Notes) maturing prior to the relevant Targeted
Maturity Date.
Payments in respect of the 1998-C SUBI Certificate will be allocated
between the Investor Certificates and the Transferor Certificate and paid to
the registered Holder of this Certificate as provided in the Agreement.
Except as otherwise provided in the Agreement, interest payments in
respect of this Certificate shall be made quarterly on the 25th day of March,
June, September and December (or if such day is not a Business Day, the next
succeeding Business Day, each such day a "Certificate Payment Date"),
commencing on March 25, 1999, and through the Class A-3 Targeted Maturity
Date and thereafter, if applicable, monthly on each succeeding Certificate
Payment Date until the Adjusted Class A-3 Certificate Balance has been
reduced to zero. Except to the extent provided otherwise in the Agreement, no
principal payments shall be made in respect of the Class ▇-▇
▇-▇-▇
▇▇▇▇▇▇▇▇▇▇▇▇ until the Class A-1 Certificates have been paid in full, and no
principal payments shall be made in respect of the Class A-3 Certificates
until the Class A-2 Certificates have been paid in full and no principal
payments shall be made in respect of the Class B Certificates until the Class
A-3 Certificates have been paid in full. Except as otherwise provided in the
Agreement, the principal of the Class A-3 Certificates shall be distributable
on the Class A-3 Targeted Maturity Date which shall be March 25, 2002 (or if
such day is not a Business Day, on the next succeeding Business Day) and
thereafter, if applicable, monthly on each succeeding Certificate Payment
Date until the Adjusted Class A-3 Certificate Balance has been reduced to
zero. In any event, any remaining unpaid principal of any Class A-3
Certificate shall be due and payable on February 25, 2004 (or if such day is
not a Business Day, on the next succeeding Business Day).
On each Certificate Payment Date, the 1998-C Securitization Trustee
shall pay or cause to be paid to the Person in whose name this Class A-3
Certificate is registered at the close of business on the calendar day
immediately preceding such Certificate Payment Date or, if Definitive
Certificates have been issued, the last Business Day of the immediately
preceding calendar month (the "Record Date"), amounts distributable as
interest on the Class A-3 Certificates pursuant to the terms of the
Agreement, all to the extent and as more specifically set forth in the
Agreement. Payments of principal hereof may be made earlier under certain
circumstances (in connection with the exercise of the Transferor of its right
to purchase the 1998-C SUBI, described below, or the liquidation of the SUBI
following a Swap Termination) or later (depending on payment, delinquency
and loss experience). Distributions on this Class A-3 Certificate will be
made by the 1998-C Securitization Trustee by check mailed to the Class A-3
Certificateholder of record in the Certificate Register without the
presentation or surrender of this Class A-3 Certificate or the making of any
notation hereon except that with respect to Class A-3 Certificates registered
in the name of Cede & Co., the nominee for The Depository Trust Company,
distributions will be made by wire transfer of immediately available funds.
Except as otherwise provided in the Agreement and notwithstanding the
foregoing, the final distribution on this Class A-3 Certificate will be made
after due notice by the 1998-C Securitization Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A-3
Certificate at the Corporate Trust Office of the 1998-C Securitization
Trustee or at the offices of Bankers Trust Luxembourg S.A. (initially at ▇▇
▇▇▇▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇▇▇, ▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇).
It is the intention of the Transferor and the Investor
Certificateholders that the Investor Certificates will be indebtedness for
federal, state and local income and franchise tax purposes and for purposes
of any other tax imposed on or measured by income. The Transferor, the 1998-C
Securitization Trustee and the Holder of this Certificate (or Certificate
Owner) by acceptance of this Certificate (or, in the case of a Certificate
Owner, by virtue of such Certificate Owner's acquisition of a beneficial
interest herein) agree to treat the Investor Certificates (or beneficial
interest therein), for purposes of federal, state and local income or
franchise taxes and any other tax imposed on or measured by income, as
indebtedness of the Transferor and to report the transactions contemplated by
the Agreement on all applicable tax returns in a manner consistent with such
treatment. Each Holder of an Investor Certificate also agrees that it will
not be entitled to any of the tax benefits related to the 1998-C Contracts
and 1998-C Leased Vehicles, including any of the depreciation deductions
resulting therefrom.
A-3-3
In the event that, notwithstanding the statement of intentions and
undertakings set forth in Section 4.12(a) of the Agreement and herein, it is
finally determined that the Class A-3 Certificates do not evidence
indebtedness of the Transferor for all income and franchise tax purposes, but
rather represent an equity interest in the assets of the 1998-C
Securitization Trust, then the Holder is deemed to agree (and each
Certificate Owner hereof with respect hereto by virtue of acquiring a
beneficial interest herein is deemed to agree): (i) to treat such
Certificates, together with the Transferor Certificate, as representing an
interest in a partnership for all tax purposes, (ii) to treat all payments in
respect of such Certificates (to the extent not a return of capital) as a
"guaranteed payment" thereon made pursuant to Section 707(c) of the Code, and
(iii) to allocate all other items of income, gain, deduction, loss or credit
with respect to the assets and operations of the 1998-C Securitization Trust
to the Transferor.
The Certificates do not represent an obligation of, or an interest in,
the Transferor, the Servicer, the Titling Trust, the Titling Trustee, the
1998-C Securitization Trustee or any of their respective Affiliates. The
Certificates are limited in right of payment to certain collections and
recoveries respecting the 1998-C SUBI Assets evidenced by the 1998-C SUBI
Certificate and certain monies on deposit in the Reserve Fund and in certain
other accounts established for the benefit of the Certificateholders, in each
case to the extent and as more specifically set forth in the Agreement. By
accepting this Certificate, the Holder hereof (and each Certificate Owner
with respect hereto, by virtue of such Certificate Owner's acquisition of a
beneficial interest herein) waives any claim to any proceeds or assets of the
Titling Trustee and to all of the Titling Trust Assets other than those from
time to time included in the 1998-C SUBI Sub-Trust (except for those
evidenced by the 1998-C SUBI Insurance Certificate) and those proceeds or
assets derived from or earned by such 1998-C SUBI Assets (except for those
evidenced by the 1998-C SUBI Insurance Certificate and the proceeds
therefrom). A copy of the Agreement may be examined during normal business
hours at the Corporate Trust Office of the 1998-C Securitization Trustee, at
the offices of Bankers Trust Luxembourg S.A. (initially at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇▇▇, ▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇) and at such other places, if any, designated by
the 1998-C Securitization 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 Transferor and the 1998-C Securitization Trustee without
the consent of any Certificateholders. In certain limited circumstances, the
Agreement may only be amended with the consent of the Holders of Investor
Certificates evidencing not less than 51% of the aggregate Voting Interest of
all Investor Certificates, voting together as a single class. To be entitled
to vote in respect of an interest in the Class A-3 Certificates, a person
shall be a holder of record of such Class A-3 Certificates as shown on the
books of the Certificate Registrar on the last day of the preceding month, or
a person appointed by such holder by an instrument in writing. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and on all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
A-3-4
As provided in the Agreement and subject to certain limitations therein
set forth, Certificates are exchangeable for new Certificates of the same
Class, in authorized denominations of a like aggregate principal amount, as
requested by the Holder surrendering the same or for register of transfer in
the Certificate Register upon surrender of this Certificate for registration
of transfer at the Corporate Trust Office of the 1998-C Securitization
Trustee in its capacity as Certificate Registrar, or at the office of the
agent of the 1998-C Securitization Trustee in its capacity as Certificate
Registrar, who shall initially be U.S. Bank National Association, ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, in the Borough of Manhattan,
the City of New York, and with respect to the Definitive Certificates only, a
transfer agent appointed in Luxembourg, or at the appropriate office of any
successor Certificate Registrar, accompanied by a written instrument of
transfer in form satisfactory to the 1998-C Securitization 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-3
Certificates of authorized denominations and of a like aggregate fractional
undivided interest will be issued to the designated transferee. No service
charge will be made for any such registration of transfer or exchange, but
the 1998-C Securitization Trustee may require payment of a sum sufficient to
cover any tax or governmental charges payable in connection therewith.
The Class A-3 Certificates are issuable only as registered Certificates
without coupons in denominations of $1,000 and integral multiples thereof
(except for one Class A-3 Certificate in a smaller minimum denomination
representing any remaining portion of the Initial Class A-3 Certificate
Balance).
Prior to due presentation of this Certificate for registration of
transfer, the 1998-C Securitization Trustee, the Certificate Registrar and
any of their respective agents may treat the Person in whose name this Class
A-3 Certificate is registered as the owner hereof for the purpose of
receiving distributions and for all other purposes, and neither the 1998-C
Securitization Trustee, the Certificate Registrar nor any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and the
1998-C Securitization Trust created thereby shall terminate upon the payment
to Investor Certificateholders of all amounts required to be paid to them
pursuant to the Agreement and the disposition of all property held as part of
the 1998-C Securitization Trust. The Transferor may at its option purchase
the corpus of the 1998-C Securitization Trust at a price specified in the
Agreement, and such purchase of the 1998-C SUBI and 1998-C SUBI Certificate
and other property of the 1998-C Securitization Trust will effect early
retirement of the Certificates; PROVIDED, HOWEVER, such right of purchase is
exercisable only on the Monthly Allocation Date on or after the Class A-3
Targeted Maturity Date, if either before or after giving effect to any
payments of principal required to be made on such Monthly Allocation Date,
the Investor Balance shall be less than or equal to [$_________________] (ten
percent of the Aggregate Net Investment Value as of the Cutoff Date).
By accepting this Certificate, the Holder hereof (and each Certificate
Owner with respect hereto, by virtue of acquiring a beneficial interest
herein) covenants and agrees (and each
A-3-5
Certificate Owner is deemed to agree) that prior to the date which is one
year and one day after the last date upon which (a) each Class of Investor
Certificates has been paid in full, and (b) all obligations due under any
other Securitized Financing have been paid in full, the Holder and/or
Certificate Owner will not institute against, or join any other Person in
instituting against the Transferor, Toyota Motor Credit Corporation, the
1998-C Securitization Trustee, the 1998-C Securitization Trust, the Titling
Trustee or the Titling Trust any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceeding or other proceedings under any federal
or state bankruptcy or similar law. The foregoing shall not limit the
Holder's and/or any Certificate Owner's right to file any claim in or
otherwise take actions with respect to any such proceeding instituted by any
Person not under such a constraint. This noncompetition covenant shall
survive the termination of the Agreement.
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the 1998-C Securitization Trustee, by manual
signature, this Class A-3 Certificate shall not entitle the Holder hereof to
any benefit under the Agreement or be valid for any purpose.
A-3-6
IN WITNESS WHEREOF, the 1998-C Securitization Trustee on behalf of the
1998-C Securitization Trust and not in its individual capacity has caused
this Class A-3 Certificate to be duly executed.
Dated: [_______________], 1998
TOYOTA AUTO LEASE TRUST 1998-C
By: U.S. BANK NATIONAL ASSOCIATION, as
1998-C Securitization Trustee
By:____________________________________
Authorized Officer
Certificate of Authentication
This is one of the Class A-3 Certificates referred to in the
within-mentioned Agreement.
U.S. BANK NATIONAL ASSOCIATION, as
1998-C Securitization Trustee
By:_____________________________________
Authorized Officer
A-3-7
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 an "eligible guarantor institution" meeting the requirements
of the Certificate Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
A-3-8
EXHIBIT B
THIS CLASS B CERTIFICATE HAS NOT BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION
IN RELIANCE ON EXEMPTIONS PROVIDED BY THE SECURITIES ACT AND SUCH STATE OR
FOREIGN SECURITIES LAWS. THE CLASS B CERTIFICATES ARE ELIGIBLE FOR PURCHASE
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT. NO RESALE OR OTHER TRANSFER
OF THIS CERTIFICATE SHALL BE MADE UNLESS SUCH RESALE OR TRANSFER (A) IS MADE
IN ACCORDANCE WITH SECTION 4.03 OF THE AGREEMENT REFERRED TO HEREIN AND (B)
IS MADE (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, (ii) IN A TRANSACTION (OTHER THAN A TRANSACTION IN CLAUSE
(iv) BELOW) EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND APPLICABLE STATE AND FOREIGN SECURITIES LAWS, (iii) TO TOYOTA LEASING
INC. (THE "TRANSFEROR") OR (iv) TO A PERSON WHO THE TRANSFEROR OF THIS CLASS
B CERTIFICATE REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT THAT IS AWARE THAT THE
RESALE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OR TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" UNDER RULE 501(a)(1),(2),(3) OR (7) UNDER
THE SECURITIES ACT. IN THE EVENT THAT THE TRANSFER OF A CLASS B CERTIFICATE
IS TO BE MADE AS DESCRIBED IN CLAUSE (ii) OF THE PRECEDING SENTENCE, THE
PROSPECTIVE INVESTOR IS REQUIRED TO DELIVER AN OPINION OF COUNSEL IN FORM AND
SUBSTANCE SATISFACTORY TO THE 1998-C SECURITIZATION TRUSTEE AND THE
TRANSFEROR TO THE EFFECT THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE OR FOREIGN SECURITIES LAWS.
THE PROSPECTIVE TRANSFEREE IN A TRANSFER OF A CLASS B CERTIFICATE TO BE MADE
AS DESCRIBED IN CLAUSE (iv) ABOVE MUST DELIVER TO THE 1998-C SECURITIZATION
TRUSTEE A REPRESENTATION LETTER REQUIRED BY SECTION 4.03 OF THE AGREEMENT
REFERRED TO HEREIN. PROSPECTIVE PURCHASERS OF THE CLASS B CERTIFICATES ARE
HEREBY NOTIFIED THAT THE SELLER OF ANY CLASS B CERTIFICATES MAY BE RELYING ON
THE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SECTION 5 OF THE ACT
PROVIDED BY RULE 144A UNDER THE ACT.
THIS CLASS B CERTIFICATE OR A BENEFICIAL INTEREST HEREIN MAY NOT BE
TRANSFERRED UNLESS THE 1998-C SECURITIZATION TRUSTEE HAS RECEIVED (I) EITHER
(A) A CERTIFICATE FROM THE TRANSFEREE TO THE EFFECT THAT SUCH TRANSFEREE IS
NOT AN EMPLOYEE BENEFIT PLAN, TRUST OR ACCOUNT SUBJECT TO TITLE I OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR
SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE"), OR A GOVERNMENTAL PLAN DEFINED IN SECTION 3(32) OF ERISA SUBJECT TO
ANY FEDERAL STATE OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE
FOREGOING PROVISIONS OF
B-1
ERISA OR THE CODE ("SIMILAR LAW") (EACH, A "BENEFIT PLAN") AND IS NOT AN
ENTITY INCLUDING AN INSURANCE COMPANY SEPARATE ACCOUNT OR AN INSURANCE
COMPANY GENERAL ACCOUNT IF THE ASSETS IN ANY SUCH ACCOUNTS CONSTITUTE "PLAN
ASSETS" FOR PURPOSES OF REGULATION SECTION 2510.3-101 OF ERISA, WHOSE
UNDERLYING ASSETS INCLUDE BENEFIT PLAN ASSETS BY REASON OF A BENEFIT PLAN'S
INVESTMENT IN THE ENTITY (SUCH BENEFIT PLAN OR ENTITY, A "BENEFIT PLAN
INVESTOR") OR (B) AN OPINION OF COUNSEL SATISFACTORY TO THE 1998-C
SECURITIZATION TRUSTEE, THE TRANSFEROR AND THE SERVICER TO THE EFFECT THAT
THE PURCHASE OR HOLDING OF SUCH CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN
THE ASSETS OF THE 1998-C SECURITIZATION TRUST BEING DEEMED TO BE "PLAN
ASSETS" SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
PROHIBITED TRANSACTIONS PROVISIONS OF SECTION 4975 OF THE CODE OR SIMILAR
LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE
MEANING OF SECTION 406 OR SECTION 407 OF ERISA OR SECTION 4975 OF THE CODE OR
SIMILAR LAW, AND WILL NOT SUBJECT THE TRUSTEE, THE TRANSFEROR OR THE SERVICER
TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER
ERISA, SECTION 4975 OF THE CODE OF SIMILAR LAW) IN ADDITION TO THOSE
UNDERTAKEN IN THE AGREEMENT AND (II) A CERTIFICATE TO THE EFFECT THAT IF THE
TRANSFEREE IS A PARTNERSHIP, GRANTOR TRUST OR S CORPORATION FOR FEDERAL
INCOME TAX PURPOSES (A "FLOW-THROUGH ENTITY"), ANY CLASS B CERTIFICATES OWNED
BY SUCH FLOW-THROUGH ENTITY WILL REPRESENT LESS THAN 50% OF THE VALUE OF ALL
THE ASSETS OWNED BY SUCH FLOW-THROUGH ENTITY AND NO SPECIAL ALLOCATION OF
INCOME, GAIN, LOSS, DEDUCTION OR CREDIT FROM SUCH CLASS B CERTIFICATES WILL
BE MADE AMONG THE BENEFICIAL OWNERS OF SUCH FLOW-THROUGH ENTITY.
IN ADDITION, NO RESALE OR OTHER TRANSFER OF THIS CLASS B CERTIFICATE OR
ANY INTEREST THEREIN SHALL BE PERMITTED UNLESS IMMEDIATELY AFTER GIVING
EFFECT TO SUCH RESALE OR OTHER TRANSFER, THERE WOULD BE FEWER THAN 100 CLASS
B CERTIFICATEHOLDERS.
THIS CLASS B CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE
CLASS A CERTIFICATES TO THE EXTENT DESCRIBED IN THE AGREEMENT REFERRED TO
BELOW.
B-2
TOYOTA AUTO LEASE TRUST 1998-C
ADJUSTABLE RATE AUTO LEASE ASSET BACKED CERTIFICATE, CLASS B
Evidencing a percentage interest in the distributions allocable to the
Investor Certificates, as defined below.
This Certificate does not represent an obligation of, or an interest in,
Toyota Leasing, Inc., Toyota Motor Credit Corporation, the Titling Trustee
or the 1998-C Securitization Trustee or any of their respective affiliates.
Initial Class B Certificate Balance: CUSIP #_______________
$48,700,000
Number B-1 Denomination: $_____________
THIS CERTIFIES THAT [_________] is the registered owner of _____________
($____________) nonassessable, fully-paid, fractional undivided interest in
the Toyota Auto Lease Trust 1998-C (the "1998-C Securitization Trust") formed
by Toyota Leasing, Inc., a California corporation, as Transferor (the
"Transferor"). The 1998-C Securitization Trust was created pursuant to a
1998-C Securitization Trust Agreement dated as of December 1, 1998 (the
"Agreement"), between the Transferor and U.S. Bank National Association, a
national banking association, as trustee (the "1998-C Securitization
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 Lease Trust 1998-C Adjustable
Rate Auto Lease Asset Backed Certificates, Class B" (the "Class B
Certificates"). Also issued under the Agreement are Certificates designated
as "Toyota Auto Lease Trust 1998-C Adjustable Rate Auto Lease Asset Backed
Certificates, Class A-1" (the "Class A-1 Certificates"), Certificates
designated as "Toyota Auto Lease Trust 1998-C Adjustable Rate Auto Lease
Asset Backed Certificates, Class A-2" (the "Class A-2 Certificates"),
Certificates designated as "Toyota Auto Lease Trust 1998-C Adjustable Rate
Auto Lease Asset Backed Certificates, Class A-3" (the "Class A-3
Certificates" and, together with the Class A-1 Certificates and the Class A-2
Certificates, the "Class A Certificates" and, together with the Class B
Certificates, the "Investor Certificates") and a Certificate evidencing the
Transferor Interest (the "Transferor Certificate" and, together with the
Investor Certificates, the "Certificates"). The Class B Certificates are
subordinated to the Class A Certificates, and the Transferor Certificate is
subordinated to the Investor Certificates, to the extent described in the
Agreement. 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.
B-1
The property of the 1998-C Securitization Trust includes, among
other things, the 1998-C SUBI Certificate evidencing beneficial interests in
the assets of the 1998-C SUBI other than the proceeds of the Residual Value
Insurance Policies. The 1998-C SUBI represents a beneficial interest in a
pool of retail automobile and light duty truck lease contracts ("Contracts")
and the new and used automobiles and light duty trucks leased thereby
("Leased Vehicles") (such pool of Contracts and Leased Vehicles, the "1998-C
SUBI Portfolio") entered into by various automobile and light duty truck
dealers pursuant to contractual arrangements with the Titling Trust. Toyota
Motor Credit Corporation acts as servicer (in that capacity, the "Servicer")
of the 1998-C SUBI Portfolio. During the Revolving Period, Principal
Collections and amounts applied to reimburse Loss Amounts and Certificate
Principal Loss Amounts allocable to the assets of the 1998-C SUBI represented
by the 1998-C SUBI Certificate generally will be reinvested in Subsequent
Contracts and Subsequent Leased Vehicles from among other unallocated
Contracts and Leased Vehicles owned by the Titling Trust. At the time of
reinvestment, such Subsequent Contracts and Subsequent Leased Vehicles will
be allocated to the 1998-C SUBI. Following the Revolving Period, Principal
Collections allocable to the assets of the 1998-C SUBI will be deposited in
the Certificateholders' Account and invested in Permitted Investments (which
are expected to be TMCC Demand Notes) maturing prior to the relevant Targeted
Maturity Date.
Payments in respect of the 1998-C SUBI Certificate will be allocated
between the Investor Certificates and the Transferor Certificate and paid to
the registered Holder of this Certificate as provided in the Agreement.
Except as otherwise provided in the Agreement, interest payments in
respect of this Certificate shall be made quarterly on the 25th day of March,
June, September and December (or if such day is not a Business Day, the next
succeeding Business Day, each such day a "Certificate Payment Date"),
commencing on March 25, 1999, and through the Class B Targeted Maturity Date
and thereafter, if applicable, monthly on each succeeding Certificate Payment
Date until the Adjusted Class B Certificate Balance has been reduced to zero.
Except to the extent provided otherwise in the Agreement, no principal
payments shall be made in respect of the Class A-2 Certificates until the
Class A-1 Certificates have been paid in full, and no principal payments
shall be made in respect of the Class A-3 Certificates until the Class A-2
Certificates have been paid in full and no principal payments shall be made
in respect of the Class B Certificates until the Class A-3 Certificates have
been paid in full. Except as otherwise provided in the Agreement, the
principal of the Class B Certificates shall be distributable on the Class B
Targeted Maturity Date which shall be December 25, 2003 (or if such day is
not a Business Day, on the next succeeding Business Day) and thereafter, if
applicable, monthly on each succeeding Certificate Payment Date until the
Adjusted Class B Certificate Balance has been reduced to zero. In any event,
any remaining unpaid principal of any Class B Certificate shall be due and
payable on May 25, 2006 (or if such day is not a Business Day, on the next
succeeding Business Day).
Distributions on this Class B Certificate will be made by the 1998-C
Securitization Trustee by check mailed to the 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 or, at the
option of a Holder who owns Class B Certificates having an aggregate initial
denomination of $250,000 or more, upon written instructions received by the
1998-C Securitization Trustee not later
B-2
than fifteen days prior to the related Record Date, by wire transfer of
immediately available funds to an account maintained by such Holder at a
depository institution in the United States having appropriate facilities
therefor. Except as otherwise provided in the Agreement and notwithstanding
the foregoing, the final distribution on this Class B Certificate will be
made after due notice by the 1998-C Securitization Trustee of the pendency of
such distribution and only upon presentation and surrender of this Class B
Certificate at the Corporate Trust Office of the 1998-C Securitization
Trustee.
It is the intention of the Transferor and the Investor
Certificateholders that the Investor Certificates will be indebtedness for
federal, state and local income and franchise tax purposes and for purposes
of any other tax imposed on or measured by income. The Transferor, the 1998-C
Securitization Trustee and the Holder of this Certificate (or Certificate
Owner) by acceptance of this Certificate (or, in the case of a Certificate
Owner, by virtue of such Certificate Owner's acquisition of a beneficial
interest herein) agree to treat the Investor Certificates (or beneficial
interests therein), for purposes of federal, state and local income or
franchise taxes and any other tax imposed on or measured by income, as
indebtedness of the Transferor and to report the transactions contemplated by
the Agreement on all applicable tax returns in a manner consistent with such
treatment. Each Holder of an Investor Certificate also agrees that it will
not be entitled to any of the tax benefits related to the 1998-C Contracts
and 1998-C Leased Vehicles, including any of the depreciation deductions
resulting therefrom.
In the event that, notwithstanding the statement of intentions and
undertakings set forth in Section 4.12(a) of the Agreement and herein, it is
finally determined that the Class B Certificates do not evidence indebtedness
of the Transferor for all income and franchise tax purposes, but rather
represent an equity interest in the assets of the 1998-C Securitization
Trust, then the Holder is deemed to agree (and each Certificate Owner by
virtue of acquiring a beneficial interest herein is deemed to agree) (i) to
treat such Certificates, together with the Transferor Certificate, as
representing an interest in a partnership for all tax purposes, (ii) to treat
all payments in respect of such Certificates (to the extent not a return of
capital) as a "guaranteed payment" thereon made pursuant to Section 707(c) of
the Code, and (iii) to allocate all other items of income, gain, deduction,
loss or credit with respect to the assets and operations of the 1998-C
Securitization Trust to the Transferor.
The Certificates do not represent an obligation of, or an interest in,
the Transferor, the Servicer, the Titling Trust, the Titling Trustee, the
1998-C Securitization Trustee or any of their respective Affiliates. The
Certificates are limited in right of payment to certain collections and
recoveries respecting the 1998-C SUBI Assets evidenced by the 1998-C SUBI
Certificate and certain monies on deposit in the Reserve Fund and in certain
other accounts established for the benefit of the Certificateholders, in each
case to the extent and as more specifically set forth in the Agreement. By
accepting this Certificate, the Holder hereof (and each Certificate Owner
with respect hereto, by virtue of such Certificate Owner's acquisition of a
beneficial interest herein) waives any claim to any proceeds or assets of the
Titling Trustee and to all of the Titling Trust Assets other than those from
time to time included in the 1998-C SUBI Sub-Trust (except for those
evidenced by the 1998-C SUBI Insurance Certificate) and those proceeds or
assets derived from or earned by such 1998-C SUBI Assets (except for those
evidenced by the 1998-C SUBI Insurance
B-3
Certificate and the proceeds therefrom). A copy of the Agreement may be
examined during normal business hours at the Corporate Trust Office of the
1998-C Securitization Trustee at the offices of Bankers Trust Company
Luxembourg S.A. in Luxembourg (initially at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇▇▇,
▇-▇▇▇ ▇▇▇▇▇▇▇▇▇▇) and at such other places, if any, designated by the 1998-C
Securitization 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 Transferor and the 1998-C Securitization Trustee without
the consent of any Certificateholders. In certain limited circumstances, the
Agreement may only be amended with the consent of the Holders of Investor
Certificates evidencing not less than 51% of the aggregate Voting Interest of
all Investor Certificates, voting together as a single class. To be entitled
to vote in respect of an interest in the Class B Certificates, a person shall
be a holder of record of such Class B Certificates as shown on the books of
the Certificate Registrar on the last day of the preceding month, or a person
appointed by an instrument in writing. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and on all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Certificate.
As provided in the Agreement and subject to certain limitations therein set
forth, Certificates are exchangeable for new Certificates of the same Class,
in authorized denominations of a like aggregate principal amount, as
requested by the Holder surrendering the same or for register of transfer at
the Corporate Trust Office of the 1998-C Securitization Trustee in its
capacity as Certificate Registrar, or at the office of the agent of the
1998-C Securitization Trustee in its capacity as Certificate Registrar, who
shall initially be U.S. Bank National Association, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at the appropriate office of any
successor Certificate Registrar, accompanied by a written instrument of
transfer in form satisfactory to the 1998-C Securitization 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 and of a like aggregate fractional
undivided interest will be issued to the designated transferee.
The Class B Certificates are issuable only as registered Certificates
without coupons in denominations of $500,000 and integral multiples of $1,000
in excess thereof, (except for one Class B Certificate in a smaller minimum
denomination representing any remaining portion of the Initial Class B
Certificate Balance). As provided in the Agreement, and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class, of authorized denominations of a like
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 1998-C Securitization 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 Certificate for registration of
transfer, the 1998-C Securitization Trustee, the Certificate Registrar and
any of their respective agents may treat the
B-4
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 1998-C Securitization 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
1998-C Securitization Trust created thereby shall terminate upon the payment
to Investor Certificateholders of all amounts required to be paid to them
pursuant to the Agreement and the disposition of all property held as part of
the 1998-C Securitization Trust. The Transferor may at its option purchase
the corpus of the 1998-C Securitization Trust at a price specified in the
Agreement, and such purchase of the 1998-C SUBI and 1998-C SUBI Certificate
and other property of the 1998-C Securitization Trust will effect early
retirement of the Certificates; PROVIDED, HOWEVER, such right of purchase is
exercisable only on the Monthly Allocation Date on or after the Class A-3
Targeted Maturity Date, if either before or after giving effect to any
payments of principal required to be made on such Monthly Allocation Date,
the Investor Balance shall be less than or equal to [$_________________] (ten
percent of the Aggregate Net Investment Value as of the Cutoff Date).
By accepting this Certificate, the Holder hereof covenants and agrees
(and each Certificate Owner is deemed to agree) that prior to the date which
is one year and one day after the last date upon which (a) each Class of
Investor Certificates has been paid in full, and (b) all obligations due
under any other Securitized Financing have been paid in full, the Holder (or
Certificate Owner) will not institute against, or join any other Person in
instituting against the Transferor, Toyota Motor Credit Corporation, the
1998-C Securitization Trustee, the 1998-C Securitization Trust, the Titling
Trustee or the Titling Trust any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceeding or other proceedings under any federal
or state bankruptcy or similar law. The foregoing shall not limit the
Holder's (or any Certificate Owner's) right to file any claim in or otherwise
take actions with respect to any such proceeding instituted by any Person not
under such a constraint. This non-petition covenant shall survive the
termination of the Agreement.
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the 1998-C Securitization 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.
B-5
IN WITNESS WHEREOF, the 1998-C Securitization Trustee on behalf of the
1998-C Securitization Trust and not in its individual capacity has caused
this Class B Certificate to be duly executed.
Dated: ______________, 1998
TOYOTA AUTO LEASE TRUST 1998-C
By: U.S. BANK NATIONAL ASSOCIATION, AS 1998-C
SECURITIZATION TRUSTEE
By:_________________________________________
Authorized Officer
B-6
Certificate of Authentication
This is one of the Class B Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION, as
1998-C Securitization Trustee
By:______________________________________________
B-7
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 an "eligible guarantor institution" meeting the requirements
of the Certificate Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.
B-8
EXHIBIT C
TRANSFEROR CERTIFICATE
THIS CERTIFICATE IS NOT TRANSFERABLE.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR THE APPLICABLE SECURITIES LAWS OF ANY STATE AND
MAY NOT BE RESOLD OR TRANSFERRED.
TOYOTA AUTO LEASE TRUST 1998-C
AUTO LEASE ASSET BACKED TRANSFEROR CERTIFICATE
Evidencing the entire interest in the distributions allocable to
the Transferor Certificate, as defined below.
This Certificate does not represent an obligation of, or an
interest in, Toyota Leasing, Inc., Toyota Motor Credit Corporation,
the Titling Trustee, the 1998-C Securitization Trustee, or any of
their respective affiliates.
THIS CERTIFIES THAT TOYOTA LEASING, INC. (the "Transferor") is the
registered owner of the entire interest not allocated to the Investor
Certificates in the Toyota Auto Lease Trust 1998-C (the "1998-C
Securitization Trust") formed by the Transferor. The 1998-C Securitization
Trust was created pursuant to a 1998-C Securitization Trust Agreement dated
as of December 1, 1998 (the "Agreement"), between the Transferor and U.S.
Bank National Association, a national banking corporation, as trustee (the
"1998-C Securitization 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 the duly authorized Transferor Certificate issued
under the Agreement and designated as the "Toyota Auto Lease Trust 1998-C
Auto Lease Asset Backed Transferor Certificate" (the "Transferor
Certificate"). Also issued under the Agreement are Certificates designated
as "Toyota Auto Lease Trust 1998-C Adjustable Rate Auto Lease Asset Backed
Certificates, Class A-1" (the "Class A-1 Certificates"), Certificates
designated as "Toyota Auto Lease Trust 1998-C Adjustable Rate Auto Lease
Asset Backed Certificates, Class A-2" (the "Class A-2 Certificates"),
Certificates designated as "Toyota Auto Lease Trust 1998-C Adjustable Rate
Auto Lease Asset Backed Certificates, Class A-3" (the "Class A-3
Certificates" and, together with the Class A-1 Certificates and the Class A-2
Certificates, the "Class A Certificates") and Certificates designated as
"Toyota Auto Lease Trust 1998-C Adjustable Rate Auto Lease Asset Backed
Certificates, Class B" (the "Class B Certificates" and, together with the
Class A Certificates, the "Investor Certificates" and, together with the
Transferor Certificate, the "Certificates"). This Transferor Certificate is
issued under and is subject to the terms, provisions
C-1
and conditions of the Agreement, to which Agreement the Holder of this
Transferor Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
The property of the 1998-C Securitization Trust includes, among other
things, the 1998-C SUBI Certificate evidencing beneficial interests in the
assets of the 1998-C SUBI other than the proceeds of the Residual Value
Insurance Policies. The 1998-C SUBI represents a beneficial interest in a
pool of retail automobile and light duty truck lease contracts ("Contracts")
and the new and used automobiles and light duty trucks leased thereby
("Leased Vehicles") (such pool of Contracts and Leased Vehicles, the "1998-C
SUBI Portfolio") entered into by various automobile and light duty truck
dealers pursuant to contractual arrangements with the Titling Trust. Toyota
Motor Credit Corporation acts as servicer (in that capacity, the "Servicer")
of the 1998-C SUBI Portfolio. During the Revolving Period, Principal
Collections and amounts applied to reimburse Loss Amounts and Certificate
Principal Loss Amounts allocable to the assets of the 1998-C SUBI represented
by the 1998-C SUBI Certificate generally will be reinvested in Subsequent
Contracts and Subsequent Leased Vehicles from among other unallocated
Contracts and Leased Vehicles owned by the Titling Trust. At the time of
reinvestment, such Subsequent Contracts and Subsequent Leased Vehicles will
be allocated to the 1998-C SUBI. Following the Revolving Period, Principal
Collections allocable to the assets of the 1998-C SUBI will be deposited in
the Certificateholders' Account and invested in Permitted Investments (which
are expected to be TMCC Demand Notes) maturing prior to the Targeted Maturity
Date.
Payments in respect of the 1998-C SUBI Certificate will be allocated
between the Investor Certificates and this Transferor Certificate and paid to
the registered Holder of this Transferor Certificate as provided in the
Agreement.
It is the intention of the Transferor and the Investor
Certificateholders that the Investor Certificates will be indebtedness of the
Transferor for federal, state and local income and franchise tax purposes and
for purposes of any other tax imposed on or measured by income. The
Transferor, the 1998-C Securitization Trustee and the Holder of this
Certificate by acceptance of this Certificate agree to treat the Investor
Certificates (or beneficial interests therein), for purposes of federal,
state and local income or franchise taxes and any other tax imposed on or
measured by income, as secured indebtedness of the Transferor and to report
the transactions contemplated by the Agreement on all applicable tax returns
in a manner consistent with such treatment.
In the event that, notwithstanding the statement of intentions and
undertakings set forth in Section 4.12(a) of the Agreement and herein, it is
finally determined that the Certificates do not evidence indebtedness of the
Transferor for all income and franchise tax purposes, but rather represent an
equity interest in the assets of the 1998-C Securitization Trust, then the
Holder hereof, agrees (i) to treat such Certificate, together with the
Investor Certificates, as representing an interest in a partnership for all
tax purposes, (ii) to treat all payments in respect of such Certificates (to
the extent not a return of capital) as a "guaranteed payment" thereon made
pursuant to Section 707(c) of the Code, and (iii) to allocate all other items
of income, gain, deduction, loss or credit with respect to the assets and
operations of the 1998-C Securitization Trust to the Transferor.
C-2
The Certificates do not represent an obligation of, or an interest in,
the Transferor, the Servicer, the Titling Trust, the Titling Trustee, the
1998-C Securitization Trustee or any of their respective affiliates. The
Certificates are limited in right of payment to certain collections and
recoveries respecting the 1998-C SUBI and 1998-C SUBI Certificate and certain
monies on deposit in the Reserve Fund and in certain other accounts
established for the benefit of the Certificateholders, in each case to the
extent and as more specifically set forth in the Agreement. By accepting
this Certificate, the Holder hereof (and each Certificate Owner with respect
hereto, by virtue of such Certificate Owner's acquisition of a beneficial
interest herein) waives any claim to any proceeds or assets of the Titling
Trustee and to all of the Titling Trust Assets other than those from time to
time included in the 1998-C SUBI Sub-Trust (except for those evidenced by the
1998-C SUBI Insurance Certificate) and those proceeds or assets derived from
or earned by such 1998-C SUBI Assets (except for those evidenced by the
1998-C SUBI Insurance Certificate and the proceeds therefrom). A copy of the
Agreement may be examined during normal business hours at the Corporate Trust
Office of the 1998-C Securitization Trustee, and at such other places, if
any, designated by the 1998-C Securitization 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 Transferor and the 1998-C Securitization Trustee without
the consent of any Certificateholders. In certain limited circumstances, the
Agreement may only be amended with the consent of the Investor
Certificatesholders evidencing not less than 51% of the aggregate Voting
Interest of all Investor Certificates, voting together as a single class.
As provided in the Agreement, this Certificate shall be owned by the
Transferor and may not be transferred.
The obligations and responsibilities created by the Agreement and the
1998-C Securitization Trust created thereby shall terminate upon the payment
to Investor Certificateholders of all amounts required to be paid to them
pursuant to the Agreement and the disposition of all property held as part of
the 1998-C Securitization Trust. The Transferor may at its option purchase
the corpus of the 1998-C Securitization Trust at a price specified in the
Agreement, and such purchase of the 1998-C SUBI and 1998-C SUBI Certificate
and other property of the 1998-C Securitization Trust will effect early
retirement of the Certificates; provided, however, such right of purchase is
exercisable only on the Monthly Allocation Date on or after the Class A-3
Targeted Maturity Date, if either before or after giving effect to any
payment required to be made on such Monthly Allocation Date, the Certificate
Balance shall be less than or equal to [$_________________] (ten percent of
the Aggregate Net Investment Value as of the Cutoff Date).
Unless the certificate of authentication hereon shall have been executed
by an authorized officer of the 1998-C Securitization Trustee, by manual
signature, this Transferor Certificate shall not entitle the Holder hereof to
any benefit under the Agreement or be valid for any purpose.
C-3
IN WITNESS WHEREOF, the 1998-C Securitization Trustee on behalf of the
1998-C Securitization Trust and not in its individual capacity has caused
this Transferor Certificate to be duly executed.
Dated: [_______________], 1998
TOYOTA AUTO LEASE TRUST 1998-C
By: U.S. BANK NATIONAL ASSOCIATION,
as 1998-C Securitization Trustee
__________________________________________
Authorized Officer
Certificate of Authentication
This is the Transferor Certificate referred to in the
within-mentioned Agreement.
By: U.S. BANK NATIONAL ASSOCIATION,
as 1998-C Securitization Trustee
__________________________________________
Authorized Officer
C-4
Certificate of Authentication
This is the Transferor Certificate referred to in the within-mentioned
Agreement.
U.S. Bank National Association, as
1998-C Securitization Trustee
By:
--------------------------------------------
EXHIBIT D
FORM OF RULE 144A TRANSFEREE CERTIFICATE
Toyota Motor Credit Corporation
Toyota Leasing, Inc.,
c/o Toyota Motor Credit Corporation
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[ ]
Re: Toyota Auto Lease Trust 1998-C; ____% Auto
LEASE ASSET BACKED CERTIFICATES CLASS B
Ladies and Gentlemen:
___________ (the "Purchaser") is today purchasing in a private resale
from ___________, (the "Seller") $_____ aggregate principal amount of Auto Lease
Asset-Backed Certificates, Class B (the "Certificates"), issued pursuant to a
securitization trust agreement, dated as of [ ] (the
"Agreement") between Toyota Leasing, Inc. ("TLI") and [ ]
(the "[ ]"), as trustee (the "Trustee"). The Certificates are securities
issued by and evidencing interests in the assets of Toyota Auto Lease Trust
1998-C (the "Trust").
In connection with the purchase of the Certificates, the Purchaser
hereby represents and warrants to each of you as follows:
1. The Purchaser understands that the Certificates have not been
registered under the Securities Act of 1933, as amended (the "Securities Act")
or the securities law of any state or foreign jurisdiction.
2. The Purchaser is acquiring the Certificates for its own
account only for investment and not for any other person, and not with a view
to, or for resale in connection with, a distribution that would constitute a
violation of the Securities Act or any state or foreign securities laws
(subject to the understanding that disposition of the Purchaser's property
will at all times be and remain
D-1
within its control). The Purchaser is not an affiliate of TLI, the Trustee or
any of their respective affiliates.
3. The Purchaser agrees that the Certificates must be held
indefinitely by it unless (i) the Certificates are subsequently registered
under the Securities Act or (ii) an exemption from the registration
requirements of the Securities Act is available.
4. The Purchaser agrees that if at some time it wishes to dispose
of or exchange any of the Certificates, it will not transfer or exchange any
of the Certificates unless such transfer or exchange is in accordance with
the provisions of Section 4.03 of the Agreement.
5. The Purchaser is a qualified institutional buyer as defined in
Rule 144A of the Securities Act and has completed one of the forms of
certification to that effect attached as Annexes hereto, it is aware that the
sale to it is being made in reliance on Rule 144A, it is acquiring the
Certificates for its own account or for the account of a qualified
institutional buyer and it understands that such Certificates may be resold,
pledged or transferred by the Purchaser only (i) to a person who the
Purchaser reasonably believes is a qualified institutional buyer that
purchases for its own account or for the account of a qualified institutional
buyer to whom notice is given that the resale, pledge or transfer is being
made in reliance on Rule 144A or (ii) pursuant to another exemption from
registration under the Securities Act and applicable state and foreign
securities laws.
6. Neither the Purchaser nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of any Certificate,
any interest in any Certificate or any other similar security of the
Transferor to, or solicited any offer to buy or accept a transfer, pledge or
other disposition of any Certificate, any interest in any Certificate or any
other similar security of TLI or the Trust with, any person in any manner, or
made any general solicitation by means of general advertising or in any other
manner, or taken any other action, which would constitute a distribution of
the Certificates under the Securities Act or which would render the
disposition of any Certificate a violation of Section 5 of the Securities Act
or any state securities law, require registration or qualification pursuant
thereto, or require registration of the Trust or TLI as an "investment
company" under the Investment Company Act of 1940, as amended, nor will it
act, nor has it authorized or will it authorize any person to act in such
manner with respect to the Certificates.
D-2
7. The Purchaser understands that there is no market, nor is
there any assurance that a market will develop, for the Certificates and that
TLI and the Trust have no obligation to make or facilitate any such market
(or to otherwise repurchase the Certificates from the Purchaser) under any
circumstances.
8. The Purchaser has consulted with its own legal counsel,
independent accountants and financial advisors to the extent it deems
necessary regarding the tax consequences to it of ownership of the
Certificates, is aware that its taxable income with respect to the
Certificates in any accounting period may not correspond to the cash flow (if
any) from the Certificates for such period, and is not purchasing the
Certificates in reliance on any representations of TLI or its counsel with
respect to tax matters.
9. The Purchaser has reviewed the Private Placement Memorandum
with respect to the Certificates dated [ ], including the
Prospectus attached thereto as Exhibit A (the "Private Placement
Memorandum"), and the agreements and other materials referred to therein, and
has had the opportunity to ask questions and receive answers concerning the
terms and conditions of the transaction contemplated by the Private Placement
Memorandum and to obtain additional information necessary to verify the
accuracy and completeness of any information furnished to the Purchaser or to
which the Purchaser had access.
10. The Purchaser understands that the Certificates will bear
legends substantially as set forth in the form of Certificate included as
Exhibit B to the Agreement.
11. The Purchaser hereby further agrees to be bound by all the
terms and conditions of the Certificates as provided in the Agreement.
12. The Purchaser selects one of the following:
__________ (a) the Purchaser is not an employee benefit plan, trust or
account subject to Title I of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or subject to Section 4975 of the Internal Revenue
Code of 1986, as amended (the "Code"), or a governmental plan defined in Section
3(32) of ERISA subject to any federal state or local law which is, to a material
extent, similar to the foregoing provisions of ERISA or the Code ("Similar Law")
(each, a "Benefit Plan") and is not an entity, including an insurance company
separate account or an insurance company general account if the assets in any
such accounts constitute "Plan Assets" for
D-3
purposes of regulation Section 2510.3-101 of ERISA, whose underlying assets
include Benefit Plan assets by reason of a Benefit Plan's investment in the
entity; or
(b) the Purchaser is delivering herewith an Opinion of Counsel
addressed to the Trustee, the Seller and the Servicer to the effect that the
purchase or holding of such Certificate will not constitute or result in the
assets of the trust being deemed to be "Plan Assets" subject to the fiduciary
responsibility provisions of ERISA or prohibited transactions provisions of
Section 4975 of the Code or Similar Law, will not constitute or result in a
prohibited transaction within the meaning of Section 406 or Section 407 of ERISA
or Section 4975 of the Code or Similar Law, and will not subject the Trustee,
the Seller or the Servicer to any obligation or liability (including obligations
or liabilities under ERISA, Section 4975 of the Code or Similar Law) in addition
to those undertaken in the Agreement.
13. If the Purchaser is a partnership, grantor trust or S
corporation for federal income tax purposes (a "Flow-Through Entity"), any
Certificates owned by such Flow-Through Entity will represent less than 50%
of the value of all the assets owned by such Flow-Through Entity and no
special allocation of income, gain, loss, deduction or credit from such
Certificates will be made among the beneficial owners of such Flow-Through
Entity.
14. If the Purchaser sells any of the Certificates, the Purchaser
will obtain from any subsequent purchaser of the Certificates the same
representations contained in this Representation Letter.
Capitalized terms used herein that are not otherwise defined shall
have the meanings ascribed thereto in the Agreement or the Private Placement
Memorandum, as the case may be.
D-4
The representations and warranties contained herein shall be binding
upon the heirs, executors, administrators and other successors of the
undersigned. If there is more than one signatory hereto, the obligations,
representations, warranties and agreements of the undersigned are made
jointly and severally.
Executed at ___________, this ___ day of _______
199__
--------------------------------
Purchaser's Name (Print)
By
------------------------------
Signature
Its
-----------------------------
--------------------------------
Address of Purchaser
--------------------------------
Purchaser's Taxpayer
Identification Number
D-5
APPENDIX 1 TO EXHIBIT D
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
(Buyers other than Registered Investment Companies)
Toyota Motor Credit Corporation
Toyota Leasing, Inc.,
c/o Toyota Motor Credit Corporation
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[ ]
Re: Toyota Auto Lease Trust 1998-C; % Auto
LEASE ASSET BACKED CERTIFICATES, CLASS B
Name of Buyer: ______________________________ ("Buyer")
Ladies and Gentlemen:
I hereby certify that, as indicated below, I am the President, Chief
Executive/Financial Officer, Senior Vice President or other executive officer of
the Buyer.
In connection with purchases by Buyer from time to time, I hereby
certify to you and, if you act as broker for one or more customers, to such
customers, that Buyer is a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act of 1933, as amended ("Rule
144A") because (i) the Buyer owned and/or invested on a discretionary basis
$______(1) in securities (except for the excluded securities referred to
below) as of the end of Buyer's most recent fiscal year (such amount being
calculated in accordance with Rule 144A) and (ii) Buyer satisfies the
criteria in the category marked below.
------------------------
(1) Buyer must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Buyer is a dealer, and, in that case,
Buyer must own and/or invest on a discretionary basis at least
$10,000,000 in securities.
D-6
_______ CORPORATION. ETC. Buyer is a corporation (other than a
bank, savings and loan association or similar
institution), Massachusetts or similar business trust,
partnership, or charitable organization described in
Section 501(c)(3) of the Internal Revenue Code of 1986,
as amended.
_______ BANK. Buyer (a) is a national bank or banking
institution organized under the laws of any State,
territory or the District of Columbia, the business of
which is substantially confined to banking and is
supervised by the State or territorial banking commission
or similar official or is a foreign bank or equivalent
institution, and (b) has an audited net worth of at least
$25,000,000 as demonstrated in its latest annual
financial statements.
_______ SAVINGS AND LOAN. Buyer (a) is a savings and loan
association, building and loan association, cooperative
bank, homestead association or similar institution, which
is supervised and examined by a State or Federal
authority having supervision over any such institutions
or is a foreign savings and loan association or
equivalent institution and (b) has an audited net worth
of at least $25,000,000 as demonstrated in its latest
annual financial statements.
_______ BROKER-DEALER. Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934, as
amended (the "1934 Act").
_______ INSURANCE COMPANY. Buyer is an insurance company whose
primary and predominant business activity is the writing
of insurance or the reinsuring of risks underwritten by
insurance companies and which is subject to supervision
by the insurance commissioner or a similar official or
agency of a State, territory or the District of Columbia
_______ STATE OR LOCAL PLAN. Buyer is a plan established and
maintained by a State, its political subdivisions, or any
agency or instrumentality of the State or its political
subdivisions, for the benefit of its employees.
_______ ERISA PLAN. Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income
Security Act of 1974.
D-7
_______ INVESTMENT ADVISOR. Buyer is an investment advisor
registered under the Investment Advisors Act of 1940.
The term "SECURITIES" as used herein does not include (i) securities
of issuers that are affiliated with Buyer, (ii) securities that are part of
an unsold allotment to or subscription by the Purchaser, if Buyer is a
dealer, (iii) bank deposit notes and certificates of deposit, (iv) loan
participations, (v) repurchase agreements, (vi) securities owned but subject
to a repurchase agreement and (vii) currency, interest rate and commodity
swaps.
For purposes of determining the aggregate of securities owned and/or
invested on a discretionary basis by Buyer, Buyer used the cost of such
securities to Buyer and did not include any of the securities referred to in
the preceding paragraph.
Further, in determining such aggregate amount, Buyer may have included
securities owned by subsidiaries of Buyer, but only if such subsidiaries are
consolidated with Buyer in its financial statements prepared in accordance
with generally accepted accounting principles and if the investments of such
subsidiaries are managed under Buyer's direction. However, such securities
were not included if Buyer is a majority owned, consolidated subsidiary of
another enterprise and Buyer is not itself a reporting company under the 1934
Act.
Buyer acknowledges that it is familiar with Rule 144A and understands
that you and your customers (if you act as a broker for one or more
customers) are and will continue to rely on the statements made herein
because one or more sales by you for your own account or your customer's
account to Buyer may be in reliance on Rule 144A.
Will Buyer be purchasing Rule 144A securities only for Buyer's own
account?
--- ---
Yes No
If the answer to this question is "no", Buyer agrees that, in
connection with any purchase of securities sold to Buyer for the account of a
third party (including any separate account) in reliance on Rule 144A, Buyer
will only repurchase for the account of a third party that at the time is a
"qualified institutional buyer" within the meaning of Rule 144A. In addition,
Buyer agrees that Buyer will not purchase securities for a third party unless
Buyer has obtained a current
D-8
representation letter from such third party or taken other appropriate steps
contemplated by Rule 144A to conclude that such third party independently
meets the definition of "qualified institutional buyer" set forth in Rule
144A.
Buyer agrees to notify you of any changes in the information and
conclusions herein. Until such notice is given, Buyer's purchase of
securities from you, or through you from your customers, will constitute a
reaffirmation of the foregoing certifications and acknowledgements as of the
date of such purchase.
Very truly yours,
Date:
-----------------------
---------------------------------
Name of Buyer (Print)
By:
------------------------------
Name:
Title:
▇-▇
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QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
(Buyers that are Registered Investment Companies)
Toyota Motor Credit Corporation [ ]
Toyota Leasing, Inc.
c/o Toyota Motor Credit Corporation
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Re: Toyota Auto Lease Trust 1998-C;
Auto Lease Asset-Backed Certificates, Class B
Name of Buyer: _________________________("Buyer")
Name of Investment Adviser: _________________________("Adviser")
I hereby certify that, as indicated below, I am the President, Chief
Executive/Financial Officer or Senior Vice President of Buyer or, if Buyer is
a "qualified institutional buyer" as defined in Rule 144A ("Rule 144A") under
the Securities Act of 1933, as amended, because Buyer is part of a Family of
Investment Companies (as defined below), of Adviser.
In connection with purchases by Buyer, from time to time, I hereby
certify to you and, if you act as broker for one or more customers, to such
customers, that Buyer is a "qualified institutional buyer" as defined in Rule
144A because (i) Buyer is an investment company registered under the Investment
Company Act of 1940, as amended and (ii) as marked below, Buyer alone, or
Buyer's Family of Investment Companies, owned at least $100,000,000 in
securities (other than the excluded securities referred to below) as of the end
of Buyer's most recent fiscal year. (2)
-------------------------
(2) Buyer must own and/or invest on a discretionary basis at least
$100,000,000 in securities unless Buyer is a dealer, and, in that case,
Buyer must own and/or invest on a discretionary basis at least
$10,000,000 in securities.
D-10
_______ Buyer owned $_________ in securities (other than the
excluded securities referred to below) as of the end of
Buyer's most recent fiscal year (such amount being
calculated in accordance with Rule 144A).
_______ Buyer is part of a Family of Investment Companies which
owned in the aggregate $[ ] in securities (other
than the excluded securities referred to below) as of the
end of Buyer's most recent fiscal year (such amount being
calculated in accordance with Rule 144A).
For purposes of determining the amount of securities owned by Buyer or
Buyer's Family of Investment Companies, I used the cost of such securities and
did not include any of the securities referred to below in the second succeeding
paragraph.
The term "FAMILY OF INVESTMENT COMPANIES" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
The term "SECURITIES" as used herein does not include (i) securities of
issuers that are affiliated with Buyer or are part of Buyer's Family of
Investment Companies, (ii) bank deposit notes and certificates of deposit, (iii)
loan participations, (iv) repurchase agreements, (v) securities owned but
subject to a repurchase agreement and (vi) currency, interest rate and commodity
swaps.
On behalf of Buyer, I acknowledge that Buyer is familiar with Rule 144A
and understands that the parties listed in the Rule 144A Representation Letter
to which this certification relates are relying and will continue to rely on the
statements made herein because one or more sales to Buyer by you for your
account or your customer's account will be made in reliance on Rule 144A. In
addition, on behalf of Buyer, I agree that, in connection with any purchase of
securities sold by or through you in reliance on Rule 144A, Buyer will only
purchase for Buyer's own account.
D-11
Finally, on behalf of Buyer or Adviser (as appropriate), I agree to
notify you of any changes in the information and conclusions herein. Until
such notice is given, Buyer's purchase from time to time of securities from
you, or, through you from your customers, will constitute a reaffirmation of
foregoing certificates and acknowledgement by me as of the date of such
purchase.
Date:
------------------
Very truly yours,
-----------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
On behalf of
-----------------------------------------
Name of Buyer:
or
-----------------------------------------
Name of Adviser:
D-12
EXHIBIT E
FORM OF NON-RULE 144A REPRESENTATION LETTER
Toyota Motor Credit Corporation
Toyota Leasing, Inc.
c/o Toyota Motor Credit Corporation
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[ ]
[ ]
Re: Toyota Auto Lease Trust 1998-C
[ ]% Automobile Lease Asset Backed Certificates, Class B
Ladies and Gentlemen:
The undersigned purchaser (the "Purchaser") understands that the
purchase of the above-referenced certificates (the "Certificates") may be
made by institutions which are "Accredited Investors" under Rule 501(a)(1),
(2), (3) or (7) under the Securities Act of 1933, as amended (the "Securities
Act"). The undersigned represents on behalf of the Purchaser that the
Purchaser is an "Accredited Investor" within the meaning of such definition.
The Purchaser is urged to review carefully the responses, representations and
warranties it is making herein.
REPRESENTATIONS AND WARRANTIES
The Purchaser makes the following representations and warranties in
order to permit [ ] as trustee (the "Trustee") of the Toyota Auto
Lease Trust 1998-C (the "Trust"), Toyota Leasing, Inc. (the "Transferor") and
[ ] to determine its suitability as a purchaser
of Certificates and to determine that the private transfer exemption from
registration relied upon by the Transferor under the Securities Act is
available to it.
E-1
1. The Purchaser understands that the Certificates have not been,
and throughout their term will not be, registered or qualified under the
Securities Act or the securities laws of any state and may be resold (which
resale is not currently contemplated) only if registered pursuant to the
provisions of the Securities Act or if an exemption from registration under
the Securities Act and other applicable state securities laws is available,
that neither the Transferor nor the Trustee is required to register the
Certificates under the Securities Act or any applicable state securities laws
and that any transfer must comply with Section 4.03 of the Securitization
Trust Agreement dated as of [ ] (the "Agreement"), between
the Transferor and the Trustee.
2. The Purchaser will comply with all applicable federal and
state securities laws in connection with any subsequent resale of the
Certificates.
3. The Purchaser is an "accredited investor" within the meaning
of Rule 501(a)(1), (2), (3) or (7) under the Securities Act and a
sophisticated institutional investor and has knowledge and experience in
financial and business matters (and, in particular, in such matters related
to securities similar to the Certificates) and is capable of evaluating the
merits and risk of its investment in the Certificates and is able to bear the
economic risks of such investment. The Purchaser has been given such
information concerning the Certificates, Toyota Motor Credit Corporation and
the Transferor as it has requested.
4. The Purchaser is acquiring the Certificates as principal for
its own account for the purpose of investment and not with a view to or for
sale in connection with any distribution thereof, subject nevertheless to any
requirement of law that the disposition of the Purchaser's property shall at
all times be and remain within its control.
5. Neither the Purchaser nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of any Certificate,
any interest in any Certificate or any other similar security of the
Transferor to, or solicited any offer to buy or accept a transfer, pledge or
other disposition of any Certificate, any interest in any Certificate or any
other similar security of the Transferor with, any person in any manner, or
made any general solicitation by means of general advertising or in any other
manner, or taken any other action, which would constitute a distribution of
the Certificates under the Securities Act or which would render the
disposition of any Certificate a violation of Section 5 of the Securities Act
or any state securities law, require registration or qualification pursuant
thereto, or require registration of the Trust under the Investment Company
E-2
Act of 1940, as amended, nor will it act, nor has it authorized or will it
authorize any person to act in such manner with respect to the Certificates.
6. The Purchaser has reviewed the Private Placement Memorandum
with respect to the Certificates dated [ ], including the
Prospectus attached thereto as Exhibit A (the "Private Placement Memorandum")
and has-had the opportunity to ask questions and receive answers concerning
the terms and conditions of the transactions contemplated by the Private
Placement Memorandum and to obtain additional information necessary to verify
the accuracy and completeness of any information furnished to the Purchaser
or to which the Purchaser had access.
7. Either (a) Purchaser is not an employee benefit plan, trust or
account subject to Title I of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), or subject to Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code"), or a governmental plan defined
in section 3(32) of ERISA subject to any federal, state or local law which
is, to a material extent, similar to the foregoing provisions of ERISA or the
Code ("Similar Law") (each, a "Benefit Plan") and is not an entity, including
an insurance company separate account or an insurance company general account
if the assets in any such accounts constitute "plan assets" for purposes of
regulation section 2510.3-101 of ERISA, whose underlying assets include
Benefit Plan assets by reason of a Benefit Plan's investment in the entity;
or (b) Purchaser is delivering herewith an opinion of counsel addressed to
the Trustee, the Transferor and the Servicer to the effect that the purchase
or holding of such Certificate will not constitute or result in the assets of
the trust being deemed to be "plan assets" subject to the fiduciary
responsibility provisions of ERISA or prohibited transactions provisions of
Section 4975 of the Code or Similar Law, will not constitute or result in a
prohibited transaction within the meaning of Section 406 or Section 407 of
ERISA or Section 4975 of the Code or Similar Law, and will not subject the
Trustee, the Transferor or the Servicer to any obligation or liability
(including obligations or liabilities under ERISA, Section 4975 of the Code
or Similar Law) in addition to those undertaken in the Agreement.
8. The Purchaser understands that the Certificates will bear a
legend substantially as set forth in the form of Certificate included as an
Exhibit to the Agreement.
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9. The Purchaser understands that there is no market, nor is
there any assurance that a market will develop, for the Certificates and that
the Transferor does not have any obligation to make or facilitate any such
market (or to otherwise repurchase the Certificates from the Purchaser) under
any circumstances.
10. The Purchaser has consulted with its own legal counsel,
independent accountants and financial advisors to the extent it deems
necessary regarding the tax consequences to it of ownership of the
Certificates, is aware that its taxable income with respect to the
Certificates in any accounting period may not correspond to the cash flow (if
any) from the Certificates for such period, and is not purchasing the
Certificates in reliance on any representations of the Transferor or its
counsel with respect to tax matters.
11. The Purchaser represents, on behalf of itself that if the
Purchaser is a partnership, grantor trust or S corporation for federal income
tax purposes (a "Flow-Through Entity"), any Class B Certificates owned by or
on behalf of such Flow-Through Entity will represent less than 50% of the
value of all the assets owned by such Flow-Through Entity and no special
allocation of income, gain, loss, deduction or credit from such Class B
Certificates will be made among the beneficial owners of such Flow-Through
Entity.
12. The Purchaser agrees that it will obtain from any subsequent
purchaser of the Certificates substantially the same representations,
warranties and agreements contained in the foregoing paragraphs I through 11
and in this paragraph 12.
Capitalized terms used herein that are not otherwise defined shall
have the meanings ascribed thereto in the Agreement or the Private Placement
Memorandum, as the case may be.
The representations and warranties continued herein shall be binding
upon the successors of the undersigned.
Executed at _________, this ____ day of ________, 199__.
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Purchaser's Name (Print)
By:
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Name:
Title:
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Address of Purchaser
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Purchaser's Taxpayer
Identification Number
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