EXECUTION COPY
AMENDED AND RESTATED CUSTODIAN AGREEMENT
among
ARCADIA FINANCIAL LTD.,
as Custodian,
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
as Indenture Trustee
and
OLYMPIC AUTOMOBILE RECEIVABLES WAREHOUSE TRUST
Dated as of July 31, 1997
This Amended and Restated Custodian Agreement, dated as of July 31, 1997
(the "Custodian Agreement"), is made with respect to the formation of Olympic
Automobile Receivables Warehouse Trust (the "Trust"), among Arcadia Financial
Ltd., a Minnesota corporation, as Custodian (in such capacity, the "Custodian"),
Norwest Bank Minnesota, National Association, as Indenture Trustee (the
"Indenture Trustee") and the Trust. Capitalized terms used herein which are not
defined herein shall have the meanings set forth in the Sale and Servicing
Agreement (as hereinafter defined).
W I T N E S S E T H:
WHEREAS, the Trust, Arcadia Financial Ltd. ("AFL"), in its individual
capacity and as Servicer (in such capacity, the "Servicer"), Arcadia Receivables
Finance Corp. II (the "Seller") and Norwest Bank Minnesota, National
Association, as Backup Servicer, entered into the Sale and Servicing Agreement,
dated as of December 28, 1995 (as previously amended, the "Original Sale and
Servicing Agreement"), pursuant to which the Seller, pursuant to one or more
Transfer Agreements, sold, transferred and assigned and undertook to continue to
so sell, transfer and assign from time to time to the Trust all of the Seller's
right, title and interest in and to the Receivables and the related Other
Conveyed Property;
WHEREAS, in connection with such sales, transfers and assignments, the
Original Sale and Servicing Agreement provides that the Trust shall hold the
Receivables Files directly or through one or more custodians acting as agents of
the Trust under a custodian agreement;
WHEREAS, pursuant to the Indenture, dated as of December 28, 1995 (as
previously amended, the "Original Indenture"), between the Trust and Norwest
Bank Minnesota, National Association, as Indenture Trustee, the Trust pledged
the Indenture Collateral (as defined in the Original Indenture) to the Indenture
Trustee for the benefit of the Noteholders to secure the performance of the
Secured Obligations (as defined in the Original Indenture);
WHEREAS, pursuant to the Custodian Agreement dated as of December 28, 1995,
(as previously amended, the "Original Custodian Agreement"), the Owner Trustee
on behalf of the Trust and on behalf of the Indenture Trustee in respect of the
Secured Obligations appointed the Custodian as Custodian of the Receivables
Files and as agent of the Indenture Trustee in respect of the Secured
Obligations;
WHEREAS, the Original Sale and Servicing Agreement and the Original
Indenture are being amended and restated by the original parties thereto as of
the date hereof and, after such amendment and restatement, will supersede the
Original Sale and Servicing Agreement and the Original Indenture (such amended
and restated agreements referred to herein as the "Sale and Servicing Agreement"
and the "Indenture," respectively);
WHEREAS, the Custodian, the Indenture Trustee and the Trust desire to enter
into this Custodian Agreement which amends and restates and will supersede the
Original Custodian Agreement; and
WHEREAS, pursuant to this Custodian Agreement, the Custodian will continue
to serve as Custodian of the Receivables Files and as agent for the Indenture
Trustee in respect of the Secured Obligations.
NOW, THEREFORE, in consideration of the mutual agreements herein contained
and of other good and valuable consideration, the receipt and adequacy of which
are hereby acknowledged, the parties agree as follows:
1. APPOINTMENT OF CUSTODIAN: ACKNOWLEDGMENT OF RECEIPT. Subject to the
terms and conditions of the Original Custodian Agreement, the Owner Trustee on
behalf of the Trust and the Indenture Trustee on behalf of the Noteholders
revocably appointed the Custodian, and the Custodian accepted such appointment,
as custodian and bailee and subject to the terms and conditions hereof, the
Owner Trustee on behalf of the Trust and the Indenture Trustee on behalf of the
Noteholders hereby confirms such revocable appointment of the Custodian, and the
Custodian hereby confirms its acceptance of such appointment, as custodian and
bailee. Pursuant to the Indenture, from and after the Initial Closing Date
through the date of release (such date, the "Release Date") of the security
interest granted to the Indenture Trustee in respect of the Secured Obligations
pursuant to the terms of the Indenture the Custodian shall not be acting as
agent of the Trust, but rather shall be acting as agent of the Indenture Trustee
for the benefit of the Noteholders in respect of the Secured Obligations to
maintain exclusive custody of the Receivables Files relating to the Receivables
from time to time held as part of the Trust. In performing its duties
hereunder, the Custodian agrees to act with reasonable care, using that degree
of skill and attention that a commercial bank acting in the capacity of a
custodian would exercise with respect to files relating to comparable automotive
or other receivables that it services or holds for itself or others. The
Custodian hereby acknowledges that on the Initial Closing Date, it received the
Receivable File for each Receivable listed on the Initial Closing Date in the
Schedule of Receivables attached as Exhibit A to the Original Sale and Servicing
Agreement (the "Master Schedule of Receivables") and that on each subsequent
Transfer Date, it received the Receivable File for each Receivable listed in the
Schedule of Receivables attached as Exhibit A to the related Transfer Agreement
and made part of the Master Schedule of Receivables.
As evidence of such acknowledgement, the Custodian executed and delivered
on the Initial Closing Date, and on each subsequent Transfer Date, a Custodian's
Acknowledgment substantially in the form attached to the Original Custodian
Agreement. In connection with each conveyance of Receivables to the Trust
pursuant to each Transfer Agreement from and after the date of this Custodian
Agreement the Custodian shall execute and deliver on the applicable Transfer
Date a Custodian's Acknowledgement, substantially in the form attached hereto as
Exhibit B, acknowledging the Custodian's receipt of the Receivable File for each
Receivable listed in the Schedule of Receivables attached as Exhibit A to the
related Transfer Agreement and made part of the Master Schedule of Receivables.
2. MAINTENANCE OF CUSTODIAL ACCOUNT AT OFFICE. The Custodian agrees to
maintain the Receivables Files at its principal office or, subject to the prior
written consent of ▇▇▇▇▇▇ and AFL to perform at such other office as shall from
time to time be identified to the Indenture Trustee and ▇▇▇▇▇▇, and the
Custodian will hold the Receivables Files in such office as agent of the Owner
Trustee and on behalf of the Indenture Trustee for the
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benefit of the Noteholders until the Release Date, clearly segregated from any
other instruments and files on its records, including other instruments and
files held by the Custodian with respect to other trusts established by the
Seller, and in compliance with Section 3(b) hereof.
3. DUTIES OF CUSTODIAN.
(a) COLLATERAL REVIEWS. The Indenture Trustee agrees to perform, and
the Custodian agrees to allow the Indenture Trustee or another party acceptable
to ▇▇▇▇▇▇ to perform, reviews of the Collateral (a) within five (5) business
days of the beginning of each Warehousing Period, (b) every thirty (30) days
after the initial audit during such Warehousing Period, and (c) during each
Warehousing Period, upon five Business Days notice from the Administrative
Agent. Each review shall include a physical inventory (which may be electronic
if so approved by the Administrative Agent) of the Receivables Files relating to
the Receivables transferred since the beginning of the Warehousing Period, in
order to determine that AFL is in possession of a Receivable File for each
Receivable listed in the Schedule of Receivables attached as Exhibit A to each
Transfer Agreement executed during such Warehousing Period, and to perform a
limited review of at least fifty (50) of the Receivables Files relating to the
Receivables transferred since the beginning of the applicable Warehousing Period
to determine that each Receivable File so reviewed includes (i) a fully executed
original retail installment sales contract or promissory note, (ii) a
certificate of insurance, application form for insurance signed by the Obligor
or a signed representation letter from the Obligor named in the Receivable File
pursuant to which the Obligor has agreed to obtain physical damage insurance for
the related Financed Vehicle, or a documented verbal confirmation of the
insurance policy for the Financed Vehicle, (iii) the original Lien Certificate
or application therefor and (iv) a credit application or a copy thereof. As
evidence of the performance of each such review on each review date, the
Indenture Trustee or such other person shall execute and deliver to ▇▇▇▇▇▇ and
the Owner Trustee, on behalf of the Trust, an Acknowledgement in the form of
Exhibit C hereto. If such review reveals, in ▇▇▇▇▇▇'▇ opinion, an
unsatisfactory number of missing items ▇▇▇▇▇▇ in its sole discretion may require
a full review of every Receivable File by the Indenture Trustee or such other
party acceptable to ▇▇▇▇▇▇. The party performing such full review shall be
entitled to reimbursement from AFL for any costs or expenses incurred in
connection therewith.
(b) SAFEKEEPING. The Custodian shall hold the Receivables Files on behalf
of the Noteholders, and maintain such accurate and complete accounts, records
and computer systems pertaining to each Receivable File as will enable the Trust
to comply with the terms and conditions of the Sale and Servicing Agreement.
Each Receivable shall be stamped on both the first page and the signature page
(if different) in accordance with the instructions from time to time provided by
▇▇▇▇▇▇, and the form and content of the stamp shall be acceptable to ▇▇▇▇▇▇.
Each Receivable shall be identified on the books and records of the Custodian in
a manner that (i) is consistent with the practices of a commercial bank acting
in the capacity of custodian with respect to similar receivables, (ii) indicates
that the Receivable is held by the Custodian as agent of the Owner Trustee and
on behalf of the Indenture Trustee for the benefit of the Noteholders until the
Release Date and (iii) is otherwise necessary, as reasonably determined by the
Custodian, to comply with the terms of this
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Custodian Agreement. The Custodian shall conduct, or cause to be conducted,
periodic physical inspections of the Receivables Files held by it under this
Custodian Agreement, and of the related accounts, records and computer systems,
in such a manner as shall enable ▇▇▇▇▇▇, the Owner Trustee on behalf of the
Trust, the Indenture Trustee and the Custodian to verify the accuracy of the
Custodian's inventory and recordkeeping. Such inspections shall be conducted at
such times, in such manner and by such persons including, without limitation,
independent accountants, as ▇▇▇▇▇▇, the Owner Trustee or the Indenture Trustee
may request, and the cost of such inspections shall be borne directly by the
Custodian and not by the Trust. The Custodian shall promptly report to ▇▇▇▇▇▇,
the Owner Trustee and the Indenture Trustee any failure on its part to hold the
Receivables Files and maintain its accounts, records and computer systems as
herein provided and promptly take appropriate action to remedy any such failure.
Notwithstanding the above, the Custodian shall make microfiche copies of the
Receivables Files and may maintain such microfiche copies of the Receivables
Files in lieu of maintaining physical possession of the Receivables Files;
PROVIDED, HOWEVER, that such microfiche copies shall duplicate the entire
contents of each Receivable File and, provided further, that the Custodian shall
at all times maintain the original of the fully executed original retail
installment sales contract or promissory note and of the Lien Certificate or
application therefor, if no such Lien Certificate has yet been issued, relating
to each Receivable. Such original sales contracts and promissory notes and Lien
Certificate and application therefor shall be stored in a fireproof vault. The
Custodian shall cause the Indenture Trustee to have at all times a copy of the
microfiche made with respect to all Receivables Files, and the Indenture Trustee
shall hold such microfiche copy on behalf of the Noteholders.
(c) ACCESS TO RECORDS. The Custodian shall, subject only to the
Custodian's security requirements applicable to its own employees having access
to similar records held by the Custodian, which requirements shall be consistent
with the practices of a commercial bank acting in the capacity of custodian with
respect to similar receivable files or records, and at such times as may be
reasonably imposed by the Custodian, permit only ▇▇▇▇▇▇, the Indenture Trustee
and the Owner Trustee, on behalf of the Trust, or their duly authorized
representatives, attorneys or auditors to inspect the Receivables Files and the
related accounts, records, computer systems and microfiche maintained by the
Custodian pursuant hereto at such times as ▇▇▇▇▇▇, the Indenture Trustee and the
Owner Trustee, on behalf of the Trust, may reasonably request.
(d) RELEASE OF DOCUMENTS. The Custodian shall release any Receivable in
the Receivables Files to the Servicer or the Trust, if appropriate, only under
the circumstances provided in the Sale and Servicing Agreement.
(e) ADMINISTRATION; REPORTS. The Custodian shall, in general, attend to
all non-discretionary details in connection with maintaining custody of the
Receivables Files on behalf of the Trust. In addition, the Custodian shall
assist the Indenture Trustee and the Owner Trustee, on behalf of the Trust,
generally in the preparation of any routine reports to Noteholders,
Certificateholders or to regulatory bodies, to the extent necessitated by the
Custodian's custody of the Receivables Files.
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(f) REVIEW OF LIEN CERTIFICATES. On any Transfer Date, as applicable, the
Custodian shall deliver to the Indenture Trustee a listing of all Receivables
with respect to which a Lien Certificate, showing Arcadia Financial Ltd. as
secured party, was not included in the related Receivable File as of such
Transfer Date. No later than 180 days after such Transfer Date, the Indenture
Trustee shall review the Receivable File for each Receivable that is identified
in such listing as not including a Lien Certificate in the related Receivable
File to confirm that such Receivable File contains a Lien Certificate showing
Arcadia Financial Ltd. as secured party and shall notify ▇▇▇▇▇▇, the Indenture
Trustee, the Owner Trustee and the Seller of the results of such review,
including the failure of any such Receivable File to contain such a Lien
Certificate.
4. INSTRUCTIONS; AUTHORITY TO ACT. The Custodian shall be deemed to have
received proper instructions with respect to the Receivables Files upon its
receipt of written instructions signed by a Responsible Officer of the Indenture
Trustee. A certified copy of a bylaw or of a resolution of the Board of
Directors of the Indenture Trustee may be received and accepted by the Custodian
as conclusive evidence of the authority of any such officer to act and may be
considered as in full force and effect until receipt of written notice to the
contrary by the Indenture Trustee. Such instructions may be general or specific
in terms. A copy of any such instructions shall be furnished by the Indenture
Trustee to the Owner Trustee and ▇▇▇▇▇▇.
5. INDEMNIFICATION BY THE CUSTODIAN. The Custodian agrees to indemnify
the Trust, the Owner Trustee, the Indenture Trustee and ▇▇▇▇▇▇ for any and all
liabilities obligations, losses, damage, payments, costs or expenses of any kind
whatsoever (including the fees and expenses of counsel) that may be imposed on,
incurred or asserted against the Trust, the Owner Trustee, the Indenture Trustee
or ▇▇▇▇▇▇ as the result of any act or omission in any way relating to the
maintenance and custody by the Custodian of the Receivables Files; PROVIDED,
HOWEVER, that the Custodian shall not be liable for any portion of any such
liabilities, obligations, losses, damages, payments or costs or expenses due to
the willful misfeasance, bad faith or gross negligence of the Indenture Trustee
or ▇▇▇▇▇▇ on behalf of the Noteholders or the Owner Trustee on behalf of the
Trust.
6. ADVICE OF COUNSEL. The Custodian, the Indenture Trustee for the
benefit of the Noteholders and ▇▇▇▇▇▇ further agree that the Custodian shall be
entitled to rely and act upon advice of counsel with respect to its performance
hereunder as custodian and shall be without liability for any action reasonably
taken pursuant to such advice, provided that such action is not in violation of
applicable Federal or state law.
7. EFFECTIVE PERIOD, TERMINATION AND AMENDMENT, INTERPRETIVE AND
ADDITIONAL PROVISIONS. This Custodian Agreement shall become effective as of
the date hereof and shall continue in full force and effect until terminated as
hereinafter provided. This Custodian Agreement may be amended at any time by
mutual agreement of the parties hereto and may be terminated by any party by
giving written notice to the other parties, such termination to take effect no
sooner than thirty (30) days after the date of such notice. Upon any
termination or amendment of this Custodian Agreement, the Indenture Trustee for
the benefit of the Noteholders in the case of amendments, and the party seeking
termination, in the case of terminations, shall give written notice to Standard
& Poor's and Moody's (the "Rating
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Agencies"). Immediately after receipt of notice of termination of this
Custodian Agreement, the Custodian shall deliver the Receivables Files to the
Indenture Trustee for the benefit of the Noteholders, or the Indenture Trustee's
agent, at such place or places as the Indenture Trustee may designate, and the
Indenture Trustee, or its agent, as the case may be, shall act as custodian for
such Receivables Files for the benefit of the Noteholders until such time as a
successor custodian, approved by ▇▇▇▇▇▇, has been appointed. If, within
twenty-four (24) hours after the termination of this Custodian Agreement, the
Custodian has not delivered the Receivables Files in accordance with the
preceding sentence, the Indenture Trustee may enter the premises of the
Custodian and remove the Receivables Files from such premises. In connection
with the administration of this Agreement, the parties may agree from time to
time upon the interpretation of the provisions of this Agreement as may in their
joint opinion be consistent with the general tenor and purposes of this
Agreement, any such interpretation to be signed by all parties and annexed
hereto.
8. GOVERNING LAW. This Custodian Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
9. NO PETITION. The Custodian and the Indenture Trustee, by entering
into this Agreement, hereby covenant and agree that they will not at any time
institute against the Seller, the Trust or the General Partner, or join in any
institution against the Seller, the Trust or the General Partner, in any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding,
or other proceeding under any United States Federal or state bankruptcy or
similar law in connection with any obligations relating to this Agreement or any
of the Related Documents until the date that is one year and one day after the
termination of the Trust pursuant to the terms of the Trust Agreement.
10. NOTICES. All demands, notices and communications hereunder shall be
in writing, delivered or mailed, and shall be deemed to have been duly given
upon receipt (a) in the case of the Custodian, at the following address:
Arcadia Financial Ltd., ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, Attention: President, (b) in the case of the Seller, at the
following address: Arcadia Receivables Finance Corp. II, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Secretary, (c)
in the case of the Trust, in care of the Owner Trustee, at the following
address: Wilmington Trust Company, ▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust
Administration, (d) in the case of the Indenture Trustee: Norwest Bank
Minnesota, National Association, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust Department, (e) in the case
of ▇▇▇▇▇▇, at the following address: ▇▇▇▇▇▇ Guaranty Trust Company of New York,
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Asset
Finance Group, and (f) in the case of each Rating Agency at the following
address: ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (for Moody's) and ▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (for Standard & Poor's), Attention:
Asset-Backed Surveillance, or at such other address as shall be designated by
such party in a written notice to the other parties.
11. BINDING EFFECT. This Custodian Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and assigns.
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Concurrently with the appointment of a successor trustee under the Trust
Agreement, the parties hereto shall amend this Custodian Agreement to make said
successor trustee the successor to the Owner Trustee hereunder. Concurrently
with the appointment of a successor indenture trustee under the Indenture, the
parties hereto shall amend this Custodian Agreement to make said successor
indenture, the successor to the Indenture Trustee hereunder, as the case may be.
12. LIMITATION OF LIABILITY. It is expressly understood and agreed by the
parties hereto that (a) this Agreement is executed and delivered by Wilmington
Trust Company, not individually or personally but solely as Owner Trustee of the
Trust under the Trust Agreement, in the exercise of the powers and authority
conferred and vested in it, (b) each of the representations, undertakings and
agreements herein made on the part of the Trust is made and intended not as
personal representations, undertakings and agreements by Wilmington Trust
Company but is made and intended for the purpose for binding only the Trust, (c)
nothing herein contained shall be construed as creating any liability on
Wilmington Trust Company, individually or personally, to perform any covenant
either expressed or implied contained herein, all such liability, if any, being
expressly waived by the parties to this Agreement and by any person claiming by,
through or under them and (d) under no circumstances shall Wilmington Trust
Company be personally liable for the payment of any indebtedness or expenses of
the Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Trust under this
Agreement or any related documents.
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IN WITNESS WHEREOF, each of the parties hereto has caused this Amended and
Restated Custodian Agreement to be in its name and on its behalf by a duly
authorized officer on the day and year first above written.
OLYMPIC AUTOMOBILE RECEIVABLES
WAREHOUSE TRUST
By WILMINGTON TRUST COMPANY,
not in its individual capacity, but solely as
Owner Trustee on behalf of the Trust
By /s/ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Financial Services Officer
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Indenture Trustee
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Corporate Trust Officer
ARCADIA FINANCIAL LTD., as Custodian
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: EVP CFO
[Signature page to Amended and Restated Custodian Agreement]