EXHIBIT 4.4
FORM OF POOLING AND SERVICING AGREEMENT
TOYOTA MOTOR CREDIT RECEIVABLES CORPORATION,
Seller
and
TOYOTA MOTOR CREDIT CORPORATION,
Servicer
and
---------------------------------,
Trustee
Dated as of o
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
SECTION 1.01 Definitions.....................................................1
ARTICLE II
CREATION OF TRUST; CONVEYANCE OF RECEIVABLES; CUSTODY OF RECEIVABLE FILES
SECTION 2.01 Creation of Trust; Conveyance of Receivables...................19
SECTION 2.02 Custody of Receivable Files....................................20
SECTION 2.03 Acceptance by Trustee..........................................21
SECTION 2.04 Representations and Warranties of Seller as to the
Receivables....................................................21
SECTION 2.05 Repurchase of Receivables Upon Breach..........................25
SECTION 2.06 Duties of Servicer as Custodian................................25
SECTION 2.07 Instructions; Authority to Act.................................26
SECTION 2.08 Indemnification of Custodian...................................26
SECTION 2.09 Effective Period and Termination...............................26
SECTION 2.10 Usage of Terms.................................................27
SECTION 2.11 Cutoff Date and Record Date....................................27
SECTION 2.12 Section References.............................................27
SECTION 2.13 Agent for Service..............................................27
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 3.01 Duties of Servicer.............................................27
SECTION 3.02 Collection of Receivable Payments..............................28
SECTION 3.03 Rebates on Full Prepayments....................................29
SECTION 3.04 Realization Upon Receivables...................................29
SECTION 3.05 Maintenance of Physical Damage Insurance Policies..............29
SECTION 3.06 Maintenance of Security Interests in Financed Vehicles.........29
SECTION 3.07 Covenants of Servicer..........................................30
SECTION 3.08 Purchase of Receivables Upon Breach............................30
SECTION 3.09 Total Servicing Fee; Payment of Certain Expenses by
Servicer......................................................30
SECTION 3.10 Servicer's Certificate.........................................31
SECTION 3.11 Annual Statement as to Compliance; Notice of Default...........31
SECTION 3.12 Annual Accountants' Report.....................................31
SECTION 3.13 Access to Certain Documentation and Information
Regarding Receivables..........................................32
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SECTION 3.14 Amendments to Schedule of Receivables..........................32
SECTION 3.15 Reports to Certificateholders and Rating Agencies..............32
ARTICLE IV
ACCOUNTS; DISTRIBUTIONS; STATEMENTS TO CERTIFICATEHOLDERS
SECTION 4.01 Accounts.......................................................33
SECTION 4.02 Collections....................................................34
SECTION 4.03 Application of Collections.....................................35
SECTION 4.04 Advances.......................................................35
SECTION 4.05 Additional Deposits............................................37
SECTION 4.06 Distributions..................................................37
SECTION 4.07 Reserve Fund...................................................39
SECTION 4.08 Yield Maintenance Account......................................42
SECTION 4.09 Net Deposits...................................................45
SECTION 4.10 Statements to Certificateholders...............................45
ARTICLE V
THE CERTIFICATES
SECTION 5.01 The Certificates...............................................47
SECTION 5.02 Authentication and Delivery of Certificates....................47
SECTION 5.03 Registration of Transfer and Exchange of Certificates..........47
SECTION 5.04 Registration of Transfer and Exchange of Class B
Certificates..................................................48
SECTION 5.05 Mutilated, Destroyed, Lost or Stolen Certificates..............49
SECTION 5.06 Persons Deemed Owners..........................................50
SECTION 5.07 Access to List of Certificateholders' Names and Addresses......50
SECTION 5.08 Maintenance of Office or Agency................................50
SECTION 5.09 Temporary Certificates.........................................51
SECTION 5.10 Book-Entry Certificates........................................51
SECTION 5.11 Notices to Clearing Agency.....................................52
SECTION 5.12 Definitive Certificates........................................52
ARTICLE VI
THE SELLER
SECTION 6.01 Representations of Seller......................................53
SECTION 6.02 Liability of Seller; Indemnities...............................54
SECTION 6.03 Merger or Consolidation of, or Assumption of the
Obligations of, Seller; Certain Limitations..................54
SECTION 6.04 Limitation on Liability of SellerandOthers.....................56
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SECTION 6.05 Seller May Own Certificates....................................56
SECTION 6.06 No Transfer....................................................56
ARTICLE VII
THE SERVICER
SECTION 7.01 Representations of Servicer....................................57
SECTION 7.02 Liability of Servicer; Indemnities.............................58
SECTION 7.03 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer...................................59
SECTION 7.04 Limitation on Liability of Servicer and Others.................59
SECTION 7.05 Servicer Not to Resign.........................................60
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.01 Events of Default..............................................60
SECTION 8.02 Consequences of an Event of Default............................61
SECTION 8.03 Trustee to Act; Appointment of Successor Servicer..............62
SECTION 8.04 Notification to Certificateholders.............................62
SECTION 8.05 Waiver of Past Defaults........................................63
SECTION 8.06 Repayment of Advances..........................................63
ARTICLE IX
THE TRUSTEE
SECTION 9.01 Duties of Trustee..............................................63
SECTION 9.02 Trustee's Certificate..........................................65
SECTION 9.03 Trustee's Assignment of Administrative Receivables
and Warranty Receivables.....................................65
SECTION 9.04 Certain Matters Affecting the Trustee..........................65
SECTION 9.05 Limitation on Trustee's Liability..............................67
SECTION 9.06 Trustee May Own Certificates...................................68
SECTION 9.07 Trustee's Fees and Expenses....................................68
SECTION 9.08 Indemnity of Trustee and Successor Servicer....................68
SECTION 9.09 Eligibility Requirements for Trustee...........................68
SECTION 9.10 Resignation or Removal of Trustee..............................69
SECTION 9.11 Successor Trustee..............................................70
SECTION 9.12 Merger or Consolidation of Trustee.............................70
SECTION 9.13 Appointment of Co-Trustee or Separate Trustee..................70
SECTION 9.14 Representations and Warranties of Trustee......................71
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SECTION 9.15 Tax Returns....................................................72
SECTION 9.16 Trustee May Enforce Claims Without Possession
of Certificates..............................................72
SECTION 9.17 Suit for Enforcement...........................................73
SECTION 9.18 Rights of Certificateholders to Direct Trustee.................73
ARTICLE X
TERMINATION
SECTION 10.01 Termination of the Trust.......................................73
SECTION 10.02 Optional Purchase of All Receivables...........................74
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01 Amendment......................................................75
SECTION 11.02 Protection of Title to Trust...................................76
SECTION 11.03 Limitation on Rights of Certificateholders.....................78
SECTION 11.04 Governing Law..................................................79
SECTION 11.05 Notices........................................................79
SECTION 11.06 Severability of Provisions.....................................79
SECTION 11.07 Assignment.....................................................79
SECTION 11.08 Certificates Nonassessable and Fully Paid......................79
SECTION 11.09 No Petition....................................................80
EXHIBIT A Form of Servicer's Certificate Pursuant to Section 3.10 A-1
EXHIBIT B Trustee's Certificate Pursuant to Section 9.02 or 9.03 B-1
EXHIBIT C Form of Class A Certificate C-1
EXHIBIT D Form of Class B Certificate D-1
EXHIBIT E Form of Transferee Certificate E-1
EXHIBIT F Form of Letter of Representations F-1
SCHEDULE A Schedule of Receivables Schedule A-1
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ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINITIONS. Except as otherwise provided in this Agreement,
whenever used herein, the following words and phrases, unless the context
otherwise requires, shall have the following meanings:
"ACCOUNTS" means the Collection Account, the Payahead Account, the Yield
Maintenance Account, if any, and the Reserve Fund.
"ACTUAL PAYMENT" means, with respect to a Receivable and a Collection
Period, all payments received by the Servicer from or for the account of the
related Obligor on such Receivable during such Collection Period (and, in the
case of the first Collection Period, all payments received by the Servicer from
or for the account of such Obligor since the Cutoff Date through the last day of
such Collection Period), net of any Supplemental Servicing Fees attributable to
such Receivable. Actual Payments do not include Applied Payments Ahead.
"ACTUARIAL RECEIVABLE" means any Receivable which provides for the
allocation of payments according to the "actuarial" method.
"ADDITIONAL AGREEMENTS" shall have the meaning specified in Section
6.03(b)(ii)(C).
"ADDITIONAL TRUSTS" shall have the meaning specified in Section
6.03(b)(ii)(C).
"ADDITIONAL YIELD MAINTENANCE AMOUNT" means, with respect to any
Distribution Date, the amount, if any, by which the Required Yield Maintenance
Amount exceeds the Yield Maintenance Amount.
"ADMINISTRATIVE PURCHASE PAYMENT" means, with respect to a Distribution
Date and to (1) an Administrative Receivable which is a Precomputed Receivable
purchased by the Seller or the Servicer as of the end of the related Collection
Period, (a) the sum of (i) all Scheduled Payments on such Receivable due after
the last day of such Collection Period (plus any portion of a Yield Maintenance
Amount attributable to such Receivable), (ii) an amount equal to any
reimbursement of Outstanding Advances made pursuant to Section 4.04(b) with
respect to such Receivable (plus all Outstanding Advances made in respect of
such Receivable, in the case of an Administrative Purchase Payment made by the
Seller) and (iii) all past due Scheduled Payments for which an Advance has not
been made, minus (b) any Rebate paid to the Obligor on such Receivable on or
prior to the date of such purchase and (2) an Administrative Receivable which is
a Simple Interest Receivable purchased by the Seller or the Servicer during the
related Collection Period, the sum of (a) the unpaid principal balance owed by
the Obligor in respect of such Receivable plus (b) interest on such unpaid
principal balance at a rate equal to the sum of the [Class B Pass Through Rate]
[or specify other rate] and the Servicing Fee Rate to the last day in the
related Collection Period.
"ADMINISTRATIVE RECEIVABLE" means a Receivable which the Servicer is
required to purchase pursuant to Section 3.02 or 3.08 or which the Seller or the
Servicer has elected to purchase pursuant to Section 10.02.
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"ADVANCE" means a Precomputed Advance or a Simple Interest Advance.
"AFFILIATE" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control," when used with respect to any
specified Person, means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the term "controlling" and
"controlled" have meanings correlative to the foregoing.
"AGGREGATE NET LOSSES" means, with respect to a Collection Period, an
amount equal to the aggregate Principal Balance of all Receivables that became
Defaulted Receivables during such Collection Period minus all Net Liquidation
Proceeds collected during such Collection Period with respect to Defaulted
Receivables.
"AGREEMENT" means this Pooling and Servicing Agreement with respect to the
Toyota Auto Receivables Grantor Trust 200_-_ among Toyota Motor Credit
Receivables Corporation, Toyota Motor Credit Corporation and the Trustee, as the
same may be amended or supplemented from time to time.
"AMOUNT FINANCED" in respect of a Receivable means the aggregate amount
advanced under such Receivable toward the purchase price of the related Financed
Vehicle and any related costs, including but not limited to accessories,
insurance premiums, service and warranty contracts and other items customarily
financed as part of retail automobile and light duty truck installment sale
contracts.
"ANNUAL PERCENTAGE RATE" or "APR" of a Receivable means the annual rate of
finance charges specified in such Receivable.
"APPLICANTS" shall have the meaning specified in Section 5.07.
"APPLIED PAYMENT AHEAD" means, with respect to a Precomputed Receivable and
a Collection Period as to which (a) the Actual Payment is less than the
Scheduled Payment and (b) a Deferred Prepayment is on deposit in the Payahead
Account, an amount equal to the lesser of (i) such Deferred Prepayment and (ii)
the amount by which the Scheduled Payment exceeds the Actual Payment.
"AUTOMOBILE RECEIVABLES" shall have the meaning specified in Section
6.03(b)(ii)(A).
"AVAILABLE INTEREST" means, with respect to any Distribution Date, the
total of the following amounts allocable to interest received by the Servicer on
or in respect of the Receivables during the related Collection Period (in the
case of the Precomputed Receivables, computed in accordance with the actuarial
method and in the case of the Simple Interest Receivables, computed in
accordance with the simple interest method): (a) the sum of the interest
component of (i) all collections on or in respect of all Receivables other than
Defaulted Receivables (including Scheduled Surplus, Prepayment Surplus and the
interest portion of Applied Payments Ahead, but otherwise excluding Payments
Ahead), (ii) the Yield Maintenance Deposit, if applicable, (iii) all Net
Liquidation Proceeds, (iv) all Advances made by the Servicer, (v) all Warranty
Purchase Payments and (vi) all Administrative Purchase Payments, less (b) the
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sum of all (i) amounts received on or in respect of a particular Receivable
(other than a Defaulted Receivable) to the extent of the aggregate Outstanding
Interest Advances in respect of such Receivable and (ii) Net Liquidation
Proceeds with respect to a particular Receivable to the extent of the aggregate
Outstanding Interest Advances in respect of such Receivable.
"AVAILABLE PRINCIPAL" means, with respect to any Distribution Date, the
total of the following amounts allocable to principal received by the Servicer
on or in respect of the Receivables during the related Collection Period (in the
case of the Precomputed Receivables, computed in accordance with the actuarial
method and in the case of the Simple Interest Receivables, computed in
accordance with the simple interest method): (a) the sum of the principal
component of all (i) collections on or in respect of all Receivables other than
Defaulted Receivables (including the principal portion of Applied Payments Ahead
but otherwise excluding Payments Ahead), (ii) Net Liquidation Proceeds, (iii)
Advances made by the Servicer, (iv) Warranty Purchase Payments, and (v)
Administrative Purchase Payments, less (b) an amount equal to all (i) amounts
received on or in respect of a particular Receivable (other than a Defaulted
Receivable) to the extent of the aggregate Outstanding Principal Advances in
respect of such Receivable, and (ii) Net Liquidation Proceeds with respect to a
particular Receivable to the extent of the aggregate Outstanding Principal
Advances in respect of such Receivable.
"BASIC SERVICING FEE" means the fee payable to the Servicer on each
Distribution Date, calculated pursuant to Section 3.09, for services rendered
during the related Collection Period, which shall be equal to one-twelfth of the
Servicing Fee Rate multiplied by the Pool Balance as of the first day of the
related Collection Period or, with respect to the first Distribution Date, the
Original Pool Balance.
"BOOK-ENTRY CERTIFICATES" means a beneficial interest in the Certificates,
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 5.10.
"BUSINESS DAY" means any day other than a Saturday, a Sunday or a day on
which banking institutions in New York, New York or Los Angeles, California are
authorized or obligated by law, executive order or governmental decree to be
closed.
"CERTIFICATE REGISTER" means the register maintained pursuant to Section
5.03.
"CERTIFICATEHOLDER" or "HOLDER" means the Person in whose name a
Certificate is registered in the Certificate Register, except that, solely for
the purposes of giving certain consents, waivers, requests or demands pursuant
to this Agreement, the interest evidenced by any Class A Certificate registered
in the name of the Seller or the Servicer, or any Person actually known to a
Responsible Officer of the Trustee to be controlling, controlled by or under
common control with the Seller or the Servicer, shall not be taken into account
in determining whether the requisite percentage necessary to effect any such
consent, waiver, request or demand shall have been obtained.
"CERTIFICATE OWNER" means, with respect to a Book-Entry Certificate, the
Person who is the owner of such Book-Entry Certificate, as reflected on the
books of the Clearing Agency, or on the books of a Person maintaining an account
with such Clearing Agency (directly or as an
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indirect participant, in either case in accordance with the rules of such
Clearing Agency) and shall mean, with respect to a Definitive Certificate, the
related Certificateholder.
"CERTIFICATE REGISTRAR" means the Trustee unless a successor thereto is
appointed pursuant to Section 5.03. The Certificate Registrar initially
designates its offices at o, as its offices for purposes of Section 5.08.
"CERTIFICATES" means the Class A Certificates and the Class B Certificates.
"CHARGE-OFF RATE" means, with respect to a Collection Period, the
percentage equivalent of a fraction, the numerator of which is the Aggregate Net
Losses for such Collection Period, and the denominator of which is the average
of (i) the aggregate Principal Balance on the last day of the Collection Period
immediately preceding such Collection Period and (ii) the aggregate Principal
Balance on the last day of such Collection Period; such quotient is then
multiplied by twelve to arrive at an annualized percentage.
"CLASS" means all Certificates whose form is identical except for variation
in denomination, principal amount or owner.
"CLASS A CERTIFICATE" means one of the Certificates executed by the Trustee
on behalf of the Trust and authenticated by the Trustee in substantially the
form attached hereto as Exhibit C.
"CLASS A CERTIFICATE BALANCE" shall initially equal the Original Class A
Certificate Balance and, on any date thereafter, shall equal the Original Class
A Certificate Balance, reduced by all amounts previously distributed to Class A
Certificateholders and allocable to principal; provided, however, that on any
Distribution Date on or after the Distribution Date on which the Class B
Certificate Balance is reduced to zero, after all required distributions and
deposits have been made, the Class A Certificate Balance will be reduced by the
amount, if any, necessary to cause the Class A Certificate Balance to equal the
Pool Balance as of the last day of the related Collection period.
"CLASS A DISTRIBUTABLE AMOUNT" means, with respect to any Distribution
Date, the sum of the Class A Principal Distributable Amount and the Class A
Interest Distributable Amount.
"CLASS A INTEREST CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess, if any, of (i) the Class A Interest Distributable
Amount for such Distribution Date plus any outstanding Class A Interest
Carryover Shortfall from the immediately preceding Distribution Date plus
interest on such outstanding Class A Interest Carryover Shortfall, to the extent
permitted by law, at the Class A Pass Through Rate from and including such
immediately preceding Distribution Date to but excluding the current
Distribution Date, over (ii) the amount of interest distributed to Class A
Certificateholders on such current Distribution Date.
"CLASS A INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Distribution Date, the product of one-twelfth of the Class A Pass Through Rate
and the Class A Certificate Balance as of the immediately preceding Distribution
Date (after giving effect to distributions of principal made on such immediately
preceding Distribution Date) or, in the case of the first Distribution Date, the
Original Class A Certificate Balance.
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"CLASS A PASS THROUGH RATE" means o% per annum.
"CLASS A PERCENTAGE" means o%.
"CLASS A POOL FACTOR" means, with respect to any Distribution Date, a
seven-digit decimal figure (rounded upwards) equal to the Class A Certificate
Balance as of such Distribution Date divided by the Original Class A Certificate
Balance.
"CLASS A PRINCIPAL CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess, if any, of (i) the Class A Principal
Distributable Amount plus any outstanding Class A Principal Carryover Shortfall
with respect to one or more prior Distribution Dates, over (ii) the amount of
principal distributed to Class A Certificateholders on such current Distribution
Date.
"CLASS A PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any
Distribution Date, the sum of the Class A Percentage of the following amounts
(but not exceeding the Class A Certificate Balance as of such Distribution
Date): (i) in the case of Precomputed Receivables, the principal portion of all
Scheduled Payments due during the related Collection Period, computed in
accordance with the actuarial method, (ii) in the case of Simple Interest
Receivables, the principal portion of all Scheduled Payments actually received
during the related Collection Period, (iii) the principal portion of all
Prepayments received during such Collection Period (to the extent such amounts
are not included in clauses (i) and (ii) above), and (iv) the Principal Balance
of each Receivable that became an Administrative Receivable, a Warranty
Receivable or a Defaulted Receivable during such Collection Period (to the
extent such amounts are not included in clauses (i), (ii) and (iii) above). In
addition, with respect to the Final Scheduled Distribution Date or the
Distribution Date upon which all remaining Receivables are to be purchased
pursuant to Section 10.02, the Class A Principal Distributable Amount will
include the portion of such amount necessary (after giving effect to the other
amounts to be distributed to the Class A Certificateholders on such Final
Scheduled Distribution Date or Distribution Date and allocable to principal) to
reduce the Class A Certificate Balance to zero.
"CLASS B CERTIFICATE" means any one of the Certificates executed by the
Trustee on behalf of the Trust and authenticated by the Trustee in substantially
the form attached hereto as Exhibit D.
"CLASS B CERTIFICATE BALANCE" shall initially equal the Original Class B
Certificate Balance and, on any Distribution Date, shall equal the amount by
which the Pool Balance as of the last day of the related Collection Period
exceeds the Class A Certificate Balance on such Distribution Date.
"CLASS B DISTRIBUTABLE AMOUNT" means, with respect to any Distribution
Date, the sum of the Class B Principal Distributable Amount and the Class B
Interest Distributable Amount.
"CLASS B INTEREST CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess, if any, of (i) the Class B Interest Distributable
Amount for such Distribution Date plus any outstanding Class B Interest
Carryover Shortfall from the immediately preceding Distribution Date plus
interest on such outstanding Class B Interest Carryover Shortfall, to the extent
permitted by law, at the Class B Pass Through Rate from and including such
immediately
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preceding Distribution Date to but excluding the current Distribution Date, over
(ii) the amount of interest distributed to Class B Certificateholders on such
current Distribution Date.
"CLASS B INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any
Distribution Date, the product of one-twelfth of the Class B Pass Through Rate
and the Class B Certificate Balance as of the immediately preceding Distribution
Date (after giving effect to distributions of principal made on such immediately
preceding Distribution Date) or, in the case of the first Distribution Date, the
Original Class B Certificate Balance.
"CLASS B PASS THROUGH RATE" means o% per annum.
"CLASS B PERCENTAGE" means o%.
"CLASS B PRINCIPAL CARRYOVER SHORTFALL" means, with respect to any
Distribution Date, the excess, if any, of (i) the Class B Principal
Distributable Amount and any outstanding Class B Principal Carryover Shortfall
with respect to one or more prior Distribution Dates, over (ii) the amount of
principal distributed to Class B Certificateholders on such current Distribution
Date.
"CLASS B PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any
Distribution Date, the sum of the Class B Percentage of the following amounts
(but not exceeding the Class B Certificate Balance as of such Distribution
Date): (i) in the case of Precomputed Receivables, the principal portion of all
Scheduled Payments due during the related Collection Period, computed in
accordance with actuarial method, (ii) in the case of Simple Interest
Receivables, the principal portion of all Scheduled Payments actually received
during the related Collection Period, (iii) the principal portion of all
Prepayments received during such Collection Period (to the extent such amounts
are not included in clauses (i) and (ii) above), and (iv) the Principal Balance
of each Receivable that became an Administrative Receivable, a Warranty
Receivable or a Defaulted Receivable during such Collection Period (to the
extent such amounts are not included in clauses (i), (ii) and (iii) above). In
addition, with respect to the Final Scheduled Distribution Date or the
Distribution Date upon which all remaining Receivables are to be purchased
pursuant to Section 10.02, the Class B Principal Distributable Amount will
include the portion of such amount necessary (after giving effect to the other
amounts to be distributed to the Class B Certificateholders on such Final
Scheduled Distribution Date or Distribution Date and allocable to principal) to
reduce the Class B Certificate Balance to zero.
"CLEARING AGENCY" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
"CLOSING DATE" means o.
"CODE" means the Internal Revenue Code of 1986, as amended.
["COLLATERAL SECURITY AGREEMENT" means the Collateral Security Agreement
dated o, by and among the Seller, the Servicer, [third party] and the Trustee,
as collateral agent, pursuant to
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which [third party] has conveyed the property and proceeds of any Yield
Maintenance Account to the Trustee in trust for the benefit of the
Certificateholders as described in Section 4.08(a).]
"COLLECTION ACCOUNT" means the account or accounts designated as such and
established and maintained pursuant to Section 4.01.
"COLLECTION PERIOD" means, with respect to any Distribution Date, the
calendar month immediately preceding the month in which such Distribution Date
occurs (or, in the case of the first Distribution Date, the period of time since
the Cutoff Date through the end of the calendar month immediately preceding the
month in which such first Distribution Date occurs).
"COMMISSION" means the Securities and Exchange Commission, and any
successor thereto.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered,
which office at the date of execution of this Agreement is located at o.
"CURRENT RECEIVABLE" means each Receivable that is not a Defaulted
Receivable or a Liquidated Receivable.
"CUTOFF DATE" means o.
"DEALER" means the dealer of automobile and/or light duty trucks who sold a
Financed Vehicle and who originated and assigned the Receivable relating to such
Financed Vehicle to TMCC under an existing agreement between such dealer and
TMCC.
"DEALER RECOURSE" means, with respect to a Receivable, all recourse rights
against the Dealer which originated the Receivable, and any successor Dealer.
"DEFAULTED RECEIVABLE" means a Receivable (other than an Administrative
Receivable or a Warranty Receivable) as to which (i) all or any part of a
Scheduled Payment is o or more days past due and the Servicer has not
repossessed the related Financed Vehicle, or (ii) the Servicer has, in
accordance with its customary servicing procedures, determined that eventual
payment in full is unlikely and either repossessed and liquidated the related
Financed Vehicle or repossessed and held the related Financed Vehicle in its
repossession inventory for 90 days, whichever occurs first.
"DEFINITIVE CERTIFICATES" shall have the meaning specified in Section 5.10.
"DEFERRED PREPAYMENT" means, with respect to a Precomputed Receivable and a
Collection Period, the aggregate amount, if any, of Payments Ahead remitted to
the Servicer in respect of such Receivable during one or more prior Collection
Periods and currently held by the Servicer or in the Payahead Account.
"DELINQUENCY PERCENTAGE" means, with respect to a Collection Period, the
percentage equivalent of a fraction, the numerator of which is the number of (i)
all outstanding Receivables 61 days or more delinquent (after taking into
account permitted extensions) as of the last day of
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such Collection Period, determined in accordance with the Servicer's normal
practices, plus (ii) all repossessed Financed Vehicles that have not been
liquidated (to the extent the related Receivable is not otherwise reflected in
clause (i) above), and the denominator of which is the aggregate number of
Current Receivables on the last day of such Collection Period.
"DELIVERY" means, when used with respect to the Reserve Fund:
(i) with respect to certificated securities, bankers' acceptances,
commercial paper, negotiable certificates of deposit and other obligations
that constitute "instruments" within the meaning of Section 9-105(1)(i) of
the UCC and are susceptible of physical delivery (collectively, "Physical
Property"), transfer thereof to the Trustee or its financial intermediary
as defined in Section 8-313(4) of the UCC (a "Financial Intermediary") in
accordance with Sections 8-313(1)(a), 8-313(1)(d)(i) or 8-313(1)(g) of the
UCC, and evidence that any such Physical Property that is in registrable
form has been registered in the name of the Trustee, its Financial
Intermediary, its custodian or its nominee;
(ii) with respect to any Reserve Fund property that is a book-entry
security held through the Federal Reserve System pursuant to federal
book-entry regulations, the following procedures, all in accordance with
applicable law, including applicable federal regulations and Articles 8 and
9 of the UCC: (A) book-entry registration of such property to an
appropriate book-entry account maintained with a Federal Reserve Bank by
the Trustee or by a custodian and issuance to the Trustee or to such
custodian, as the case may be, of a deposit advice or other written
confirmation of such book-entry registration, (B) the making by any such
custodian of entries in its books and records identifying such book-entry
security held through the Federal Reserve System pursuant to federal
book-entry regulations as belonging to the Trustee and indicating that such
custodian holds such Reserve Fund property solely as agent for the Trustee,
and the making by the Trustee of entries in its books and records
establishing that it holds such Reserve Fund property solely as Trustee
pursuant to Section 4.07, and (C) such additional or alternative procedures
as may hereafter become necessary to effect complete transfer of ownership
of any such Reserve Fund property to the Trustee, consistent with changes
in applicable law or regulations or the interpretation thereof; and
(iii) with respect to any Reserve Fund property that is an
uncertificated security under Article 8 of the UCC and that is not governed
by clause (ii) above, registration of the transfer to, and ownership of
such Reserve Fund property by, the Trustee, its Financial Intermediary, its
custodian or its nominee by the issuer of such Reserve Fund.
"DETERMINATION DATE" means, with respect to any Distribution Date, the o
calendar day of the month in which such Distribution Date occurs or, if such day
is not a Business Day, the next succeeding Business Day.
"DISTRIBUTION DATE" means, with respect to a Collection Period, the o
calendar day of the following calendar month, or if such day is not a Business
Day, the next succeeding Business Day, commencing o.
8
"DTC" means The Depository Trust Company, and its successors.
"DUFF & ▇▇▇▇▇▇" means Duff & ▇▇▇▇▇▇ Inc., and its successors.
"ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated account with an
Eligible Institution or (b) a segregated trust account with the corporate trust
department of a depository institution organized under the laws of the United
States of America or any one of the states thereof or the District of Columbia
(or any domestic branch of a foreign bank), having corporate trust powers and
acting as trustee for funds deposited in such account, so long as any of the
securities of such depository institution shall have a credit rating from each
Rating Agency in one of its generic rating categories that signifies investment
grade.
"ELIGIBLE INSTITUTION" means (a) the corporate trust department of the
Trustee or (b) a depository institution organized under the laws of the United
States of America or any one of the states thereof or the District of Columbia
(or any domestic branch of a foreign bank), which (i) has either (A) a long-term
unsecured debt rating of "AA-" or better by Standard & Poor's and "Aa3" or
better by Moody's or (B) an account or accounts in which funds will be held
therein for 30 days or less which are maintained with a depository institution
or trust company, the short-term unsecured debt obligations of which are rated
"A-1+" or better by Standard & Poor's or if not rated by Standard & Poor's then
otherwise approved by Standard & Poor's and rated "P-1" or better by Moody's, or
if not rated by Moody's then otherwise approved by Moody's, and (ii) whose
deposits are insured by the FDIC. If so qualified, the Trustee may be considered
an Eligible Institution for the purposes of clause (b) of this definition.
"ELIGIBLE INVESTMENTS" means, at any time, any one or more of the following
obligations and securities:
(i) obligations of, and obligations fully guaranteed as to timely
payment of principal and interest by, the United States or any agency
thereof, provided such obligations are backed by the full faith and credit
of the United States;
(ii) general obligations of or obligations guaranteed by FNMA or any
state of the United States, the District of Columbia or the Commonwealth of
Puerto Rico then rated the highest available credit rating of each Rating
Agency for such obligations;
(iii) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States, any state
thereof, the District of Columbia or the Commonwealth of Puerto Rico, so
long as at the time of such investment or contractual commitment providing
for such investment either the long-term unsecured debt of such corporation
has the highest available rating from each Rating Agency for such
obligations or the commercial paper or other short-term debt which is then
rated has the highest available credit rating of each Rating Agency for
such obligations;
(iv) certificates of deposit issued by any depository institution or
trust company (including the Trustee) incorporated under the laws of the
United States or of any state thereof, the District of Columbia or the
Commonwealth of Puerto Rico and subject to supervision and examination by
banking authorities of one or more of such jurisdictions, provided that the
short-term unsecured debt obligations of such depository
9
institution or trust company is then rated the highest available rating of
each Rating Agency for such obligations;
(v) certificates of deposit issued by any bank, trust company, savings
bank or other savings institution and fully insured by the FDIC;
(vi) repurchase obligations held by the Trustee that are acceptable to
the Trustee with respect to any security described in clauses (i), (ii) or
(vii) hereof or any other security issued or guaranteed by any other agency
or instrumentality of the United States, in either case entered into with a
federal agency or a depository institution or trust company (acting as
principal) described in clause (iv) above;
(vii) interests in any closed-end management type investment company
or investment trust (a) registered under the Investment Company Act, the
portfolio of which is limited to the obligations of, or guaranteed by, the
United States and to agreements to repurchase such obligations, which
agreements, with respect to principal and interest, are at least 100%
collateralized by such obligations marked to market on a daily basis and
the investment company or investment trust shall take delivery of such
obligations either directly or through an independent custodian designated
in accordance with the Investment Company Act and (b) acceptable to each
Rating Agency (as approved in writing by each Rating Agency) as collateral
for securities having ratings equivalent to the rating of the Rated
Certificates on the Closing Date;
(viii) money market funds, including, without limitation, the VISTA4
Money Market Funds, so long as such funds are rated ___ by Moody's (so long
as ▇▇▇▇▇'▇ is a Rating Agency) and ___ by Standard & Poor's (so long as
Standard & Poor's is a Rating Agency), and any other fund for which the
Trustee or an Affiliate of the Trustee serves as an investment advisor,
administrator, shareholder servicing agent and/or custodian or
subcustodian, provided that any shares of such funds have a credit rating
of at least ___ by Moody's (so long as ▇▇▇▇▇'▇ is a Rating Agency) and ___
by Standard & Poor's (so long as Standard & Poor's is a Rating Agency) and
notwithstanding that (i) the Trustee or an Affiliate of the Trustee charges
and collects fees and expenses from such funds for services rendered, (ii)
the Trustee charges and collects fees and expenses for services rendered
pursuant to this Agreement, and (iii) services performed for such funds and
pursuant to this Agreement may converge at any time. Each of the Seller and
the Servicer hereby specifically authorizes the Trustee or an Affiliate of
the Trustee to charge and collect all fees and expenses from such funds for
services rendered to such funds, in addition to any fees and expenses the
Trustee may charge and collect for services rendered pursuant to this
Agreement; and
(ix) such other investments acceptable to each Rating Agency (as
approved in writing by each Rating Agency) as will not result in the
qualification, downgrading or withdrawal of the rating then assigned to the
Rated Certificates by such Rating Agency;
provided that each of the foregoing investments shall mature no later than the
Distribution Date immediately following the date of purchase (other than in the
case of the investment of monies in instruments of which the entity at which the
related Account is located
10
is the obligor, which may mature on the related Distribution Date), and shall be
required to be held to such maturity.
Notwithstanding anything to the contrary contained in this definition, (a)
no Eligible Investment may be purchased at a premium, (b) any of the foregoing
which constitutes a certificated security shall not be considered a Eligible
Investment unless it is registered in the name of the Trustee in its capacity as
such, and (c) any of the foregoing which constitutes an uncertificated security
shall not be considered a Eligible Investment unless (i) it is registered in the
name of the Trustee in its capacity as such or in the name of its Financial
Intermediary; (ii) no notation of the right of the issuer thereof to a Lien
thereon is contained in the initial transaction statement therefor sent to the
Trustee; (iii) a Responsible Officer of the Trustee does not have notice or
actual knowledge of (A) any restriction on the transfer thereof imposed by the
issuer thereof, or (B) any adverse claim, and no notation of any such
restriction or of any specific adverse claim as to which the issuer has a duty
under the law of the state in which the Corporate Trust Office is located at the
time of registration is contained in the initial transaction statement therefor
sent to the Trustee; and (iv) to a Responsible Officer of the Trustee's actual
knowledge, no creditor has served legal process upon the issuer thereof at its
chief executive office in the United States which legal process attempts to
place a Lien thereon prior to the registration thereof in the name of the
Trustee.
For purposes of this definition, any reference to the highest available
credit rating of an obligation shall mean the highest available credit rating
for such obligation, or such lower credit rating (as approved in writing by each
Rating Agency) as will not result in the qualification, downgrading or
withdrawal of the rating then assigned to the Rated Certificates by such Rating
Agency.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EVENT OF DEFAULT" shall have the meaning specified in Section 8.01.
"EXCESS AMOUNTS" means, with respect to any Distribution Date, the
remaining Available Interest on deposit in the Collection Account in respect of
such Distribution Date after all distributions pursuant to Section 4.06(c) have
been made. Excess Amounts shall include all amounts received upon prepayment in
full of Rule of 78s Receivables in excess of the then outstanding principal
balances thereof and accrued interest thereon (calculated pursuant to the
actuarial method).
"EXCESS PAYMENT" means, with respect to a Receivable and a Collection
Period, the amount, if any, by which the Actual Payment exceeds the sum of (i)
the Scheduled Payment, and (ii) any Overdue Payment.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FDIC" means the Federal Deposit Insurance Corporation, and its successors.
"FNMA" means the Federal National Mortgage Association, and its successors.
"FINAL SCHEDULED DISTRIBUTION DATE" shall mean o.
11
"FINAL SCHEDULED MATURITY DATE" shall mean o.
"FINANCED VEHICLE" means, with respect to a Receivable, the related
automobile or light duty truck, as the case may be, together with all accessions
thereto, securing the related Obligor's indebtedness under such Receivable.
"FINANCIAL INTERMEDIARY" shall have the meaning specified in the definition
of the term "Delivery."
"INDEPENDENT DIRECTOR" means a director of the Seller who is not (i) a
director, officer or employee of any affiliate of the Seller, (ii) a natural
person related to any director or officer of any affiliate of the Seller, (iii)
a holder (directly or indirectly) of more than 10% of any voting securities of
any affiliate of the Seller, or (iv) a natural person related to a holder
(directly or indirectly) of more than 10% of any voting securities of any
affiliate of the Seller.
"INSURANCE POLICY" means, with respect to a Receivable, an insurance policy
covering physical damage, credit life, credit disability, theft, mechanical
breakdown or similar event relating to the related Financed Vehicle or Obligor.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as
amended.
"LIEN" means any security interest, lien, charge, pledge, equity or
encumbrance of any kind other than tax liens, mechanics' liens and any liens
that attach to a Receivable or any property, as the context may require, by
operation of law.
"LIQUIDATED RECEIVABLE" means a Receivable that (i) has been the subject of
a Prepayment in full, or (ii) has been paid in full or the final amounts in
respect of such payment have been paid with respect to a Defaulted Receivable,
regardless of whether all or any part of such payment has been made by the
Obligor under such Receivable, the Seller pursuant to this Agreement, the
Servicer pursuant to this Agreement or pursuant to the Receivables Purchase
Agreement, an insurer pursuant to an Insurance Policy or otherwise.
"LIQUIDATION EXPENSES" means, with respect to a Defaulted Receivable, the
amount charged by the Servicer, in accordance with its customary servicing
procedures, to or for its account for repossessing, refurbishing and disposing
of the related Financed Vehicle and other out-of-pocket costs related to such
liquidation.
"LIQUIDATION PROCEEDS" means, with respect to a Defaulted Receivable, all
amounts realized with respect to such Receivable from whatever sources
(including, without limitation, proceeds of any Insurance Policy), net of
amounts that are required by law or such Receivable to be refunded to the
related Obligor.
"MONTHLY PAYMENT" means, with respect to any Receivable, the amount of each
fixed monthly payment payable to the obligee under such Receivable in accordance
with the terms thereof, net of any portion of such monthly payment that
represents late payment charges, extension fees or collections allocable to
payments to be made by Obligors for payment of insurance premiums, extended
service contracts or similar items.
12
"MONTHLY REMITTANCE CONDITIONS" shall have the meaning specified in Section
4.02(a).
"MOODY'S" means ▇▇▇▇▇'▇ Investors Service, Inc., and its successors.
"NET LIQUIDATION PROCEEDS" means, with respect to a Defaulted Receivable,
Liquidation Proceeds less Liquidation Expenses.
"NONRECOVERABLE ADVANCE" shall have the meaning specified in Section
4.04(c).
"OBLIGOR" on a Receivable means the purchaser or co-purchasers of the
related Financed Vehicle purchased in part or in whole by the execution and
delivery of such Receivable or any other Person who owes or may be liable for
payments under such Receivable.
"OFFERED CERTIFICATES" shall have the meaning specified in Section
6.03(b)(ii)(D).
"OFFICER'S CERTIFICATE" means a certificate signed by the president, any
vice president, the treasurer or the secretary of the Seller or the Servicer, as
the case may be, and delivered to the Trustee.
"OPINION OF COUNSEL" means a written opinion of counsel (who, in the case
of counsel to the Seller or the Servicer, may be an employee of or outside
counsel to the Seller or the Servicer), which counsel shall be acceptable to the
Trustee.
"OPTIONAL PURCHASE PERCENTAGE" means 10.00%.
"ORIGINAL CLASS A CERTIFICATE BALANCE" means $o
"ORIGINAL CLASS B CERTIFICATE BALANCE" means $o
"ORIGINAL POOL BALANCE" means $o.
"OUTSTANDING ADVANCES" means, with respect to a Receivable and the last day
of a Collection Period, the sum of all Advances made as of or prior to such
date, minus all payments or collections as of or prior to such date which are
specified in Section 4.04(b) as applied to reimburse all unpaid Advances with
respect to such Receivable.
"OUTSTANDING INTEREST ADVANCES" means, as of the last day of a Collection
Period with respect to a Receivable, the portion of Outstanding Advances
allocable to interest.
"OUTSTANDING PRINCIPAL ADVANCES" means, as of the last day of a Collection
Period with respect to a Receivable, the portion of Outstanding Advances
allocable to principal.
"OVERDUE PAYMENT" shall have the meaning specified in Section 4.03(a).
"PASS THROUGH RATE" means the Class A Pass Through Rate or the Class B Pass
Through Rate, as indicated by the context.
13
"PAYAHEAD ACCOUNT" means the account or accounts designated as such and
established and maintained pursuant to Section 4.01.
"PAYMENT AHEAD" means, with respect to a Precomputed Receivable and a
Collection Period, any Excess Payment (not representing prepayment in full of
such Precomputed Receivable) which the Servicer, in accordance with its
customary servicing practices, will apply towards the payment of Scheduled
Payments in one or more future Collection Periods.
"PERSON" means any legal person, including any individual, corporation,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PHYSICAL PROPERTY" shall have the meaning specified in the definition of
the term "Delivery."
"POOL BALANCE" means, as of any date, the aggregate Principal Balance of
the Receivables (exclusive of all Administrative Receivables for which the
Servicer has paid the Administrative Purchase Payment, Warranty Receivables for
which the Seller has paid the Warranty Purchase Payment and Defaulted
Receivables) as of the close of business on such date.
"POOL FACTOR" as of any Distribution Date, means a seven-digit decimal
figure equal to the Pool Balance as of such Distribution Date divided by the
Original Pool Balance.
"PRECOMPUTED ADVANCE" shall have the meaning specified in Section 4.04(a).
"PRECOMPUTED RECEIVABLE" means any Actuarial Receivable or Rule of 78s
Receivable.
"PREPAYMENT" means (i) with respect to any Precomputed Receivable, any
Excess Payment other than a Payment Ahead or (ii) with respect to any Simple
Interest Receivable, any prepayment, whether in part or in full, in respect of
such Simple Interest Receivable.
"PREPAYMENT SURPLUS" means, with respect to any Distribution Date on which
a Prepayment is to be applied with respect to a Precomputed Receivable, that
portion of such Prepayment which is not attributable to principal in accordance
with the actuarial method, net of one month's interest at the Weighted Average
Pass-Through Rate on the Principal Balance of such Receivable as of the first
day of the related Collection Period.
"PRINCIPAL BALANCE" means, with respect to any Receivable as of any date,
the Amount Financed minus the sum of the following amounts: (i) in the case of a
Precomputed Receivable, that portion of all Scheduled Payments due on or prior
to such date allocable to principal, computed in accordance with the actuarial
method, (ii) in the case of a Simple Interest Receivable, that portion of all
Scheduled Payments actually received on or prior to such date allocable to
principal, (iii) any Warranty Purchase Payment or Administrative Purchase
Payment with respect to such Receivable allocable to principal, and (iv) any
Prepayments or other payments applied to reduce the unpaid principal balance of
such Receivable.
"RATED CERTIFICATES" means any Class of Certificates that has been rated by
a Rating Agency at the request of the Seller.
14
"RATING AGENCY" means each of Moody's and Standard & Poor's.
"REBATE" means, with respect to a Precomputed Receivable and any date, the
rebate, calculated on an actuarial basis, under such Precomputed Receivable that
is or would be payable to the related Obligor for unearned finance charges or
any other charges subject to rebate if such Obligor were to prepay such
Receivable in full on such date.
"RECEIVABLE" means any retail installment sale contract executed by an
Obligor in respect of a Financed Vehicle, and all proceeds thereof and payments
thereunder, which Receivable shall be identified in the Schedule of Receivables.
"RECEIVABLE FILE" means the documents specified in Section 2.02 pertaining
to a particular Receivable.
"RECEIVABLES PURCHASE AGREEMENT" means that certain Receivables Purchase
Agreement, dated as of the Cutoff Date, between the Seller and TMCC.
"RECORD DATE" means, with respect to Certificates of either Class and each
Distribution Date, the calendar day immediately preceding such Distribution Date
or, if Definitive Certificates representing Certificates of such Class have been
issued, the last day of the month immediately preceding the month in which such
Distribution Date occurs. Any amount stated "as of a Record Date" or "on a
Record Date" shall give effect to (i) all applications of collections, and (ii)
all distributions to any party under this Agreement or to the related Obligor,
as the case may be, in each case as determined as of the opening of business on
the related Record Date.
"RELEASED ADMINISTRATIVE AMOUNT" means, with respect to a Distribution Date
and to an Administrative Receivable, the Deferred Prepayment, if any, for such
Administrative Receivable.
"RELEASED WARRANTY AMOUNT" means, with respect to a Distribution Date and
to a Warranty Receivable, the Deferred Prepayment, if any, for such Warranty
Receivable.
"REQUIRED RATE" means, with respect to each Collection Period, [the sum of
the Servicing Fee Rate and the Class B Pass Through Rate][or specify other
rate].
"REQUIRED RATING" means a rating of ___ by Moody's and ___ by Standard &
Poor's.
"REQUIRED YIELD MAINTENANCE AMOUNT" means, with respect to any Distribution
Date, an amount equal to [the aggregate amount by which (i) the aggregate amount
of interest that would accrue on the Principal Balance of each Receivable that
is an asset of the Trust for the period commencing on the last day of the
related Collection Period and ending on the last day of the Collection Period
during which such Receivable is scheduled to mature if such Receivable bore
interest at the Required Rate (assuming that all subsequent payments on such
Receivable are made as scheduled and no prepayments are made in respect thereof)
exceeds (ii) the aggregate amount of interest that would accrue thereon for the
same period at the related APR][or specify other formula][specify discounting
factors].
15
"RESERVE FUND" means the segregated trust account established and
maintained for the benefit of the Certificateholders as a reserve fund pursuant
to Section 4.07(a).
"RESERVE FUND INITIAL DEPOSIT" means $o.
"RESIDUAL CERTIFICATE" shall have the meaning specified in Section 5.01.
"RESPONSIBLE OFFICER" means, when used with respect to the Trustee, any
officer within the Corporate Trust Office of the Trustee, including any Vice
President, Assistant Vice President, Assistant Treasurer, Assistant Secretary or
any other officer of the Trustee customarily performing functions similar to
those performed by any of the above designated officers and also, with respect
to a particular matter, any other officer to whom such matter is referred
because of such officer's knowledge of and familiarity with such particular
subject.
"RULE OF 78S RECEIVABLE" means any Receivable which provides for the
allocation of payments according to the "sum of periodic balances" or "sum of
monthly payments" method.
"SCHEDULE OF RECEIVABLES" means the schedule of receivables attached as
Schedule A to this Agreement, as it may be amended from time to time.
"SCHEDULED PAYMENT" means, with respect to any Distribution Date and to a
Receivable, the payment set forth in such Receivable as due from the Obligor in
the related Collection Period; provided, however, that in the case of the first
Collection Period, the Scheduled Payment shall include all such payments due
from the Obligor on or after the Cutoff Date.
"SCHEDULED SURPLUS" means, with respect to any Distribution Date for any
Receivable having an APR which exceeds the sum of the Weighted Average Pass
Through Rate and the Servicing Fee Rate, the product of (i) the interest portion
of the related Scheduled Payment (in the case of any Precomputed Receivable,
determined in accordance with the actuarial method), and (ii) the remainder of
(a) one minus (b) a fraction, the numerator of which equals the sum of the
Weighted Average Pass Through Rate and the Servicing Fee Rate and the
denominator of which equals such APR.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SELLER" means Toyota Motor Credit Receivables Corporation, in its capacity
as seller of the Receivables under this Agreement, and each successor thereto
(in the same capacity) pursuant to Section 6.03.
"SERVICER" means TMCC, in its capacity as servicer of the Receivables
pursuant to this Agreement, and each successor thereto (in the same capacity)
appointed pursuant to Section 8.03.
"SERVICER'S CERTIFICATE" means an Officer's Certificate of the Servicer
completed and executed pursuant to Section 3.10, substantially in the form
attached hereto as Exhibit A.
"SERVICING FEE RATE" means o% per annum.
16
"SIMPLE INTEREST ADVANCE" shall have the meaning specified in Section
4.04(a).
"SIMPLE INTEREST RECEIVABLE" means any Receivable which provides for the
allocation of payments according to the simple interest method.
"SPECIFIED RESERVE FUND BALANCE" means with respect to any Distribution
Date, an amount equal to [o% of the sum of the Class A Certificate Balance and
the Class B Certificate Balance (after giving effect to distributions of
principal to be made on such Distribution Date), except that, if on any
Distribution Date (i) the average of the Charge-off Rates for the preceding
three Collection Periods exceeds o% or (ii) the average of the Delinquency
Percentages for the preceding three Collection Periods exceeds o%, then the
Specified Reserve Fund Balance for such Distribution Date will be an amount
equal to o% of such sum (after giving effect to such principal distributions).
Finally, on any Distribution Date on which the sum of the Class A Certificate
Balance and the Class B Certificate Balance is $o or less after giving effect to
distributions of principal on such Distribution Date, the Specified Reserve Fund
Balance for the immediately succeeding Distribution Date will be the greater of
the applicable amount determined as set forth above or $o; provided, however,
that the Specified Reserve Fund Balance shall in no event be more than the sum
of the Class A Certificate Balance and the Class B Certificate Balance, in each
case as of such Distribution Date][or specify other formula].
"STANDARD & POOR'S" means Standard & Poor's Ratings Services, and its
successors
"SUCCESSOR SERVICER" means any entity appointed as a successor to the
Servicer pursuant to Section 8.03.
"SUPPLEMENTAL SERVICING FEE" means, with respect to any Distribution Date,
all late fees, prepayment charges, extension fees and other administrative fees
and expenses or similar charges allowed by applicable law with respect to the
Receivables received by the Servicer during the related Collection Period.
"TMCC" means Toyota Motor Credit Corporation, and its successors and
assigns.
"TMCRC" means Toyota Motor Credit Receivables Corporation, and its
successors and assigns.
"TOTAL SERVICING FEE" means the sum of the Basic Servicing Fee and the
Supplemental Servicing Fee.
"TRUST" means the trust created by this Agreement, the estate of which
consists of (i) the Receivables (other than Warranty Receivables for which the
Seller has paid the Warranty Purchase Payment and Administrative Receivables for
which the Servicer or the Seller has paid the Administrative Purchase Payment)
and all monies paid thereunder, or due and to become due thereunder, in each
case on and after the Cutoff Date; (ii) security interests in the Financed
Vehicles; (iii) such assets (excluding investment earnings thereon) as are from
time to time deposited in the Accounts, other than the Reserve Fund and any
Yield Maintenance Account; (iv) proceeds from claims on any Insurance Policies;
(v) the right to realize upon any property (including the right to receive
future Liquidation Proceeds) that shall have secured a Receivable
17
and have been repossessed by or on behalf of the Trustee; (vi) an assignment of
the Seller's rights as purchaser under the Receivables Purchase Agreement; (vii)
the right of the Seller to receive payments pursuant to any Dealer Recourse; and
(viii) all proceeds of the foregoing. Neither the Reserve Fund nor any Yield
Maintenance Account shall be a part of or otherwise includable in the Trust.
"TRUSTEE" means o and any successor trustee appointed pursuant to Section
9.11.
"TRANSFEREE'S CERTIFICATE" means the representation letter to be delivered
to the Trustee by any transferee of a Class B Certificate pursuant to Section
5.04, substantially in the form attached hereto as Exhibit E.
"TRUSTEE'S CERTIFICATE" means a certificate completed and executed by a
Responsible Officer pursuant to Section 9.02 or 9.03, substantially in the form
attached hereto as Exhibit B.
"UCC" means the Uniform Commercial Code as in effect in the respective
jurisdiction.
"UNITED STATES" means the United States of America.
"VICE PRESIDENT" of any Person means any vice president of such Person,
whether or not designated by a number or words before or after the title "Vice
President", who is a duly elected officer of such Person.
"VOTING INTERESTS" means the aggregate voting strength evidenced by the
Class A Certificates or the Class B Certificates, as the case may be; provided,
however, that where the Voting Interests are relevant in determining whether the
vote of the requisite percentage of Class A Certificateholders necessary to
effect any consent, waiver, request or demand shall have been obtained, the
Voting Interests shall be deemed to be reduced by the amount equal to the Voting
Interests (without giving effect to this provision) represented by the interests
evidenced by any Certificate registered in the name of the Seller, the Servicer
or any Person actually known to a Responsible Officer of the Trustee to be
controlling, controlled by or under common control with the Seller or the
Servicer.
"WARRANTY PURCHASE PAYMENT" means, with respect to a Distribution Date and
to (1) a Warranty Receivable which is a Precomputed Receivable repurchased by
the Seller as of the end of the related Collection Period, (a) the sum of (i)
all Scheduled Payments on such Receivable due after the last day of such
Collection Period (plus the portion of the Yield Maintenance Amount attributable
to such Receivable, if any), (ii) all past due Scheduled Payments for which an
Advance has not been made, (iii) an amount equal to any reimbursement of
Outstanding Advances made pursuant to Section 4.04(b) with respect to such
Receivable and (iv) all Outstanding Advances made in respect of such Receivable,
minus (b) the sum of (i) any Rebate paid to the Obligor on such Receivable on or
prior to the date of such purchase and (ii) any other proceeds in respect of
such Receivable previously received (to the extent applied to reduce the
Principal Balance of such Receivable on such Distribution Date), and (2) a
Warranty Receivable which is a Simple Interest Receivable repurchased by the
Seller as of the end of the related Collection Period, the sum of (a) the unpaid
principal balance owed by the Obligor in respect of such Receivable plus (b)
interest on such unpaid principal balance at a rate
18
equal to the sum of [the Class B Pass Through Rate][or specify other rate] and
the Servicing Fee Rate to the last day in the related Collection Period.
"WARRANTY RECEIVABLE" means a Receivable which the Seller is required to
repurchase pursuant to Section 2.05.
"WEIGHTED AVERAGE PASS THROUGH RATE" means the average of the Class A Pass
Through Rate and Class B Pass Through Rate weighted on the basis of the Class A
Certificate Balance and the Class B Certificate Balance as of the first day of
the relevant Interest Period.
"YIELD MAINTENANCE ACCOUNT" means the segregated trust account established
and maintained for the benefit of the Certificateholders as a reserve fund
pursuant to Section 4.08(a), if any.
"YIELD MAINTENANCE AGREEMENT" means the Yield Maintenance Agreement dated
o, among the Servicer, the Seller [, third party] and the Trustee, pursuant to
which Additional Yield Maintenance Amounts are to be deposited in the Yield
Maintenance Account on each Distribution Date.
"YIELD MAINTENANCE AMOUNT" means, with respect to any Distribution Date,
the aggregate amount on Deposit in any Yield Maintenance Account after giving
effect to the withdrawal therefrom of any related Yield Maintenance Deposit and
without regard to any amounts on deposit therein in respect of interest or
investment earnings earned on the investment of amounts on deposit therein in
Eligible Investments for any period.
"YIELD MAINTENANCE ACCOUNT INITIAL DEPOSIT" means an amount equal to [the
aggregate amount by which (i) the aggregate amount of interest that would accrue
on the Principal Balance of each Receivable that is an asset of the Trust for
the period commencing on the last day of the first Collection Period and ending
on the last day of the Collection Period during which such Receivable is
scheduled to mature if such Receivable bore interest at the Required Rate
(assuming that all subsequent payments on such Receivable are made as scheduled
and no prepayments are made in respect thereof) exceeds (ii) the aggregate
amount of interest that would accrue thereon for the same period at the related
APR][or specify other formula][specify discounting factors].
"YIELD MAINTENANCE DEPOSIT" means, with respect to any Distribution Date,
the amount by which (i) the aggregate amount of interest that would have been
due during the related Collection Period on all Receivables that have APRs less
than the Required Rate if such Receivables bore interest at the Required Rate
exceeds (ii) the amount of interest accrued on such receivables at their
respective APRs and due during such Collection Period.
ARTICLE II
CREATION OF TRUST; CONVEYANCE OF RECEIVABLES;
CUSTODY OF RECEIVABLE FILES
SECTION 2.01 CREATION OF TRUST; CONVEYANCE OF RECEIVABLES. (a) Upon the
execution of this Agreement by the parties hereto, there is hereby created the
Toyota Auto
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Receivables 200_-_ Grantor Trust. The Seller, pursuant to the mutually agreed
upon terms contained in this Agreement, shall sell, transfer, assign and
otherwise convey to the Trustee on behalf of the Trust, without recourse (but
subject to the Seller's obligations in this Agreement), all of its right, title
and interest in and to the Receivables and any proceeds related thereto,
including any Dealer Recourse and such other items as shall be specified in this
Agreement.
(b) In consideration of the Trustee's delivery to the Seller on behalf
of the Trust of authenticated Certificates, in authorized denominations, in
an aggregate amount equal to the Original Pool Balance, the Seller does
hereby sell, transfer, assign and otherwise convey to the Trustee, in trust
for the benefit of the Certificateholders, without recourse (subject to the
Seller's obligations herein):
(i) all right, title and interest of the Seller in and to the
Receivables and all monies due thereon or paid thereunder or in
respect thereof (including proceeds of the repurchase of Receivables
by the Seller pursuant to Section 2.05 or 10.02 or the purchase of
Receivables by the Servicer pursuant to Section 3.08 or 10.02) on or
after the Cutoff Date;
(ii) the interest of the Seller in the security interests in the
Financed Vehicles granted by the Obligors pursuant to the Receivables
and any accessions thereto;
(iii) the interest of the Seller in any proceeds of any physical
damage insurance policies covering Financed Vehicles and in any
proceeds of any credit life or credit disability insurance policies
relating to the Receivables or the Obligors;
(iv) the interest of the Seller in any Dealer Recourse;
(v) the interest of the Seller under the Receivables Purchase
Agreement;
(vi) the right of the Seller to realize upon any property
(including the right to receive future Liquidation Proceeds) that
shall have secured a Receivable and have been repossessed by or on
behalf of the Trustee;
(vii) all other assets comprising the Trust; and
(viii) all proceeds of the foregoing.
(c) It is the intention of the Seller that the transfer and assignment
contemplated by this Agreement shall constitute a sale of the Receivables
from the Seller to the Trust and the beneficial interest in and title to
the Receivables shall not be part of the Seller's estate in the event of
the filing of a bankruptcy petition by or against the Seller under any
bankruptcy law. The Seller agrees to execute and file all filings
(including filings under the UCC) necessary in any jurisdiction to provide
third parties with notice of the sale of the Receivables pursuant to this
Agreement and to perfect such sale under the UCC.
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(d) Although the parties hereto intend that the transfer and
assignment contemplated by this Agreement be a sale, in the event such
transfer and assignment is deemed to be other than a sale, the parties
intend that all filings described in the foregoing paragraph shall give the
Trustee on behalf of the Trust a first priority perfected security interest
in, to and under the Receivables, and other property conveyed hereunder and
all proceeds of any of the foregoing. This Agreement shall be deemed to be
the grant of a security interest from the Seller to the Trustee on behalf
of the Trust, and the Trustee on behalf of the Trust shall have all the
rights, powers and privileges of a secured party under the UCC.
(e) In connection with the foregoing conveyance, the Servicer shall
maintain its computer system so that, from and after the time of sale of
the Receivables to the Trustee on behalf of the Trust under this Agreement,
the Servicer's master computer records (including any back-up archives)
that refer to any Receivable indicate clearly the interest of the Trust in
such Receivables and that the Receivable is owned by the Trustee on behalf
of the Trust. Indication of the Trust's ownership of a Receivable shall be
deleted from or modified on the Servicer's computer systems when, and only
when, the Receivable has been paid in full, repurchased or assigned
pursuant to this Agreement.
SECTION 2.02 CUSTODY OF RECEIVABLE FILES. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Trustee on
behalf of the Trust, upon the execution and delivery of this Agreement,
revocably appoints the Servicer, and the Servicer accepts such appointment, to
act as the agent of the Trust as custodian of the following documents or
instruments which are hereby constructively delivered to the Trustee with
respect to each Receivable:
(a) the fully executed original of the Receivable;
(b) documents evidencing or related to any Insurance Policy;
(c) the original credit application of each Obligor, fully executed by
such Obligor on TMCC's customary form, or on a form approved by TMCC, for
such application;
(d) the original certificate of title (or evidence that such
certificate of title has been applied for) or such documents that the
Servicer shall keep on file, in accordance with TMCC's customary
procedures, evidencing the security interest in the related Financed
Vehicle; and
(e) any and all other documents that the Seller or the Servicer, as
the case may be, shall keep on file, in accordance with its customary
procedures, relating to such Receivable or the related Obligor or Financed
Vehicle.
SECTION 2.03 ACCEPTANCE BY TRUSTEE. The Trustee hereby acknowledges its
acceptance, on behalf of the Trust, pursuant to this Agreement, of all right,
title and interest in and to the Receivables conveyed by the Seller pursuant to
this Agreement and declares and shall declare from and after the date hereof
that the Trustee holds and shall hold such right, title and interest, upon the
trust set forth in this Agreement.
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SECTION 2.04 REPRESENTATIONS AND WARRANTIES OF SELLER AS TO THE
RECEIVABLES. The Seller does hereby make the following representations and
warranties on which the Trustee shall rely in accepting the Receivables in trust
and authenticating the Certificates:
(a) CHARACTERISTICS OF RECEIVABLES. Each Receivable (i) shall have
been originated in the United States by a Dealer for the retail sale of the
related Financed Vehicle in the ordinary course of such Dealer's business,
shall have been fully and properly executed by the parties thereto, shall
have been purchased by TMCC from such Dealer under an existing agreement
with TMCC and shall have been validly assigned by such Dealer to TMCC in
accordance with the terms of such agreement and shall have been
subsequently sold by TMCC to the Seller pursuant to the Receivables
Purchase Agreement, (ii) shall have created or shall create a valid,
subsisting and enforceable first priority security interest in favor of
TMCC in the related Financed Vehicle, which security interest has been
assigned by TMCC to the Seller and shall be assignable, and shall be so
assigned, by the Seller to the Trustee, (iii) shall, except as otherwise
provided in this Agreement, provide for level Monthly Payments (provided
that the payment in the first or last month in the life of the Receivable
may be minimally different from the level payment) that fully amortize the
Amount Financed by maturity and provide for a finance charge or yield
interest at its APR, in either case calculated based on the Rule of 78s,
the simple interest method or the actuarial method, (iv) shall contain
customary and enforceable provisions, such that the rights and remedies of
the holder thereof shall be adequate for realization against the collateral
of the benefits of the security and (v) shall provide for, in the event
that such Receivable is prepaid, a prepayment that fully pays the Principal
Balance and includes accrued but unpaid interest in an amount calculated by
using an interest rate at least equal to its APR.
(b) SCHEDULE OF RECEIVABLES. The information set forth in the Schedule
of Receivables shall be true and correct in all material respects as of the
opening of business on the Cutoff Date, and no selection procedures adverse
to the Certificateholders shall have been utilized in selecting the
Receivables from those automobile and light duty truck receivables of TMCC
which met the selection criteria set forth in this Section and this
Agreement.
(c) COMPLIANCE WITH LAW. Each Receivable and each sale of the related
Financed Vehicle shall have complied at the time it was originated or made,
and shall comply at the time of execution of this Agreement, in all
material respects with all requirements of applicable federal, state and
local laws, and regulations thereunder, including usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit
Billing Act, the Fair Credit Reporting Act, the Fair Debt Collection
Practices Act, the Federal Trade Commission Act, the ▇▇▇▇▇▇▇▇-▇▇▇▇ Warranty
Act, Federal Reserve Board Regulations B, M and Z (to the extent
applicable), state adaptations of the National Consumer Act and of the
Uniform Consumer Credit Code and other consumer credit, equal credit
opportunity and disclosure laws.
(d) BINDING OBLIGATION. Each Receivable shall constitute the legal,
valid and binding payment obligation in writing of the related Obligor,
enforceable by the holder thereof in accordance with its terms, except as
enforceability may be limited by
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bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting the enforcement of creditors' rights in general and by general
principles of equity, regardless of whether such enforceability shall be
considered in a proceeding in equity or at law.
(e) NO BANKRUPT OBLIGORS. None of the Receivables shall be due, to the
best knowledge of the Seller, from any Obligor who is presently the subject
of a bankruptcy proceeding or is bankrupt or is insolvent.
(f) NO GOVERNMENT OBLIGORS. None of the Receivables shall be due from
the United States or any state, or from any agency, department or
instrumentality of the United States or any state or local government.
(g) EMPLOYEE OBLIGORS. None of the Receivables shall be due from any
employee of the Seller, TMCC or any of their respective affiliates.
(h) SECURITY INTEREST IN FINANCED VEHICLES. Immediately prior to the
sale, assignment and transfer thereof, each Receivable shall be secured by
a validly perfected first priority security interest in the related
Financed Vehicle in favor of TMCC as secured party or all necessary and
appropriate action with respect to such Receivable shall have been taken to
perfect a first priority security interest in such Financed Vehicle in
favor of TMCC as secured party.
(i) RECEIVABLES IN FORCE. No Receivable shall have been satisfied,
subordinated or rescinded, nor shall any Financed Vehicle have been
released in whole or in part from the lien granted by the related
Receivable.
(j) NO WAIVERS. No provision of a Receivable shall have been waived in
such a manner that such Receivable fails to meet all of the other
representations and warranties made by the Seller herein with respect
thereto.
(k) NO AMENDMENTS. No Receivable shall have been amended or modified
in such a manner that the total number of Scheduled Payments has been
increased or that the related Amount Financed has been increased or that
such Receivable fails to meet all of the other representations and
warranties made by the Seller herein with respect thereto.
(l) NO DEFENSES. No facts shall be known to the Seller which would
give rise to any right of rescission, setoff, counterclaim or defense, nor
shall the same have been asserted or threatened, with respect to any
Receivable.
(m) NO LIENS. To the knowledge of the Seller, no liens or claims shall
have been filed, including liens for work, labor or materials relating to a
Financed Vehicle, that shall be liens prior to, or equal or coordinate
with, the security interest in such Financed Vehicle granted by the related
Receivable.
(n) NO DEFAULT; NO REPOSSESSION. Except for payment defaults that, as
of the Cutoff Date, have been continuing for a period of not more than o
days, no default, breach, violation or event permitting acceleration under
the terms of any Receivable shall have occurred as of the Cutoff Date; no
continuing condition that with notice or the lapse
23
of time would constitute a default, breach, violation or event permitting
acceleration under the terms of any Receivable shall have arisen; the
Seller shall not have waived any of the foregoing; and no Financed Vehicle
has been repossessed without reinstatement as of the Cutoff Date.
(o) INSURANCE. At the time of origination of each Receivable, each
Obligor was required under the terms of such Receivable to obtain and
maintain physical damage insurance covering the related Financed Vehicle.
(p) GOOD TITLE. It is the intention of the Seller that the transfer
and assignment herein contemplated, taken as a whole, constitute a sale of
the Receivables from the Seller to the Trust and that the beneficial
interest in and title to the Receivables not be part of the debtor's estate
in the event of the filing of a bankruptcy petition by or against the
Seller under any bankruptcy law. No Receivable has been sold, transferred,
assigned or pledged by the Seller to any Person other than the Trust, and
no provision of a Receivable shall have been waived, except as provided in
clause (j) above; immediately prior to the transfer and assignment herein
contemplated, the Seller had good and marketable title to each Receivable
free and clear of all Liens and rights of others; immediately upon the
transfer and assignment thereof, the Trust shall have good and marketable
title to each Receivable, free and clear of all Liens and rights of others;
and the transfer and assignment herein contemplated has been perfected
under the UCC.
(q) LAWFUL ASSIGNMENT. No Receivable shall have been originated in, or
shall be subject to the laws of, any jurisdiction under which the sale,
transfer and assignment of such Receivable under this Agreement or pursuant
to a transfer of the related certificate of title shall be unlawful, void
or voidable.
(r) ALL FILINGS MADE. All filings (including UCC filings) necessary in
any jurisdiction to provide third parties with notice of the transfer and
assignment herein contemplated, to perfect the sale of the Receivables from
the Seller to the Trustee and to give the Trustee on behalf of the Trust a
first priority perfected security interest in the Receivables shall have
been made.
(s) ONE ORIGINAL. There shall be only one original executed copy of
each Receivable.
(t) CHATTEL PAPER. Each Receivable constitutes "chattel paper" as
defined in the UCC.
(u) MATURITY OF RECEIVABLES. Each Receivable shall have an original
maturity of not less than o months nor greater than o months and, as of the
Cutoff Date, a remaining maturity of not less than o months nor greater
than o months.
(v) FINANCE CHARGE. Each Receivable provides for an APR equal to or
greater than o% and equal to or less than o%.
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(w) PRINCIPAL BALANCE. Each Receivable had an original principal
balance of not less than $o nor more than $o and an unpaid principal
balance, as of the Cutoff Date, of not less than $o nor more than $o.
(x) NO OVERDUE PAYMENTS. No Receivable shall have a Scheduled Payment
that is more than o days past due as of the Cutoff Date.
(y) LOCATION OF RECEIVABLE FILES. Each Receivable File shall be kept
at one of the locations listed in the Schedule of Receivables or at such
other office as shall be specified to the Trustee by 30 days' prior written
notice.
(z) PAYMENTS ON THE RECEIVABLES. Each Receivable shall provide for
level monthly payments that fully amortize the Amount Financed by maturity,
except that the payment in the first or last month in the life of the
Receivable may be minimally different from the level payment.
(aa) ORIGINATION DATE. Each Receivable was originated on or before o.
(bb) NO SPECIAL FINANCING. No Receivable was originated under a
special financing program.
(cc) NO FORCE-PLACED INSURANCE. No Financed Vehicle was subject to
force-placed insurance as of the Cutoff Date.
SECTION 2.05 REPURCHASE OF RECEIVABLES UPON BREACH. Upon discovery by the
Seller or the Servicer or upon the actual knowledge of a Responsible Officer of
the Trustee of a breach of any of the representations and warranties of the
Seller set forth in this Agreement that materially and adversely affects the
interests of the Certificateholders in any Receivable, the party discovering
such breach shall give prompt written notice to the others. As of the last day
of the second Collection Period following the Collection Period in which it
discovers or receives notice of such breach (or, at the Seller's election, the
last day of the first Collection Period following the Collection Period in which
it discovers or receives notice of such breach), the Seller shall, unless such
breach shall have been cured in all material respects, repurchase such
Receivable and, if necessary, the Seller shall enforce the obligation of TMCC
under the Receivables Purchase Agreement to repurchase such Receivable from the
Seller. This repurchase obligation shall obtain for all representations and
warranties of the Seller contained in this Agreement whether or not the Seller
has knowledge of the breach at the time of the breach or at the time the
representations and warranties were made. In consideration of the repurchase of
any such Receivable, on the Business Day immediately preceding the related
Distribution Date, the Seller shall remit the Warranty Purchase Payment of such
Receivable to the Collection Account in the manner specified in Section 4.05 and
shall be entitled to receive the Released Warranty Amount. In the event that any
Liens or claims shall have been filed, including Liens for work, labor or
materials relating to a Financed Vehicle, that shall be prior to, or equal or
coordinate with, the lien granted by the related Receivable, which Liens or
claims shall not have been satisfied or otherwise released in full as of the
Closing Date, and such breach materially and adversely affects the interests of
the Trust in such Receivable, the Seller shall repurchase such Receivable on the
terms and in the manner specified above.
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Upon any such repurchase, the Trustee on behalf of the Trust shall, without
further action, be deemed to transfer, assign, set-over and otherwise convey to
the Seller, all right, title and interest of the Trustee on behalf of the Trust
in, to and under such repurchased Receivable, all monies due or to become due
with respect thereto and all proceeds thereof. The Trustee shall execute such
documents and instruments of transfer and assignment and take such other actions
as shall be reasonably requested by the Seller to effect the conveyance of such
Receivable pursuant to this Section. The sole remedy of the Trustee, the Trust
or the Certificateholders with respect to a breach of the Seller's
representations and warranties pursuant to this Agreement or with respect to the
existence of any such Liens or claims shall be to require the Seller to
repurchase the related Receivable pursuant to this Section and to enforce TMCC's
obligation to the Seller to repurchase such Receivables pursuant to the
Receivables Purchase Agreement. The Trustee shall have no duty to conduct any
affirmative investigation as to the occurrence of any condition requiring the
repurchase of any Receivable pursuant to this Section.
SECTION 2.06 DUTIES OF SERVICER AS CUSTODIAN.
(a) SAFEKEEPING. The Servicer, in its capacity as custodian, shall
hold the Receivable Files on behalf of the Trustee for the use and benefit
of all present and future Certificateholders, and maintain such accurate
and complete accounts, records and computer systems pertaining to each
Receivable File as shall enable the Trustee to comply with this Agreement.
In performing its duties as custodian, the Servicer shall act with
reasonable care, using that degree of skill and attention that it exercises
with respect to the receivable files of comparable automobile and light
duty truck receivables that the Servicer services for itself or others. The
Servicer shall conduct, or cause to be conducted, periodic examinations of
the files of receivables owned or serviced by it which shall include
Receivable Files held by it under this Agreement, and of the related
accounts, records and computer systems, in such a manner as shall enable
the Trustee to verify the accuracy of the Servicer's record keeping. The
Servicer shall promptly report to the Trustee any failure on its part to
hold the Receivable Files and maintain its accounts, records and computer
systems as herein provided and promptly take appropriate action to remedy
any such failure.
(b) MAINTENANCE OF AND ACCESS TO RECORDS. The Servicer shall maintain
each Receivable File at one of its offices specified in the Schedule of
Receivables or at such other office as shall be specified to the Trustee by
30 days' prior written notice. The Servicer shall make available to the
Trustee or its duly authorized representatives, attorneys or auditors the
Receivable Files and the related accounts, records and computer systems
maintained by the Servicer at such times as the Trustee shall reasonably
instruct.
(c) RELEASE OF DOCUMENTS. Upon instruction from the Trustee, the
Servicer shall release any document in the Receivable Files to the Trustee
or its agent or designee, as the case may be, at such place or places as
the Trustee may designate, as soon as practicable. The Servicer shall not
be responsible for any loss occasioned by the failure of the Trustee to
return any document or any delay in doing so.
SECTION 2.07 INSTRUCTIONS; AUTHORITY TO ACT. The Servicer shall be deemed
to have received proper instructions with respect to the Receivable Files upon
its receipt of written
26
instructions signed by a Responsible Officer of the Trustee. A certified copy of
a bylaw or of a resolution of the board of directors of the Trustee shall
constitute conclusive evidence of the authority of any such Responsible Officer
to act and shall be considered in full force and effect until receipt by the
Servicer of written notice to the contrary given by the Trustee.
SECTION 2.08 INDEMNIFICATION OF CUSTODIAN. The Servicer, as custodian of
the Receivable Files, shall indemnify the Trustee for any and all liabilities,
obligations, losses, compensatory damages, payments, costs or expenses of any
kind whatsoever (including reasonable attorney's fees and expenses incurred in
connection with defending against any such claim) that may be imposed on,
incurred or asserted against the Trustee as the result of any improper act or
omission in any way relating to the maintenance and custody of the Receivable
Files by the Servicer, as custodian; provided, however, that the Servicer shall
not be liable for any portion of any such amount resulting from the willful
misfeasance, bad faith or negligence of the Trustee.
SECTION 2.09 EFFECTIVE PERIOD AND TERMINATION. The Servicer's appointment
as custodian of the Receivable Files shall become effective as of the Cutoff
Date and shall continue in full force and effect until terminated pursuant to
this Section. If the Servicer shall resign as Servicer pursuant to Section 7.05
or if all of the rights and obligations of the Servicer have been terminated
pursuant to Section 8.02, the appointment of the Servicer as custodian of the
Receivable Files shall be terminated by the Trustee, or by Certificate Owners
representing in the aggregate not less than 51% of the voting interests of the
Class A Certificates and Class B Certificates, acting as a single Class, in the
same manner as the Trustee or such Holders may terminate the rights and
obligations of the Servicer under Section 8.02. The Trustee may terminate the
Servicer's appointment as custodian of the Receivable Files with cause at any
time immediately upon written notification to the Servicer. As soon as
practicable after any termination of such appointment, the Servicer shall
deliver the Receivable Files to the Trustee or its agent at such place or places
as the Trustee may reasonably designate. Notwithstanding the termination of the
Servicer as custodian of the Receivable Files, the Trustee agrees that upon any
such termination, the Trustee shall provide, or cause its agent to provide,
access to the Receivable Files to the Servicer, upon reasonable advance written
request and during normal business hours, for the purpose of carrying out its
duties and responsibilities with respect to the servicing of the Receivables
pursuant to this Agreement.
SECTION 2.10 USAGE OF TERMS. With respect to all terms in this Agreement,
the singular includes the plural and the plural the singular; words importing
any gender include the other genders; references to "writing" include printing,
typing, lithography and other means of reproducing words in a visible form;
references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement; references to
Persons include their permitted successors and assigns; and the term "including"
means "including without limitation."
SECTION 2.11 CUTOFF DATE AND RECORD DATE. All references to the Record Date
prior to the first Record Date in the life of the Trust shall be to the Cutoff
Date.
SECTION 2.12 SECTION REFERENCES. All section references shall be to
Sections in this Agreement.
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SECTION 2.13 AGENT FOR SERVICE. The agent for service for the Seller shall
be its President, ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and
the agent for service for the Servicer shall be its Senior Vice President, ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 3.01 DUTIES OF SERVICER. The Servicer, as agent for the Trust,
shall manage, service, administer and make collections on and in respect of the
Receivables with reasonable care, using that degree of skill and attention that
the Servicer exercises with respect to all comparable automobile and light duty
truck receivables that it services for itself or others. The Servicer's duties
shall include collecting and posting of all payments, responding to inquiries of
Obligors or by federal, state or local government authorities with respect to
the Receivables, investigating delinquencies, sending payment information to
Obligors, reporting tax information to Obligors in accordance with its customary
practices, policing the collateral, accounting for collections, furnishing
monthly and annual statements to the Trustee with respect to distributions,
generating federal income tax information, making Advances and performing the
other duties specified herein. The Servicer shall follow its customary
standards, policies and procedures and shall have full power and authority,
acting alone, to do any and all things in connection with such managing,
servicing, administration and collection that it may deem necessary or
desirable.
Without limiting the generality of the foregoing, the Servicer shall be
authorized and empowered by the Trustee to execute and deliver, on behalf of
itself, the Trust, the Trustee or the Certificateholders or any of them, any and
all instruments of satisfaction or cancellation, or of partial or full release
or discharge and all other comparable instruments, with respect to the
Receivables and the Financed Vehicles. The Servicer is hereby authorized to
commence, in its own name or in the name of the Trust, a legal proceeding to
enforce a Defaulted Receivable pursuant to Section 3.04 or to commence or
participate in a legal proceeding (including without limitation a bankruptcy
proceeding) relating to or involving a Receivable, including a Defaulted
Receivable. If the Servicer commences or participates in such a legal proceeding
in its own name, the Trustee shall thereupon be deemed to have automatically
assigned, solely for the purpose of collection on behalf of the party retaining
an interest in such Receivable, such Receivable and the other property conveyed
to the Trust pursuant to Section 2.01 with respect to such Receivable to the
Servicer for purposes of commencing or participating in any such proceeding as a
party or claimant, and the Servicer is authorized and empowered by the Trustee
to execute and deliver in the Servicer's name any notices, demands, claims,
complaints, responses, affidavits or other documents or instruments in
connection with any such proceeding. If in any enforcement suit or legal
proceeding it shall be held that the Servicer may not enforce a Receivable on
the grounds that it shall not be a real party in interest or a holder entitled
to enforce such Receivable, the Trustee on behalf of the Trust shall, at the
Servicer's expense and written direction, take reasonable steps to enforce such
Receivable, including bring suit in its name or the name of the
Certificateholders. The Trustee shall furnish the Servicer with any powers of
attorney and other documents and take any other steps which the Servicer may
deem reasonably necessary or appropriate to enable the Servicer to carry out its
servicing and administrative duties under this Agreement.
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SECTION 3.02 COLLECTION OF RECEIVABLE PAYMENTS. The Servicer shall make
reasonable efforts to collect all payments called for under the terms and
provisions of the Receivables as and when the same shall become due, and shall
follow such customary collection procedures as it follows with respect to
comparable automobile or light duty truck receivables that it services for
itself or others. The Servicer shall be authorized to grant extensions, rebates
or adjustments on a Receivable in accordance with the customary servicing
standards of the Servicer without the prior consent of the Trustee; provided,
however, that if, as a result of any change in the related APR, increase in the
total number of Scheduled Payments, extension of payments such that the
Receivable will be outstanding later than the Final Scheduled Maturity Date, or
other modification of the terms of a Receivable, the amount of any Scheduled
Payment due in a subsequent Collection Period is reduced, the Servicer shall be
obligated to either repurchase such Receivable pursuant to Section 3.08 or to
make an Advance in respect of such Receivable in each subsequent Collection
period equal to the amount by which such Scheduled Payment has been reduced. In
addition, in the event that any such rescheduling or extension of a Receivable
modifies the terms of such Receivable in such a manner as to release the
security interest in the related Financed Vehicle or constitute a cancellation
of such Receivable and the creation of a new automobile or light duty truck
receivable, the Servicer shall purchase such Receivable pursuant to Section
3.08, and the receivable created shall not be included in the Trust. The
Servicer may, in accordance with its customary servicing procedures, waive any
prepayment charge, late payment charge or any other fees that may be collected
in the ordinary course of servicing the Receivables.
SECTION 3.03 REBATES ON FULL PREPAYMENTS. In the event that the amount of a
full Prepayment by an Obligor under a Precomputed Receivable, after adjustment
for the applicable Rebate, is less than the amount that would be payable under
the actuarial method if a full Prepayment were made at the end of the billing
month under such Precomputed Receivable, either because the Rebate calculated
under the terms of such Precomputed Receivable is greater than the amount
calculable under the actuarial method or because the Servicer's customary
servicing procedure is to credit a greater Rebate, the Servicer, as part of its
servicing duties, shall remit such difference to the Trust by deposit into the
Collection Account pursuant to Section 4.05.
SECTION 3.04 REALIZATION UPON RECEIVABLES. On behalf of the Trust, the
Servicer shall use its best efforts, consistent with its customary servicing
procedures, to repossess or otherwise comparably convert the ownership of any
Financed Vehicle that it has reasonably determined should be repossessed or
otherwise converted following a default under the Receivable secured by the
Financed Vehicle (and shall specify such Receivables to the Trustee no later
than the Determination Date following the end of the Collection Period in which
the Servicer shall have made such determination). The Servicer shall follow such
practices and procedures as it shall deem necessary or advisable and as shall be
customary and usual in its servicing of automobile and light duty truck
receivables, which practices and procedures may include reasonable efforts to
realize upon any Dealer Recourse, selling the related Financed Vehicle at public
or private sale and other actions by the Servicer in order to realize upon such
a Receivable. The Servicer shall be entitled to recover its reasonable
Liquidation Expenses with respect to each Defaulted Receivable. All Net
Liquidation Proceeds realized in connection with any such action with respect to
a Receivable shall be deposited by the Servicer in the Collection Account in the
manner specified in Section 4.02. The foregoing is subject to the proviso that,
in
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any case in which the Financed Vehicle shall have suffered damage, the Servicer
shall not expend funds in connection with any repair or towards the repossession
of such Financed Vehicle unless it shall determine in its discretion that such
repair and/or repossession shall increase the Liquidation Proceeds of the
related Receivable by an amount greater than the amount of such expenses.
SECTION 3.05 MAINTENANCE OF PHYSICAL DAMAGE INSURANCE POLICIES. The
Servicer shall, in accordance with its customary servicing procedures and
underwriting standards, require that each Obligor shall have obtained physical
damage insurance covering each Financed Vehicle as of the origination of the
related Receivable.
SECTION 3.06 MAINTENANCE OF SECURITY INTERESTS IN FINANCED VEHICLES. The
Servicer shall, in accordance with its customary servicing procedures and at its
own expense, take such steps as are necessary to maintain perfection of the
security interest created by each Receivable in the related Financed Vehicle.
The Trustee hereby authorizes the Servicer, and the Servicer hereby agrees, to
take such steps as are necessary to again perfect such security interest on
behalf of the Trust in the event of the relocation of a Financed Vehicle or for
any other reason. In the event that the assignment of a Receivable to the Trust
is insufficient, without a notation on the related Financed Vehicle's
certificate of title, to grant to the Trust a first priority perfected security
interest in the related Financed Vehicle, the Servicer hereby agrees to serve as
the agent of the Trust for the purpose of perfecting the security interest of
the Trust in such Financed Vehicle and agrees that the Servicer's listing as the
secured party on the certificate of title is in this capacity as agent of the
Trust.
SECTION 3.07 COVENANTS OF SERVICER. The Servicer shall make the following
covenants on which the Trustee shall rely in accepting the Receivables in trust
and authenticating the Certificates.
(a) LIENS IN FORCE. Except as contemplated by this Agreement, the
Servicer shall not release in whole or in part any Financed Vehicle from
the security interest securing the related Receivable.
(b) NO IMPAIRMENT. The Servicer shall do nothing to impair the rights
of the Certificateholders in the Receivables.
(c) NO AMENDMENTS. Except as provided in Section 3.02, the Servicer
shall not amend or otherwise modify any Receivable such that the total
number of Scheduled Payments, the Amount Financed or the APR is altered or
extends the maturity of such Receivable beyond the Final Scheduled Maturity
Date.
SECTION 3.08 PURCHASE OF RECEIVABLES UPON BREACH. Upon discovery by the
Seller, the Servicer or the Trustee of a breach of any of the covenants of the
Servicer set forth in Section 3.07 that materially and adversely affects the
interests of the Certificateholders in a Receivable, or if an improper
extension, rescheduling or modification of a Receivable is made by the Servicer
as described in Section 3.02, the party discovering such breach shall give
prompt written notice to the others. As of the last day of the second Collection
Period following the Collection Period in which it discovers or receives notice
of such breach (or, at the Servicer's
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election, the last day of the first Collection Period following the Collection
Period in which it discovers or receives notice of such breach), the Servicer
shall, unless such breach or impropriety shall have been cured in all material
respects, purchase from the Trust such Receivable. In consideration of the
purchase of any such Receivable, on the Business Day immediately preceding the
related Distribution Date the Servicer shall remit the Administrative Purchase
Payment to the Collection Account in the manner specified in Section 4.05, and
shall be entitled to receive the Released Administrative Amount. Upon such
deposit of the Administrative Purchase Payment, the Servicer shall for all
purposes of this Agreement be deemed to have released all claims for
reimbursement of Outstanding Advances made in respect of such Receivable. The
sole remedy of the Trustee, the Trust or the Certificateholders against the
Servicer with respect to a breach pursuant to Section 3.02 or 3.07 shall be to
require the Servicer to purchase the related Receivables pursuant to this
Section, except as otherwise provided in Section 7.02. The Trustee shall have no
duty to conduct any affirmative investigation as to the occurrence of any
condition requiring the repurchase of any Receivable pursuant to this Section
except as otherwise provided in Section 7.02.
SECTION 3.09 TOTAL SERVICING FEE; PAYMENT OF CERTAIN EXPENSES BY SERVICER.
As compensation for the performance of its obligations hereunder, the Servicer
shall be entitled to receive on each Distribution Date, out of Available
Interest, the Total Servicing Fee. The Basic Servicing Fee in respect of a
Collection Period shall be calculated based on a 360 day year comprised of
twelve 30-day months. Except to the extent otherwise provided herein, the
Servicer shall be required to pay all expenses incurred by it in connection with
its activities under this Agreement (including fees and disbursements of the
Trustee and independent accountants, taxes imposed on the Servicer, expenses
incurred in connection with distributions and reports to Certificateholders and
all other fees and expenses not expressly stated under this Agreement to be for
the account of the Certificateholders).
SECTION 3.10 SERVICER'S CERTIFICATE. On or before each Determination Date,
the Servicer shall deliver to the Trustee and each Rating Agency a Servicer's
Certificate executed by the President or any Vice President or principal
accounting officer of the Servicer substantially in the form attached hereto as
Exhibit A (and setting forth such additional information as requested by the
Trustee or any Rating Agency from time to time which information the Servicer is
able to reasonably provide) containing all information necessary to make the
distributions required by Sections 4.06 and 4.07 in respect of the Collection
Period immediately preceding the date of such Servicer's Certificate and all
information necessary for the Trustee to send statements to Certificateholders
pursuant to Section 4.10(a). The Servicer shall also specify to the Trustee, no
later than the Determination Date following the last day of a Collection Period
as of which the Seller shall be required to repurchase or the Servicer shall be
required to purchase a Receivable, the identity of any such Receivable and the
identity of any Receivable which the Servicer shall have determined to be a
Defaulted Receivable during such Collection Period. Receivables purchased or to
be purchased by the Servicer or the Seller and Receivables that the Servicer has
determined during such Collection Period to be Defaulted Receivables and with
respect to which payment of the Administrative Purchase Payment or Warranty
Purchase Payment has been provided from whatever source as of the last day of
such Collection Period shall be identified by the related Obligor's account
number (as specified in the Schedule of Receivables).
SECTION 3.11 ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF DEFAULT.
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(a) The Servicer shall deliver to the Trustee, on or before December
31 of each year, beginning with [ __________ ], 200_, an Officer's
Certificate of the Servicer, stating that (i) a review of the activities of
the Servicer during the preceding 12-month period ended [ __________ ] (or
other applicable period in the case of the first such Officer's
Certificate) and of its performance under this Agreement has been made
under such officer's supervision, and (ii) to such officer's knowledge,
based on such review, the Servicer has fulfilled all its obligations under
this Agreement throughout such period, or, if there has been a default in
the fulfillment of any such obligation, specifying each such default known
to such officer and the nature and status thereof.
(b) The Servicer shall deliver to the Trustee, promptly after having
obtained knowledge thereof, but in no event later than five Business Days
thereafter, an Officer's Certificate specifying the nature and status of
any event which with the giving of notice or lapse of time, or both, would
become an Event of Default.
SECTION 3.12 ANNUAL ACCOUNTANTS' REPORT. The Servicer shall cause a firm of
independent accountants (who may also render other services to the Servicer or
to the Seller) to deliver to the Trustee on or before [ __________ ] of each
year, beginning with beginning with [ __________ ], 200_, an Officer's
Certificate of the Servicer, stating that (i) a review of the activities of the
Servicer during the preceding 12-month period ended [ __________ ] (or other
applicable period in the case of the first such report or letter) to the effect
that such accountants have reviewed certain records and documents relating to
the servicing of the Receivables under this Agreement (using procedures
specified in such report or letter) and as a result of such review, and in
connection with such procedures, they are reporting such exceptions, if any, as
shall be set forth therein. Such report or letter shall also indicate that the
firm is independent with respect to the Seller and the Servicer within the
meaning of the Code of Professional Ethics of the American Institute of
Certified Public Accountants.
SECTION 3.13 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
RECEIVABLES. The Servicer shall provide to the Trustee reasonable access to the
documentation regarding the Receivables. The Servicer shall provide such access
to any Certificateholder only in such cases where a Certificateholder is
required by applicable statutes or regulations to review such documentation. In
each case, such access shall be afforded without charge but only upon reasonable
request and during normal business hours at the respective offices of the
Servicer. Nothing in this Section shall derogate from the obligation of the
Servicer to observe any applicable law prohibiting disclosure of information
regarding the Obligors, and the failure of the Servicer to provide access as
provided in this Section as a result of such obligation shall not constitute a
breach of this Section.
SECTION 3.14 AMENDMENTS TO SCHEDULE OF RECEIVABLES. If the Servicer, during
a Collection Period, assigns to a Receivable an account number that differs from
the original account number identifying such Receivable on the Schedule of
Receivables, the Servicer shall deliver to the Seller and the Trustee on or
before the Distribution Date relating to such Collection Period an amendment to
the Schedule of Receivables reporting the newly assigned account number,
together with the old account number of each such Receivable. The first such
delivery of amendments to the Schedule of Receivables to the Trustee shall
include monthly amendments
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reporting account numbers appearing on the Schedule of Receivables with the new
account numbers assigned to such Receivables during any prior Collection Period.
SECTION 3.15 REPORTS TO CERTIFICATEHOLDERS AND RATING AGENCIES.
(a) The Trustee shall provide to any Certificateholder or Certificate
Owner who so requests in writing a copy of any (i) Servicer's Certificate,
(ii) annual statement as to compliance described in Section 3.11(a), (iii)
annual accountants' report described in Section 3.12 or (iv) statement to
Certificateholders pursuant to Section 4.10(a). The Trustee may require
such Certificateholder or Certificate Owner to pay a reasonable sum to
cover the cost of the Trustee's complying with such request.
(b) The Trustee shall forward to each Rating Agency a copy of each (i)
Servicer's Certificate, (ii) annual statement as to compliance described in
Section 3.11(a), (iii) Officer's Certificate of the Servicer described in
Section 3.11(b), (iv) annual accountants' report pursuant to Section 3.12,
(v) statement to Certificateholders pursuant to Section 4.10(a), (vi)
Trustee's Certificate delivered by the Trustee pursuant to Section 9.02 or
9.03 and (vii) other report it may receive pursuant to this Agreement at
its address specified in Section 11.05 or in this Agreement.
ARTICLE IV
ACCOUNTS; DISTRIBUTIONS;
STATEMENTS TO CERTIFICATEHOLDERS
SECTION 4.01 ACCOUNTS.
(a) The Servicer shall establish the Collection Account and Payahead
Account in the name of the Trustee for the benefit of the
Certificateholders. Except as otherwise provided in this Agreement, each
such account shall be an account initially established with the Trustee and
maintained with the Trustee so long as (i) the commercial paper or other
short-term unsecured debt obligations of the Trustee are rated "P-1" or
better by Moody's, or if not rated by Moody's then otherwise approved by
Moody's, and "A-1+" or better by Standard & Poor's if rated by Standard &
Poor's, or if not rated by Standard & Poor's then otherwise approved by
Standard & Poor's, in each case at the time of any deposit therein, or (ii)
such account is a segregated trust account located in the corporate trust
department of the Trustee bearing a designation clearly indicating that the
funds deposited therein (other than interest or investment earnings
thereon) are held in trust for the benefit of the Certificateholders, and
the Trustee has a long-term deposit rating from Moody's (so long as ▇▇▇▇▇'▇
is a Rating Agency) of at least "A1" (or such lower rating as Moody's shall
approve in writing) and corporate trust powers under applicable federal and
state laws and is organized under the laws of the United States or any
state thereof, the District of Columbia or the Commonwealth of Puerto Rico.
Except as otherwise provided in this Agreement, in the event that the
Trustee no longer meets either of the foregoing requirements, then the
Servicer shall, with the Trustee's assistance as necessary, cause the
Collection Account and Payahead Account to be moved to a bank or trust
company that satisfies either of such requirements.
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(b) For so long as the depository institution or trust company then
maintaining the Collection Account and Payahead Account meets the
requirements of Section 4.01(a)(i) or (a)(ii), all amounts held in these
accounts shall, to the extent permitted by applicable laws, rules and
regulations, be invested, as directed in writing by the Servicer, in
Eligible Investments; otherwise such amounts shall be maintained in cash.
Earnings on investment of funds in these accounts (net of losses and
investment expenses) shall be paid to the Servicer on each Distribution
Date as servicing compensation, and any losses and investment expenses
shall be charged against the funds on deposit in the related account.
(c) For so long as o is the Trustee, the Collection Account and
Payahead Account shall be maintained with o as described in clause (ii) of
the second sentence of Section 4.01(a). In the event that the long-term
debt rating of the Trustee does not satisfy clause (ii) of the second
sentence of Section 4.01(a), the Servicer shall, with the assistance of the
Trustee as necessary, cause the Collection Account and Payahead Account to
be moved to an institution or an account otherwise satisfying the
requirements of Section 4.01(a).
(d) Subject to the foregoing, the Servicer, on behalf of the Trustee,
shall establish and maintain as the Collection Account an Eligible Deposit
Account in the name of and under the exclusive control of the Trustee,
bearing a designation clearly indicating that the funds deposited therein
are held for the benefit of the Certificateholders. On the Closing Date,
the Trustee will transfer, or cause to be transferred, to such Collection
Account all funds or investments on deposit in the Collection Account
established pursuant to the Trust Agreement for the benefit of the
Certificateholders, and all of the proceeds thereof, and will transfer all
of its right, title and interest in the Collection Account, all funds or
investments held or to be held therein and all proceeds thereof, whether or
not on behalf of the Certificateholders, to the Trustee for the benefit of
the Certificateholders.
SECTION 4.02 COLLECTIONS.
(a) Except as otherwise provided in this Agreement, the Servicer shall
remit daily to the Collection Account all payments received by or on behalf
of the Obligors on or in respect of the Receivables (other than, in the
case of Precomputed Receivables, payments constituting Payments Ahead) and
all Net Liquidation Proceeds within two Business Days after receipt
thereof. Notwithstanding the foregoing, for so long as (i) TMCC is the
Servicer, (ii) either (a) TMCC's short-term unsecured debt is rated P-1 by
Moody's and A-1 by Standard & Poor's (so long as Moody's and Standard &
Poor's are Rating Agencies), or (b) certain arrangements are made that have
been approved in writing by each Rating Agency and (iii) an Event of
Default shall not have occurred and be continuing (collectively, the
"Monthly Remittance Conditions"), the Servicer shall not be required to
remit such collections to the Collection Account on the foregoing daily
basis but shall be entitled to retain such collections, without segregation
from its other funds, until the Business Day before each Distribution Date
at which time the Servicer shall remit all such collections in respect of
the related Collection Period to the Collection Account in immediately
available funds. Commencing with the first day of the first Collection
Period that begins at least two Business Days after the day on which any
34
Monthly Remittance Condition ceases to be satisfied and for so long as any
Monthly Remittance Conditions is not satisfied, all collections then held
by the Servicer shall be immediately deposited into the Collection Account
and all future collections on or in respect of the Receivables and all Net
Liquidation Proceeds shall be remitted by the Servicer to the Collection
Account on a daily basis within two Business Days after receipt thereof.
(b) Except as otherwise provided in this Agreement, the Servicer shall
deposit all Payments Ahead in the Collection Account within two Business
Days after receipt thereof, which Payments Ahead shall be transferred to
the Payahead Account pursuant to Section 4.06(a)(ii). Notwithstanding the
foregoing, so long as all Monthly Remittance Conditions are satisfied, the
Servicer will not be required to deposit Payments Ahead in the Collection
Account or the Payahead Account within two Business Days after receipt
thereof but shall be entitled to retain such Payments Ahead, without
segregation from its other funds, until such time as the Servicer shall be
required to remit Applied Payments Ahead to the Collection Account pursuant
to Section 4.06(a)(i). Commencing with the first day of the first
Collection Period that begins at least two Business Days after the day on
which any Monthly Remittance Condition ceases to be satisfied and for so
long as all Monthly Remittance Conditions are not satisfied, all Payments
Ahead then held by the Servicer shall be immediately deposited into the
Payahead Account and all future Payments Ahead shall be remitted by the
Servicer to the Payahead Account within two Business Days after receipt
thereof.
(c) The Servicer shall give the Trustee and each Rating Agency written
notice of the failure of any Monthly Remittance Condition (and any
subsequent curing of a failed Monthly Remittance Condition) as soon as
practical after the occurrence thereof. Notwithstanding the failure of any
Monthly Remittance Condition, the Servicer may utilize an alternative
collection or Payment Ahead remittance schedule (which may be the
remittance schedule previously utilized prior to the failure of such
Monthly Remittance Condition), if the Servicer provides to the Trustee
written confirmation from each Rating Agency that such alternative
remittance schedule will not result in the qualification, reduction or
withdrawal of the rating then assigned to any Class of Rated Certificates.
SECTION 4.03 APPLICATION OF COLLECTIONS. As of the Business Day immediately
preceding the related Distribution Date, all collections for the related
Collection Period shall be applied by the Servicer as follows:
(a) With respect to each Receivable (other than an Administrative
Receivable or a Warranty Receivable), payments made by or on behalf of the
Obligor which are not Supplemental Servicing Fees shall be applied first to
reimburse the Servicer for Outstanding Advances made with respect to such
Receivable (each such payment, an "Overdue Payment"). Next, the amount of
any payment in excess of Supplemental Servicing Fees and Outstanding
Advances with respect to such Receivable shall be applied to the Scheduled
Payment with respect to such Receivable. If the amount of such payment
remaining after the applications described in the two preceding sentences
(i) equals (together with any Deferred Prepayment) the unpaid principal
balance of such Receivable, it shall be applied to prepay the principal
balance of such Receivable, or (ii)
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is less than the unpaid principal balance of such Receivable, it shall
constitute a Payment Ahead with respect to such Receivable.
(b) With respect to each Administrative Receivable and Warranty
Receivable, payments made by or on behalf of the Obligor shall be applied
in the same manner, except that any Released Administrative Amount or
Released Warranty Amount shall be remitted to the Servicer or the Seller,
as applicable. A Warranty Purchase Payment or an Administrative Purchase
Payment shall be applied to reduce Outstanding Advances and such Warranty
Purchase Payment or Administrative Purchase Payment, as applicable, shall
be applied to the Scheduled Payment, in each case to the extent that the
payments by the Obligor shall be insufficient, and then to prepay the
unpaid principal balance of such Receivable in full.
SECTION 4.04 ADVANCES.
(a) As of last day of a Collection Period, if the payments during such
Collection Period by or on behalf of the Obligor on or in respect of a
Precomputed Receivable (other than an Administrative Receivable or a
Warranty Receivable) after application under Section 4.03(a) shall be less
than the Scheduled Payment (determined as of the Closing Date), whether as
a result of any modification or extension granted to the Obligor or
otherwise, then the Deferred Prepayment, if any, with respect to such
Precomputed Receivable shall be applied by the Servicer to the extent of
the shortfall, and such Deferred Prepayment shall be reduced accordingly.
Subject to the provisions of the last sentence of this paragraph, the
Servicer shall deposit an amount equal to such shortfall (each, a
"Precomputed Advance") in the Collection Account on the Business Day
immediately preceding the related Distribution Date. In addition, as of
last day of a Collection Period, if the payments during such Collection
Period by or on behalf of the Obligor on or in respect of a Simple Interest
Receivable (other than an Administrative Receivable or a Warranty
Receivable) after application under Section 4.03(a) shall be less than the
Scheduled Payment (determined as of the Closing Date), whether as a result
of any modification or extension granted to the Obligor or otherwise, then
an amount equal to the product of the Principal Balance of such Receivable
as of the first day of the related Collection Period and one-twelfth of its
Annual Percentage Rate minus the amount of interest actually received on
such Receivable during the Collection Period (each, a "Simple Interest
Advance") shall be deposited by the Servicer into the Collection Account on
the Business Day immediately preceding the related Distribution Date. If
such a calculation in respect of a Simple Interest Receivable results in a
negative number, an amount equal to such negative amount shall be paid to
the Servicer in reimbursement of any Outstanding Advances in respect of
Simple Interest Receivables. In addition, in the event that a Simple
Interest Receivable becomes a Liquidated Receivable, the amount of accrued
and unpaid interest thereon (but not including interest for the current
Collection Period) shall, up to the amount of Outstanding Advances in
respect of Simple Interest Receivables in respect thereof, be withdrawn
from the Collection Account and paid to the Servicer in reimbursement of
such Outstanding Advances. No Advances will be made with respect to the
Principal Balance of Simple Interest Receivables. The Servicer shall not be
required to make an Advance (other than a Simple Interest Advance in
respect of an interest shortfall arising from the Prepayment of a Simple
Interest
36
Receivable) to the extent that the Servicer, in its sole discretion, shall
determine that such Advance is unlikely to be recovered from subsequent
payments made by or on behalf of the related Obligor, Liquidation Proceeds,
by the Administrative Purchase Payment or by the Warranty Purchase Payment
with respect to such Receivable or otherwise.
(b) The Servicer shall be entitled to reimbursement for Outstanding
Advances, without interest, with respect to a Receivable from the following
sources with respect to such Receivable: (i) subsequent payments made by or
on behalf of the related Obligor, (ii) Liquidation Proceeds, (iii) the
Administrative Purchase Payment, and (iv) the Warranty Purchase Payment;
provided, however, that in the case of Advances made pursuant to Section
3.02, the Servicer shall be entitled to reimbursement only from amounts
received in respect of such Receivable that are in excess of the amount of
the Scheduled Payment in the related Collection Period.
(c) To the extent that during any Collection Period any funds
described above in Section 4.04(b) with respect to a Receivable as to which
the Servicer previously has made an unreimbursed Advance are received by
the Trustee or the Servicer, and the Servicer determines that any
Outstanding Advances with respect to such Receivable are unlikely to be
recovered from payments made on or with respect to such Receivable (each, a
"Nonrecoverable Advance"), then, on the related Distribution Date, upon the
Servicer providing the Seller and the Trustee with an Officer's Certificate
setting forth the basis for its determination of any such amount, the
Trustee shall promptly remit to the Servicer (i) from Available Interest an
amount equal to the portion of such Nonrecoverable Advance allocable to
interest and (ii) from Available Principal an amount equal to the portion
of such Nonrecoverable Advance allocable to principal, in each case without
interest, in accordance with Section 4.06(c)(i). In lieu of causing the
Trustee to remit any such amounts or the amounts described in clauses (i)
through (iv) in Section 4.04(b), the Servicer may deduct such amounts from
deposits otherwise to be made into the Collection Account.
SECTION 4.05 ADDITIONAL DEPOSITS.
(a) The following additional deposits shall be made to the Collection
Account: (i) the Seller shall remit the aggregate Warranty Purchase
Payments with respect to Warranty Receivables pursuant to Section 2.05 or
the amount required upon the optional termination of the Trust by the
Seller or the Servicer, or any successor to the Servicer, pursuant to
Section 10.02; (ii) the Servicer shall remit (A) the amount required to be
remitted in respect of certain full Prepayments pursuant to Section 3.03,
(B) the aggregate Advances pursuant to Sections 3.02, 3.08 and 4.04(a), and
(C) the aggregate Administrative Purchase Payments with respect to
Administrative Receivables pursuant to Sections 3.02 and 3.08; and (iii)
the Trustee shall transfer any Yield Maintenance Deposit from the Yield
Maintenance Account to the Collection Account pursuant to Sections 4.06 (in
assuring the availability therein of the related Available Interest) and
4.08(b) and shall transfer the amounts described in Sections 4.06 and
4.07(b) from the Reserve Fund to the Collection Account pursuant to Section
4.07(b).
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(b) All deposits required to be made pursuant to this Section by the Seller
or the Servicer, as the case may be, may be made in the form of a single deposit
and shall be made in immediately available funds, no later than 5:00 P.M., New
York City time, on the Business Day immediately preceding the related
Distribution Date. At the direction of the Servicer, the Trustee shall invest
such amounts in Eligible Investments maturing not later than [3:00 P.M.] New
York City Time, on the related Distribution Date.
SECTION 4.06 DISTRIBUTIONS.
(a) On each Distribution Date (or, if both the Accounts are not
maintained by the Trustee, on the Business Day immediately preceding each
Distribution Date), the Trustee shall cause to be made the following
transfers and distributions in immediately available funds in the amounts
set forth in the Servicer's Certificate for such Distribution Date:
(i) from the Payahead Account (or directly from the Servicer in
the case of Payments Ahead held by the Servicer pursuant to Section
4.02(b) or (c)) to the Collection Account, the aggregate Applied
Payments Ahead; and
(ii) if the Servicer is not permitted to hold Payments Ahead
pursuant to Section 4.02(b) or (c), from the Collection Account to the
Payahead Account, the aggregate Payments Ahead for the related
Collection Period.
(b) On each Determination Date, the Servicer shall calculate the
Available Interest, the Available Principal, the Class A Distributable
Amount, the Class B Distributable Amount, the amount to be distributed to
Certificateholders of each Class and all other distributions to be made on
the related Distribution Date.
(c) The rights of the Class B Certificateholders to receive
distributions in respect of the Class B Certificates shall be and hereby
are subordinated to the rights of the Class A Certificateholders to receive
distributions in respect of the Class A Certificates to the extent provided
in this Section. On each Distribution Date, the Trustee shall make the
following distributions from the Collection Account in the following order
of priority and in the amounts set forth in the Servicer's Certificate for
such Distribution Date; provided, however, that except as otherwise
provided in Sections 4.05(a) or 4.06(a), such distributions shall be made
only from those funds deposited in the Collection Account for the related
Collection Period:
(i) to the Servicer from Available Interest or Available
Principal, any payments in respect of Nonrecoverable Advances required
pursuant to Section 4.04(c);
(ii) to the Servicer, from Available Interest (after giving
effect to any reduction in Available Interest described in clause (i)
above), the Total Servicing Fee (including any unpaid Total Servicing
Fees from one or more prior Collection Periods);
(iii) to the Class A Certificateholders of record, from Available
Interest (after giving effect to the reduction in Available Interest
described in clauses (i)
38
and (ii) above), an amount equal to the sum of the Class A Interest
Distributable Amount and any outstanding Class A Interest Carryover
Shortfall from the immediately preceding Distribution Date and, if
such Available Interest is insufficient, the Class A
Certificateholders will receive such shortfall first, from the Class B
Percentage of Available Principal and second, if such amounts are
still insufficient, from monies on deposit in the Reserve Fund;
(iv) to the Class B Certificateholders of record, from Available
Interest (after giving effect to the reduction in Available Interest
described in clauses (i), (ii) and (iii) above), an amount equal to
the sum of the Class B Interest Distributable Amount and any
outstanding Class B Interest Carryover Shortfall from the immediately
preceding Distribution Date and, if such Available Interest is
insufficient, the Class B Certificateholders will receive such
shortfall from monies on deposit in the Reserve Fund;
(v) to the Class A Certificateholders of record, from Available
Principal (after giving effect to any reduction in Available Principal
described in clauses (i) and (iii) above), an amount equal to the sum
of the Class A Principal Distributable Amount and any outstanding
Class A Principal Carryover Shortfall from the immediately preceding
Distribution Date and, if such Available Principal is insufficient,
the Class A Certificateholders will receive such shortfall first, from
Available Interest (after giving effect to the reduction in Available
Interest described in clauses (i) through (iv) above) and second, if
such amounts are still insufficient, from monies on deposit in the
Reserve Fund; and
(vi) to the Class B Certificateholders of record, from Available
Principal (after giving effect to the reduction in Available Principal
described in clauses (i), (iii) and (v) above), an amount equal to the
sum of the Class B Principal Distributable Amount and any outstanding
Class B Principal Carryover Shortfall from the immediately preceding
Distribution Date and, if such Available Principal is insufficient,
the Class B Certificateholders will receive such shortfall first, from
Available Interest (after giving effect to the reduction in Available
Interest described in clauses (i) through (v) above) and second, if
such amounts are still insufficient, from monies on deposit in the
Reserve Fund.
(d) On each Distribution Date, the Trustee shall deposit any Excess
Amounts into the Reserve Fund until the amount on deposit therein equals
the Specified Reserve Fund Balance and shall distribute the remainder, if
any, to the Seller.
(e) Subject to Section 10.01 respecting the final payment upon
retirement of each Certificate, the Servicer shall on each Distribution
Date instruct the Trustee to distribute to each Certificateholder of any
Class of record on the related Record Date by check mailed to such
Certificateholder at the address of such Holder appearing in the
Certificate Register (or, if DTC, its nominee or a Clearing Agency is the
relevant Certificateholder, by wire transfer of immediately available funds
or pursuant to other arrangements), the amount to be distributed to such
Certificateholder pursuant to such Holder's Certificates.
39
SECTION 4.07 RESERVE FUND.
(a) (i) In order to effectuate the subordination provided for herein
and to assure that sufficient amounts to make required distributions
to Certificateholders will be available, the Seller shall establish
and maintain with the Trustee a trust account: the "Reserve Fund"
which will include the money and other property deposited and held
therein pursuant to Section 4.06(d) and this Section. Except as
otherwise provided in this Agreement, the Reserve Fund shall (A) be a
segregated trust account initially established with the Trustee and
maintained with the Trustee so long as the commercial paper or other
short-term unsecured debt obligations of the Trustee have the Required
Rating and (B) in the event that the commercial paper or other
short-term unsecured debt obligations of the Trustee no longer have
the Required Rating, the Servicer shall, with the assistance of the
Trustee as necessary, cause the Reserve Fund to be moved to (1) a
segregated deposit account in a bank or trust company, the commercial
paper or other short-term unsecured debt obligations of which shall
have the Required Rating, or (2) a segregated trust account bearing a
designation clearly indicating the funds deposited therein are held in
trust for the benefit of the Class A Certificateholders and the Class
B Certificateholders located in the corporate trust department of a
depository institution or trust company (which may include the
Trustee) having a long-term deposit rating from Moody's (so long as
▇▇▇▇▇'▇ is a Rating Agency) of at least ___ (or such lower rating as
Moody's shall approve in writing) and corporate trust powers under
applicable federal and state laws and organized under the laws of the
United States or any state thereof, the District of Columbia or the
Commonwealth of Puerto Rico.
On or prior to the Closing Date, the Seller shall deposit an
amount equal to the Reserve Fund Initial Deposit into the Reserve
Fund. The Reserve Fund shall not be part of the Trust but instead will
be held for the benefit of the Holders of the Class A Certificates and
the Class B Certificates. The Seller hereby acknowledges that the
Reserve Fund Initial Deposit (and any investment earnings thereon) are
owned directly by it, and the Seller hereby agrees to treat the same
as its assets (and earnings) for federal income tax and all other
purposes. On each Distribution Date, Excess Amounts will be deposited
into the Reserve Fund by the Trustee to the extent set forth in
Section 4.06(d).
(ii) In order to give effect to the subordination provided for
herein and to assure availability of the amounts maintained in the
Reserve Fund, the Seller hereby sells, conveys and transfers to the
Trustee, as collateral agent, and its successors and assigns, the
Reserve Fund Initial Deposit and all proceeds thereof and hereby
pledges to the Trustee as collateral agent, and its successors and
assigns, all other amounts deposited in or credited to the Reserve
Fund from time to time under this Agreement, all earnings and
distributions thereon and proceeds thereof (other than proceeds
constituting interest or net investment earnings attributable to the
investment of the Reserve Fund at the direction of the Servicer)
subject, however, to the limitations set forth below, and solely for
the purpose of securing and providing for payment of the Class A and
Class B Distributable
40
Amounts, together with any Class A and Class B Interest Carryover
Shortfalls and Class A and Class B Principal Carryover Shortfalls, in
accordance with Section 4.06 and this Section to have and to hold all
the aforesaid property, rights and privileges unto the Trustee, its
successors and assigns, in trust for the uses and purposes, and
subject to the terms and provisions, set forth in this Section. The
Trustee hereby acknowledges such transfer and accepts the trust
hereunder and shall hold and distribute the Reserve Fund in accordance
with the terms and provisions of this Section.
(b) Consistent with the limited purposes for which such trust are
granted, on each Distribution Date the amount on deposit in the Reserve
Fund shall be available for, and applied to make, distributions as provided
in Section 4.06. In addition, on each Distribution Date on which the amount
on deposit in the Reserve Fund (after giving effect to all deposits thereto
or withdrawals therefrom on such Distribution Date) is greater than the
Specified Reserve Fund Balance, the Trustee will distribute any remaining
amounts to the Seller. Upon any such distribution to the Seller, the
Certificateholders will have no further rights in, or claims to, such
amount.
(c) (i) Amounts held in the Reserve Fund shall be invested in the
manner specified in Section 4.01(b). Such investments shall not be sold or
disposed of prior to their maturity. All such investments shall be made in
the name of the Trustee, its Financial Intermediary or its nominee, in
either case as collateral agent, and all income and gain realized thereon
shall be solely for the benefit of the Seller and shall be payable by the
Trustee to the Seller on each Distribution Date. Realized losses, if any,
on investment of the Reserve Fund shall be charged first against
undistributed investment earnings attributable to the Reserve Fund and then
against the Reserve Fund.
(ii) With respect to the Reserve Fund, the Seller and the Trustee
agree that:
(A) any Reserve Fund property that is held in deposit
accounts shall be held solely in the name of the Trustee, as
collateral agent, at the Trustee (in a segregated trust account if the
deposits of the Trustee do not have the Required Rating) or at one or
more depository institutions which are eligible to maintain the
Reserve Fund as described in Section 4.07(a)(i); such deposit account
shall be subject to the exclusive custody and control of the Trustee,
and the Trustee shall have sole signature authority with respect
thereto;
(B) any Reserve Fund property that constitutes Physical
Property shall be delivered to the Trustee, as collateral agent, in
accordance with paragraph (i) of the definition of the term "Delivery"
and shall be held, pending maturity or disposition, solely by the
Trustee, as collateral agent or a financial intermediary (as such term
is defined in Section 8-313(4) of the UCC) acting solely for the
Trustee, as collateral agent;
(C) any Reserve Fund property that is a book-entry security
held through the Federal Reserve pursuant to federal book-entry
regulations shall
41
be delivered in accordance with paragraph (ii) of the definition of
the term "Delivery" and shall be maintained by the Trustee, as
collateral agent, pending maturity or disposition, through continued
book-entry registration of such Reserve Fund as described in such
paragraph; and
(D) any Reserve Fund property that is an "uncertificated
security" under Article Eight of the UCC and that is not governed by
clause (C) above shall be delivered to the Trustee, as collateral
agent, in accordance with paragraph (iii) of the definition of the
term "Delivery" and shall be maintained by the Trustee, as collateral
agent, pending maturity or disposition, through continued registration
of the Trustee's or its Financial Intermediary's (or its custodian's
or its nominee's) ownership of such security, in its capacity as
collateral agent.
Effective upon Delivery of the Reserve Fund property in the form of
Physical Property, book-entry securities or uncertificated securities,
the Trustee shall be deemed to have purchased such Reserve Fund
property for value, in good faith and without notice of any adverse
claim thereto.
(iii) Each of the Seller and the Servicer agrees to take or cause
to be taken such further actions, to execute, deliver and file or
cause to be executed, delivered and filed such further documents and
instruments (including, without limitation, any UCC financing
statements or this Agreement) as may be determined to be necessary, in
an Opinion of Counsel to the Seller delivered to the Trustee, in order
to perfect the interests created by this Section and otherwise fully
to effectuate the purposes, terms and conditions of this Section. The
Seller and/or the Servicer, as the case may be, shall:
(A) promptly execute, deliver and file any financing
statements, amendments, continuation statements, assignments,
certificates and other documents with respect to such interests and
perform all such other acts as may be necessary in order to perfect or
to maintain the perfection of the Trustee's security interest; and
(B) make the necessary filings of financing statements or
amendments thereto within ten Business Days after the occurrence of
any of the following: (1) any change in their respective corporate
names or any trade names, (2) any change in the location of their
respective chief executive offices or principal places of business and
(3) any merger or consolidation or other change in their respective
identities or corporate structures; and shall promptly notify the
Trustee of any such filings.
(iv) The Trustee shall not enter into any subordination or
intercreditor agreement with respect to the Reserve Fund.
42
(d) Upon termination of the Trust pursuant to Section 10.01, any
amounts on deposit in the Reserve Fund, after payment of all amounts
due to the Certificateholders, shall be paid to the Seller.
SECTION 4.08 YIELD MAINTENANCE ACCOUNT. (a) (i) In order to assure that
sufficient amounts to make required distributions of interest to
Certificateholders will be available, the Servicer shall establish and maintain
with the Trustee a trust account: the "Yield Maintenance Account" which will
include the money and other property deposited and held therein pursuant to this
Section. Except as otherwise provided in this Agreement, the Yield Maintenance
Account shall (A) be a segregated trust account initially established with the
Trustee and maintained with the Trustee so long as the commercial paper or other
short-term unsecured debt obligations of the Trustee have the Required Rating
and (B) in the event that the commercial paper or other short-term unsecured
debt obligations of the Trustee no longer have the Required Rating, the Servicer
shall, with the assistance of the Trustee as necessary, cause the Yield
Maintenance Account to be moved to (1) a segregated deposit account in a bank or
trust company, the commercial paper or other short-term unsecured debt
obligations of which shall have the Required Rating, or (2) a segregated trust
account bearing a designation clearly indicating the funds deposited therein are
held in trust for the benefit of the Class A Certificateholders and the Class B
Certificateholders located in the corporate trust department of a depository
institution or trust company (which may include the Trustee) having a long-term
deposit rating from Moody's (so long as ▇▇▇▇▇'▇ is a Rating Agency) of at least
___ (or such lower rating as Moody's shall approve in writing) and corporate
trust powers under applicable federal and state laws and organized under the
laws of the United States or any state thereof, the District of Columbia or the
Commonwealth of Puerto Rico.
On or prior to the Closing Date, the Seller [or third party] shall deposit
an amount equal to the Yield Maintenance Account Initial Deposit into the Yield
Maintenance Account. In addition, on each subsequent Distribution Date, the
Seller [or third party] shall, pursuant to the Yield Maintenance Agreement [and
the Collateral Security Agreement] deposit an amount equal to the Additional
Yield Maintenance Amount into the Yield Maintenance Account. The Yield
Maintenance Account shall not be part of the Trust but instead will be held for
the benefit of the Holders of the Class A Certificates and the Class B
Certificates. The [Seller hereby acknowledges][third party, pursuant to the
Collateral Security Agreement and the Yield Maintenance Agreement], has
acknowledged] that the Yield Maintenance Account Initial Deposit, all Additional
Yield Maintenance Amounts and any investment earnings thereon are owned directly
by it, and the [Seller hereby agrees][third party has thereunder agreed] to
treat the same as its assets (and earnings) for federal income tax and all other
purposes.
(ii) In order to assure availability of the amounts
maintained in the Yield Maintenance Account, the [third party
has, pursuant to the Yield Maintenance Agreement and the
Collateral Security Agreement, sold, conveyed and transferred]
[Seller hereby sells, conveys and transfers] to the Trustee, as
collateral agent, and its successors and assigns, the Yield
Maintenance Account Initial Deposit and all proceeds thereof and
[pursuant to the Yield Maintenance Agreement and the Collateral
Security Agreement has pledged][hereby pledges] to the Trustee as
collateral agent, and its successors and assigns, all other
amounts deposited in or credited to the Yield Maintenance Account
from time to time
43
under the Yield Maintenance Agreement, all earnings and
distributions thereon and proceeds thereof (other than proceeds
constituting interest or net investment earnings attributable to
investment of the Yield Maintenance Account at the direction of
the Servicer) subject, however, to the limitations set forth
below, and solely for the purpose of securing and providing for
payment of each Yield Maintenance Deposit, if applicable,
comprising a portion of Available Interest to be distributed in
accordance with Section 4.06 and this Section on any Distribution
Date, to have and to hold all the aforesaid property, rights and
privileges unto the Trustee, its successors and assigns, in trust
for the uses and purposes, and subject to the terms and
provisions, set forth in this Section. The Trustee hereby
acknowledges such transfer and accepts the trust hereunder and
shall hold and distribute the Yield Maintenance Account in
accordance with the terms and provisions of this Section.
(b) Consistent with the limited purposes for which such trusts
are granted, on each Distribution Date the amount of the related Yield
Maintenance Deposit, if any, to the extent amounts on deposit in the
Yield Maintenance Account are sufficient therefor, shall be available
for distribution as provided in Section 4.06 (in determining and
distributing Available Interest) and, on each Distribution Date, if
the amount on deposit in the Yield Maintenance Account (after giving
effect to all deposits thereto or withdrawals therefrom on such
Distribution Date) is greater than the Required Yield Maintenance
Amount, the Trustee will distribute any remaining amounts to the
Seller [or third party]. Upon any such distribution to the Seller [or
third party], the Certificateholders will have no further rights in,
or claims to, such amount.
(c) (i) Amounts held in the Yield Maintenance Account shall
be invested in the manner specified in Section 4.01(b). Such
investments shall not be sold or disposed of prior to their
maturity. All such investments shall be made in the name of the
Trustee, its Financial Intermediary or its nominee, in either
case as collateral agent, and all income and gain realized
thereon shall be solely for the benefit of the Seller [or third
party] and shall be payable by the Trustee to the Seller [or
third party] on each Distribution Date. Realized losses, if any,
on investment of the Yield Maintenance Account shall be charged
first against undistributed investment earnings attributable to
the Yield Maintenance Account and then against the Yield
Maintenance Account.
(ii) With respect to the Yield Maintenance Account, [the
Seller and the Trustee agree] [, in the Yield Maintenance
Agreement and the Collateral Security Agreement, the Seller, the
third party and the Trustee have agreed] that:
(A) any Yield Maintenance Account property that is held in
deposit accounts shall be held solely in the name of the Trustee,
as collateral agent, at the Trustee (in a segregated trust
account if the deposits of the Trustee do not have the Required
Rating) or at one or more depository institutions which are
eligible to maintain the Yield Maintenance Account as described
in Section 4.07(a)(i); such deposit account shall be subject to
the exclusive custody and
44
control of the Trustee, and the Trustee shall have sole signature
authority with respect thereto;
(B) any Yield Maintenance Account property that constitutes
Physical Property shall be delivered to the Trustee, as collateral
agent, in accordance with paragraph (i) of the definition of the term
"Delivery" and shall be held, pending maturity or disposition, solely
by the Trustee, as collateral agent or a financial intermediary (as
such term is defined in Section 8-313(4) of the UCC) acting solely for
the Trustee, as collateral agent;
(C) any Yield Maintenance Account property that is a
book-entry security held through the Federal Reserve pursuant to
federal book-entry regulations shall be delivered in accordance with
paragraph (ii) of the definition of the term "Delivery" and shall be
maintained by the Trustee, as collateral agent, pending maturity or
disposition, through continued book-entry registration of such Yield
Maintenance Account as described in such paragraph; and
(D) any Yield Maintenance Account property that is an
"uncertificated security" under Article Eight of the UCC and that is
not governed by clause (C) above shall be delivered to the Trustee, as
collateral agent, in accordance with paragraph (iii) of the definition
of the term "Delivery" and shall be maintained by the Trustee, as
collateral agent, pending maturity or disposition, through continued
registration of the Trustee's or its Financial Intermediary's (or its
custodian's or its nominee's) ownership of such security, in its
capacity as collateral agent.
Effective upon Delivery of the Yield Maintenance Account property in
the form of Physical Property, book-entry securities or uncertificated
securities, the Trustee shall be deemed to have purchased such Yield
Maintenance Account property for value, in good faith and without
notice of any adverse claim thereto.
(iii) Each of the Seller and the Servicer agrees [and, pursuant
to the Yield Maintenance Agreement and the Collateral Security
Agreement, the third party has agreed,] to take or cause to be taken
such further actions, to execute, deliver and file or cause to be
executed, delivered and filed such further documents and instruments
(including, without limitation, any UCC financing statements or this
Agreement) as may be determined to be necessary, in an Opinion of
Counsel to [the Seller] [the third party] delivered to the Trustee, in
order to perfect the interests created by this Section and otherwise
fully to effectuate the purposes, terms and conditions of this
Section. The [third party][Seller and/or the Servicer], as the case
may be, shall:
(A) promptly execute, deliver and file any financing
statements, amendments, continuation statements, assignments,
certificates and other documents with respect to such interests and
perform all such other acts as may be
45
necessary in order to perfect or to maintain the perfection of the
Trustee's security interest; and
(B) make the necessary filings of financing statements or
amendments thereto within ten Business Days after the occurrence of
any of the following: (1) any change in their respective corporate
names or any trade names, (2) any change in the location of their
respective chief executive offices or principal places of business and
(3) any merger or consolidation or other change in their respective
identities or corporate structures; and shall promptly notify the
Trustee of any such filings.
(iv) The Trustee shall not enter into any subordination or
intercreditor agreement with respect to the Yield Maintenance Account.
(d) Upon termination of the Trust pursuant to Section 10.01, any
amounts on deposit in the Yield Maintenance Account, after payment of all
amounts due to the Certificateholders, shall be paid to the [Seller][third
party].
SECTION 4.09 NET DEPOSITS. For so long as TMCC shall be, the Seller, the
Servicer and the Trustee may make any remittances pursuant to this Article net
of amounts to be distributed by the applicable recipient to such remitting
party. Nonetheless, each such party shall account for all of the above described
remittances and distributions as if the amounts were deposited and/or
transferred separately.
SECTION 4.10 STATEMENTS TO CERTIFICATEHOLDERS.
(a) On each Distribution Date, the Trustee shall include with each
distribution to each Certificateholder of record, a statement, prepared by
the Servicer, based on information in the Servicer's Certificate furnished
pursuant to Section 3.10, setting forth for the related Collection Period
the following information as of the related Record Date or such
Distribution Date, as the case may be:
(i) the amount of such distribution allocable to principal on
each Class of Certificates;
(ii) the amount of such distribution allocable to interest on
each Class of Certificates;
(iii) the Pool Balance as of the close of business on the last
day of such Collection Period;
(iv) the amount of the Basic Servicing Fee paid to the Servicer
with respect to the related Collection Period and the amount of any
Supplemental Servicing Fee received by the Servicer with respect to
such Collection Period;
(v) the amount of the Interest and Principal Carryover Shortfalls
with respect to each Class of Certificates, if any, on such
Distribution Date and the change in such amounts from the immediately
preceding Distribution Date;
46
(vi) the Class A Certificate Balance, the Class B Certificate
Balance and the Pool Factor with respect to each Class of Certificates
as of such Distribution Date, in each case after giving effect to
distributions in respect of principal reported under clause (i) above;
(vii) the amount otherwise distributable to the Class B
Certificateholders that is distributed to the Class A
Certificateholders on such Distribution Date;
(viii) the balance on deposit in the Reserve Fund, after giving
effect to distributions made on such Distribution Date, and the change
in such balance from the immediately preceding Distribution Date;
(ix) the aggregate amount of Payments Ahead on deposit in the
Payahead Account or held by the Servicer and the change in such amount
from the immediately preceding Distribution Date;
(x) the amount of Outstanding Advances made in respect of such
Collection Period and the amount of unreimbursed Advances on such
Distribution Date; and
(xi) the Specified Reserve Fund Balance, the amount on deposit in
the Reserve Fund, any Required Yield Maintenance Amount and Yield
Maintenance Amount as of such Distribution Date, in each case after
giving effect to all distributions, deposits and withdrawals made on
such Distribution Date.
(b) Within a reasonable period of time after the end of each calendar
year, but not later than the latest date permitted by law, the Trustee
shall mail a statement or statements prepared by the Servicer to each
Person who at any time during such calendar year shall have been a Holder
of a Class A or Class B Certificate that reiterates the amounts set forth
in clauses (i), (ii), (iv) and (v) above for each Distribution Date during
the preceding calendar year and that specifies in the aggregate the amounts
set forth in clauses (i), (ii), (iv) and (v) above for such calendar year
for purposes of such Certificateholder's preparation of federal income tax
returns. In addition, the Servicer shall furnish to the Trustee for
distribution to each such Person at such time any other information that
the Servicer actually knows is necessary under applicable law for the
preparation of such income tax returns.
ARTICLE V
THE CERTIFICATES
SECTION 5.01 THE CERTIFICATES. The Class A Certificates and the Class B
Certificates shall be substantially in the form attached hereto as Exhibit C or
Exhibit D, as the case may be. Each Class of Certificates shall be issuable in
minimum denominations of $1,000 and integral multiples in excess thereof;
provided, however, that one Class A Certificate and one Class B Certificate may
be issued in a denomination that includes any remaining portion of the Original
Class A Certificate Balance and the Original Class B Certificate Balance,
respectively (each, a
47
"Residual Certificate"). The Certificates shall be executed on behalf of the
Trust by manual or facsimile signature of a Responsible Officer and
authenticated on behalf of the Trustee by the manual or facsimile signature of a
Responsible Officer. Certificates bearing the manual or facsimile signatures of
individuals who were, at the time when such signatures were affixed, authorized
to sign on behalf of the Trustee shall be valid and binding obligations of the
Trust, notwithstanding that such individuals or any of them have ceased to be so
authorized prior to the authentication and delivery of such Certificates or did
not hold such offices at the date of such Certificates. All Certificates shall
be dated the date of their authentication.
SECTION 5.02 AUTHENTICATION AND DELIVERY OF CERTIFICATES. The Trustee shall
cause to be authenticated and delivered to or upon the order of the Seller, in
exchange for the Receivables and the other assets of the Trust, simultaneously
with the sale, assignment and transfer to the Trust of the Receivables, and the
constructive delivery to the Trustee on behalf of the Trust of the Receivable
Files and the other components of the Trust, Certificates duly authenticated by
the Trustee, in authorized denominations equaling in the aggregate the Original
Pool Balance and evidencing the entire ownership of the Trust. No Certificate
shall be entitled to any benefit under this Agreement, or be valid for any
purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form set forth in the form of such
Certificate attached hereto as Exhibit C or Exhibit D, as the case may be,
executed by the Trustee by manual or facsimile signature, and such certificate
upon any Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered under this Agreement.
SECTION 5.03 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
(a) The Certificate Registrar shall maintain a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the
Certificate Registrar shall provide for the registration of Certificates
and transfers and exchanges of Certificates as provided in this Agreement.
The Trustee is hereby initially appointed Certificate Registrar for the
purpose of registering Certificates and transfers and exchanges of
Certificates as provided in this Agreement In the event that, subsequent to
the Closing Date, the Trustee notifies the Servicer that it is unable to
act as Certificate Registrar, the Servicer shall appoint another bank or
trust company, having an office or agency located in the [Borough of
Manhattan], The City of New York, agreeing to act in accordance with the
provisions of this Agreement applicable to it, and otherwise acceptable to
the Trustee, to act as successor Certificate Registrar under this
Agreement.
(b) Upon surrender for registration of transfer of any Certificate at
the Corporate Trust Office, the Trustee on behalf of the Trust shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of the
same Class in authorized denominations of a like aggregate principal
amount.
(c) At the option of a Certificateholder, Certificates may be
exchanged for other Certificates of the same Class of authorized
denominations of a like aggregate principal amount, upon surrender of the
Certificates to be exchanged at any such office or agency. Whenever any
Certificates are so surrendered for exchange the Trustee on behalf of the
48
Trust shall execute, authenticate and deliver the Certificates that the
Certificateholder making the exchange is entitled to receive. Every
Certificate presented or surrendered for registration of transfer or
exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar duly executed by
the Holder thereof or his attorney duly authorized in writing.
(d) No service charge shall be made for any registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(e) All Certificates surrendered for registration of transfer or
exchange shall be canceled and subsequently destroyed by the Trustee.
(f) Registration of transfer and sale of the Class B Certificates
shall be subject to the further conditions specified in Section 5.04.
(g) Each purchaser of a Class A Certificate that is Plan (as defined
in Section 5.04(a)(i)) that is a purchaser of a Class A Certificate or of a
beneficial interest therein shall be deemed to have represented and
warranted, by accepting such Certificate or beneficial interest, that such
purchaser is an "accredited investor" as defined in Rule 501(a) under the
Securities Act.
SECTION 5.04 REGISTRATION OF TRANSFER AND EXCHANGE OF CLASS B CERTIFICATES.
(a) No transfer of a Class B Certificate shall be made unless the
Trustee shall have received a representation from the transferee of such
Certificate acceptable to and in form and substance satisfactory to the
Trustee (in the event such Certificate is a Definitive Certificate, such
requirement will be satisfied only by the Trustee's receipt of a
representation letter from the transferee substantially in the form of
Exhibit E) to the effect that:
(i) such transferee (A) is not an employee benefit plan or
arrangement subject to Section 406 of ERISA or a plan subject to
Section 4975 of the Code (a "Plan"), nor a person acting on behalf of
a Plan nor using the assets of a Plan to effect such transfer, and (B)
is not an insurance company purchasing a Class B Certificate with
funds contained in an "insurance company general account" or
"insurance company separate account" (as defined in Section V(e) of
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) as to
which there is a Plan with respect to which the amount of such general
account's reserves and liabilities for the contracts held by or on
behalf of such Plan and all other Plans maintained by the same
employer (or affiliate thereof as defined in Section V(a)(1) of PTCE
95-60) of by the same employee organization exceed 10% of the total of
all reserves and liabilities of such general account (as such amounts
are determined under Section I(a) of PTCE 95-60) at the date of
acquisition; or
(ii) is a Plan or a person acting on behalf of a Plan or using
the assets of a Plan to effect such transfer, or is an insurance
company purchasing a Class B
49
Certificate with funds contained in an insurance company general
account or insurance company separate account, having attached thereto
an opinion of counsel satisfactory to the Trustee, which opinion shall
not be an expense of either the Trustee or the Trust Fund, addressed
to the Trustee, to the effect that the purchase or holding of such
Class B Certificate will not result in the assets of the Trust Fund
being deemed to be "plan assets" and subject to the prohibited
transaction provisions of ERISA and the Code and will not subject the
Trustee to any obligation in addition to those expressly undertaken in
this Agreement or to any liability.
For purposes of the preceding sentence, with respect to a Class B
Certificate that is a Book-Entry Certificate, in the event the Transferee
Certificate is not furnished, the representations contained in clause (i)
above shall be deemed to have been made to the Trustee by the transferee's
(including an initial acquiror's) acceptance of such Certificate.
Notwithstanding anything else to the contrary herein, any purported
transfer of a Class B Certificate or beneficial interest therein to or on
behalf of an employee benefit plan subject to ERISA or to the Code or to an
insurance company purchasing with funds from a general account or insurance
company separate account not exempt pursuant to PTCE 95-60 without the
delivery to the Trustee of an opinion of counsel satisfactory to the
Trustee as described in clause (ii) above shall be void and of no effect.
(b) To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person
for any registration of transfer of any ERISA-Restricted Certificate that
is in fact not permitted by this Section 23.01(b) or for making any
payments due on such Certificate to the Holder thereof or taking any other
action with respect to such Holder under the provisions of the Pooling and
Servicing Agreement so long as the transfer was registered by the Trustee
in accordance with the foregoing requirements.
SECTION 5.05 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If (i) any
mutilated Certificate is surrendered to the Certificate Registrar, or the
Certificate Registrar receives evidence to its satisfaction of the destruction,
loss or theft of any Certificate, and (ii) there is delivered to the Certificate
Registrar and the Trustee such security or indemnity as may be required by them
to save each of them harmless, then, in the absence of notice that such
Certificate has been acquired by a bona fide purchaser, the Trustee on behalf of
the Trust shall execute and the Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor and fractional undivided interest.
In connection with the issuance of any new Certificate under this Section, the
Trustee may require the payment by the Holder of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto.
If, after the delivery of such replacement Certificate or payment of a
destroyed, lost or stolen Certificate, a bona fide purchaser of the original
Certificate in lieu of which such replacement Certificate was issued presents
for payment such original Certificate, the Seller and the Trustee shall be
entitled to recover such replacement Certificate (or such payment) from the
Person to whom it was delivered or any Person taking such replacement
Certificate from such Person to whom such replacement Certificate was delivered
or any assignee of such Person,
50
except a bona fide purchaser, and shall be entitled to recover upon the security
or indemnity provided therefor to the extent of any loss, damage, cost or
expense incurred by the Seller or the Trustee in connection therewith.
SECTION 5.06 PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Trustee, the Certificate Registrar
and any of their respective agents may treat the Person in whose name any
Certificate is registered as the owner of such Certificate for the purpose of
receiving distributions pursuant to Section 4.06 and for all other purposes
whatsoever, and neither the Trustee, the Certificate Registrar nor any of their
respective agents shall be affected by any notice to the contrary.
SECTION 5.07 ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND ADDRESSES. The
Certificate Registrar shall furnish or cause to be furnished to the Servicer,
within 15 days after receipt by the Certificate Registrar of a written request
therefor from the Servicer, a list of the names and addresses of the
Certificateholders as of the most recent Record Date. If three or more
Certificateholders, or one or more Holders of Class A or Class B Certificates
evidencing not less than 25% of the Voting Interests thereof (hereinafter
referred to as "Applicants"), apply in writing to the Trustee, and such
application states that the Applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Certificates and such application is accompanied by a copy of the
communication that such Applicants propose to transmit, then the Trustee shall,
within five Business Days after the receipt of such application, afford such
Applicants access, during normal business hours, to the current list of
Certificateholders. Every Certificateholder, by receiving and holding a
Certificate, agrees with the Servicer and the Trustee that neither the Servicer
nor the Trustee shall be held accountable by reason of the disclosure of any
such information as to the names and addresses of the Certificateholders under
this Agreement, regardless of the source from which such information was
derived.
SECTION 5.08 MAINTENANCE OF OFFICE OR AGENCY. The Trustee shall maintain in
The City of New York, an office or offices or agency or agencies where
Certificates may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Trustee in respect of the Certificates
and this Agreement may be served. The Trustee initially shall designate the
Corporate Trust Office as its office for such purposes. The Trustee shall give
prompt written notice to the Seller, the Servicer and to Certificateholders of
any change in the location of the Certificate Register or any such office or
agency.
SECTION 5.09 TEMPORARY CERTIFICATES. Pending the preparation of definitive
Certificates of either Class, the Trustee, on behalf of the Trust, may execute,
authenticate and deliver, temporary Certificates of either Class that are
printed, lithographed, typewritten, mimeographed or otherwise produced, in any
authorized denomination, substantially of the tenor of the definitive
Certificates of either Class in lieu of which they are issued. If temporary
Certificates of either Class are issued, the Seller will cause definitive
Certificates of either Class to be prepared without unreasonable delay. After
the preparation of definitive Certificates of either Class, the temporary
Certificates of either Class shall be exchangeable for definitive Certificates
of either Class upon surrender of the temporary Certificates of either Class at
the office or agency to be maintained as provided in Section 5.08, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates of either Class, the
51
Trustee on behalf of the Trust shall execute and the Trustee shall authenticate
and deliver in exchange therefor a like principal amount of definitive
Certificates of either Class in authorized denominations. Until so exchanged the
temporary Certificates of either Class shall in all respects be entitled to the
same benefits under this Agreement as definitive Certificates of either Class.
SECTION 5.10 BOOK-ENTRY CERTIFICATES. The Class A and Class B Certificates,
upon original issuance (except for the Residual Certificates) will be issued in
minimum denominations of $1,000 and integral multiples thereof, and initially
shall be issued as Book-Entry Certificates, to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Seller. The certificate or
certificates delivered to DTC evidencing such Certificates shall initially be
registered on the Certificate Register in the name of CEDE & CO., the nominee of
the initial Clearing Agency, and no Certificate Owner will receive a definitive
certificate representing such Certificate Owner's interest in the Class A or
Class B Certificates, except as provided in Section 5.12. Subject to Section
5.12, unless and until definitive, fully registered Certificates of either Class
(the "Definitive Certificates") have been issued to Certificate Owners pursuant
to Section 5.12:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Seller, the Servicer, the Certificate Registrar and the
Trustee may deal with the Clearing Agency for all purposes (including
the making of distributions on the Certificates and the giving of
instructions or directions hereunder) as the authorized representative
of the Certificate Owners;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Agreement, the provisions of this
Section shall control;
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency (or through procedures established by the
Clearing Agency) and shall be limited to those established by law and
agreements between such Certificate Owners and the Clearing Agency
and/or the Clearing Agency Participants. Unless and until Definitive
Certificates are issued pursuant to Section 5.12, the initial Clearing
Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit distributions of principal and
interest on the Certificates to such Clearing Agency Participants; and
(v) whenever this Agreement requires or permits actions to be
taken based upon instructions or directions of Holders of Certificates
evidencing a specified percentage of the Voting Interests of either
Class or both Classes the Clearing Agency shall be deemed to represent
such percentage only to the extent that it has received instructions
to such effect from Certificate Owners and/or Clearing Agency
Participants owning or representing, respectively, such required
percentage of the beneficial interest in such Certificates and has
delivered such instructions to the Trustee.
52
SECTION 5.11 NOTICES TO CLEARING AGENCY. Whenever notice or other
communication to the Class A or Class B Certificateholders is required under
this Agreement, other than to the Holder of a Residual Certificate, unless and
until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 5.12, the Trustee and the Servicer shall give all such
notices and communications specified herein to be given to Holders of
Certificates to the Clearing Agency.
SECTION 5.12 DEFINITIVE CERTIFICATES. If (i)(A) the Seller advises the
Trustee in writing that the Clearing Agency is no longer willing or able to
properly discharge its responsibilities as described in the Letter of
Representations (a form of which is attached hereto as Exhibit F) and (B) the
Trustee or the Seller is unable to locate a qualified successor, (ii) the Seller
at its option, advises the Trustee in writing that it elects to terminate the
book-entry system through the Clearing Agency, or (iii) after the occurrence of
an Event of Default, Certificate Owners representing in the aggregate not less
than 51% of the voting interests of the Class A Certificates and Class B
Certificates, acting as a single Class, advise the Trustee and the Clearing
Agency through the Clearing Agency Participants in writing that the continuation
of a book-entry system through the Clearing Agency is no longer in the best
interests of the Certificate Owners, then the Trustee shall notify all
Certificate Owners, through the Clearing Agency, of the occurrence of any such
event and of the availability of Definitive Certificates to Certificate Owners
requesting the same. Upon surrender to the Trustee of the Class A or Class B
Certificates by the Clearing Agency, accompanied by registration instructions
from the Clearing Agency for registration, the Trustee shall issue the
Definitive Certificates and deliver such Definitive Certificates in accordance
with the instructions of the Clearing Agency. Neither the Seller, the
Certificate Registrar nor the Trustee shall be liable for any delay in delivery
of such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Certificates, the
Trustee shall recognize the Holders of the Definitive Certificates as Class A or
Class B Certificateholders hereunder. The Trustee shall not be liable if the
Trustee or the Seller is unable to locate a qualified successor Clearing Agency.
ARTICLE VI
THE SELLER
SECTION 6.01 REPRESENTATIONS OF SELLER. The Seller shall make the following
representations on which the Trustee shall rely in accepting the Receivables in
trust and executing and authenticating the Certificates. The representations
shall speak as of the execution and delivery of this Agreement and shall survive
the sale of the Receivables to the Trustee.
(a) ORGANIZATION AND GOOD STANDING. The Seller shall have been duly
organized and shall be validly existing as a corporation in good standing
under the laws of the State of California, with corporate power and
authority to own its properties and to conduct its business as such
properties shall be currently owned and such business is presently
conducted, and had at all relevant times, and shall now have, corporate
power, authority and legal right to acquire, own and sell the Receivables.
(b) DUE QUALIFICATION. The Seller shall be duly qualified to do
business as a foreign corporation in good standing, and shall have obtained
all necessary licenses and
53
approvals in all jurisdictions in which the ownership or lease of property
or the conduct of its business shall require such qualifications.
(c) POWER AND AUTHORITY. The Seller shall have the corporate power and
authority to execute and deliver this Agreement and to carry out its terms;
the Seller shall have full corporate power and authority to sell and assign
the property to be sold and assigned to and deposited with the Trustee as
part of the Trust and shall have duly authorized such sale and assignment
to the Trustee by all necessary corporate action; and the execution,
delivery and performance of this Agreement shall have been duly authorized
by the Seller by all necessary corporate action.
(d) VALID SALE; BINDING OBLIGATIONS. This Agreement shall evidence a
valid sale, transfer and assignment of the Receivables, enforceable against
creditors of and purchasers from the Seller; and shall constitute a legal,
valid and binding obligation of the Seller enforceable in accordance with
its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting creditors'
rights generally or by general equity principles.
(e) NO VIOLATION. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms of this ------------
Agreement shall not conflict with, result in any breach of any of the terms
and provisions of, nor constitute (with or without notice or lapse of time)
a default under, the articles of incorporation or bylaws of the Seller or
any indenture, agreement or other instrument to which the Seller is a party
or by which it shall be bound; nor result in the creation or imposition of
any Lien upon any of its properties pursuant to the terms of any such
indenture, agreement or other instrument (other than this Agreement), nor
violate any law or, to the best of the Seller's knowledge, any order, rule
or regulation applicable to the Seller of any court or of any federal or
state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties which
breach, default, conflict, lien or violation would have a material adverse
effect on the earnings, business affairs or business prospects of the
Seller.
(f) NO PROCEEDINGS. There is no action, suit or proceeding before or
by any court or governmental agency or body, domestic or foreign, now
pending, or to the Seller's knowledge, threatened, against or affecting the
Seller: (i) asserting the invalidity of this Agreement or the Certificates,
(ii) seeking to prevent the issuance of the Certificates or the
consummation of any of the transactions contemplated by this Agreement,
(iii) seeking any determination or ruling that might materially and
adversely affect the performance by the Seller of its obligations under, or
the validity or enforceability of, this Agreement or the Certificates, or
(iv) relating to the Seller and which might adversely affect the federal
income tax attributes of the Certificates.
SECTION 6.02 LIABILITY OF SELLER; INDEMNITIES. The Seller shall be liable
in accordance with this Agreement only to the extent of the obligations in this
Agreement specifically undertaken by the Seller in such capacity under this
Agreement and shall have no other obligations or liabilities hereunder.
54
SECTION 6.03 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS
OF, SELLER; CERTAIN LIMITATIONS.
(a) Any corporation (i) into which the Seller may be merged or
consolidated, (ii) which may result from any merger, conversion or
consolidation to which the Seller shall be a party, or (iii) which may
succeed to all or substantially all of the business of the Seller, which
corporation in any of the foregoing cases executes an agreement of
assumption to perform every obligation of the Seller under this Agreement,
shall be the successor to the Seller under this Agreement without the
execution or filing of any document or any further act on the part of any
of the parties to this Agreement, except that if the Seller in any of the
foregoing cases is not the surviving entity, then the surviving entity
shall execute an agreement of assumption to perform every obligation of the
Seller hereunder. The Seller shall provide notice of any merger,
consolidation or succession pursuant to this Section to each Rating Agency
and shall receive from each Rating Agency a letter to the effect that such
merger, consolidation or succession will not result in a qualification,
downgrading or withdrawal of the then-current ratings on the Rated
Certificates.
(b) (i) Subject to paragraph (ii) below, the purpose of the Seller
shall be to engage in any lawful activity for which a corporation may
be organized under the General Corporation Law of California other
than the banking business, the trust company business or the practice
of a profession permitted to be incorporated by the California
Corporations Code.
(ii) Notwithstanding paragraph (b)(i) above, the purpose of the
Seller shall be limited to the following purposes, and activities
incident to and necessary or convenient to accomplish the following
purposes: (A) to acquire from time to time from the Servicer, all
right, title and interest in and to receivables or leases arising out
of or relating to the sale or lease of new or used motor vehicles
(including automobiles and light trucks) or industrial equipment,
wholesale loans secured by new or used motor vehicles (including
automobiles and light duty trucks) or industrial equipment, moneys due
thereunder, security interests in the vehicles or industrial equipment
financed thereby, proceeds from claims on insurance policies related
thereto and related rights (collectively, "Automobile Receivables");
(B) to acquire, own, hold, service, sell, assign, pledge and otherwise
deal with the Automobile Receivables, collateral securing the
Automobile Receivables, related insurance policies, agreements with
the Servicer and any proceeds or further rights associated with any of
the foregoing; (C) to transfer Automobile Receivables to grantor
trusts or owner trusts (the "Additional Trusts") pursuant to pooling
and servicing agreements or similar agreements (the "Additional
Agreements") to be entered into by and among the Servicer, as
servicer, the Seller and the trustee named therein; (D) to sell any
class of asset-backed certificates or other securities issued by the
Additional Trusts under the related Additional Agreements ("Offered
Certificates"); (E) to hold and enjoy all of the rights and privileges
of any Offered Certificates issued by the Additional Trusts to the
Seller under the related Additional Agreements; (F) to perform its
obligations under the Additional Agreements; and (G) to engage in any
activity
55
and to exercise any powers permitted to corporations under the laws of
the State of California that are related or incidental to the
foregoing and necessary, convenient or advisable to accomplish the
foregoing.
(iii) So long as any outstanding debt of the Seller or Offered
Certificates are rated by any nationally recognized statistical rating
agency, the Seller shall not issue unsecured notes or otherwise borrow
money unless (A) the Seller has made a written request to the related
nationally recognized rating agency to issue unsecured notes or incur
borrowings and such notes or borrowings are rated by the related
nationally recognized rating agency the same as or higher than the
rating afforded any outstanding rated debt or Offered Certificates, or
(B) (1) such notes or borrowings are fully subordinated (and which
shall provide for payment only after payment in respect of all
outstanding rated debt and/or Offered Certificates) and are
nonrecourse against any assets of the Seller other than the assets
pledged to secure such notes or borrowings, (2) such notes or
borrowings do not constitute a claim against the Seller in the event
the assets pledged to secure such notes or borrowings are insufficient
to pay such notes or borrowings, (3) holders of such notes or
borrowings agree that they have no rights in any assets of the Seller
other than the assets pledged to secure such notes or borrowings, (4)
to the extent that any holder of such notes or borrowings is deemed to
have any interest in any assets of the Seller other than the assets
pledged to secure such notes or borrowings, holders of such notes or
borrowings agree that their interest is subordinate to claims or
rights of holders of other debts issued by the Seller, and that such
agreement constitutes a subordination agreement for purposes of
Section 510(a) of the Bankruptcy Code, and (5) where such notes or
borrowings are secured by the rated debt or Offered Certificates, such
notes or borrowings are fully subordinated (and which shall provide
for payment only after payment in respect of all outstanding rated
debt and/or Offered Certificates) to such rated debt or Offered
Certificates.
(c) Notwithstanding any other provision of this Section and any
provision of law, the Seller shall not do any of the following:
(i) engage in any business or activity other than as set forth in
clause (b) above;
(ii) without the affirmative vote of a majority of the members of
the Board of Directors of the Seller (which must include the
affirmative vote of all duly appointed Independent Directors, as
required by the articles of incorporation and bylaws of the Seller),
(A) dissolve or liquidate, in whole or in part, or institute
proceedings to be adjudicated bankrupt or insolvent, (B) consent to
the institution of bankruptcy or insolvency proceedings against it,
(C) file a petition seeking or consent to reorganization or relief
under any applicable federal or state law relating to bankruptcy, (D)
consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the corporation
or a substantial part of its property, (E) make a general assignment
for the benefit of creditors, (F) admit in writing its inability to
pay its debts generally as they
56
become due, or (G) take any corporate action in furtherance of the
actions set forth in clauses (A) through (F) above, provided, however,
that no director may be required by any shareholder of the Seller to
consent to the institution of bankruptcy or insolvency proceedings
against the Seller so long as it is solvent; or
(iii) merge or consolidate with any other corporation, company or
entity or sell all or substantially all of its assets or acquire all
or substantially all of the assets or capital stock or other ownership
interest of any other corporation, company or entity (except for the
acquisition of Automobile Receivables of TMCC and the sale of
Automobile Receivables to one or more trusts in accordance with the
terms of clause (b)(ii) above, which shall not be otherwise restricted
by this Section 6.03(c)).
SECTION 6.04 LIMITATION ON LIABILITY OF SELLER AND OTHERS. The Seller and
any director or officer or employee or agent of the Seller may rely in good
faith on the advice of counsel or on any document of any kind, prima facie
properly executed and submitted by any Person respecting any matters arising
under this Agreement. The Seller shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its obligations
as Seller of the Receivables under this Agreement and that in its opinion may
involve it in any expense or liability.
SECTION 6.05 SELLER MAY OWN CERTIFICATES. The Seller and any Person
controlling, controlled by or under common control with the Seller may in its
individual or any other capacity become the owner or pledgee of Certificates
with the same rights as it would have if it were not the Seller or an affiliate
thereof except as otherwise specifically provided in the definition of the term
"Certificateholder." Certificates so owned by or pledged to the Seller or such
controlling or commonly controlled Person shall have an equal and proportionate
benefit under the provisions of this Agreement, without preference, priority or
distinction as among all of the Certificates, except as set forth herein with
respect to certain rights to vote, consent or give directions to the Trustee as
a Holder.
SECTION 6.06 NO TRANSFER. The Seller hereby covenants that, except as
otherwise provided in this Agreement, it will not transfer, pledge or assign to
any Person any part of its right to receive any Excess Amounts pursuant to
Section 4.06(d)(iii) unless it has first delivered to the Trustee and each
Rating Agency an Opinion of Counsel in form and substance satisfactory to the
Trustee stating that such transfer will not (i) adversely affect the status of
the Trust as a grantor trust pursuant to subpart E, part I of subchapter J of
the Code and (ii) cause the Reserve Fund to be taxable as a corporation under
the Code. The Seller shall give written notice to each Rating Agency of any
proposed transfer, pledge or assignment to any Person of all or any part of its
right to receive Excess Amounts pursuant to Section 4.06(d)(iii).
ARTICLE VII
THE SERVICER
SECTION 7.01 REPRESENTATIONS OF SERVICER. The Servicer shall make the
following representations on which the Trustee shall rely in accepting the
Receivables in trust and
57
executing and authenticating the Certificates. The representations shall speak
as of the execution and delivery of this Agreement and shall survive the sale of
the Receivables to the Trustee.
(a) ORGANIZATION AND GOOD STANDING. The Servicer shall have been duly
organized and shall be validly existing as a corporation in good standing
under the laws of the State of California, with corporate power and
authority to own its properties and to conduct its business as such
properties shall be currently owned and such business is presently
conducted, and had at all relevant times, and shall now have, corporate
power, authority and legal right to acquire, own, sell and service the
Receivables and to hold the Receivable Files as custodian on behalf of the
Trustee.
(b) DUE QUALIFICATION. The Servicer shall be duly qualified to do
business as a foreign corporation in good standing, and shall have obtained
all necessary licenses and approvals in all jurisdictions in which the
ownership or lease of property or the conduct of its business (including
the servicing of the Receivables as required by this Agreement) shall
require such qualifications.
(c) POWER AND AUTHORITY. The Servicer shall have the corporate power
and authority to execute and deliver this Agreement and to carry out its
terms; and the execution, delivery and performance of this Agreement shall
have been duly authorized by the Servicer by all necessary corporate
action.
(d) BINDING OBLIGATIONS. This Agreement shall constitute a legal,
valid and binding obligation of the Servicer enforceable in accordance with
its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting
creditors' rights generally or by general principles of equity.
(e) NO VIOLATION. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms of this Agreement shall not
conflict with, result in any breach of any of the terms and provisions of,
nor constitute (with or without notice or lapse of time) a default under,
the articles of incorporation or bylaws of the Servicer, or conflict with
or breach any of the material terms or provisions of, or constitute (with
or without notice or lapse of time) a default under, any indenture,
agreement or other instrument to which the Servicer is a party or by which
it shall be bound; nor result in the creation or imposition of any Lien
upon any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than this Agreement); nor violate any
law or, to the best of the Servicer's knowledge, any order, rule or
regulation applicable to the Servicer of any court or of any federal or
state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Servicer or its properties;
which breach, default, conflict, lien or violation would have a material
adverse effect on the earnings, business affairs or business prospects of
the Servicer.
(f) NO PROCEEDINGS. There is no action, suit or proceeding before or
by any court or governmental agency or body, domestic or foreign, now
pending, or to the Servicer's knowledge, threatened, against or affecting
the Servicer: (i) asserting the invalidity of this Agreement or the
Certificates, (ii) seeking to prevent the issuance of the Certificates
58
or the consummation of any of the transactions contemplated by this
Agreement, (iii) seeking any determination or ruling that might materially
and adversely affect the performance by the Servicer of its obligations
under, or the validity or enforceability of, this Agreement or the
Certificates or (iv) relating to the Servicer and which might adversely
affect the federal income tax attributes of the Certificates.
SECTION 7.02 LIABILITY OF SERVICER; INDEMNITIES.
(a) The Servicer shall be liable in accordance herewith only to the
extent of the obligations specifically undertaken by the Servicer under
this Agreement and shall have no other obligations or liabilities under
this Agreement. Such obligations shall include the following:
(i) the Servicer shall defend, indemnify and hold harmless the
Trustee, the Trust and the Certificateholders from and against any and
all costs, expenses, losses, damages, claims and liabilities,
including reasonable fees and expenses of counsel and expenses of
litigation arising out of or resulting from the use or operation by
the Servicer or any affiliate thereof of any Financed Vehicle;
(ii) the Servicer shall indemnify, defend and hold harmless the
Trustee and the Trust from and against any taxes that may at any time
be asserted against the Trustee or the Trust with respect to the
transactions contemplated in this Agreement, including, without
limitation, any sales, gross receipts, general corporation, tangible
or intangible personal property, privilege or license taxes (but not
including any taxes asserted with respect to, and as of the date of,
the sale of the Receivables to the Trust or the issuance and original
sale of the Certificates, or asserted with respect to ownership of the
Receivables, or federal or other income taxes arising out of
distributions on the Certificates) and costs and expenses in defending
against the same;
(iii) the Servicer shall indemnify, defend and hold harmless the
Trustee, the Trust and the Certificateholders from and against any and
all costs, expenses, losses, claims, damages and liabilities to the
extent that such cost, expense, loss, claim, damage or liability arose
out of, and was imposed upon the Trustee, the Trust or the
Certificateholders through the negligence, willful misfeasance or bad
faith of the Servicer in the performance of its duties under this
Agreement or by reason of reckless disregard of its obligations and
duties under this Agreement; and
(iv) the Servicer shall indemnify, defend and hold harmless the
Trustee from and against all costs, expenses, losses, claims, damages
and liabilities arising out of or incurred in connection with the
acceptance or performance of the trusts and duties contained in this
Agreement, except to the extent that such cost, expense, loss, claim,
damage or liability: (A) shall be due to the willful misfeasance, bad
faith or negligence of the Trustee (B) shall arise from the breach by
the Trustee of any of its representations or warranties set forth in
Section 9.14, (C) relates to any tax other than the taxes with respect
to which either the Seller or
59
the Servicer shall be required to indemnify the Trustee, or (D) shall
arise out of or be incurred in connection with the performance by the
Trustee of the duties of a Successor Servicer under this Agreement.
(b) Indemnification under this Section shall include, without
limitation, reasonable fees and expenses of counsel and expenses of
litigation. If the Servicer has made any indemnity payments pursuant to
this Section and the recipient thereafter collects any of such amounts from
others, the recipient shall promptly repay such amounts collected to the
Servicer, without interest, so long as no amounts are outstanding to the
Trustee.
(c) The provisions of this Section shall survive the resignation or
removal of the Trustee and the termination of this Agreement.
SECTION 7.03 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS
OF, THE SERVICER. Any corporation (i) into which the Servicer may be merged or
consolidated, (ii) which may result from any merger, conversion or consolidation
to which the Servicer shall be a party or (iii) which may succeed to all or
substantially all of the business of the Servicer, which corporation in any of
the foregoing cases executes an agreement of assumption to perform every
obligation of the Servicer under this Agreement, shall be the successor to the
Servicer under this Agreement without the execution or filing of any paper or
any further act on the part of any of the parties to this Agreement. The
Servicer shall provide notice of any merger, consolidation or succession
pursuant to this Section to the Trustee and each Rating Agency.
SECTION 7.04 LIMITATION ON LIABILITY OF SERVICER AND OTHERS.
(a) Neither the Servicer nor any of its directors, officers, employees
or agents shall be under any liability to the Trust, the Trustee or the
Certificateholders, except as provided in this Agreement, for any action
taken or for refraining from the taking of any action pursuant to this
Agreement, or for errors in judgment; provided, however, that this
provision shall not protect the Servicer or any such person against any
liability that would otherwise be imposed by reason of willful misfeasance,
bad faith or negligence in the performance of duties or by reason of
reckless disregard of obligations and duties under this Agreement. The
Servicer and any director, officer, employee or agent of the Servicer may
rely in good faith on any document of any kind prima facie properly
executed and submitted by any Person respecting any matters arising under
this Agreement.
(b) Except as provided in this Agreement, the Servicer shall not be
under any obligation to appear in, prosecute, or defend any legal action
that shall not be incidental to its duties to service the Receivables in
accordance with this Agreement, and that in its opinion may involve it in
any expense or liability; provided, however, that the Servicer may
undertake any reasonable action that it may deem necessary or desirable in
respect of this Agreement and the rights and duties of the parties to this
Agreement and the interests of the Certificateholders under this Agreement.
(c) The Servicer and any director, officer, employee or agent of the
Servicer may rely in good faith on the advice of counsel or on any document
of any kind prima facie
60
properly executed and submitted by any Person respecting any matters
arising under this Agreement. The Servicer shall not be under any
obligation to appear in, prosecute, nor defend any legal action that shall
not be incidental to its obligations under this Agreement, and that in its
opinion may involve it in any expense or liability.
SECTION 7.05 SERVICER NOT TO RESIGN. Subject to the provisions of Section
7.03, TMCC shall not resign from the obligations and duties hereby imposed on it
as Servicer under this Agreement except upon determination that the performance
of its duties under this Agreement shall no longer be permissible under
applicable law. Notice of any such determination permitting the resignation of
TMCC shall be communicated to the Trustee at the earliest practicable time and
any such determination shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee concurrently with or promptly after such notice.
No such resignation shall become effective until the Trustee or a successor
Servicer shall have assumed the responsibilities and obligations of TMCC in
accordance with Section 8.03.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.01 EVENTS OF DEFAULT. For purposes of this Agreement, each of the
following shall constitute an "Event of Default":
(a) any failure by the Servicer to deliver to the Trustee the
Servicer's Certificate for the related Collection Period, or any failure by
the Servicer (or, so long as the Servicer is TMCC, the Seller) to deliver
to the Trustee, for distribution to Certificateholders, any proceeds or
payment required to be so delivered under the terms of the Certificates or
this Agreement, in each case that continues unremedied for a period of
three Business Days after discovery by an officer of the Servicer (or, so
long as the Servicer is TMCC, the Seller) or written notice has been given
(i) to the Servicer by the Trustee or (ii) to the Trustee and the Servicer
(or, so long as the Servicer is TMCC, the Seller) by holders of
Certificates evidencing not less than 25% of the Voting Interests of the
Class A Certificate and the Class B Certificates, voting together as a
single class; or
(b) failure on the part of the Servicer (or so long as the Servicer is
TMCC, the Seller) duly to observe or to perform in any material respect any
other covenants or agreements of the Servicer (or so long as the Servicer
is TMCC, the Seller) set forth in the Certificates or in this Agreement,
which failure shall (i) materially and adversely affect the rights of the
Trust and (ii) continue unremedied for a period of 90 days after the date
on which written notice of such failure, requiring the same to be remedied,
shall have been given (A) to the Servicer or the Seller, as the case may
be, by the Trustee or (B) to the Trustee and the Servicer or the Seller, as
the case may be, by holders of Certificates evidencing not less than 25% of
the Voting Interests of the Class A Certificate and the Class B
Certificates, voting together as a single class; or
(c) the entry of a decree or order by a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
trustee in bankruptcy, conservator, receiver or liquidator for the Servicer
(or, so long as the Servicer is TMCC,
61
the Seller) in any bankruptcy, insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding up or liquidation of their respective affairs, and the continuance
of any such decree or order unstayed and in effect for a period of 90
consecutive days; or
(d) the consent by the Servicer (or, so long as the Servicer is TMCC,
the Seller) to the appointment of a trustee in bankruptcy, conservator or
receiver or liquidator in any bankruptcy, insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or relating
to the Servicer (or, so long as the Servicer is TMCC, the Seller) of or
relating to substantially all of their property, or the Servicer (or, so
long as the Servicer is TMCC, the Seller) shall admit in writing its
inability to pay its debts generally as they become due, file a petition to
take advantage of any applicable insolvency or reorganization statute, make
an assignment for the benefit of its creditors, or voluntarily suspend
payment of its obligations.
SECTION 8.02 CONSEQUENCES OF AN EVENT OF DEFAULT. If an Event of Default
shall occur and be continuing, so long as such Event of Default has not been
cured or waived, either the Trustee or the Holders of Certificates evidencing
not less than 51% of the voting interests of the Class A Certificates and the
Class B Certificates, voting together as a single class (but excluding for
purposes of such calculation and action all Certificates held by TMCC, TMCRC or
any of their affiliates), by notice then given in writing to the Servicer (and
to the Trustee if given by Certificateholders), may terminate all of the rights
and obligations of the Servicer under this Agreement. On or after the receipt by
the Servicer of such written notice, all authority and power of the Servicer
under this Agreement, whether with respect to the Certificates, the Receivables
or otherwise, shall, without further action, pass to and be vested in the
Trustee pursuant to and under this Section or such Successor Servicer as may be
appointed under Section 8.03; and, without limitation, the Trustee shall be
hereby authorized and empowered to execute and deliver, on behalf of the
predecessor Servicer, as attorney-in-fact or otherwise, any and all documents
and other instruments, and to do or accomplish all other acts or things
necessary or appropriate to effect the purposes of such notice of termination,
whether to complete the transfer and endorsement of the Receivables and related
documents, or otherwise. The predecessor Servicer shall cooperate with the
Successor Servicer and the Trustee in effecting the termination of the
responsibilities and rights of the predecessor Servicer under this Agreement,
including, without limitation, the transfer to the Successor Servicer for
administration by it of all cash amounts that shall at the time be held by the
predecessor Servicer for deposit, or have been deposited by the predecessor
Servicer, in the Accounts or the Reserve Fund or thereafter received with
respect to the Receivables and all Payments Ahead that shall at that time be
held by the predecessor Servicer. All reasonable costs and expenses (including
attorneys' fees) incurred in connection with transferring the Receivable Files
to the Successor Servicer and amending this Agreement to reflect such succession
as Servicer pursuant to this Section shall be paid by the predecessor Servicer
upon presentation of reasonable documentation of such costs and expenses.
Notwithstanding the foregoing, in the event the predecessor Servicer is the
Trustee, the original Servicer hereunder shall reimburse the Trustee for all
reasonable costs and expenses as described in the immediately preceding
sentence.
SECTION 8.03 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR SERVICER. On and
after the time the Servicer receives a notice of termination pursuant to Section
8.02 or tenders its
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resignation pursuant to Section 7.05, the Trustee shall, by an instrument in
writing, assume the rights and responsibilities of the Servicer in its capacity
as Servicer under this Agreement and the transactions set forth or provided for
in this Agreement, and shall be subject to all the responsibilities,
restrictions, duties and liabilities relating thereto placed on the Servicer by
the terms and provisions of this Agreement. As compensation therefor, the
Trustee shall be entitled to such compensation (whether payable out of the
Collection Account or otherwise) as the Servicer would have been entitled to
under this Agreement if no such notice of termination or resignation had been
given. Notwithstanding the foregoing, the Trustee may, if it shall be unwilling
so to act, or shall, if it is legally unable so to act, appoint, or petition a
court of competent jurisdiction to appoint, any established institution, having
a net worth of not less than $50,000,000 and whose regular business includes the
servicing of automobile and/or light duty truck receivables, as the successor to
the Servicer under this Agreement, provided that the appointment of any such
successor to the Servicer will not result in the qualification, reduction or
withdrawal of the rating then assigned to any Class of Rated Certificates by
either Rating Agency. In connection with such appointment and assumption, the
Trustee may make such arrangements for the compensation of such successor out of
payments on or in respect of the Receivables as it and such successor shall
agree; provided, however, that no such compensation shall be in excess of that
permitted the original Servicer under this Agreement. The Trustee and such
Successor Servicer shall take such action, consistent with this Agreement, as
shall be necessary to effectuate any such succession. The Trustee shall not be
relieved of its duties as Successor Servicer under this Section until the newly
appointed Servicer shall have assumed the responsibilities and obligations of
the Servicer under this Agreement.
SECTION 8.04 NOTIFICATION TO CERTIFICATEHOLDERS. Upon a Responsible Officer
of the Trustee obtaining actual knowledge of (i) the occurrence of an Event of
Default and the expiration of any cure period applicable thereto or (ii) any
termination of, or appointment of a successor to, the Servicer pursuant to this
Section, the Trustee shall give prompt written notice thereof to
Certificateholders at their respective addresses appearing in the Certificate
Register and to each Rating Agency. Such notices will be deemed to have been
given on the date of such mailing.
If required by the Luxembourg Stock Exchange, for so long as the Class A
Certificates are listed on the Luxembourg Stock Exchange, notices to holders of
the Class A Certificates will be given by publication in a leading daily
newspaper of general circulation in Luxembourg or, if publication in Luxembourg
is not practical, in Europe. Such publication is expected to be made in the
LUXEMBOURGER WORT. If required by The Stock Exchange of Hong Kong Limited, for
so long as the Class A Certificates are listed on The Stock Exchange of Hong
Kong Limited, notices to holders of the Class A Certificates will be given in a
leading daily newspaper of general circulation in the English language in Hong
Kong. Such publication is expected to be made in the SOUTH CHINA MORNING POST.
Such notices will be deemed to have been given on the date of such publication.
SECTION 8.05 WAIVER OF PAST DEFAULTS. The Holders of Certificates
evidencing not less than 51% of the voting interests of the Class A Certificates
and the Class B Certificates, voting together as a single class (but excluding
for purposes of such calculation and action all Certificates held by TMCC, TMCRC
or any of their affiliates), may, waive any Event of Default or default by the
Servicer in the performance of its obligations hereunder and its consequences,
63
except a default in making any required deposits to or payments from the
Certificate or Payahead Accounts or the Reserve Fund in accordance with this
Agreement or in respect of a covenant or provision of this Agreement that under
Section 11.01 cannot be modified or amended without the consent of the Holder of
each Certificate. Upon any such waiver of a past default, such default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereon
except to the extent expressly so waived.
SECTION 8.06 REPAYMENT OF ADVANCES. If a Successor Servicer replaces the
Servicer, the predecessor Servicer shall be entitled to receive reimbursement
for Outstanding Advances pursuant to Sections 4.03 and 4.04, in the manner
specified in Section 4.06, with respect to all Advances made by the predecessor
Servicer.
ARTICLE IX
THE TRUSTEE
SECTION 9.01 DUTIES OF TRUSTEE.
(a) The Trustee, both prior to and after the occurrence of an Event of
Default, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. If, to the actual knowledge of a
Responsible Officer of the Trustee, an Event of Default has occurred and
has not been cured or waived, the Trustee shall exercise such of the rights
and powers vested in it by this Agreement, and use the same degree of care
and skill in their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs; provided, however,
that if the Trustee assumes the duties of the Servicer pursuant to Section
8.03, the Trustee in performing such duties shall use the degree of skill
and attention customarily exercised by a servicer with respect to
automobile and/or light duty truck receivables that it services for itself
or others.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee that shall be specifically required to be
furnished pursuant to any provision of this Agreement, shall examine them
to determine whether they conform to the requirements of this Agreement.
(c) No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act, its own bad faith or its own willful misfeasance; provided,
however, that:
(i) prior to the occurrence of an Event of Default actually known
to a Responsible Officer of the Trustee, and after the curing or
waiving of all such Events of Default that may have occurred, the
duties and obligations of the Trustee shall be determined solely by
the express provisions of this Agreement, the Trustee shall not be
liable except for the performance of such duties and obligations as
are specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee, the
permissive
64
right of the Trustee to do things enumerated in this Agreement shall
not be construed as a duty and, in the absence of bad faith on the
part of the Trustee, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Trustee
and conforming to the requirements of this Agreement;
(ii) the Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer of the Trustee,
unless it shall be proved that the Trustee was negligent in performing
its duties in accordance with the terms of this Agreement; and
(iii) the Trustee shall not be personally liable with respect to
any action taken, suffered or omitted to be taken in good faith in
accordance with the direction of the Holders of Class A Certificates
or Class B Certificates evidencing not less than 25% of the Voting
Interests of the related Class relating to the time, method and place
of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee, under
this Agreement.
(d) The Trustee shall not be required to expend or risk its own funds
or otherwise incur financial liability in the performance of any of its
duties under this Agreement, or in the exercise of any of its rights or
powers, if there shall be reasonable grounds for believing that the
repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it, and none of the provisions
contained in this Agreement shall in any event require the Trustee to
perform, or be responsible for the manner of performance of, any of the
obligations of the Servicer under this Agreement except during such time,
if any, as the Trustee shall be the successor to, and be vested with the
rights, duties, powers and privileges of, the Servicer in accordance with
the terms of this Agreement.
(e) Except for actions expressly authorized by this Agreement, the
Trustee shall take no action reasonably likely to impair the security
interests created or existing under any Receivable or to impair the value
of any Receivable.
(f) All information obtained by the Trustee regarding the Obligors and
the Receivables, whether upon the exercise of its rights under this
Agreement or otherwise, shall be maintained by the Trustee in confidence
and shall not be disclosed to any other Person, unless such disclosure is
required by this Agreement or any applicable law or regulation.
SECTION 9.02 TRUSTEE'S CERTIFICATE. On or as soon as practicable after each
date on which the Servicer shall purchase Administrative Receivables or the
Seller shall repurchase Warranty Receivables, the Trustee shall submit to the
Servicer or the Seller, as applicable, a Trustee's Certificate (substantially in
the form attached hereto as Exhibit B), identifying the purchaser and the
Receivables so purchased, executed by the Trustee and completed as to its date
and the date of this Agreement, and accompanied by a copy of the Servicer's
Certificate for the related Collection Period. The Trustee's Certificate
submitted with respect to such Distribution
65
Date shall operate, as of such Distribution Date, as an assignment, without
recourse, representation or warranty, to the Seller or the Servicer, as the case
may be, of all the Trustee's right, title and interest in and to such
Administrative Receivable or Warranty Receivable and to the other property
conveyed to the Trust pursuant to Section 2.01 with respect to such
Administrative Receivable or Warranty Receivable, and all security and documents
relating thereto, such assignment being an assignment outright and not for
security.
SECTION 9.03 TRUSTEE'S ASSIGNMENT OF ADMINISTRATIVE RECEIVABLES AND
WARRANTY RECEIVABLES. With respect to all Administrative Receivables and all
Warranty Receivables, the Trustee shall, by a Trustee's Certificate
(substantially in the form attached hereto as Exhibit B) assign, without
recourse, representation or warranty, to the Seller or the Servicer as
applicable, all the Trustee's right, title and interest in and to each such
repurchased Receivable and the other property conveyed to the Trust pursuant to
Section 2.01 with respect to such Receivable, and all security and any documents
relating thereto, such assignment being an assignment outright and not for
security; and the Seller or the Servicer, as applicable, shall thereupon own
each such Receivable, and all such related security and documents, free of any
further obligation to the Trustee or the Certificateholders with respect
thereto. If in any enforcement suit or legal proceeding it is held that the
Servicer may not enforce a repurchased Receivable on the ground that it is not a
real party in interest or a holder entitled to enforce the Receivable, the
Trustee on behalf of the Trust shall, at the Servicer's written direction and
expense, take such reasonable steps as the Trustee deems necessary to enforce
the Receivable, including bringing suit in the Trust's name or the names of the
Certificateholders.
SECTION 9.04 CERTAIN MATTERS AFFECTING THE TRUSTEE.
(a) Except as otherwise provided in Section 9.01:
(i) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(ii) the Trustee may consult with counsel and any advice of
counsel or Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted
by it under this Agreement in good faith and in accordance with such
advice of counsel or Opinion of Counsel;
(iii) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement, or to institute,
conduct or defend any litigation under this Agreement or in relation
to this Agreement, at the request, order or direction of any of the
Certificateholders pursuant to the provisions of this Agreement,
unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities that may be incurred therein or thereby; nothing contained
in this Agreement shall, however, relieve the Trustee of the
obligations, upon the occurrence of an Event of Default actually known
to a Responsible Officer of the
66
Trustee (that shall not have been cured or waived), to exercise such
of the rights and powers vested in it by this Agreement, and to use
the same degree of care and skill in their exercise as a prudent man
would exercise or use under the circumstances in the conduct of his
own affairs;
(iv) the Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to
be authorized or within the discretion or rights or powers conferred
upon it by this Agreement;
(v) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default that may have occurred, the
Trustee shall not be bound to make any investigation into the facts of
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing to do so by
Holders of Certificates evidencing not less than 25% of the Voting
Interests of a Class; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is, in
the opinion of the Trustee, not reasonably assured to the Trustee by
the security afforded to it by the terms of this Agreement, the
Trustee may require reasonable indemnity against such cost, expense or
liability as a condition to so proceeding; the reasonable expense of
every such examination shall be paid by the Seller or, if paid by the
Trustee, shall be reimbursed by the Seller upon demand; and nothing in
this clause shall derogate from the obligation of the Servicer to
observe any applicable law prohibiting disclosure of information
regarding the Obligors; and
(vi) the Trustee may execute any of the trusts or powers under
this Agreement or perform any duties under this Agreement either
directly or by or through agents or attorneys or a custodian and shall
not be liable or responsible for the misconduct or negligence of any
of its agents or attorneys or a custodian appointed with due care by
the Trustee.
(b) No Certificateholder will have any right to institute any
proceeding with respect to this Agreement, unless such Holder shall have
given to the Trustee written notice of default and (i) the Event of Default
arises from the Servicer's failure to remit collections or payments when
due or (ii) the Holders Certificates evidencing not less than 25% of the
Voting Interests of a Class have made written request upon the Trustee to
institute such proceeding in its own name as Trustee thereunder, and have
offered to the Trustee reasonable indemnity, and the Trustee for 30 days
has neglected or refused to institute any such proceedings.
SECTION 9.05 LIMITATION ON TRUSTEE'S LIABILITY. The Trustee shall make no
representations as to the validity or sufficiency of this Agreement or of the
Certificates (other than the execution by the Trustee on behalf of the Trust of,
or the certificate of authentication on, the Certificates), or of any Receivable
or related document. The Trustee shall have no obligation to perform any of the
duties of the Seller or the Servicer unless explicitly set forth in this
Agreement. The Trustee shall at no time have any responsibility or liability for
or with respect to
67
the legality, validity and enforceability of any security interest in any
Financed Vehicle or any Receivable, or the perfection and priority of such a
security interest or the maintenance of any such perfection and priority, or for
or with respect to the efficacy of the Trust or its ability to generate the
payments to be distributed to Certificateholders under this Agreement, including
without limitation, the existence, condition, location and ownership of any
Financed Vehicle; the existence and enforceability of any physical damage or
credit life or credit disability insurance; the existence and contents of any
Receivable or any computer or other record thereof; the validity of the
assignment of any Receivable to the Trust or of any intervening assignment; the
completeness of any Receivable; the performance or enforcement of any
Receivable; the compliance by the Seller or the Servicer with any covenant or
the breach by the Seller or the Servicer of any warranty or representation made
under this Agreement or in any related document and the accuracy of any such
warranty or representation prior to the Trustee's receipt of notice or other
discovery of any noncompliance therewith or any breach thereof; any investment
of monies by the Servicer or any loss resulting therefrom (it being understood
that the Trustee shall remain responsible as Trustee for any Trust property that
it may hold); the acts or omissions of the Seller, the Servicer or any Obligor;
any action of the Servicer taken in the name of or as the agent of the Trustee;
or any action by the Trustee taken at the instruction of the Servicer; provided,
however, that the foregoing shall not relieve the Trustee of its obligation to
perform its duties under this Agreement. Except with respect to a claim based on
the failure of the Trustee to perform its duties under this Agreement or based
on the Trustee's negligence or willful misconduct, bad faith or negligence, no
recourse shall be had for any claim based on any provision of this Agreement,
the Certificates or any Receivable or assignment thereof against the institution
serving as Trustee in its individual capacity. The Trustee shall not have any
personal obligation, liability or duty whatsoever to any Certificateholder or
any other Person with respect to any such claim, and any such claim shall be
asserted solely against the Trust or any indemnitor who shall furnish indemnity
as provided in this Agreement. The Trustee shall not be accountable for the use
or application by the Seller of any of the Certificates or of the proceeds of
such Certificates, or for the use or application of any funds paid to the
Servicer in respect of the Receivables. The Trustee shall have no responsibility
for filing any financing or continuation statement in any public office at any
time or to otherwise perfect or maintain the perfection of any security interest
or lien granted to it hereunder (unless the Trustee shall have become the
successor Servicer) or to prepare or file any Securities and Exchange Commission
filing for the Trust or to record this Agreement.
It is expressly understood and agreed by the parties hereto that (i) each
of this Agreement and the Certificates is executed and delivered by the Trustee,
not in its individual capacity but solely as trustee of the Trust in the
exercise of its powers and authority conferred and vested in it, (ii) each of
the representations (other than the representations and warranties of the
Trustee set forth in Section 9.14), undertakings and agreements herein made on
the part of the Trust is made and intended not as a representation, undertaking
or agreement by the Trustee in its individual capacity, but is made and intended
for the purpose of binding only the Trust and (iii) under no circumstances shall
the Trustee in its individual capacity be personally liable for the breach or
failure of any obligation, representation, warranty or covenant made or
undertaken by the Trust under this Agreement or the Certificates.
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The Trustee will not be responsible for any losses incurred in connection
with investments in Eligible Investments made in accordance with the terms of
this Agreement, other than losses arising out of the Trustee's negligence, bad
faith or willful misconduct.
SECTION 9.06 TRUSTEE MAY OWN CERTIFICATES. The Trustee in its individual or
any other capacity may become the owner or pledgee of Certificates with the same
rights as it would have if it were not the Trustee.
SECTION 9.07 TRUSTEE'S FEES AND EXPENSES. The Servicer covenants and agrees
to pay to the Trustee from time to time, and the Trustee shall be entitled to,
reasonable compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) for all services
rendered by it in the execution of the trusts created by this Agreement and in
the exercise and performance of any of the powers and duties of the Trustee
under this Agreement, and the Servicer shall pay or reimburse the Trustee upon
its request for all reasonable expenses, disbursements and advances (including
the reasonable compensation and the expenses and disbursements of its counsel
and of all persons not regularly in its employ) incurred or made by the Trustee
in defense of any action brought against it in connection with this Agreement
except any such expense, disbursement or advance as may arise from its
negligence, willful misfeasance or bad faith or that is the responsibility of
Certificateholders under this Agreement. Additionally, the Servicer, pursuant to
Section 7.02, shall indemnify the Trustee with respect to certain matters.
SECTION 9.08 INDEMNITY OF TRUSTEE AND SUCCESSOR SERVICER. Upon the
appointment of a Successor Servicer pursuant to Section 8.03, such Successor
Servicer and the Trustee and their respective agents and employees shall be
indemnified by the Trust and held harmless against any loss, liability, or
expense (including reasonable attorney's fees and expenses) arising out of or
incurred in connection with the acceptance of performance of the trusts and
duties contained in this Agreement to the extent that (i) the Successor Servicer
or the Trustee, as the case may be, shall not be indemnified for such loss,
liability or expense by the Servicer pursuant to Section 8.02; (ii) such loss,
liability, or expense shall not have been incurred by reason of the Successor
Servicer's or the Trustee's wilful misfeasance, bad faith or negligence; and
(iii) such loss, liability or expense shall not have been incurred by reason of
the Successor Servicer's or the Trustee's breach of its respective
representations and warranties pursuant to Sections 8.03, 9.09 and 9.14,
respectively.
The Successor Servicer and/or the Trustee shall be entitled to the
indemnification provided by this Section only to the extent all amounts due the
Servicer and all holders of Certificates issued by the Trust with respect to any
Distribution Date pursuant to Sections 4.06 and 4.07 have been paid in full and
all amounts required to be deposited in the Reserve Fund with respect to any
Distribution Date pursuant to Section 4.07 have been so deposited.
SECTION 9.09 ELIGIBILITY REQUIREMENTS FOR TRUSTEE.
Except as otherwise provided in this Agreement, the Trustee under this
Agreement shall at all times be a corporation having its corporate trust office
in the same state (or the District of Columbia or the Commonwealth of Puerto
Rico) as the location of the Corporate Trust Office as specified in this
Agreement; organized and doing business under the laws of such state (or the
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District of Columbia or the Commonwealth of Puerto Rico) or the United States;
authorized under such laws to exercise corporate trust powers; having a combined
capital and surplus of at least $50,000,000 and subject to supervision or
examination by federal or state authorities; and having a long-term deposit
rating no lower than ___ by Moody's (if ▇▇▇▇▇'▇ is a Rating Agency), or be
otherwise acceptable to each Rating Agency, as evidenced by a letter to such
effect from each of them (which acceptance may be evidenced in the form of a
letter, dated on or shortly before the Closing Date, assigning an initial rating
to the Rated Certificates).
If the Trustee shall publish reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purpose of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, the Trustee shall resign immediately in the manner
and with the effect specified in Section 9.10.
SECTION 9.10 RESIGNATION OR REMOVAL OF TRUSTEE.
(a) The Trustee may at any time resign and be discharged from the
trusts created by this Agreement by giving written notice thereof to the
Servicer. Upon receiving such notice of resignation, the Servicer shall
promptly appoint a successor Trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the resigning Trustee
and one copy to the successor Trustee. If no successor Trustee shall have
been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor
Trustee.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 9.09 and shall fail to resign
after written request therefor by the Servicer, or if at any time the
Trustee shall be legally unable to act, or shall be adjudged a bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be
appointed, or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Servicer may remove the Trustee. If
it shall remove the Trustee under the authority of the immediately
preceding sentence, the Servicer shall promptly appoint a successor Trustee
by written instrument, in duplicate, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor Trustee,
and payment of all fees owed to the outgoing Trustee.
(c) Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor
Trustee as provided in Section 9.11. The Servicer shall give each Rating
Agency notice of any such resignation or removal of the Trustee and
appointment and acceptance of a successor Trustee.
SECTION 9.11 SUCCESSOR TRUSTEE. Any successor Trustee appointed as provided
in Section 9.10 shall execute, acknowledge and deliver to the Servicer and to
its predecessor Trustee an instrument accepting such appointment under this
Agreement, and thereupon the
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resignation or removal of the predecessor Trustee shall become effective and
such successor Trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor under this Agreement, with like effect as if originally named as
Trustee. The predecessor Trustee shall deliver to the successor Trustee all
documents and statements held by it under this Agreement; and the Servicer and
the predecessor Trustee shall execute and deliver such instruments and do such
other things as may reasonably be required for fully and certainly vesting and
confirming in the successor Trustee all such rights, powers, duties and
obligations. No successor Trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor Trustee shall be
eligible under the provisions of Section 9.09. Upon acceptance of appointment by
a successor Trustee as provided in this Section, the Servicer shall mail notice
of the successor of such Trustee under this Agreement to all Certificateholders
at their addresses as shown in the Certificate Register and shall give notice by
mail to each Rating Agency. If the Servicer fails to mail such notice within ten
days after acceptance of appointment by the successor Trustee, the successor
Trustee shall cause such notice to be mailed at the expense of the Servicer.
SECTION 9.12 MERGER OR CONSOLIDATION OF TRUSTEE. Any corporation (i) into
which the Trustee may be merged or consolidated, (ii) which may result from any
merger, conversion, or consolidation to which the Trustee shall be a party or
(iii) which may succeed to all or substantially all the corporate trust business
of the Trustee, which corporation executes an agreement of assumption to perform
every obligation of the Trustee under this Agreement, shall be the successor of
the Trustee hereunder, provided such corporation shall be eligible pursuant to
Section 9.09, without the execution or filing of any instrument or any further
act on the part of any of the parties hereto, anything herein to the contrary
notwithstanding. Notice of any such merger shall be given by the Trustee to each
Rating Agency.
SECTION 9.13 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. Notwithstanding
any other provisions of this Agreement, at any time, for the purpose of meeting
any legal requirements of any jurisdiction in which any part of the Trust or any
Financed Vehicle may at the time be located, the Servicer and the Trustee acting
jointly shall have the power and shall execute and deliver all instruments to
appoint one or more Persons approved by the Trustee to act as co-trustee,
jointly with the Trustee, or separate trustee or separate trustees, of all or
any part of the Trust, and to vest in such Person, in such capacity and for the
benefit of the Certificateholders, such title to the Trust, or any part thereof,
and, subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Servicer and the Trustee may consider
necessary or desirable. If the Servicer shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, or in
the case an Event of Default shall have occurred and be continuing, the Trustee
alone shall have the power to make such appointment. No co-trustee or separate
trustee under this Agreement shall be required to meet the terms of eligibility
as a successor trustee pursuant to Section 9.09 and no notice of a successor
Trustee pursuant to Section 9.11 and no notice to Certificateholders of the
appointment of any co-trustee or separate trustee shall be required pursuant to
Section 9.11.
Each separate trustee and co-trustee shall, to the extent permitted by law,
be appointed and act subject to the following provisions and conditions:
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(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred upon and exercised or
performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee
is not authorized to act separately without the Trustee joining in
such act), except to the extent that under any law of any jurisdiction
in which any particular act or acts are to be performed (whether as
Trustee under this Agreement or as successor to the Servicer under
this Agreement), the Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties
and obligations (including the holding of title to the Trust or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-trustee, but solely at
the direction of the Trustee;
(ii) no trustee under this Agreement shall be personally liable
by reason of any act or omission of any other trustee under this
Agreement; and
(iii) the Servicer and the Trustee acting jointly (or during the
continuation of an Event of Default, the Trustee alone) may at any
time accept the resignation of or remove any separate trustee or
co-trustee.
Any notice, request or other writing given to the Trustee shall be deemed
to have been given to each of the then separate trustees and co-trustees, as
effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Section. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Agreement,
including, but not limited to, every provision of this Agreement relating to the
conduct of, affecting the liability of, or affording protection to, the Trustee.
Each such instrument shall be filed with the Trustee and a copy thereof given to
the Servicer.
Any separate trustee or co-trustee may at any time appoint the Trustee its
agent or attorney-in-fact with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement on
its behalf and in its name. If any separate trustee or co-trustee shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee. Notwithstanding anything to the contrary in this Agreement,
the appointment of any separate trustee or co-trustee shall not relieve the
Trustee of its obligations and duties under this Agreement.
SECTION 9.14 REPRESENTATIONS AND WARRANTIES OF TRUSTEE. The Trustee shall
make the following representations and warranties on which the Seller and
Certificateholders may rely:
(i) ORGANIZATION AND GOOD STANDING. The Trustee is a national
banking corporation duly organized, existing and in good standing;
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(ii) POWER AND AUTHORITY. The Trustee has full power, authority
and right to execute, deliver and perform this Agreement and has taken
all necessary action to authorize the execution, delivery and
performance by it of this Agreement;
(iii) NO VIOLATION. The execution, delivery and performance by
the Trustee of this Agreement (a) shall not violate any provision of
any law governing the banking and trust powers of the Trustee or, to
the best of the Trustee's knowledge, any order, writ, judgment, or
decree of any court, arbitrator, or governmental authority applicable
to the Trustee or any of its assets, (b) shall not violate any
provision of the corporate charter or by-laws of the Trustee, and (c)
shall not violate any provision of, or constitute, with or without
notice or lapse of time, a default under, or result in the creation or
imposition of any Lien on any properties included in the Trust
pursuant to the provisions of any mortgage, indenture, contract,
agreement or other undertaking to which it is a party, which
violation, default or Lien could reasonably be expected to materially
and adversely affect the Trustee's performance or ability to perform
its duties under this Agreement or the transactions contemplated in
this Agreement;
(iv) NO AUTHORIZATION REQUIRED. The execution, delivery and
performance by the Trustee of this Agreement shall not require the
authorization, consent, or approval of, the giving of notice to, the
filing or registration with, or the taking of any other action in
respect of, any governmental authority or agency regulating the
banking and corporate trust activities of the Trustee; and
(v) DULY EXECUTED. This Agreement shall have been duly executed
and delivered by the Trustee and shall constitute the legal, valid,
and binding agreement of the Trustee, enforceable in accordance with
its terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws
affecting creditors' rights generally or by general principles of
equity.
SECTION 9.15 TAX RETURNS. In the event the Trust shall be required to file
tax returns, the Servicer shall prepare or shall cause to be prepared any tax
returns required to be filed by the Trust and shall remit such returns to the
Trustee for signature at least five days before such returns are due to be
filed. The Trustee, upon request, shall furnish the Servicer with all such
information known to the Trustee as may be reasonably required in connection
with the preparation of all tax returns of the Trust, and shall, upon request,
execute such returns.
SECTION 9.16 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF CERTIFICATES.
All rights of action and claims under this Agreement or the Certificates may be
prosecuted and enforced by the Trustee without the possession of any of the
Certificates or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as Trustee. Any recovery of judgment shall, after provision for the payment of
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, be for the ratable benefit of the
Certificateholders in respect of which such judgment has been obtained.
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SECTION 9.17 SUIT FOR ENFORCEMENT. If an Event of Default shall occur and
be continuing, the Trustee, in its discretion may, subject to the provisions of
Section 9.01, proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Agreement or in aid of the execution of
any power granted in this Agreement or for the enforcement of any other legal,
equitable or other remedy as the Trustee, being advised by counsel, shall deem
most effectual to protect and enforce any of the rights of the Trustee or the
Certificateholders.
SECTION 9.18 RIGHTS OF CERTIFICATEHOLDERS TO DIRECT TRUSTEE. Holders of
Certificates evidencing not less the 25% of the Voting Interests of a Class (but
excluding for purposes of such calculation and action all Certificates held by
TMCC, TMCRC or any of their affiliates) shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee; provided,
however, that subject to Section 9.01, the Trustee shall have the right to
decline to follow any such direction if the Trustee being advised by counsel
determines that the action so directed may not lawfully be taken, or if the
Trustee in good faith shall, by a Responsible Officer, determine that the
proceedings so directed would be illegal or subject it to personal liability or
be unduly prejudicial to the rights of Certificateholders not parties to such
direction; and provided further that nothing in this Agreement shall impair the
right of the Trustee to take any action deemed proper by the Trustee and which
is not inconsistent with such direction by the Certificateholders.
ARTICLE X
TERMINATION
SECTION 10.01 TERMINATION OF THE TRUST.
(a) The Trust and the respective obligations and responsibilities of
the Seller, the Servicer and the Trustee shall terminate upon (i) the
purchase as of any Distribution Date by the Seller or Servicer, or any
successor to the Servicer, at its option of the corpus of the Trust as
described in Section 10.03, (ii) the payment to Certificateholders of all
amounts required to be paid to them pursuant to this Agreement, [or (iv) a
Swap Termination Event as provided in Section 10.02] (iii) the maturity or
liquidation of the last Receivable and the disposition of all property held
as part of the Trust; provided, however, that in no event shall the trust
created by this Agreement continue beyond the expiration of 21 years from
the death of the last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the
late ambassador of the United States to the Court of St. ▇▇▇▇▇, living on
the date of this Agreement. The Servicer shall promptly notify the Trustee
and each Rating Agency of any prospective termination pursuant to this
Section.
(b) Notice of any termination, specifying the Distribution Date upon
which the Certificateholders must surrender their Certificates to the
Trustee for payment of the final distribution and retirement of the
Certificates, shall be given promptly by the Trustee (at the written
direction of the Servicer) by letter to Certificateholders mailed not later
than the 15th day and not earlier than the 30th day prior to the date on
which such final distribution is expected to occur specifying (i) the
Distribution Date upon which final
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payment of the Certificates shall be made upon presentation and surrender
of Certificates at the office of the Trustee therein specified, (ii) the
amount of any such final payment and (iii) if applicable, that the Record
Date otherwise applicable to such Distribution Date is not applicable,
payments being made only upon presentation and surrender of the
Certificates at the office of the Trustee therein specified. The Trustee
shall give such notice to the Certificate Registrar (if other than the
Trustee) at the time such notice is given to Certificateholders. In the
event such notice is given, the Seller, the Servicer, or any successor to
the Servicer, or the Trustee, as the case may be, shall make deposits into
the Collection Account in accordance with Section 4.05, or, in the case of
an optional purchase of Receivables pursuant to Section 10.02, shall
deposit the amount specified in Section 10.02. Upon presentation and
surrender of the Certificates, the Trustee shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date pursuant
to Section 4.06.
(c) In the event that all of the Certificateholders shall not
surrender their Certificates for retirement within six months after the
date specified in the above-mentioned written notice, the Trustee shall
give a second written notice to the remaining Certificateholders to
surrender their Certificates for retirement and receive the final
distribution with respect thereto. If within one year after the second
notice all the Certificates shall not have been surrendered for retirement,
the Trustee may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of
the funds and other assets that remain subject to this Agreement. Any funds
remaining in the Trust after exhaustion of such remedies shall be
distributed by the Trustee to the California Special Olympics.
SECTION 10.02 OPTIONAL PURCHASE OF ALL RECEIVABLES. On each Distribution
Date following the last day of a Collection Period as of which the Pool Balance
shall be less than the Optional Purchase Percentage (expressed as a seven-digit
decimal figure) multiplied by the Original Pool Balance, the Seller shall have
the option to purchase the corpus of the Trust; provided that the option to
purchase provided in this Section shall not be exercised if the final
distribution to Certificateholders would be less than the aggregate outstanding
principal amount of the Certificates plus the sum of (i) the Class A Interest
Distributable Amount for the related Distribution Date, (ii) any unpaid Class A
Interest Carryover Shortfall, (iii) the Class B Interest Distributable Amount
for the related Distribution Date and (iv) any unpaid Class B Interest Carryover
Shortfall. To exercise such option, the Seller or the Servicer, or any successor
to the Servicer, as the case may be, shall notify the Trustee in writing, no
later than the tenth day of the month preceding the month in which the
Distribution Date as of which such purchase is to be effected and shall, on or
before the Distribution Date on which such purchase is to occur, deposit
pursuant to Section 4.06 in the Collection Account an amount equal to the
aggregate Administrative Purchase Payments for the Receivables (including
Defaulted Receivables), plus the appraised value of any other property held by
the Trust (less liquidation expenses to be incurred in connection with the
recovery thereof), such value to be determined by an appraiser mutually agreed
upon by the Seller, the Servicer and the Trustee, and shall succeed to all
interests in and to the Trust. Notwithstanding the foregoing, if ▇▇▇▇▇'▇ is a
Rating Agency, the Seller or the Servicer, as the case may be, may not effect
any such purchase if the long-term unsecured debt obligations of the related
entity are
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rated less than ___, unless the Trustee shall have received an Opinion of
Counsel that such purchase will not constitute a fraudulent conveyance, or
▇▇▇▇▇'▇ is otherwise satisfied, as evidenced by written notice from Moody's to
the Trustee. Upon such deposit of the amount necessary to purchase the corpus of
the Trust, the Servicer shall for all purposes of this Agreement be deemed to
have released all claims for reimbursement of Outstanding Advances made in
respect of the Receivables. The payment shall be made in the manner specified in
Section 4.06, and shall be distributed pursuant to Section 4.07. In the event
that both the Seller and the Servicer, or any successor to the Servicer, elect
to purchase the Receivables pursuant to this Section, the party first notifying
the Trustee (based on the Trustee's receipt of such notice) shall be permitted
to purchase the Receivables.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01 AMENDMENT.
(a) This Agreement may be amended by the Seller, the Servicer and the
Trustee, without the consent of any of the Certificateholders, (i) to cure
any ambiguity, to correct or supplement any provision in this Agreement
which may be inconsistent with any other provision of this Agreement, to
add, change or eliminate any other provision of this Agreement with respect
to matters or questions arising under this Agreement that shall not be
inconsistent with the provisions of this Agreement or to add or provide for
any credit enhancement and (ii) to change the formula for determining the
Specified Reserve Fund Balance, any Required Yield Maintenance Amount or
the manner in which the Reserve Fund or any Yield Maintenance Account is
funded or to amend or modify any provisions of this Agreement relating to
the remittance schedule with respect to collections deposited into the
Collection Account or the Payahead Account pursuant to Section 4.02;
provided, however, that any such action shall not, as evidenced by an
Opinion of Counsel, adversely affect in any material respect the interests
of the Certificateholders and provided, further, that in connection with
any amendment pursuant to clause (ii) above the Servicer shall deliver to
the Trustee a letter from each Rating Agency to the effect that such
amendment will not cause the then-current rating on the Rated Certificates
to be qualified, reduced or withdrawn.
(b) This Agreement may also be amended from time to time by the
Seller, the Servicer and the Trustee, with the consent of Holders of the
Class A Certificates and the Class B Certificates, acting together as a
single Class (but excluding for purposes of such calculation and action all
Certificates held by TMCC, TMCRC or any of their affiliates), evidencing
not less than 51% of the Voting Interests of each Class of Certificates
(which consent of any Holder of a Certificate given pursuant to this
Section or pursuant to any other provision of this Agreement shall be
conclusive and binding on such Holder and on all future Holders of such
Certificate and of any Certificate issued upon the transfer thereof or in
exchange thereof or in lieu thereof whether or not notation of such consent
is made upon the Certificate), for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this
Agreement, or of modifying in any manner the rights of either Class of
Certificateholders; provided, however, that no
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such amendment shall (i) except as otherwise provided in Section 11.01(a),
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Receivables or distributions that
shall be required to be made on any Certificate or the applicable Pass
Through Rate, Reserve Fund Balance or any Yield Maintenance Amount or (ii)
reduce the aforesaid percentage of the Voting Interests of the Certificates
of either Class required to consent to any such amendment, without the
consent of the Holders of all Certificates of the relevant Class then
outstanding.
(c) Prior to the execution of any such amendment or consent, the
Trustee shall furnish written notification of the substance of such
amendment or consent to each Rating Agency.
(d) Promptly after the execution of any such amendment or consent, the
Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder. It shall not be necessary
for the consent of Certificateholders pursuant to Section 11.01(b) to
approve the particular form of any proposed amendment or consent, but it
shall be sufficient if such consent shall approve the substance thereof.
The manner of obtaining such consents and of evidencing the authorization
by Certificateholders of the execution thereof shall be subject to such
reasonable requirements as the Trustee may prescribe.
(e) Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel
stating that the execution of such amendment is authorized or permitted by
this Agreement. The Trustee may, but shall not be obligated to, enter into
any such amendment which affects the Trustee's own rights, duties or
immunities under this Agreement or otherwise.
SECTION 11.02 PROTECTION OF TITLE TO TRUST.
(a) Each of the Seller and the Servicer or both shall execute and file
such financing statements and cause to be executed and filed such
continuation and other statements, all in such manner and in such places as
may be required by law fully to preserve, maintain and protect the interest
of the Certificateholders and the Trustee under this Agreement in the
Receivables and in the proceeds thereof. Each of the Seller and the
Servicer shall deliver (or cause to be delivered) to the Trustee
file-stamped copies of, or filing receipts for, any document filed as
provided above, as soon as available following such filing.
(b) Neither the Seller nor the Servicer shall change its name,
identity or corporate structure in any manner that would, could or might
make any financing statement or continuation statement filed by the Seller
in accordance with paragraph (a) above seriously misleading within the
meaning of Section 9-402(7) of the UCC, unless it shall have given the
Trustee at least 60 days' prior written notice thereof and shall have
promptly filed appropriate amendments to all previously filed financing
statements or continuation statements.
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(c) Each of the Seller and the Servicer shall give the Trustee at
least 60 days' prior written notice of any relocation of its principal
executive office if, as a result of such relocation, the applicable
provisions of the UCC would require the filing of any amendment of any
previously filed financing or continuation statement or of any new
financing statement and shall promptly file any such amendment. The
Servicer shall at all times maintain each office from which it services
Receivables and its principal executive office within the United States.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit (i) the reader
thereof to know at any time the status of such Receivable, including
payments and recoveries made and payments owing (and the nature of each)
and (ii) reconciliation between payments or recoveries on (or with respect
to) each Receivable and the amounts from time to time deposited in the
Accounts and any Payments Ahead held by the Servicer in respect of such
Receivable.
(e) The Servicer shall maintain its computer systems so that, from and
after the time of sale under this Agreement of the Receivables to the
Trustee, the Servicer's master computer records (including any back-up
archives) that refer to any Receivable indicate clearly the interest of the
Trust in such Receivable and that the Receivable is owned by the Trustee.
Indication of the Trustee's ownership of a Receivable shall be deleted from
or modified on the Servicer's computer systems when, and only when, the
Receivable has been paid in full, repurchased or assigned pursuant to this
Agreement.
(f) If at any time the Seller or the Servicer shall propose to sell,
grant a security interest in, or otherwise transfer any interest in
automobile and/or light duty truck receivables to any prospective
purchaser, lender or other transferee, the Servicer shall give to such
prospective purchaser, lender or other transferee computer tapes, records
or print-outs (including any restored from back-up archives) that, if they
refer in any manner whatsoever to any Receivable, indicate clearly that
such Receivable has been sold and is owned by the Trustee unless such
Receivable has been paid in full, repurchased or assigned pursuant to this
Agreement.
(g) The Servicer shall permit the Trustee and its agents at any time
to inspect, audit and make copies of and abstracts from the Servicer's
records regarding any Receivables then or previously included in the Trust.
(h) Upon request, the Servicer shall furnish to the Trustee, within
five Business Days, a list of all Receivables (by contract number and name
of Obligor) then held as part of the Trust, together with a reconciliation
of such list to the Schedule of Receivables and to each of the Servicer's
Certificates furnished before such request indicating removal of
Receivables from the Trust.
(i) The Servicer shall deliver to the Trustee promptly after the
execution and delivery of each amendment to any financing statement, an
Opinion of Counsel either (i) stating that, in the opinion of such Counsel,
all financing statements and continuation statements have been executed and
filed that are necessary fully to preserve and protect the interest of the
Trustee in the Receivables, and reciting the details of such filings or
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referring to prior Opinions of Counsel in which such details are given, or
(ii) stating that, in the opinion of such Counsel, no such action is
necessary to preserve and protect such interest.
(j) The Seller shall, to the extent required by applicable law, cause
the Certificates to be registered with the Commission pursuant to Section
12(b) or Section 12(g) of the Exchange Act within the time periods
specified in such Sections.
(k) This Agreement may be executed simultaneously in any number of
counterparts, each of which shall be deemed to be an original, and all of
which shall constitute but one and the same instrument.
SECTION 11.03 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.
(a) The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or the Trust, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting
or to take any action or commence any proceeding in any court for a
partition or winding up of the Trust, nor otherwise affect the rights,
obligations and liabilities of the parties to this Agreement or any of
them.
(b) No Certificateholder shall have any right to vote (except as
provided in Sections 8.05 and 11.01) or in any manner otherwise control the
operation and management of the Trust, or the obligations of the parties to
this Agreement, nor shall anything set forth in this Agreement, or
contained in the terms of the Certificates, be construed so as to
constitute the Certificateholders from time to time as partners or members
of an association; nor shall any Certificateholder be under any liability
to any third person by reason of any action pursuant to any provision of
this Agreement.
(c) No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action,
or proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of default and of the continuance thereof, as hereinbefore
provided, and unless also the Holders of Certificates evidencing not less
the 25% of the Voting Interests of the related Class shall have made
written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee under this Agreement and shall have
offered to the Trustee such reasonable indemnity as it may require against
the costs, expenses, and liabilities to be incurred therein or thereby, and
the Trustee, for 30 days after its receipt of such notice, request and
offer of indemnity, shall have neglected or refused to institute any such
action, suit, or proceeding and during such 30-day period, no request or
waiver inconsistent with such written request has been given to the Trustee
pursuant to this Section or Section 9.05; it being understood and intended,
and being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatever by virtue or by
availing itself or themselves of any provisions of this Agreement to
affect, disturb, or prejudice the rights of the Holders of any other of the
Certificates, or to obtain or seek to obtain priority over or preference to
any other such Holder, or to enforce any right under this Agreement, except
in the
79
manner provided in this Agreement and for the equal, ratable, and common
benefit of all Certificateholders. For the protection and enforcement of
the provisions of this Section, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or
in equity.
SECTION 11.04 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York and the
obligations, rights and remedies of the parties under this Agreement shall be
determined in accordance with such laws.
SECTION 11.05 NOTICES. All demands, notices and communications under this
Agreement shall be in writing, personally delivered or mailed by certified mail,
return receipt requested, and shall be deemed to have been duly given upon
receipt (i) in the case of the Seller or the Servicer, to the agent for service
as specified in this Agreement, or at such other address as shall be designated
by the Seller or the Servicer in a written notice to the Trustee; (ii) in the
case of the Trustee, at the Corporate Trust Office; (iii) in the case of
Standard & Poor's, at ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Asset Backed Surveillance Department; and (iv) in the case of
▇▇▇▇▇'▇, at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: ABS Monitoring
Department; and (v) in the case of Duff & ▇▇▇▇▇▇, at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇. Any notice required or permitted to be mailed to a
Certificateholder shall be given by first class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder shall
receive such notice.
SECTION 11.06 SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid or unenforceable in any jurisdiction, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
SECTION 11.07 ASSIGNMENT. Notwithstanding anything to the contrary
contained in this Agreement, except as provided in Sections 6.03 and 7.03 and as
provided in the provisions of this Agreement concerning the resignation of the
Servicer, this Agreement may not be assigned by the Seller or the Servicer
without the prior written consent of Holders of Certificates evidencing not less
than 51% of the Voting Interests of the Class A Certificates and the Class B
Certificates, voting together as a single Class.
SECTION 11.08 CERTIFICATES NONASSESSABLE AND FULLY PAID. Certificateholders
shall not be personally liable for obligations of the Trust. The interests
represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust or for any reason whatsoever, and, upon the authentication
thereof by the Trustee pursuant to Section 5.02 or 5.03, the Certificates are
and shall be deemed fully paid.
SECTION 11.09 NO PETITION. Each of the Servicer and the Trustee (not in its
individual capacity but solely as Trustee) covenants and agrees that prior to
the date which is one year and one day after the date upon which each Class of
Certificates has been paid in full, it will not at
80
any time file, join in any filing of, or cooperate with or encourage others to
file any bankruptcy, reorganization arrangement, insolvency or liquidation
proceeding or other proceedings under any federal or state bankruptcy or similar
law against the Seller. This Section 11.09 shall survive the termination of this
Agreement or the termination of the Servicer or the Trustee, as the case may be,
under this Agreement.
Each Certificateholder hereby covenants and agrees that it will not at any
time file, join in any filing of, or cooperate with or encourage others to file
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law against the Seller in connection with any obligations
relating to the Certificates.
* * * *
81
IN WITNESS WHEREOF, the parties have caused this Pooling and Servicing
Agreement to be duly executed by their respective officers as of the day and
year first above written.
TOYOTA MOTOR CREDIT RECEIVABLES
CORPORATION,
as Seller
By:
-----------------------------------
Name:
Title:
TOYOTA MOTOR CREDIT CORPORATION,
as Servicer
By:
-----------------------------------
Name:
Title:
[NAME OF TRUSTEE],
as Trustee
By:
----------------------------------
Name:
Title:
82
EXHIBIT A
FORM OF SERVICER'S CERTIFICATE
PURSUANT TO SECTION 3.10 OF
POOLING AND SERVICING AGREEMENT
TOYOTA AUTO RECEIVABLES _______
GRANTOR TRUST
Servicer's Certificate
For the Month of ____, ___
PRINCIPAL AND INTEREST COLLECTIONS
Beginning Pool Balance (1)$
Beginning Pool Factor [(1)/--] (2)
Principal Collected (3)$
Interest Collected (4)$
Less: Beginning Purchased Accrued
Interest Repaid (5)
Plus: Purchased Accrued Interest --
End of Collection Period (6)
Net decrease/(increase) in Purchased
Accrued Interest [(5)-(6)] (7)$
Plus: Non-Reimbursable Interest Payment (8)
Total Interest Received
[(4)-(5)+(6)+(8)] (9)$
Additional Deposits (4.06)
(i) Repurchase Amounts (10)
(ii) Liquidation Proceeds (11)
Total Additional Deposits (12)$
Total Available Funds [(3)+(9)+(12)] (13)
A-1
TOYOTA AUTO RECEIVABLES ___ GRANTOR TRUST
Servicer's Certificate
For the Month of ____, ___
DISTRIBUTIONS:
-------------
CLASS A CLASS B TOTAL
Class Percentage % % 100.00%
--------- -------
Pool Factor
------------ ------------ ----------
Beginning Pool Balance
------ ------------ ------------ ----------
Ending Pool Balance
------ ------------ ------------ ----------
Collected Principal (3)
------------ ------------ ----------
Collected Interest (9)
------------ ------------ ----------
Defaulted Receivables (13)
------------ ------------ -------------------
Servicing Fee [( /12)x(1)] ( ) ( ) ( )
-------- ------------ ------------ -------------------
Total Available Funds
------------ ------------ -------------------
PAYMENTS TO CERTIFICATEHOLDERS
Monthly Principal Payment [(15)-(16)
------------ ------------ -------------------
Interest Distributable Amount
[(15)x( %/12]
-- ------------ ------------ -------------------
Total payments to Certificateholders
------------ ------------ -------------------
Amount due Class B but paid to
Class A (subordination)
------------ ------------ -------------------
Class A Interest Carryover Shortfall
------------ ------------ -------------------
Class B Interest Carryover Shortfall
------------ ------------ -------------------
Class A Principal Carryover Shortfall
------------ ------------ -------------------
Class B Principal Carryover Shortfall
------------ ------------ -------------------
Amounts to be paid to the Seller
------------ ------------ -------------------
Payments from/(to) the
Reserve Fund
------------ ------------ -------------------
Reserve Fund Balance
------------ ------------ -------------------
Specified Reserve Fund Balance
------------ ------------ -------------------
Yield Maintenance Amount
------------ ------------ -------------------
Required Yield Maintenance Amount
------------ ------------ -------------------
A-2
TOYOTA AUTO RECEIVABLES ___ GRANTOR TRUST
Servicer's Certificate
For the Month of ____, ___
RECONCILIATION OF THE RESERVE FUND
Beginning Reserve Fund Balance (45)$
Reserve Fund Prior to Payments to Seller (48)$
Specified Reserve Fund Balance: (1) $
-------------
Required Amount (49)
Amount of Excess Spread released [(48)-(49)] (50)
A-3
TOYOTA AUTO RECEIVABLES ___ GRANTOR TRUST
Servicer's Certificate
For the Month of ____, ___
DELINQUENT ACCOUNTS
Period of Delinquency Units Amount Percent of Pool
30 - 59 days $ 0.00%
60 - 89 days 0.00%
90 days or more 0.00% (A)
----- ----- -----
Total $ 0.00%
----- -----
Repossession Inventory $ (B)
----- ----- -----
Delinquency Percentage
(less than 1.5%?) [(A)+(B)/(1)] %
----
REALIZED LOSS ANALYSIS (Section 5.02)
Quarter
Month Month Month Total
Realized Losses/(Recoveries) (X) $ $ $ $
Beginning Pool Balance (mils) (Y) $ $ $ $
Realized Loss Percentage
(less than 1.5%?) [(X)/(Y)) *4] _____%
Realized Losses Since Inception $_____
Change in Realized Losses $_____
PROCEEDS FROM INSURANCE AND DEALER REPURCHASES
Proceeds received during the month from
physical damage insurance $_____
Proceeds received during the month from Dealer
repurchase obligations relating to Defaulted
Receivables $_____
A-4
EXHIBIT B
FORM OF TRUSTEE'S CERTIFICATE
PURSUANT TO SECTION 9.02 OR 9.03
OF THE POOLING AND SERVICING
AGREEMENT
_____________, as trustee (the "Trustee") of the Toyota Auto Receivables ______
Grantor Trust created pursuant to the Pooling and Servicing Agreement (the
"Agreement"), dated as of _________ , _____ , among Toyota Motor Credit
Receivables Corporation, as Seller, Toyota Motor Credit Corporation, as
Servicer, and the Trustee, does hereby sell, transfer, assign and otherwise
convey to the [Seller][Servicer], without any recourse, representation or
warranty, all of the Trustee's right, title and interest in and to all of the
Receivables identified in the attached Servicer's Certificate as "Repurchased
Receivables," which are to be repurchased by the [Seller pursuant to Section
2.05 or 10.02] [Servicer pursuant to Section 3.08 or 10.02] of the Agreement,
and all security and documents relating thereto.
Capitalized terms used herein that are not otherwise defined shall have the
meanings ascribed thereto in the Agreement.
IN WITNESS WHEREOF, I have hereunto set my hand this___th day of _____, __.
________________________________,
as Trustee
By:
-------------------------------
Title:
B-1
EXHIBIT C
FORM OF CLASS A CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TOYOTA AUTO RECEIVABLES 200_-_ GRANTOR TRUST
o% ASSET BACKED CERTIFICATE, CLASS A
evidencing a fractional undivided interest in the Trust, as defined below,
the property of which includes a pool of retail installment sale contracts
secured by the new and used automobiles and light duty trucks financed
thereby and sold to the Trust by Toyota Motor Credit Receivables
Corporation. The Final Scheduled Distribution Date is March 15, 2001.
(This Certificate does not represent an interest in or obligation of Toyota
Motor Credit Receivables Corporation, Toyota Motor Credit Corporation or
any of their respective affiliates)
CUSIP o
NUMBER R-A1 $o
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a o ($o)
nonassessable, fully-paid, fractional undivided interest in the Toyota Auto
Receivables 200_-_ Grantor Trust (the "Trust") formed by Toyota Motor Credit
Receivables Corporation, a California corporation (the "Seller"). The Trust was
created pursuant to a Pooling and Servicing Agreement, dated as of o (the
"Agreement"), among the Seller, Toyota Motor Credit Corporation, as Servicer,
and o, as trustee (the "Trustee"). A summary of certain of the pertinent
provisions of the Agreement is set forth below. To the extent not otherwise
defined herein, the capitalized terms used herein have the meanings assigned to
them in the Agreement.
This Certificate is one of the duly authorized Certificates issued under
the Agreement and designated as "Toyota Auto Receivables 200_-_ Grantor Trust o%
Asset Backed Certificates, Class A" (the "Class A Certificates"). Also issued
under the Agreement are Certificates designated as "Toyota Auto Receivables
200_-_ Grantor Trust o% Asset Backed Certificates, Class B" (the "Class B
Certificates" and, together with the Class A Certificates, the "Certificates").
The Class B Certificates are subordinated to the Class A Certificates to the
C-1
extent described in the Agreement. The aggregate undivided interest in the Trust
evidenced by all Class A Certificates is o%. This Class A Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Class A Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound. The property of the
Trust includes, among other things, a pool of retail installment sale contracts
(the "Receivables") for the new and used automobiles and light duty trucks
financed thereby (the "Financed Vehicles"), certain monies due under the
Receivables on and after the Cutoff Date, security interests in the Financed
Vehicles, certain bank accounts and the proceeds thereof, proceeds from claims
on physical damage, credit life and disability insurance policies covering the
Financed Vehicles, the Receivables or the related Obligors, an assignment of the
Seller's rights under the Receivables Purchase Agreement and the right of the
Seller to receive the proceeds of any Dealer Recourse relating to the
Receivables.
Under the Agreement, there will be distributed on the o day of each month
or, if such day is not a Business Day, the next succeeding Business Day (each, a
"Distribution Date"), commencing on o, to the Person in whose name this Class A
Certificate is registered at the close of business on the last calendar day
immediately preceding the related Distribution Date or, if Definitive
Certificates are issued, the last day of the immediately preceding calendar
month (each, a "Record Date"), such Class A Certificateholder's percentage
interest in the Class A Distributable Amount for such Distribution Date actually
distributed, together with any outstanding Class A Interest Carryover Shortfall
and any outstanding Class A Principal Carryover Shortfall, all to the extent and
as more specifically set forth in the Agreement.
Distributions on this Class A Certificate will be made by the Trustee by
check or money order mailed to the related Class A Certificateholder of record
in the Certificate Register without the presentation or surrender of this Class
A Certificate or the making of any notation hereon except that with respect to
Class A Certificates registered in the name of Cede & Co., the nominee for The
Depository Trust Company, distributions will be made in the form of immediately
available funds. Except as otherwise provided in the Agreement and
notwithstanding the foregoing, the final distribution on this Class A
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A
Certificate at the office or agency maintained for that purpose by the Trustee
in the Borough of Manhattan, The City of New York.
The Certificates do not represent an obligation of, or an interest in, the
Seller, the Servicer or any of their respective affiliates. Under no
circumstances shall o in its individual capacity be personally liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Trust under the Agreement or the Certificates. Each of the
Agreement and this Certificate has been executed and delivered by o, not in its
individual capacity but solely as trustee of the Trust. Each of the
representations (other than the representations and warranties of the Trustee
set forth in Section 9.14), undertakings and agreements made by o in the
Agreement is made on the part of the Trust and intended not as a representation,
undertaking or agreement by o in its individual capacity, but is made and
intended for the purpose of binding only the Trust. The Certificates are limited
in right of payment to certain collections and recoveries respecting the
Receivables and the monies on deposit in the Reserve Fund [and the Yield
Maintenance Account,] all as more specifically set
C-2
forth in the Agreement. A copy of the Agreement may be examined during normal
business hours at the principal office of the Trustee, and at such other places,
if any, designated by the Trustee, by any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
parties thereto and the rights of the Certificateholders under the Agreement at
any time by the Seller, the Servicer and the Trustee with the consent of the
Holders of Certificates evidencing not less than 51% of the Voting Interests of
each Class of Certificates acting together as a single Class (but excluding for
purposes of such calculation and action all Certificates held by TMCC, TMCRC or
any of their affiliates). Any such consent by the Holder of this Class A
Certificate shall be conclusive and binding on such Holder and on all future
Holders of this Class A Certificate and of any Class A Certificate issued upon
the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Class A Certificate. The Agreement
also permits the amendment thereof, in certain circumstances, without the
consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Class A Certificate is registrable in the
Certificate Register upon surrender of this Class A Certificate for registration
of transfer at the offices or agencies maintained by the Trustee in its capacity
as Certificate Registrar, or by any successor Certificate Registrar, in The City
of New York, accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Class A Certificates of authorized denominations
evidencing the same aggregate interest in the Trust will be issued to the
designated transferee.
The Class A Certificates are issuable only as registered Certificates
without coupons in denominations of $1,000 and integral multiples thereof
(except for one Class A Certificate in a smaller minimum denomination
representing any remaining portion of the Original Class A Certificate Balance).
As provided in the Agreement and subject to certain limitations therein set
forth, Class A Certificates are exchangeable for new Class A Certificates of
authorized denominations evidencing the same aggregate principal amount, as
requested by the Holder surrendering the same. No service charge will be made
for any such registration of transfer or exchange, but the Trustee may require
payment of a sum sufficient to cover any tax or governmental charges payable in
connection therewith.
Prior to due presentation of this Class A Certificate for transfer, the
Trustee, the Certificate Registrar and any of their respective agents may treat
the Person in whose name this Class A Certificate is registered as the owner
hereof for the purposes of receiving distributions and for all other purposes,
and neither the Trustee, the Certificate Registrar nor any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and the Trust
created thereby shall terminate upon the payment to Certificateholders of all
amounts required to be paid to them pursuant to the Agreement or the maturity or
liquidation of the last Receivable and the disposition of all property held as
part of the Trust. The Seller or the Servicer, or any successor to the Servicer,
may, at its option, purchase the corpus of the Trust at a price specified in the
C-3
Agreement, and such purchase of the Receivables and other property of the Trust
will effect early retirement of the Certificates; however, such right of
purchase is exercisable only on a Distribution Date following the last day of
the month in which the Pool Balance is 10% or less of the Original Pool Balance.
Unless the certificate of authentication hereon shall have been executed by
an authorized officer of the Trustee, by manual signature, this Class A
Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
C-4
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this Class A Certificate to be duly executed.
Dated: o TOYOTA AUTO RECEIVABLES 200_-_
GRANTOR TRUST
By: o,
not in its individual capacity
but solely as Trustee
By:
------------------------------
Authorized Officer
This is one of the Certificates referred to in the within-mentioned
Agreement.
o,
as Trustee
By:
------------------------------
Authorized Officer
C-5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
-------------------------------------------------------------------------------
(Please print or typewrite name and address, including postal zip code, of
assignee)
-------------------------------------------------------------------------------
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_____________________________ Attorney to transfer said Certificate on the books
of the Certificate Registrar, with full power of substitution in the premises.
Dated:
*
-----------------------------------
Signature Guaranteed:
*
-----------------------------------
---------------------
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
C-6
EXHIBIT D
FORM OF CLASS B CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A CERTIFICATES
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE (A) REPRESENTS TO THE TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT AN
EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED, OR SECTION 4975 OF THE CODE OR A PERSON ACTING ON BEHALF OF A
PLAN OR USING THE ASSETS OF A PLAN TO EFFECT SUCH PURCHASE (2) AN INSURANCE
COMPANY PURCHASING SUCH CERTIFICATE OR INTEREST FROM FUNDS IN A GENERAL ACCOUNT
OR SEPARATE ACCOUNT (WITH CERTAIN LIMITATIONS) OR (B) DELIVERS AN OPINION OF
COUNSEL, EACH IN ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO
HEREIN. NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED
TRANSFER OF THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT
TO ERISA OR TO THE CODE OR A PERSON ACTING ON BEHALF OF A PLAN OR USING THE
ASSETS OF A PLAN TO EFFECT SUCH PURCHASE OR TO AN INSURANCE COMPANY FOR AMOUNTS
IN A NON-EXEMPT INSURANCE COMPANY GENERAL ACCOUNT OR SEPARATE ACCOUNT WITHOUT
DELIVERING THE OPINION OF COUNSEL DESCRIBED ABOVE SHALL BE VOID AND OF NO
EFFECT.
D-1
TOYOTA AUTO RECEIVABLES 200_-_ GRANTOR TRUST
o% ASSET BACKED CERTIFICATE, CLASS B
evidencing a fractional undivided interest in the Trust, as defined below,
the property of which includes a pool of retail installment sale contracts
secured by the new and used automobiles and light duty trucks financed
thereby and sold to the Trust by Toyota Motor Credit Receivables
Corporation. The Final Scheduled Distribution Date is March 15, 2001.
(This Certificate does not represent an interest in or obligation of Toyota
Motor Credit Receivables Corporation, Toyota Motor Credit Corporation or
any of their respective affiliates)
NUMBER R-B1 CUSIP o
$o
THIS CERTIFIES THAT CEDE & CO. is the registered owner of a o ($o)
nonassessable, fully-paid, fractional undivided interest in the Toyota Auto
Receivables 200_-_ Grantor Trust (the "Trust") formed by Toyota Motor Credit
Receivables Corporation, a California corporation (the "Seller"). The Trust was
created pursuant to a Pooling and Servicing Agreement dated as of o (the
"Agreement") among the Seller, Toyota Motor Credit Corporation, as Servicer, and
o, as trustee (the "Trustee"). A summary of certain of the pertinent provisions
of the Agreement is set forth below. To the extent not otherwise defined herein,
the capitalized terms used herein have the meanings assigned to them in the
Agreement.
This Certificate is one of the duly authorized Certificates issued under
the Agreement and designated as "Toyota Auto Receivables 200_-_ Grantor Trust o%
Asset Backed Certificates, Class B" (the "Class B Certificates"). Also issued
under the Agreement are Certificates designated as "Toyota Auto Receivables
200_-_ Grantor Trust o% Asset Backed Certificates, Class A" (the "Class A
Certificates" and, together with the Class B Certificates, the "Certificates").
The Class B Certificates are subordinated to the Class A Certificates to the
extent described in the Agreement. The aggregate undivided interest in the Trust
evidenced by all Class B Certificates is o%. This Class B Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Class B Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound. The property of the
Trust includes, among other things, a pool of retail installment sale contracts
(the "Receivables") for the new and used automobiles and light duty trucks
financed thereby (the "Financed Vehicles"), certain monies due under the
Receivables on and after the Cutoff Date, security interests in the Financed
Vehicles, certain bank accounts and the proceeds thereof, proceeds from claims
on physical damage, credit life and disability insurance policies covering the
Financed Vehicles, the Receivables or the related Obligors, an assignment of the
Seller's rights under the Receivables Purchase Agreement and the right of the
Seller to receive the proceeds of any Dealer Recourse relating to the
Receivables.
Under the Agreement, there will be distributed on the o day of each month
or, if such day is not a Business Day, the next succeeding Business Day (each, a
"Distribution Date"),
D-2
commencing ono, to the Person in whose name this Class B Certificate is
registered at the close of business on the last calendar day immediately
preceding the related Distribution Date or, if Definitive Certificates are
issued, the last day of the month immediately preceding the month of such
distribution (each, a "Record Date"), such Class B Certificateholder's
percentage interest in an amount equal to the Class B Distributable Amount for
such Distribution Date actually distributed, together with any outstanding Class
B Interest Carryover Shortfall and any outstanding Class B Principal Carryover
Shortfall, all to the extent and as more specifically set forth in the
Agreement.
Distributions on this Class B Certificate will be made by the Trustee by
check or money order mailed to the related Class B Certificateholder of record
in the Certificate Register without the presentation or surrender of this Class
B Certificate or the making of any notation hereon. Except as otherwise provided
in the Agreement and notwithstanding the above, the final distribution on this
Class B Certificate will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this Class B
Certificate at the office or agency maintained for that purpose by the Trustee
in the Borough of Manhattan, The City of New York.
The Certificates do not represent an obligation of, or an interest in, the
Seller, the Servicer or any of their respective affiliates. Under no
circumstances shall o in its individual capacity be personally liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Trust under the Agreement or the Certificates. Each of the
Agreement and this Certificate has been executed and delivered by o, not in its
individual capacity but solely as trustee of the Trust. Each of the
representations (other than the representations and warranties of the Trustee
set forth in Section 9.14), undertakings and agreements made by o in the
Agreement is made on the part of the Trust and intended not as a representation,
undertaking or agreement by o in its individual capacity, but is made and
intended for the purpose of binding only the Trust. The Certificates are limited
in right of payment to certain collections and recoveries respecting the
Receivables and the monies on deposit in the Reserve Fund [and the Yield
Maintenance Account,] all as more specifically set forth in the Agreement. A
copy of the Agreement may be examined during normal business hours at the
principal office of the Trustee, and at such other places, if any, designated by
the Trustee, by any Certificateholder upon request.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
parties thereto and the rights of the Certificateholders under the Agreement at
any time by the Seller, the Servicer and the Trustee with the consent of the
Holders of Certificates evidencing not less than 51% of the Voting Interests of
each Class of Certificates acting together as a single Class (but excluding for
purposes of such calculation and action all Certificates held by TMCC, TMCRC or
any of their affiliates). Any such consent by the Holder of this Class B
Certificate shall be conclusive and binding on such Holder and on all future
Holders of this Class B Certificate and of any Class B Certificate issued upon
the transfer hereof or in exchange herefor or in lieu hereof whether or not
notation of such consent is made upon this Class B Certificate. The Agreement
also permits the amendment thereof, in certain circumstances, without the
consent of the Holders of any of the Certificates.
D-3
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Class B Certificate is registrable in the
Certificate Register upon surrender of this Class B Certificate for registration
of transfer at the offices or agencies maintained by the Trustee in its capacity
as Certificate Registrar, or by any successor Certificate Registrar, in The City
of New York, accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar duly executed by the
Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Class B Certificates of authorized denominations
evidencing the same aggregate interest in the Trust will be issued to the
designated transferee.
No transfer of a Class B Certificate shall be made unless the Trustee shall
have received a representation from the transferee of such Certificate
acceptable to and in form and substance satisfactory to the Trustee (in the
event such Certificate is a Definitive Certificate, such requirement will be
satisfied only by the Trustee's receipt of a representation letter from the
transferee to the effect that:
(i) such transferee (A) is not an employee benefit plan or arrangement
subject to Section 406 of ERISA or a plan subject to Section 4975 of the
Code (a "Plan"), nor a person acting on behalf of a Plan nor using the
assets of a Plan to effect such transfer, and (B) is not an insurance
company purchasing a Class B Certificate with funds contained in an
"insurance company general account" or an "insurance company separate
account" (as defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTCE 95-60")) as to which there is a Plan with respect to
which the amount of such general account's reserves and liabilities for the
contracts held by or on behalf of such Plan and all other Plans maintained
by the same employer (or affiliate thereof as defined in Section V(a)(1) of
PTCE 95-60) of by the same employee organization exceed 10% of the total of
all reserves and liabilities of such general account (as such amounts are
determined under Section I(a) of PTCE 95-60) at the date of acquisition; or
(ii) is a Plan or a person acting on behalf of a Plan or using the
assets of a Plan to effect such transfer or is an insurance company
purchasing a Class B Certificate with funds contained in an insurance
company general account OR separate account, having attached thereto an
opinion of counsel satisfactory to the Trustee, which opinion shall not be
an expense of either the Trustee or the Trust Fund, addressed to the
Trustee, to the effect that the purchase or holding of such Class B
Certificate will not result in the assets of the Trust Fund being deemed to
be "plan assets" and subject to the prohibited transaction provisions of
ERISA and the Code and will not subject the Trustee to any obligation in
addition to those expressly undertaken in this Agreement or to any
liability.
With respect to a Class B Certificate that is a Book-Entry Certificate, in the
event the representation letter referred to in the preceding sentence is not
furnished, the representations contained in clause (i) above shall be deemed to
have been made to the Trustee by the transferee's (including an initial
acquiror's) acceptance of such Certificate. Notwithstanding anything else to the
contrary herein, any purported transfer of a Class B Certificate to or on behalf
of an employee benefit plan subject to ERISA or to the Code or a person acting
on behalf of a Plan or using the assets of a Plan to effect such transfer or to
an insurance company purchasing with funds from a general account or separate
account not exempt pursuant to ▇▇▇▇
▇-▇
95-60 without the delivery to the Trustee of an opinion of counsel satisfactory
to the Trustee as described in clause (ii) above shall be void and of no effect.
The Class B Certificates are issuable only as registered Certificates
without coupons in denominations of $1,000 and integral multiples thereof
(except for one Class B Certificate in a smaller minimum denomination
representing any remaining portion of the Original Class B Certificate Balance).
As provided in the Agreement and subject to certain limitations therein set
forth, Class B Certificates are exchangeable for new Class B Certificates of
authorized denominations evidencing the same aggregate principal amount, as
requested by the Holder surrendering the same. No service charge will be made
for any such registration of transfer or exchange, but the Trustee may require
payment of a sum sufficient to cover any tax or governmental charges payable in
connection therewith.
Prior to due presentation of this Class B Certificate for transfer, the
Trustee, the Certificate Registrar and any of their respective agents may treat
the Person in whose name this Class B Certificate is registered as the owner
hereof for the purpose of receiving distributions and for all other purposes,
and neither the Trustee, the Certificate Registrar nor any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by the Agreement and the Trust
created thereby shall terminate upon the payment to Certificateholders of all
amounts required to be paid to them pursuant to the Agreement or the maturity or
liquidation of the last Receivable and the disposition of all property held as
part of the Trust. The Seller or the Servicer, or any successor to the Servicer,
may, at its option, purchase the corpus of the Trust at a price specified in the
Agreement, and such purchase of the Receivables and other property of the Trust
will effect early retirement of the Certificates; however, such right of
purchase is exercisable only on a Distribution Date following the last day of
the month in which the Pool Balance is 10% or less of the Original Pool Balance.
Unless the certificate of authentication hereon shall have been executed by
an authorized officer of the Trustee, by manual signature, this Class B
Certificate shall not entitle the Holder hereof to any benefit under the
Agreement or be valid for any purpose.
D-5
IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its
individual capacity, has caused this Class B Certificate to be duly executed.
Dated: o TOYOTA AUTO RECEIVABLES 200_-_
GRANTOR TRUST
By: o,
not in its individual capacity
but solely as Trustee
By:
--------------------------------
Authorized Officer
This is one of the Certificates referred to in the within-mentioned
Agreement.
o,
as Trustee
By:
--------------------------------
Authorized Officer
D-6
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
-------------------------------------------------------------------------------
(Please print or typewrite name and address, including postal zip code, of
assignee)
-------------------------------------------------------------------------------
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_____________________________ Attorney to transfer said Certificate on the books
of the Certificate Registrar, with full power of substitution in the premises.
Dated:
*
-----------------------------------
Signature Guaranteed:
*
-----------------------------------
---------------------
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
D-7
EXHIBIT E
FORM OF
TRANSFEREE CERTIFICATE
Toyota Auto Receivables 200_-_ Grantor Trust
o% Asset Backed Certificates, Class B
I, [Name], hereby represent and warrant to o, as trustee (the "Trustee") of
the above-named trust, as follows:
1. I am [an officer of [Name of Transferee],] the proposed transferee
("Transferee") of an Ownership Interest in a Class B Certificate (the
"Certificate") issued pursuant to the Pooling and Servicing Agreement (the
"Agreement") dated as of o, relating to the above-referenced securities, each
among Toyota Motor Credit Receivables Corporation, as seller (the "Seller"),
Toyota Motor Credit Corporation, as servicer and the Trustee. Capitalized terms
used but not defined herein shall have the meanings ascribed thereto in the
Agreement. [Transferee has authorized me to make the following representations
and warranties on behalf of Transferee.]
2. The Transferee agrees to require a Transfer Certificate substantially in
the form of this Transfer Certificate from any Person to whom the Transferee
attempts to Transfer its interest in the Certificate and in connection with any
Transfer by a Person for whom the Transferee is acting as nominee, trustee or
agent. The Transferee will not Transfer its interest or cause any interest to be
Transferred to any Person that the Transferee knows cannot truthfully complete a
Transfer Affidavit.
3. CHECK APPROPRIATE BOX:
[ ] The Transferee (A) is not an employee benefit plan or arrangement
subject to Section 406 of ERISA or a plan subject to Section 4975 of
the Code (a "Plan"), nor a person acting on behalf of a Plan nor using
the assets of a Plan to effect such transfer, and (B) is not an
insurance company purchasing a Class B Certificate with funds
contained in an "insurance company general account" or an "insurance
company separate account" (as defined in Section V(e) of Prohibited
Transaction Class Exemption 95-60 ("PTCE 95-60")) as to which there is
a Plan with respect to which the amount of such general account's
reserves and liabilities for the contracts held by or on behalf of
such Plan and all other Plans maintained by the same employer (or
affiliate thereof as defined in Section V(a)(1) of PTCE 95-60) of by
the same employee organization exceed 10% of the total of all reserves
and liabilities of such general account (as such amounts are
determined under Section I(a) of PTCE 95-60) at the date of
acquisition; or
[ ] The Transferee is a Plan or a person acting on behalf of a Plan or
using the assets of a Plan to effect such transfer or is an insurance
company purchasing a Class B Certificate with funds contained in an
insurance company general account or
E-1
separate account, but has attached hereto an opinion of counsel
addressed to the Trustee to the effect that the purchase or holding of
such Class B Certificate will not result in the assets of the Trust
Fund being deemed to be "plan assets" and subject to the prohibited
transaction provisions of ERISA and the Code and will not subject the
Trustee to any obligation in addition to those expressly undertaken in
the Agreement or to any liability.
IN WITNESS WHEREOF, the undersigned has caused this instrument to be
executed this ___ day of __________, 20__.
-----------------------------------
Print Name of Transferee
[By:
------------------------------
Name:
Title:]
E-2
EXHIBIT F
FORM OF LETTER OF REPRESENTATIONS
[Omitted]
F-1
SCHEDULE A
SCHEDULE OF RECEIVABLES
Schedule A-1