SALE AND SERVICING
AGREEMENT
among
THE MONEY STORE AUTO TRUST 1997-4
Issuer,
TMS AUTO HOLDINGS, INC.
Seller,
THE MONEY STORE AUTO FINANCE INC.
Servicer, and
THE MONEY STORE INC.
Representative
Dated as of November 30, 1997
TABLE OF CONTENTS
PAGE
ARTICLE I
Definitions
SECTION 1.1 Definitions............................................ 1
SECTION 1.2 Other Definitional Provisions ......................... 21
ARTICLE II
Conveyance of Receivables
SECTION 2.1 Conveyance of Initial Receivables...................... 22
SECTION 2.2 Conveyance of Subsequent Receivables................... 23
ARTICLE III
The Receivables
SECTION 3.1 Representations and Warranties of Seller.............. 26
SECTION 3.2 Repurchase upon Breach................................ 30
SECTION 3.3 Custody of Receivables Files.......................... 31
SECTION 3.4 Duties of Servicer as Custodian....................... 32
SECTION 3.5 Instructions; Authority To Act........................ 33
SECTION 3.6 Custodian's Indemnification........................... 33
SECTION 3.7 Effective Period and Termination...................... 34
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.1 Duties of Servicer.................................... 34
SECTION 4.2 Collection and Allocation of Receivable Payments..... 35
SECTION 4.3 Realization upon Receivables......................... 35
SECTION 4.4 Physical Damage Insurance............................ 36
SECTION 4.5 Maintenance of Security Interests in Financed
Vehicles............................................. 36
SECTION 4.5-A. Segregation of Receivables Files..................... 37
SECTION 4.6 Covenants of Servicer................................ 37
SECTION 4.7 Purchase of Receivables upon Breach.................. 37
SECTION 4.8 Servicing Fee........................................ 38
SECTION 4.9 Servicer's Certificate............................... 38
SECTION 4.10 Annual Statement as to Compliance; Notice of Default. 39
SECTION 4.11 Annual Independent Certified Public Accountants'
Report............................................... 39
SECTION 4.12 Access to Certain Documentation and Information
Regarding Receivables................................ 40
SECTION 4.13 Servicer Expenses.................................... 40
SECTION 4.14 Appointment of Subservicer........................... 40
SECTION 4.15 Obligations under Basic Documents.................... 40
ARTICLE V
Distributions;Statements to Certificateholders
and Noteholders
SECTION 5.1 Establishment of Trust Accounts..................... 41
SECTION 5.1-A Capitalized Interest Account........................ 43
SECTION 5.2 Collections......................................... 44
SECTION 5.3 Application of Collections.......................... 44
SECTION 5.4 Deficiency Notice................................... 45
SECTION 5.5 Additional Deposits................................. 45
SECTION 5.6 Distributions....................................... 45
SECTION 5.7 Pre-Funding Account................................. 47
SECTION 5.8 Statements to Certificateholders and Noteholders.... 48
SECTION 5.9 Net Deposits........................................ 49
SECTION 5.10 Optional Deposits by the Security Insurer........... 49
ARTICLE VI
The Seller
SECTION 6.1 Representations of the Seller...................... 50
SECTION 6.2 Corporate Existence................................ 51
SECTION 6.3 Liability of Seller; Indemnities................... 52
SECTION 6.4 Merger or Consolidation of, or Assumption of the
Obligations of, Seller............................. 53
SECTION 6.5 Limitation on Liability of Seller and Others....... 54
SECTION 6.6 Seller May Own Certificates or Notes............... 54
ARTICLE VII
The Servicer
SECTION 7.1 Representations of Servicer........................ 54
SECTION 7.2 Indemnities of Servicer............................ 56
SECTION 7.3 Merger or Consolidation of, or Assumption of the
Obligations of, Servicer........................... 57
SECTION 7.4 Limitation on Liability of Servicer and Others..... 58
SECTION 7.5 Servicer Not To Resign............................. 58
ARTICLE VIII
Default
SECTION 8.1 Servicer Default................................... 59
SECTION 8.2 Appointment of Successor........................... 60
SECTION 8.3 [RESERVED]......................................... 61
SECTION 8.4 Notification to Noteholders and Certificateholders. 61
SECTION 8.5 Waiver of Past Defaults............................ 61
ARTICLE IX
Termination
SECTION 9.1 Optional Purchase of All Receivables............... 61
ARTICLE X
Administrative Duties of the Servicer
SECTION 10.1 Administrative Duties.............................. 63
SECTION 10.2 Records............................................ 65
SECTION 10.3 Additional Information to be Furnished to the Issuer 65
ARTICLE XI
Miscellaneous Provisions
SECTION 11.1 Amendment.......................................... 65
SECTION 11.2 Protection of Title to Trust....................... 66
SECTION 11.3 Notices............................................ 69
SECTION 11.4 Assignment......................................... 69
SECTION 11.5 Limitations on Rights of Others.................... 70
SECTION 11.6 Severability....................................... 70
SECTION 11.7 Separate Counterparts.............................. 70
SECTION 11.8 Headings........................................... 70
SECTION 11.9 Governing Law...................................... 70
SECTION 11.10 Assignment to Trustee.............................. 70
SECTION 11.11 Nonpetition Covenants.............................. 70
SECTION 11.12 Limitation of Liability of Owner Trustee, Trustee
and Indenture Collateral Agent..................... 71
SECTION 11.13 Independence of the Servicer....................... 71
SECTION 11.14 No Joint Venture................................... 72
SECTION 11.15 Third-Party Beneficiaries.......................... 72
SECTION 11.16 Disclaimer by Security Insurer..................... 72
SCHEDULES
Schedule A - Schedule of Receivables
Schedule B - Location of Receivables
EXHIBITS
Exhibit A - Form of Subsequent Transfer Agreement
Exhibit B - [Intentionally Left Blank]
Exhibit C - Form of Monthly Noteholder Statement
Exhibit D - Form of Servicer's Certificate
Exhibit E - Form of Note Policy
Exhibit F - Form of Stamp
SALE AND SERVICING AGREEMENT dated as of
November 30, 1997, among THE MONEY STORE AUTO TRUST
1997-4, a Delaware business trust (the "Issuer"), TMS
AUTO HOLDINGS, INC., a Delaware corporation (the
"Seller"), THE MONEY STORE AUTO FINANCE INC., a
Delaware corporation (the "Servicer"), and THE MONEY
STORE INC., a New Jersey corporation (the
"Representative").
WHEREAS the Issuer desires to purchase a portfolio of receivables
arising in connection with motor vehicle retail installment sale contracts
acquired by The Money Store Auto Finance Inc. through motor vehicle dealers;
WHEREAS the Seller has purchased such receivables from The Money Store
Auto Finance Inc. and is willing to sell such receivables to the Issuer;
WHEREAS the Issuer desires to purchase additional receivables arising
in connection with motor vehicle retail installment sale contracts to be
acquired by The Money Store Auto Finance Inc. through motor vehicle dealers;
WHEREAS the Seller has an agreement to purchase such additional
receivables from The Money Store Auto Finance Inc. and is willing to sell such
receivables to the Issuer;
WHEREAS the Servicer is willing to service all such receivables;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
SECTION 1.1 DEFINITIONS. Whenever used in this Agreement, the
following words and phrases shall have the following meanings:
"Addition Notice" means, with respect to any transfer of Subsequent
Receivables to the Trust pursuant to Section 2.2 of the Agreement, notice of the
Seller's election to transfer Subsequent Receivables to the Trust, such notice
to designate the related Subsequent Transfer Date and the approximate principal
amount of Subsequent Receivables to be transferred on such Subsequent Transfer
Date.
"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 Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing. A Person shall not be deemed to be an
Affiliate of any person solely because such other Person has the contractual
right or obligation to manage such Person unless such other Person controls such
Person through equity ownership or otherwise.
"Aggregate Principal Balance" means, with respect to any date of
determination, the sum of the Principal Balances for all Receivables (other than
(i) any Receivable that became a Liquidated Receivable during the related
Monthly Period and (ii) any Receivable that was purchased or repurchased by any
Person pursuant to the Agreement during the related Monthly Period) as of the
date of determination.
"Agreement" means this Sale and Servicing Agreement, as the same may
be amended and supplemented from time to time.
"Amount Financed" means, with respect to a Receivable, the aggregate
amount advanced under such Receivable toward the purchase price of the Financed
Vehicle and any related costs, including amounts advanced in respect of
accessories, insurance premiums, service, car club and warranty contracts, other
items customarily financed as part of retail automobile installment sale
contracts or promissory notes, and related costs.
"Annual Percentage Rate" or "APR" of a Receivable means the annual
percentage rate of finance charges or service charges, as stated in the related
Contract.
"Available Funds" means, with respect to any Determination Date, the
sum of (i) the Collected Funds for such Determination Date, (ii) all Purchase
Amounts deposited in the Collection Account during the related Monthly Period,
and proceeds of any repurchase by a Dealer pursuant to Dealer Agreement, (iii)
the Monthly Capitalized Interest Amount with respect to the related Distribution
Date and all Pre-Funding Earnings deposited in the Collection Account pursuant
to Section 5.6(a), (iv) following the acceleration of the Notes pursuant to
Section 5.2 of the Indenture, the amount of money or property collected pursuant
to Section 5.4 of the Indenture since the preceding Determination Date by the
Trustee or Controlling Party for distribution pursuant to Section 5.6 of the
Indenture, and (v) any Insolvency Proceeds received pursuant to Section 9.1(b)
hereof.
"Base Servicing Fee" means, with respect to any Monthly Period, the
fee payable to the Servicer for services rendered during such Monthly Period,
which shall be equal to one- twelfth of the Servicing Fee Rate multiplied by the
Pool Balance as of the first day of such Monthly Period.
"Basic Documents" means the Certificate of Trust, the Trust Agreement,
the Sale and Servicing Agreement, the Indenture, the Insurance Agreement, the
Depository Agreement and other documents and certificates delivered in
connection therewith.
"Business Day" means a day other than a Saturday, a Sunday or other
day on which commercial banks located in the states of California, Delaware, New
Jersey, North Carolina or New York are authorized or obligated to be closed.
"Capitalized Interest Account" means the account designated as such,
established and maintained pursuant to Section 5.1-A.
"Capitalized Interest Account Initial Deposit" means $142,470.84
deposited on the Closing Date.
"Certificate" means a Trust Certificate (as defined in the Trust
Agreement).
"Certificate Distribution Account" has the meaning assigned to such
term in the Trust Agreement.
"Certificateholder" each person in whose name a Certificate is
registered.
"Class" means the Class A-1 Notes, the Class A-2 Notes or the Class
A-3 Notes, as the context requires.
"Class A-1 Deficiency Claim Amount" means, with respect to the
Determination Date relating to the Class A-1 Final Scheduled Distribution Date,
the excess, if any, of (i) the sum of the amounts payable on the Class A-1 Final
Scheduled Distribution Date pursuant to clauses (i) and (ii) of Section 5.6(c)
of the Agreement over (ii) the Available Funds for such Determination Date.
"Class A-1 Distribution Amount" means, with respect to the Class A-1
Final Scheduled Distribution Date, the sum of (i) the Available Funds for the
immediately preceding Determination Date plus (ii) the Class A-1 Deficiency
Claim Amount, if any, received and deposited in the Collection Account (from an
Insurer Optional Deposit or otherwise other than from draws under the Note
Policy).
"Class A-1 Final Scheduled Distribution Date" means January 8, 1999.
"Class A-1 Notes" has the meaning assigned to such term in the
Indenture.
"Class A-2 Notes" has the meaning assigned to such term in the
Indenture.
"Class A-3 Notes" has the meaning assigned to such term in the
Indenture.
"Closing Date" means December 30, 1997.
"Collected Funds" means, with respect to any Determination Date, the
amount of funds in or to be deposited in the Collection Account representing
collections on the Receivables during the related Monthly Period, including all
Net Liquidation Proceeds and proceeds of any Insurance Policy collected during
the related Monthly Period (but excluding any Purchase Amounts).
"Collection Account" means the account designated as such, established
and maintained pursuant to Section 5.1 of the Agreement.
"Computer Tape" means the computer tapes or other electronic media
furnished by TMS Auto Holdings, Inc. to the Issuer and its assigns and the
Security Insurer describing certain characteristics of the Initial Receivables
as of the Cutoff Date and of Subsequent Receivables as of the related Subsequent
Cutoff Date.
"Contract" means a motor vehicle retail installment sale contract.
"Corporate Trust Office" means (i) with respect to the Owner Trustee,
the principal corporate trust office of the Owner Trustee, which at the time of
execution of this Agreement is ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, and (ii) with respect to the Trustee and the
Indenture Collateral Agent, the principal corporate trust office of the Trustee,
which at the time of execution of this Agreement is ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust Department.
"Cram Down Loss" means, with respect to a Receivable, if a court of
appropriate jurisdiction in an insolvency proceeding shall have issued an order
reducing the amount owed on a Receivable or otherwise modifying or restructuring
the scheduled payments to be made on a Receivable, an amount equal to (i) the
excess of the principal balance of such Receivable immediately prior to such
order over the principal balance of such Receivable as so reduced and/or (ii) if
such court shall have issued an order reducing the effective rate of interest on
such Receivable, the net present value of such reduction (using as the discount
rate the higher of the APR on such Receivable or the rate of interest, if any,
specified by the court in such order) of the scheduled payments as so modified
or restructured. A "Cram Down Loss" shall be deemed to have occurred on the date
of issuance of such order.
"Dealer" means a dealer who sold a Financed Vehicle and who originated
and assigned the respective Receivable to the Seller under an existing agreement
between such Dealer and the Seller.
"Dealer Agreement" means any agreement between a Dealer and TMS Auto
Finance relating to the acquisition of Receivables from a Dealer by TMS Auto
Finance.
"Defaulted Receivable" means a Receivable with respect to which: (i)
ten percent or more of a Scheduled Payment is 120 or more days delinquent, (ii)
the Servicer has repossessed the related Financed Vehicle (and any applicable
redemption period has expired) or (iii) such Receivable is in default and the
Servicer has determined in good faith that payments thereunder are not likely to
be resumed.
"Deficiency Claim Amount" shall have the meaning set forth in Section
5.4 of the Agreement.
"Deficiency Claim Date" means, with respect to any Distribution Date
or the Class A-1 Final Scheduled Distribution Date, as applicable, the fourth
Business Day immediately preceding such Distribution Date or the Class A-1 Final
Scheduled Distribution Date, as applicable.
"Deficiency Notice" shall have the meaning set forth in Section 5.4 of
the Agreement.
"Delivery" when used with respect to Trust Account Property means:
(a) with respect to bankers' acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute instruments and
are susceptible of physical delivery ("Physical Property"):
(i) transfer of possession thereof to the
Trustee, endorsed to, or registered in the name of,
the Trustee or its nominee or endorsed in blank;
(b) with respect to a certificated security:
(i) delivery thereof in bearer form to the
Indenture Collateral Agent; or
(ii) delivery thereof in registered form to the
Indenture Collateral Agent and
(A) the certificate is endorsed to the
Indenture Collateral Agent or in blank by effective
endorsement; or
(B) the certificate is registered in the
name of the Indenture Collateral Agent, upon original issue or
registration of transfer by the Issuer;
(c) with respect to an uncertificated security:
(i) the delivery of the uncertificated security
to the Indenture Collateral Agent; or
(ii) the issuer has agreed that it will comply with
instructions originated by the Indenture Collateral Agent
without further consent by the registered owner;
(d) with respect to any security issued by the U.S. Treasury that is a
book- entry security held through the Federal Reserve System pursuant to Federal
book-entry regulations:
(i) a Federal Reserve Bank by book entry credits the
book-entry security to the securities account (as defined in
31 CFR Part 357) of a participant (as defined in 31 CFR Part
357) which is also a securities intermediary; and
(ii) the participant indicates by book entry that the
book-entry security has been credited to the Indenture
Collateral Agent securities account;
(e) with respect to a security entitlement:
(i) the Indenture Collateral Agent becomes the
entitlement holder; or
(ii) the securities intermediary has agreed that it
will comply with entitlement orders originated by the
Indenture Collateral Agent without further consent by the
entitlement holder;
(f) for the purpose of clauses (b) and (c) hereof "delivery" means:
(i) with respect to a certificated security:
(A) the Indenture Collateral Agent acquires
possession thereof;
(B) another person (other than a securities
intermediary) either acquires possession thereof on behalf of
the Indenture Collateral Agent or, having previously acquired
possession thereof, acknowledges that it holds for the
Indenture Collateral Agent; or
(C) a securities intermediary acting on
behalf of the Indenture Collateral Agent acquires possession
of thereof, only if the certificate is in registered form and
has been specially endorsed to the Indenture Collateral Agent
by an effective endorsement;
(ii) with respect to an uncertificated security:
(A) the issuer registers the Indenture
Collateral Agent as the registered owner, upon original issue
or registration of transfer; or
(B) another person (other than a securities
intermediary) either becomes the registered owner thereof on
behalf of the Indenture Collateral Agent or, having previously
become the registered owner, acknowledges that it holds for
the Indenture Collateral Agent;
(g) for purposes of this definition, except as otherwise indicated,
the following terms shall have the meaning assigned to each such term in the
UCC:
(i) "certificated security"
(ii) "effective endorsement"
(iii) "entitlement holder"
(iv) "instrument"
(v) "securities account"
(vi) "securities entitlement"
(vii) "securities intermediary"
(viii) "uncertificated security"
(h) in each case of Delivery contemplated herein, the Indenture
Collateral Agent shall make appropriate notations on its records, and shall
cause same to be made on the records of its nominees, indicating that securities
are held in trust pursuant to and as provided in this Agreement.
"Depositor" shall mean the Seller in its capacity as Depositor under
the Trust Agreement.
"Depository Agreement" means the Note Depository Agreement.
"Determination Date" means, with respect to any Distribution Date, the
fifth Business Day prior to the related Distribution Date or, in the case of the
Class A-1 Final Scheduled Distribution Date if any distributions are required to
be made on the Class A-1 Final Scheduled Distribution Date, the fifth Business
Day prior to such Class A-1 Scheduled Distribution Date.
"Distribution Amount" means, with respect to a Distribution Date, the
sum of (i) the Available Funds for the immediately preceding Determination Date,
plus (ii) the Deficiency Claim Amount, if any, received (from an Insurer
Optional Deposit or otherwise other than from draws under the Note Policy) by
the Trustee with respect to such Distribution Date.
"Distribution Date" means, with respect to each Monthly Period, the
twentieth day of the following calendar month, or if such day is not a Business
Day, the immediately following Business Day, commencing in January, 1998.
"Draw Date" means, with respect to any Distribution Date and the Class
A-1 Final Scheduled Distribution Date, the second Business Day immediately
preceding such Distribution Date, or the Class A-1 Final Scheduled Distribution
Date, as applicable.
"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 have a credit rating from each
Rating Agency in one of its generic rating categories which signifies investment
grade.
"Eligible Institution" means (a) the corporate trust department of the
Trustee or any other entity specified in the Agreement 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 AAA
or better by Standard & Poor's and Aaa or better by Moody's or (B) a certificate
of deposit rating of A-1+ by Standard & Poor's and P-1 or better by Moody's or
any other short-term or certificate of deposit rating acceptable to the Rating
Agencies and to the Security Insurer and (ii) whose deposits are insured by the
FDIC. If so qualified under clause (b) above, the Owner Trustee or the Trustee
may be considered an Eligible Institution.
"Eligible Investments" mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:
(a) direct obligations of, and obligations fully guaranteed as to
timely payment by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit of any
depository institution or trust company incorporated under the laws of the
United States of America or any state thereof or the District of Columbia (or
any domestic branch of a foreign bank) and subject to supervision and
examination by Federal or state banking or depository institution authorities
(including depository receipts issued by any such institution or trust company
as custodian with respect to any obligation referred to in clause (a) above or
portion of such obligation for the benefit of the holders of such depository
receipts); PROVIDED, HOWEVER, that at the time of the investment or contractual
commitment to invest therein (which shall be deemed to be made again each time
funds are reinvested following each Distribution Date), the commercial paper or
other short-term senior unsecured debt obligations (other than such obligations
the rating of which is based on the credit of a Person other than such
depository institution or trust company) of such depository institution or trust
company shall have a credit rating from Standard & Poor's of A-1+ and from
Moody's of P-1;
(c) commercial paper having, at the time of the investment or
contractual commitment to invest therein, a rating from Standard & Poor's of
A-1+ and from Moody's of P- 1;
(d) investments in money market funds (including funds for which the
Trustee or the Owner Trustee or any of their respective Affiliates is investment
manager or advisor) having a rating from Standard & Poor's of AAA-m or AAAm-G
and from Moody's of Aaa and having been approved by the Security Insurer;
(e) bankers' acceptances issued by any depository institution or trust
company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that is a
direct obligation of, or fully guaranteed by, the United States of America or
any agency or instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either case entered
into with a depository institution or trust company (acting as principal)
referred to in clause (b) above;
(g) any demand deposit in a trust account maintained by the Chase
Manhattan bank; provided that such deposits shall consist of direct obligations
of, and obligations guaranteed as to timely payment by, The Chase Manhattan
Bank; and
(h) any other investment which would satisfy the Rating Agency
Condition and is consistent with the ratings of the Securities and which, so
long as no Insurer Default shall have occurred and be continuing, has been
approved by the Security Insurer.
Any of the foregoing Eligible Investments may be purchased by or
through the Owner Trustee or the Trustee or any of its Affiliates.
"FDIC" means the Federal Deposit Insurance Corporation.
"Final Scheduled Distribution Date" means with respect to (i) the
Class ▇-▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇, ▇▇▇▇, (▇▇) the Class A-2 Notes, the March 2004
Distribution Date and (iii) the Class A-3 Notes, the March 2004 Distribution
Date.
"Final Scheduled Maturity Date" means March 2004.
"Financed Vehicle" means an automobile, light-duty truck, van or
minivan, together with all accessions thereto, securing an Obligor's
indebtedness under the respective Receivable.
"Funding Period" means the period beginning on and including the
Closing Date and ending on the first to occur of (a) the Distribution Date on
which the amount on deposit in the Pre-Funding Account (after giving effect to
any transfers therefrom in connection with the transfer of Subsequent
Receivables to the Issuer on such Distribution Date) is less than $200,000, (b)
the date on which an Event of Default or a Servicer Default occurs, an Event of
Default under the Indenture occurs or the date on which an Insolvency Event
occurs with respect to the Holder of the GP Interest and (c) the close of
business on the February 1998 Distribution Date.
"GP Interest": The 1% interest in the Trust held by TMS Auto Holdings,
Inc., Delaware corporation, pursuant to the Trust Agreement.
"Indenture" means the Indenture dated as of November 30, 1997, among
the Issuer, the Indenture Collateral Agent and the Trustee, as the same may be
amended and supplemented from time to time.
"Indenture Collateral Agent" means the Person acting as Indenture
Collateral Agent under the Indenture, its successors in interest and any
successor Indenture Collateral Agent under the Indenture.
"Initial Cutoff Date" means as to any Initial Receivable, the later of
November 30, 1997 and the date of origination of such Initial Receivable.
"Initial Receivables" means any Receivable conveyed to the Trust on
the Closing Date.
"Insolvency Event" means, with respect to a specified Person, (a) the
filing of a petition against such Person or the entry of a decree or order for
relief by a court having jurisdiction in the premises in respect of such Person
or any substantial part of its property in an involuntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now or
hereafter in effect, or appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator, or similar official for such Person or for any
substantial part of its property, or ordering the winding-up or liquidation of
such Person's affairs, and such petition, decree or order shall remain unstayed
and in effect for a period of 60 consecutive days; or (b) the commencement by
such Person of a voluntary case under any applicable federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect, or the
consent by such Person to the entry of an order for relief in an involuntary
case under any such law, or the consent by such Person to the appointment of or
taking possession by, a receiver, liquidator, assignee, custodian, trustee,
sequestrator, or similar official for such Person or for any substantial part of
its property, or the making by such Person of any general assignment for the
benefit of creditors, or the failure by such Person generally to pay its debts
as such debts become due, or the taking of action by such Person in furtherance
of any of the foregoing.
"Insurance Agreement" means the Insurance Agreement, dated as of
November 30, 1997, among the Security Insurer, the Indenture Trustee, the Trust,
the Servicer, the Representative, the Owner Trustee and the Seller.
"Insurance Agreement Event of Default" means an "Insurance Agreement
Event of Default" as defined in the Insurance Agreement.
"Insurance Policy" means, with respect to a Receivable, any insurance
policy (including the insurance policies described in Section 4.4 of the
Agreement) benefiting the holder of the Receivable providing loss or physical
damage, credit life, credit disability, theft, mechanical breakdown or similar
coverage with respect to the Financed Vehicle or the Obligor.
"Insurer's Agent" means The Chase Manhattan Bank.
"Insurer Default" means the occurrence and continuance of any of the
following events:
(a) the Security Insurer shall have failed to make a payment required
under the Note Policy in accordance with its terms;
(b) The Security Insurer shall have (i) filed a petition or commenced
any case or proceeding under any provision or chapter of the United States
Bankruptcy Code or any other similar federal or state law relating to
insolvency, bankruptcy, rehabilitation, liquidation or reorganization, (ii) made
a general assignment for the benefit of its creditors, or (iii) had an order for
relief entered against it under the United States Bankruptcy Code or any other
similar federal or state law relating to insolvency, bankruptcy, rehabilitation,
liquidation or reorganization which is final and nonappealable; or
(c) a court of competent jurisdiction, the New York Department of
Insurance or other competent regulatory authority shall have entered a final and
nonappealable order, judgment or decree (i) appointing a custodian, trustee,
agent or receiver for the Security Insurer or for all or any material portion of
its property or (ii) authorizing the taking of possession by a custodian,
trustee, agent or receiver of the Security Insurer (or the taking of possession
of all or any material portion of the property of the Security Insurer);
provided, however, that the Security Insurer's rights shall be immediately
reinstated upon cure of such Insurer Default.
"Insurer Optional Deposit" means, with respect to any Distribution
Date or the Class A-1 Final Scheduled Distribution Date, as applicable, an
amount delivered by the Insurer pursuant to Section 5.10 of the Agreement, at
its sole option, to the Trustee for deposit into the Collection Account for any
of the following purposes: (i) to provide funds in respect of the payment of
fees or expenses of any provider of services to the Trust with respect to such
Distribution Date or the Class A-1 Final Scheduled Distribution Date, as
applicable; or (ii) to include such amount as part of the Distribution Amount or
Class A-1 Distribution Amount for such Distribution Date or Class A-1 Final
Scheduled Distribution Date, as applicable, to the extent that without such
amount a draw would be required to be made on the Note Policy.
"Interest Rate" means, with respect to (i) the Class A-1 Notes,
5.90875% per annum (computed on the basis of the actual number of days elapsed
in a 360-day year), (ii) the Class A-2 Notes, 6.35% per annum (computed on the
basis of a 360-day year of twelve 30-day months) and (iii) the Class A-3 Notes,
6.46% per annum (computed on the basis of a 360-day year of twelve 30-day
months).
"Investment Earnings" means, with respect to any Distribution Date,
the investment earnings (net of losses and investment expenses) on amounts on
deposit in the Trust Accounts and the Certificate Distribution Account.
"Issuer" means The Money Store Auto Trust 1997-4.
"Lien" means a security interest, lien, charge, pledge, equity, or
encumbrance of any kind, other than tax liens, mechanics' liens and any liens
that attach to the respective Receivable by operation of law as a result of any
act or omission by the related Obligor.
"Lien Certificate" means, with respect to a Financed Vehicle, an
original certificate of title, certificate of lien or other notification issued
by the Registrar of Titles of the applicable state to a secured party which
indicates that the lien of the secured party on the Financed Vehicle is recorded
on the original certificate of title. In any jurisdiction in which the original
certificate of title is required to be given to the Obligor, the term "Lien
Certificate" shall mean only a certificate or notification issued to a secured
party.
"Liquidated Receivable" means, with respect to any Determination Date,
a Receivable as to which, as of the last day of the related Monthly Period, (i)
90 days have elapsed since the Servicer repossessed the Financed Vehicle, (ii)
the Servicer has determined in good faith that all amounts it expects to recover
have been received, (iii) 10% or more of a Scheduled Payment shall have become
150 or more days delinquent, or (iv) the Financed Vehicle has been sold and the
proceeds received.
"Mandatory Redemption Date" means the Distribution Date in February
1998.
"Monthly Capitalized Interest Amount" means in the case of the January
and February 1998 Distribution Dates, an amount equal to the product of (x) a
fraction the numerator of which is one and the denominator of which is twelve,
(y) the weighted average of each Interest Rate and the Certificate Rate, less
2.5% and (z) the difference between the sum of the aggregate principal amount of
the Notes immediately prior to the applicable Distribution Date and the Pool
Balance as of the last day of the second preceding Monthly Period, or in the
case of the January Distribution Date, as of the Closing Date.
"Monthly Period" means with respect to each Distribution Date and the
Class A-1 Final Scheduled Distribution Date, the calendar month preceding the
month in which such Distribution Date or Class A-1 Final Scheduled Distribution
Date, as applicable, occurs.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., or its successor.
"Net Liquidation Proceeds" means as to any Liquidated Receivable, all
amounts realized with respect to such Receivable (other than amounts paid
pursuant to this Agreement and drawings under the Note Policy) net of (i)
reasonable expenses incurred by the Servicer in connection with the collection
of such Receivable and the repossession and disposition of the Financed Vehicle
and (ii) amounts that are required to be refunded to the Obligor on such
Receivable; PROVIDED, HOWEVER, that the Net Liquidation Proceeds with respect to
any Receivable shall in no event be less than zero.
"Note Distribution Account" means the account designated as such,
established and maintained pursuant to Section 5.1 of the Agreement.
"Note Insured Payment" has the meaning as defined in the Note Policy.
"Noteholders' Distributable Amount" means, with respect to any
Distribution Date, the sum of the Noteholders' Principal Distributable Amount
and the Noteholders' Interest Distributable Amount.
"Noteholders' Interest Carryover Shortfall" means, with respect to any
Distribution Date, the excess of the Noteholders' Monthly Interest Distributable
Amount for the preceding Distribution Date and any outstanding Noteholders'
Interest Carryover Shortfall on such preceding Distribution Date, over the
amount in respect of interest that was actually deposited in the Note
Distribution Account on such preceding Distribution Date, plus interest on the
amount of interest due but not paid to Noteholders on the preceding Distribution
Date, to the extent permitted by law, at the respective Interest Rate borne by
each Class of Notes from such preceding Distribution Date to but excluding the
current Distribution Date.
"Noteholders' Interest Distributable Amount" means, with respect to
any Distribution Date, the sum of the Noteholders' Monthly Interest
Distributable Amount for such Distribution Date and the Noteholders' Interest
Carryover Shortfall for such Distribution Date. Interest on the Class A-1 Notes
shall be calculated on the basis of a 360 day year and the actual number of days
elapsed in the related interest period. Interest on the Class A-2 Notes and the
Class A-3 Notes shall be computed on the basis of a 360-day year of twelve
30-day months. Notwithstanding the foregoing, the Noteholder's Interest
Distributable Amount with respect to the Class A-1 Notes on the Distribution
Date following the Class A-1 Final Scheduled Distribution Date will only include
amounts in respect thereof due but unpaid on the Class A-1 Final Scheduled
Distribution Date together with interest thereon, to the extent permitted by
law, at the Interest Rate.
"Noteholders' Monthly Interest Distributable Amount" means, (A) with
respect to any Distribution Date, the product of (i) (X) in the case of the
Class A-1 Notes, the product of the Interest Rate for such Class and a fraction,
the numerator of which is the number of days elapsed from and including the
prior Distribution Date (or, in the case of the first Distribution Date, from
and including the Closing Date) to but excluding such Distribution Date and the
denominator of which is 360 and (Y) in the case of the Class A-2 Notes and the
Class A-3 Notes, one-twelfth of the Interest Rate for such Class (or, in the
case of the first Distribution Date, the Interest Rate for such Class multiplied
by a fraction, the numerator of which is the number of days elapsed from and
including December 20, 1997 to but excluding such Distribution Date and the
denominator of which is 360) and (ii) the outstanding principal amount of the
Notes of such Class immediately preceding such Distribution Date and (B) with
respect to the Class A-1 Notes and the Class A-1 Final Scheduled Distribution
Date, the product of (i) the Interest Rate for the Class A-1 Notes multiplied by
a fraction, the numerator of which is the actual number of days elapsed from and
including the preceding Distribution Date to but excluding the Class A-1 Final
Scheduled Distribution Date and the denominator of which is 360 and (ii) the
outstanding principal amount of the Class A-1 Notes immediately preceding the
Class A-1 Final Scheduled Distribution Date.
"Noteholders' Monthly Principal Distributable Amount" means, with
respect to any Distribution Date, the Noteholders' Percentage of the Principal
Distributable Amount.
"Noteholders' Percentage" means with respect to any Determination Date
(i) relating to a Distribution Date prior to the Distribution Date on which the
principal amount of the Class A-3 Notes is reduced to zero, 100%; (ii) relating
to the Distribution Date on which the principal amount of the Class A-3 Notes is
reduced to zero, the percentage equivalent of a fraction, the numerator of which
is the principal amount of the Class A-3 Notes immediately prior to such
Distribution Date, and the denominator of which is the Principal Distributable
Amount; and (iii) relating to any other Distribution Date, 0%.
"Noteholders' Principal Carryover Shortfall" means, as of the close of
any Distribution Date, the excess of the Noteholders' Monthly Principal
Distributable Amount and any outstanding Noteholders' Principal Carryover
Shortfall for the preceding Distribution Date over the amount in respect of
principal that was actually deposited in the Note Distribution Account on such
preceding Distribution Date.
"Noteholders' Principal Distributable Amount" means, with respect to
any Distribution Date, (other than the Final Scheduled Distribution Date for any
Class of Notes), the lesser of (i) the outstanding principal balance on the
Notes on such Distribution Date prior to making any distribution thereon and
(ii) the sum of the Noteholders' Monthly Principal Distributable Amount for such
Distribution Date and the Noteholders' Principal Carryover Shortfall as of the
close of the preceding Distribution Date. The Noteholders' Principal
Distributable Amount on the Final Scheduled Distribution Date for any Class of
Notes will equal the sum of (i) the Noteholders' Monthly Principal Distributable
Amount for such Distribution Date, (ii) the Noteholders' Principal Carryover
Shortfall as of the close of the preceding Distribution Date, and (iii) the
excess of the outstanding principal amount of such Class of Notes, if any, over
the amounts described in clauses (i) and (ii). Notwithstanding the foregoing,
the Noteholder's Principal Distributable Amount with respect to the Class A-1
Notes on the Distribution Date following the Class A-1 Final Scheduled
Distribution Date will only include the amount thereof due but unpaid on the
Class A-1 Notes on the Class A-1 Final Scheduled Distribution Date.
"Note Policy" means the note guaranty insurance policy issued by the
Security Insurer to the Trustee for the benefit of the Noteholders with respect
to the Notes, including any endorsements thereto, in the form of Exhibit E to
the Indenture.
"Note Pool Factor" for each Class of Notes as of the close of business
on a Distribution Date means a seven-digit decimal figure equal to the
outstanding principal amount of such Class of Notes as of such Distribution Date
after giving effect to principal distributions on such date divided by the
original outstanding principal amount of such Class of Notes.
"Obligor" on a Receivable means the purchaser or co-purchasers of the
Financed Vehicle and any other Person who owes payments under the Receivable.
"Officer's Certificate" means a certificate signed by the (a) chairman
of the board, the president, any executive vice president or any vice president
and (b) any treasurer, assistant treasurer, secretary or assistant secretary of
the Representative, the Seller or the Servicer, as appropriate.
"Opinion of Counsel" means one or more written opinions of counsel who
may be an employee of or counsel to the Representatives, the Seller or the
Servicer, which counsel shall be acceptable to the Trustee, the Owner Trustee,
the Security Insurer or the Rating Agencies, as applicable, and which shall be
addressed to the Security Insurer.
"Original Pool Balance" means the sum, as of any date, of the Pool
Balance as of the Initial Cutoff Date, plus the aggregate Principal Balance of
the Subsequent Receivables, if any, sold to the Trust, as of their respective
Subsequent Cutoff Dates.
"Owner Trust Estate" has the meaning assigned to such term in the
Trust Agreement.
"Owner Trustee" means Bankers Trust (Delaware), not in its individual
capacity but solely as Owner Trustee under the Trust Agreement, its successors
in interest or any successor Owner Trustee under the Trust Agreement.
"Person" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust (including any beneficiary
thereof), unincorporated organization or government or any agency or political
subdivision thereof.
"Physical Property" has the meaning assigned to such term in the
definition of "Delivery" above.
"Pool Balance" means, as of any date of determination, the aggregate
Principal Balance of the Receivables (excluding Purchased Receivables and
Liquidated Receivables).
"Precomputed Receivable" means any Receivable under which the portion
of a payment allocable to interest and the portion allocable to principal is
determined in accordance with the Rule of 78s Method.
"Pre-Funded Amount" means, with respect to any Distribution Date, the
amount on deposit in the Pre-Funding Account, (exclusive of Pre-Funding
Earnings) which initially shall be $21,485,751.08.
"Pre-Funding Account" has the meaning specified in Section
5.1(a)(iii).
"Pre-Funding Earnings" means any investment earnings (net of losses)
on amounts on deposit in the Pre-Funding Account.
"Prepayment Amount" means, as of the Distribution Date on or
immediately following the last day of the Funding Period, after giving effect to
any transfer of Subsequent Receivables on such date, an amount equal to the
Pre-Funded Amount on deposit in the Pre- Funding Account as of such Distribution
Date.
"Principal Balance" means, with respect to any Receivable, as of any
date, the Amount Financed minus (i) that portion of all amounts received on or
prior to such date and allocable to principal in accordance with (x) in the case
of Simple Interest Receivables, the terms of the Receivable and (y) in the case
of Precomputed Receivables, the actuarial method, and (ii) any Cram Down Loss in
respect of such Receivable.
"Principal Carryover Shortfall" means, as of the close of business on
any Distribution Date, the excess of the Principal Distributable Amount plus any
outstanding Principal Carryover Shortfall from the preceding Distribution Date
over the amount of principal deposited in the Note Distribution Account with
respect to such current Distribution Date.
"Principal Distributable Amount" means, with respect to any
Distribution Date, without duplication, the sum of (i) the principal portion
(calculated in the case of Precomputed Receivables on the basis of the actuarial
method and in the case of Simple Interest Receivables, calculated on the basis
of the Simple Interest Method) of all Collected Funds received during the
immediately preceding Monthly Period (other than Liquidated Receivables and
Purchased Receivables) including the principal portion of all prepayments, (ii)
the Principal Balance of all Receivables that became Liquidated Receivables
during the related Monthly Period (other than Purchased Receivables), (iii)
(without duplication of amounts in clause (ii) hereof) the principal portion of
the Purchase Amounts received with respect to all Receivables that became
Purchased Receivables during the related Monthly Period, (iv) in the sole
discretion of the Security Insurer, the Principal Balance of all the Receivables
that were required to be purchased pursuant to Sections 3.2 and 4.7, during such
Monthly Period but were not purchased, (v) the aggregate amount of Cram Down
Losses that shall have occurred during the related Monthly Period; and (vi)
following the acceleration of the Notes pursuant to Section 5.2 of the
Indenture, the amount of money or property collected pursuant to Section 5.4 of
the Indenture since the preceding Determination Date by the Trustee or
Controlling Party for distribution pursuant to Section 5.6 of the Indenture.
"Purchase Agreement" means the Purchase Agreement between the Seller
and TMS Auto Finance, dated as of November 30, 1997, pursuant to which the
Seller acquired the Initial Receivables, as such Agreement may be amended from
time to time.
"Purchase Amount" means, with respect to a Receivable, the Principal
Balance and all accrued and unpaid interest on the Principal Balance of such
Receivable (including one month's interest thereon, in the month of payment, at
the APR less, so long as TMS Auto Finance is the Servicer, the Servicing Fee),
after giving effect to the receipt of any moneys collected (from whatever
source) on such Receivable, if any.
"Purchased Receivable" means a Receivable purchased as of the close of
business on the last day of a Monthly Period by the Servicer or the
Representative pursuant to Section 4.7 of the Agreement or repurchased by the
Seller, TMS Auto Finance or the Representative pursuant to Section 3.2 of the
Agreement.
"Rating Agency" means Moody's and Standard & Poor's. If no such
organization or successor maintains a rating on the Securities, "Rating Agency"
shall be a nationally recognized statistical rating organization or other
comparable Person designated by the Seller and acceptable to the Security
Insurer (so long as an Insurer Default shall not have occurred and be
continuing), notice of which designation shall be given to the Trustee, the
Owner Trustee, the Security Insurer and the Servicer.
"Rating Agency Condition" means, with respect to any action, that each
Rating Agency shall have been given 10 days' (or such shorter period as shall be
acceptable to each Rating Agency) prior notice thereof and that each of the
Rating Agencies shall have notified the Seller, the Servicer, the Security
Insurer, the Owner Trustee and the Trustee in writing that such action will not
result in a reduction or withdrawal of the then current rating of any Class of
Notes.
"Realized Losses" means, with respect to any Receivable that becomes a
Liquidated Receivable, the excess of the Principal Balance of such Liquidated
Receivable over Net Liquidation Proceeds to the extent allocable to principal.
"Receivable" means any Contract listed on Schedule A, as such Schedule
shall be amended to reflect the transfer of Subsequent Receivables to the Trust
(which Schedule may be in the form of microfiche).
"Receivable Files" means the documents specified in Section 3.3.
"Record Date" with respect to each Distribution Date means the day
immediately preceding such Distribution Date, unless otherwise specified in the
Agreement.
"Registrar of Titles" means, with respect to any state, the
governmental agency or body responsible for the registration of, and the
issuance of certificates of title relating to, motor vehicles and liens thereon.
"Rule of 78s Method" means the method under which a portion of a
payment allocated to earned interest and the portion allocable to principal is
determined according to the sum of the month's digits or any equivalent method
commonly referred to as the "Rule of 78s."
"Rule of 78s Receivable" means a Receivable which by its terms
calculates interest and principal with respect to each scheduled payment in
accordance with the Rule of 78s method.
"Scheduled Payment" on a Precomputed Receivable means that portion of
the payment required to be made by the Obligor during the respective Monthly
Period sufficient to amortize the Principal Balance thereof under the actuarial
method over the term of the Receivable and to provide interest at the APR.
"Security Insurer" means MBIA Insurance Corporation, a stock insurance
company incorporated under the laws of the State of New York, or any successor
thereto, as issuer of the Policies.
"Seller" means TMS Auto Holdings, Inc., a Delaware corporation, and
its successors in interest to the extent permitted hereunder.
"Service Contract" means, with respect to a Financed Vehicle, the
agreement, if any, financed under the related Receivable that provides for the
repair of such Financed Vehicle.
"Servicer" means The Money Store Auto Finance Inc., as the servicer of
the Receivables, and each successor Servicer pursuant to Section 7.3 or 8.2 of
the Agreement.
"Servicer Default" means an event specified in Section 8.1 of the
Agreement.
"Servicer's Certificate" means an Officer's Certificate of the
Servicer delivered pursuant to Section 4.9 of the Agreement, substantially in
the form of Exhibit D to the Agreement.
"Servicing Fee" has the meaning specified in Section 4.8 of the
Agreement.
"Servicing Fee Rate" means 1.5% per annum.
"Simple Interest Method" means the method of allocating a fixed level
payment to principal and interest, pursuant to which the portion of such payment
that is allocated to interest is equal to the product of the fixed rate of
interest multiplied by the unpaid principal balance multiplied by the period of
time elapsed since the preceding payment of interest was made (in some states
assuming 30 day months), divided by the actual number of days in a year (360
days in states which assume 30 day months) and the remainder of such payment is
allocable to principal.
"Simple Interest Receivable" means any Receivable under which the
portion of a payment allocable to interest and the portion allocable to
principal is determined in accordance with the Simple Interest Method.
"Standard & Poor's" means Standard & Poor's Ratings Services, or its
successor.
"Subsequent Cutoff Date" means (i) the last day of the month preceding
the month in which particular Subsequent Receivables are conveyed to the Trust
pursuant to this Agreement or (ii) if any such Subsequent Receivable is
originated in the month of the related Subsequent Transfer Date, the date of
origination.
"Subsequent Purchase Agreement" means an agreement by and between the
Seller and TMS Auto Finance pursuant to which the Seller will acquire Subsequent
Receivables.
"Subsequent Receivables" means the Receivables transferred to the
Issuer pursuant to Section 2.2 of the Agreement, which shall be listed on
Schedule A to the related Subsequent Transfer Agreement.
"Subsequent Transfer Agreement" has the meaning assigned thereto in
Section 2.2(b) of the Agreement.
"Subsequent Transfer Date" means, with respect to Subsequent
Receivables, any date, occurring not more frequently than once a month, during
the Funding Period on which Subsequent Receivables are to be transferred to the
Trust pursuant to this Agreement, and a Subsequent Transfer Agreement is
executed and delivered to the Trust.
"Supplemental Servicing Fee" means charges collected (from whatever
source) on the Receivables during the related Monthly Period including, in the
case of a Precomputed Receivable that is prepaid in full, the difference between
the Principal Balance of such Receivable (plus accrued interest to the date of
prepayment) and the principal balance of such Receivable computed according to
the Rule of 78s, and other late fees, prepayment fees, administrative fees and
expenses or similar charges allowed by applicable law with respect to
Receivables, plus reinvestment proceeds on any payments received in respect of
Receivables during the related Monthly Period.
"TMS Auto Finance" means The Money Store Auto Finance Inc., a Delaware
corporation.
"Trust" means the Issuer.
"Trust Account Property" means the Trust Accounts, all amounts and
investments held from time to time in any Trust Account (whether in the form of
deposit accounts, Physical Property, book-entry securities, uncertificated
securities or otherwise), and all proceeds of the foregoing.
"Trust Accounts" has the meaning assigned thereto in Section 5.1 of
the Agreement.
"Trust Agreement" means the Trust Agreement dated as of November 30,
1997, between the Seller and the Owner Trustee, as the same may be amended and
supplemented from time to time.
"Trust Officer" means, (i) in the case of the Trustee, the chairman or
vice-chairman of the board of directors, the chairman or vice-chairman of the
executive committee of the board of directors, the president, any vice
president, the secretary, any assistant secretary, the treasurer, any assistant
treasurer, the cashier, any assistant cashier, any trust officer or assistant
trust officer, the controller and any assistant controller or any other officer
of the Trustee customarily performing functions similar to those performed by
any of the above designated officers and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject, and (ii) in the case of the Owner Trustee, any officer in
the corporate trust office of the Owner Trustee with direct responsibility for
the administration of this Agreement or any of the Basic Documents on behalf of
the Owner Trustee.
"Trust Property" has the meaning assigned thereto in Section 2.1 of
the Agreement.
"Trustee" means the Person acting as Trustee under the Indenture, its
successors in interest and any successor trustee under the Indenture.
"Voting Interest" means the interest in the Trust issued pursuant to
the Trust Agreement entitling the holder thereof to exercise sole voting control
over actions requiring the approval or disapproval of Certificateholders.
"UCC" means the Uniform Commercial Code as in effect in the State of
New York on the date of the Agreement.
SECTION 1.2 OTHER DEFINITIONAL PROVISIONS
(a) Capitalized terms used herein and not otherwise defined herein
have the meanings assigned to them in the Indenture, or, if not defined therein,
in the Trust Agreement.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any instrument governed hereby and in any certificate or
other document made or delivered pursuant hereto unless otherwise defined
therein.
(c) As used in this Agreement, in any instrument governed hereby and
in any certificate or other document made or delivered pursuant hereto or
thereto, accounting terms not defined in this Agreement or in any such
instrument, certificate or other document, and accounting terms partly defined
in this Agreement or in any such instrument, certificate or other document to
the extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles as in effect on the date of this
Agreement or any such instrument, certificate or other document, as applicable.
To the extent that the definitions of accounting terms in this Agreement or in
any such instrument, certificate or other document are inconsistent with the
meanings of such terms under generally accepted accounting principles, the
definitions contained in this Agreement or in any such instrument, certificate
or other document shall control.
(d) The words "hereof," "herein," "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Section, Schedule and Exhibit
references contained in this Agreement are references to Sections, Schedules and
Exhibits in or to this Agreement unless otherwise specified; and the term
"including" shall mean "including without limitation."
(e) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(f) Any agreement, instrument or statute defined or referred to herein
or in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments) references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.
ARTICLE II
CONVEYANCE OF RECEIVABLES
SECTION 2.1 CONVEYANCE OF INITIAL RECEIVABLES. In consideration of the
Issuer's delivery to or upon the order of the Seller on the Closing Date of the
net proceeds from the sale of the Notes and the Certificates and the other
amounts to be distributed from time to time to the Seller in accordance with the
terms of this Agreement, the Seller does hereby sell, transfer, assign, set over
and otherwise convey to the Issuer, without recourse (subject to the obligations
set forth herein), all right, title and interest of the Seller in and to:
(a) the Initial Receivables, and all moneys received thereon after the
Initial Cutoff Date;
(b) an assignment of the security interests in the Financed Vehicles
granted by Obligors pursuant to the Initial Receivables and any other interest
of the Seller in such Financed Vehicles;
(c) any proceeds with respect to the Initial Receivables from claims
on any physical damage, credit life or disability insurance policies covering
Financed Vehicles or Obligors and any proceeds from the liquidation of the
Initial Receivables;
(d) any proceeds from any Initial Receivable repurchased by a Dealer,
pursuant to a Dealer Agreement, as a result of a breach of representation or
warranty in the related Dealer Agreement;
(e) all rights under any Service Contracts on the related Financed
Vehicles;
(f) the related Receivables Files;
(g) all of the Seller's right, title and interest in its rights and
benefits, but none of its obligations or burdens, under the Purchase Agreement,
including the Seller's rights under the Purchase Agreement, and the delivery
requirements, the representations and warranties and the cure and repurchase
obligations of TMS Auto Finance under the Purchase Agreement; and
(h) the proceeds of any and all of the foregoing (the items specified
in clauses (a) through (h) are referred to herein as the "Trust Property").
It is the intention of the Seller that the transfer and assignment
contemplated by this Agreement shall constitute a sale of the Receivables and
other Trust Property from the Seller to the Trust and the beneficial interest in
and title to the Receivables and the other Trust Property 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. In the event that, notwithstanding
the intent of the Seller, the transfer and assignment contemplated hereby is
held not to be a sale, this Agreement shall constitute a grant of a security
interest in the property referred to in this Section 2.1 for the benefit of the
Noteholders, the Certificateholders and the Security Insurer.
SECTION 2.2 CONVEYANCE OF SUBSEQUENT RECEIVABLES. (a) Subject to the
conditions set forth in paragraph (b) below, in consideration of the Issuer's
delivery on each related Subsequent Transfer Date to or upon the order of the
Seller of the amount described in Section 5.7(a) to be delivered to the Seller,
the Seller does hereby sell, transfer, assign, set over and otherwise convey to
the Issuer without recourse (subject to the obligations set forth herein), all
right, title and interest of the Seller in and to:
(i) the Subsequent Receivables listed on Schedule A to the
related Subsequent Transfer Agreement;
(ii) the security interests in the Financed Vehicles granted by
Obligors pursuant to such Subsequent Receivables and any other
interest of the Seller in such Financed Vehicles;
(iii) any proceeds with respect to such Subsequent Receivables
from claims on any physical damage, credit life or disability
insurance policies covering the related Financed Vehicles or Obligors
and any proceeds from the liquidation of such Subsequent Receivables;
(iv) any proceeds from any Subsequent Receivable repurchased by a
Dealer, pursuant to a Dealer Agreement, as a result of a breach of
representation or warranty in the related Dealer Agreement;
(v) all rights under any Service Contracts on the related
Financed Vehicles:
(vi) the related Receivables Files;
(vii) all of the Seller's right, title and interest in its rights
and benefits, but none of its obligations or burdens, under each of
the Subsequent Purchase Agreements, including the Seller's rights
under each of the Subsequent Purchase Agreements, and the delivery
requirements, representations and warranties and the cure and
repurchase obligations of TMS Auto Finance under each of the
Subsequent Purchase Agreements, on or after the related Subsequent
Cutoff Date; and
(viii) the proceeds of any and all of the foregoing.
(b) The Seller shall transfer to the Issuer the Subsequent Receivables
and the other property and rights related thereto described in paragraph (a)
above only upon the satisfaction of each of the following conditions on or prior
to the related Subsequent Transfer Date:
(i) the Seller shall have provided the Trustee, the Owner
Trustee, the Security Insurer and the Rating Agencies with an Addition
Notice not later than one day prior to the first Subsequent Transfer
Date and five days prior to any other Subsequent Transfer Date and
shall have provided any information reasonably requested by any of the
foregoing with respect to the Subsequent Receivables;
(ii) the Seller shall have delivered to the Owner Trustee, the
Security Insurer and the Trustee a duly executed Subsequent Transfer
Agreement which shall include supplements to Schedule A, listing the
Subsequent Receivables;
(iii) the Seller shall, to the extent required by Section 5.2,
have deposited in the Collection Account all collections in respect of
the Subsequent Receivables;
(iv) as of each Subsequent Transfer Date, (A) the Seller shall
not be insolvent and shall not become insolvent as a result of the
transfer of Subsequent Receivables on such Subsequent Transfer Date,
(B) the Seller shall not intend to incur or believe that it shall
incur debts that would be beyond its ability to pay as such debts
mature, (C) such transfer shall not have been made with actual intent
to hinder, delay or defraud any Person and (D) the assets of the
Seller shall not constitute unreasonably small capital to carry out
its business as conducted;
(v) the Funding Period shall not have terminated;
(vi) after giving effect to any transfer of Subsequent
Receivables on a Subsequent Transfer Date, the Receivables transferred
to the Trust pursuant hereto shall meet the following criteria (based
on the characteristics of the Initial Receivables on the Initial
Cutoff Date and the Subsequent Receivables on the related Subsequent
Cutoff Dates): (i) the weighted average APR of the Receivables
transferred to the Trustee shall not be less than approximately
18.80%; (ii) the weighted average remaining term of the Receivables
transferred to the Trust shall not be greater than approximately 60
months; (iii) not more than approximately 35.0% of the Aggregate
Principal Balance of the Receivables shall consist of Obligors whose
mailing addresses are in California; (iv) no more than 10.0% the
Receivables shall have a remaining term to maturity of more than 66
months and no Receivable shall have an original term to maturity of
more than 73 months, (v) not more than 20.0% of the Aggregate
Principal Balance of the Receivables shall have Obligors whose mailing
addresses are in any one state other than California unless an Opinion
of Counsel acceptable to the Rating Agencies and the Security Insurer
with respect to the security interest in the related Financed Vehicles
is furnished by the Seller on or prior to such Subsequent Transfer
Date and (vi) each Subsequent Receivable has a final maturity date not
later than January 2004.
(vii) each of the representations and warranties made by the
Seller pursuant to Section 3.1 with respect to the Subsequent
Receivables to be transferred on such Subsequent Transfer Date shall
be true and correct as of the related Subsequent Transfer Date, and
the Seller shall have performed all obligations to be performed by it
hereunder on or prior to such Subsequent Transfer Date;
(viii) the Seller shall, at its own expense, on or prior to the
Subsequent Transfer Date indicate in its computer files that the
Subsequent Receivables identified in the Subsequent Transfer Agreement
have been sold to the Trust pursuant to this Agreement;
(ix) the Seller shall have taken any action required to maintain
the first perfected ownership interest of the Trust in the Owner Trust
Estate and the first perfected security interest of the Indenture
Collateral Agent in the Collateral;
(x) no selection procedures adverse to the interests of the
Noteholders, or the Security Insurer shall have been utilized in
selecting the Subsequent Receivables;
(xi) the addition of any such Subsequent Receivables shall not
result in a material adverse tax consequence to the Trust, the
Noteholders, or the Security Insurer;
(xii) the Seller shall have delivered (A) to the Rating Agencies
and the Security Insurer an Opinion of Counsel with respect to the
transfer of such Subsequent Receivables substantially in the form of
the Opinion of Counsel delivered to the Rating Agencies and the
Security Insurer on the Closing Date and any other opinions so
required by the Security Insurer, including, without limitation, an
Opinion of Counsel to the effect that in a bankruptcy of the
Representative a court would not consolidate the assets of the Seller
with those of the Representative and (B) to the Trustee the Opinion of
Counsel required by Section 11.2(i)(1);
(xiii) Intentionally omitted;
(xiv) the Security Insurer (so long as no Insurer Default shall
have occurred and be continuing), in its absolute and sole discretion,
shall have approved in writing the transfer of such Subsequent
Receivables to the Trust; and
(xv) the Seller shall have delivered to the Security Insurer and
the Trustee an Officers' Certificate confirming the satisfaction of
each condition precedent specified in this paragraph (b).
The Seller and the Representative jointly and severally covenant that in the
event any of the foregoing conditions precedent are not satisfied with respect
to any Subsequent Receivable on the date required as specified above, the Seller
will immediately repurchase such Subsequent Receivable from the Trust, at a
price equal to the Purchase Amount thereof, in the manner specified in Section
4.7.
ARTICLE III
THE RECEIVABLES
SECTION 3.1 REPRESENTATIONS AND WARRANTIES OF SELLER. The
Representative and the Seller, jointly and severally, make the following
representations and warranties as to the Receivables on which the Issuer is
deemed to have relied in acquiring the Receivables and upon which the Security
Insurer shall be deemed to rely in issuing the Note Policy. Such representations
and warranties speak as of the execution and delivery of this Agreement and as
of the Closing Date in the case of the Initial Receivables, and as of the
related Subsequent Transfer Date in case of the Subsequent Receivables, but
shall survive the sale, transfer and assignment of the Receivables to the Issuer
and the pledge thereof to the Trustee pursuant to the Indenture.
(a) TITLE. It is the intention of the Seller that the transfer and
assignment herein contemplated constitute a sale of the Receivables from the
Seller to the Trust and that the beneficial interest in and title to such
Receivables not be part of the debtor's estate in the event of the filing of a
petition for receivership by or against the Seller under any bankruptcy law.
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, immediately upon the transfer thereof, the Trust shall have good and
marketable title to each such Receivable, free and clear of all Liens; and the
transfer of the Receivables to the Trust has been perfected under the UCC. No
Dealer or any other Person has any right to receive proceeds of any Receivables.
(b) ALL FILINGS MADE. All filings (including, without limitation, UCC
filings) necessary in any jurisdiction to give the Trust a first priority
perfected ownership interest in the Receivables, and to give the Trustee a first
priority perfected security interest therein, shall have been made.
(c) CHARACTERISTICS OF RECEIVABLES. Each Receivable (i) shall have
been originated in the United States of America by a Dealer in connection with
the retail sale of a 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 the Seller from TMS Auto Finance which in turn
shall have purchased such Receivable from such Dealer under an existing dealer
agreement with TMS Auto Finance and shall have been validly assigned by TMS Auto
Finance to the Seller in accordance with its terms, (ii) shall have created or
shall create a valid, subsisting and enforceable first priority security
interest in favor of TMS Auto Finance in the Financed Vehicle, which security
interest has been assigned by TMS Auto Finance to the Seller, which in turn
shall be assignable by the Seller to the Trust, (iii) 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, (iv) shall 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, (v) in the case of a Precomputed Receivable, shall provide
for, in the event that such Contract is prepaid, a prepayment that fully pays
the Principal Balance and includes a full months interest to the date of payment
in the month of prepayment at the Annual Percentage Rate, and (vi) has not been
amended or collections with respect to which have been waived, other than as
evidenced in the Receivable File relating thereto.
(d) SCHEDULE OF RECEIVABLES. The information set forth in Schedule A
to this Agreement is true and correct in all material respects as of the close
of business on the Initial Cutoff Date or, with respect to any Subsequent
Receivables, as of the close of business on the related Subsequent Cutoff Date,
and no selection procedures believed by the Seller to be adverse to the
Noteholders or the Security Insurer were utilized in selecting the Receivables.
The Computer Tape regarding the Receivables is true and correct in all material
respects as of the Initial Cutoff Date and will be true and correct as of each
Subsequent Cutoff Date.
(e) COMPLIANCE WITH LAW. Each Initial Receivable complied at the time
it was originated or made and complies at the execution of this Agreement or,
with respect to any Subsequent Receivables conveyed on a Subsequent Transfer
Date, such Subsequent Receivables shall comply in all material respects with all
requirements of applicable Federal, state and local laws and regulations
thereunder, including, without limitation, usury laws, the Federal Truth-in-
Lending Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act,
the Fair Debt Collection Practices Act, the Federal Trade Commission Act, the
▇▇▇▇▇▇▇▇-▇▇▇▇ Warranty Act, the ▇▇▇▇-▇▇▇▇▇▇▇▇ Act, the Federal Reserve Board's
Regulations B and Z, state adaptations of the National Consumer Act and other
consumer credit laws and equal credit opportunity and disclosure laws.
(f) BINDING OBLIGATION. Each Receivable represents the legal, valid
and binding payment obligation in writing of the Obligor thereunder, enforceable
by the holder thereof in accordance with its terms except as such enforceability
may be limited by applicable bankruptcy, insolvency, moratorium, fraudulent
conveyance, reorganization and similar laws now or hereafter in effect related
to or affecting creditors' rights generally and subject to general principles of
equity (whether applied in a proceeding at law or in equity); and all parties to
each Receivable had full legal capacity to execute and deliver such Receivable
and all other documents related thereto and to grant the security interest
purported to be granted thereby.
(g) NO GOVERNMENT OBLIGOR. None of the Receivables are due from the
United States of America or any State or from any agency, department or
instrumentality of the United States of America or any state.
(h) SECURITY INTEREST IN FINANCED VEHICLE. Immediately prior to the
sale, assignment and transfer thereof to the Trust, each Receivable is secured
by a validly perfected first priority security interest in the Financed Vehicle
in favor of TMS Auto Finance as secured party or all necessary and appropriate
actions have been commenced that would result in the valid perfection of a first
priority security interest in the Financed Vehicle in favor of TMS Auto Finance
as secured party. Immediately after the sale, assignment and transfer thereof to
the Trust, although the Lien Certificate will not indicate the Trust or Owner
Trustee as secured party, each Receivable will be secured by an enforceable and
perfected security interest in the Financed Vehicle in favor of the Trust as
secured party for the benefit of the Noteholders and the Security Insurer, which
security interest is prior to all other Liens in such Financed Vehicle.
(i) RECEIVABLES IN FORCE. No Receivable has been satisfied,
subordinated or rescinded, nor has any Financed Vehicle been released from the
Lien granted by the related Receivable in whole or in part unless another
vehicle has been substituted as collateral securing the Receivable without any
other modification to such Receivable.
(j) NO WAIVER. No provision of a Receivable has been waived except as
reflected in the Receivable File relating to such Receivable.
(k) NO DEFENSES. No right of rescission, setoff, counterclaim or
defense has been asserted or threatened with respect to any Receivable.
(l) NO LIENS. There are no Liens or claims, including Liens for work,
labor, materials or unpaid state or federal taxes relating to any Financed
Vehicle securing the related Receivable, that are or may be prior to or equal to
the Lien granted by such Receivable.
(m) NO DEFAULT. No Initial Receivable has a payment that is more than
30 days delinquent as of the Initial Cutoff Date or, with respect to any
Subsequent Receivables, of not more than 30 days delinquent as of the related
Subsequent Cutoff Date and, except as permitted in this paragraph, no default,
breach, violation or event (in any such case) permitting acceleration under the
terms of any Receivable has occurred; and no continuing condition that with
notice or the lapse of time would constitute a default, breach, violation or
event (in any such case) permitting acceleration under the terms of any
Receivable shall have arisen as of the Cutoff Date; and the Seller has not
waived and shall not waive any of the foregoing. For purposes of this clause
(m), a Receivable is considered 30 days delinquent as of the end of the month
following the date on which a second consecutive Scheduled Payment has not been
made. As of the Closing Date, no Receivable has had an uncured first payment
default.
(n) NO BANKRUPTCIES. No Obligor on any Receivable was the subject of a
bankruptcy proceeding commenced following the execution of the related Contract.
(o) NO REPOSSESSIONS. As of the Initial Cutoff Date, no Financed
Vehicle securing any Receivable is in repossession status and, as of the related
Subsequent Cutoff Date, no Financed Vehicle securing any Subsequent Receivable
will be in repossession status.
(p) ADVERSE SELECTION. No selection procedures adverse to the
Noteholders or the Security Insurer were utilized in selecting the Receivables
from those owned by the Servicer which met the selection criteria contained in
this Agreement.
(q) CHATTEL PAPER. Each Receivable constitutes "chattel paper" as
defined in the UCC.
(r) INSURANCE. The Seller, in accordance with its customary
procedures, has determined that the Obligor, at the time the Receivable was
originated, obtained physical damage insurance covering the Financed Vehicle and
under the terms of the Receivable the Obligor is required to maintain such
insurance.
(s) LAWFUL ASSIGNMENT. No Receivable was originated in, as of the
Initial Cutoff Date or, with respect to any Subsequent Receivables, as of the
related Subsequent Cutoff Date, is subject to the laws of, any jurisdiction
under which the sale, transfer and assignment of such Receivable or this
Agreement is unlawful, void or voidable).
(t) NO INSURANCE PREMIUMS. No portion of the Principal Balance of any
Receivable includes amounts attributable to the payment of any physical damage
or theft insurance premium.
(u) ONE ORIGINAL. There is only one original executed copy of each
Receivable.
(v) LOCATION OF RECEIVABLE FILES. The Receivable Files shall be kept
at one or more of the locations listed in Schedule B and each item required to
be in a Receivable File is in such Receivable File.
(w) COMPUTER RECORDS. As of the Closing Date, the accounting and
computer records relating to the Initial Receivables of the Seller have been
marked to show the absolute ownership by the Owner Trustee on behalf of the
Trust of the Initial Receivables, and, as of any Subsequent Transfer Date the
accounting and computer records relating to the Subsequent Receivables will be
marked to show the absolute ownership by the Owner Trustee on behalf of the
Trust of the Subsequent Receivables.
(x) TAXES. To the best knowledge of the Representative and the Seller,
there are no state or local taxing jurisdictions which have asserted that
nonresident holders of notes issued by, a trust which holds assets similar to
the assets to be held by the Trust are subject to the jurisdiction's income or
other taxes solely by reason of the location in the jurisdiction of the Owner
Trustee, the Seller, the Servicer, the Representative, the obligors on or the
assets securing the Receivables held by the Trust, or the issuer of a financial
guaranty insurance policy.
(y) MATURITY OF RECEIVABLES. Each Initial Receivable has a final maturity
date not later than January 2004; each Receivable has an original term to
maturity of not more than 73 months; the weighted average original term of the
Initial Receivables is approximately 57.76 months; the weighted average
remaining term of the Initial Receivables is approximately 56.75 months as of
the Initial Cutoff Date. No Initial Receivable shall have a remaining term to
maturity in excess of 60 months except 19.9% of the Aggregate Principal Balance
of the Initial Receivables represent Initial Receivables with remaining terms to
maturity of up to 73 months.
(z) FINANCING. Approximately 15.66% of the aggregate principal balance
of the Initial Receivables, represent new vehicles; the remainder of the Initial
Receivables represent used vehicles; approximately 26.89% of the aggregate
Principal Balance of the Initial Receivables represent Precomputed Receivables
and the remainder of the Initial Receivables represent Simple Interest
Receivables; all of the Initial Receivables which are Precomputed Receivables
are Rule of 78s Receivables. The aggregate Principal Balance of the Initial
Receivables, is $68,514,248.92.
(aa) APR. The weighted average Annual Percentage Rate of the Initial
Receivables is approximately 18.92%. Each Initial Receivable has an APR equal to
or greater than 12.25%.
(bb) NUMBER. There are 5,864 Initial Receivables.
(cc) BALANCE. Each Initial Receivable has a remaining principal
balance of not less than $1,175.67 and not more than $36,025.00, the average
Principal Balance of the Initial Receivables is $11,683.88.
SECTION 3.2 REPURCHASE UPON BREACH. (a) The Representative, the
Seller, the Servicer, the Security Insurer or the Owner Trustee, as the case may
be, shall inform the other parties to this Agreement and the Trustee promptly,
in writing, upon the discovery of any breach of the Representative's or the
Seller's representations and warranties made pursuant to Section 3.1. As of the
last day of the second (or, if the Representative or the Seller so elects, the
first) month following the discovery by the Representative or the Seller or
receipt by the Representative or the Seller of notice from any of the
Representative, the Seller, the Servicer, the Security Insurer or the Owner
Trustee of such breach, unless such breach is cured by such date, the
Representative and the Seller shall jointly and severally have an obligation to
repurchase any Receivable in which the interests of the Noteholders or the
Security Insurer are materially and adversely affected by any such breach as of
such date. The "second month" shall mean the month following the month in which
discovery occurs or notice is given, and the "first month" shall mean the month
in which discovery occurs or notice is given. In consideration of and
simultaneously with the repurchase of the Receivable, the Representative and/or
the Seller shall remit, or cause TMS Auto Finance to remit, to the Collection
Account the Purchase Amount in the manner specified in Section 5.5 and the
Issuer shall execute such assignments and other documents reasonably requested
by such person in order to effect such repurchase. The sole remedy of the
Issuer, the Owner Trustee, the Trustee, the Noteholders or the
Certificateholders with respect to a breach of representations and warranties
pursuant to Section 3.1 and the agreement contained in this Section shall be the
repurchase of Receivables pursuant to this Section, subject to the conditions
contained herein or to enforce the obligation of TMS Auto Finance to the Seller
to repurchase such Receivables pursuant to the Purchase Agreement. Neither the
Owner Trustee nor the Trustee shall have a duty to conduct any affirmative
investigation as to the occurrence of any conditions requiring the repurchase of
any Receivable pursuant to this Section.
(b) Pursuant to Section 2.1 of this Agreement, the Seller conveyed to
the Trust all of the Seller's right, title and interest in its rights and
benefits, but none of its obligations or burdens, under the Purchase Agreement
including the Seller's rights under the Purchase Agreement and the delivery
requirements, the representations and warranties and the cure or repurchase
obligations of TMS Auto Finance thereunder. The Seller hereby represents and
warrants to the Trust that such assignment is valid, enforceable and effective
to permit the Trust to enforce such obligations of TMS Auto Finance under the
Purchase Agreement.
SECTION 3.3 CUSTODY OF RECEIVABLES FILES. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Issuer hereby
revocably appoints the Servicer, and the Servicer hereby accepts such
appointment, to act as the agent of the Issuer and the Trustee as custodian of
the following documents or instruments which are hereby constructively delivered
to the Trustee, as of the Initial Cutoff Date (in the case of Initial
Receivables) and as of each Subsequent Transfer Date (in the case of Subsequent
Receivables transferred on such Subsequent Transfer Date) as pledgee of the
Issuer with respect to each Receivable:
(a) the original Receivable;
(b) a record of the information supplied by the Obligor in the
original credit application;
(c) the original certificate of title or such documents that the
Servicer shall keep on file, in accordance with its customary procedures,
evidencing the security interest of TMS Auto Finance in the Financed Vehicle (it
being understood that the original certificates of title generally are not
delivered to the Seller for 120 days but that promptly upon delivery they shall
be delivered to the Servicer as custodian hereunder); and
(d) any and all other documents that the Servicer shall keep on file,
in accordance with its customary procedures, relating to a Receivable, an
Obligor or a Financed Vehicle.
SECTION 3.4 DUTIES OF SERVICER AS CUSTODIAN. (a) SAFEKEEPING. The
Servicer shall hold the Receivables Files on behalf of the Issuer and the
Trustee and maintain such accurate and complete accounts, records and computer
systems pertaining to each Receivable File as shall enable the Issuer to comply
with this Agreement. In performing its duties as custodian the Servicer shall
act with reasonable care, using that degree of skill and attention that the
Servicer exercises with respect to the receivable files relating to all
comparable automotive receivables that the Servicer services for itself or
others, and in any event with no less degree of skill and care than would be
exercised by a prudent servicer or custodian of non-prime motor vehicle retail
installment sales contracts, except that the Servicer shall not be obligated,
and does not currently intend, to (i) pay any premium of force-placed insurance
concerning any Financed Vehicle or (ii) monitor any Obligor's maintenance of
such insurance. The Servicer shall conduct, or cause to be conducted, periodic
audits of the Receivables Files held by it under this Agreement and of the
related accounts, records and computer systems, in such a manner as shall enable
the Owner Trustee, the Security Insurer or the Trustee to verify the accuracy of
the Servicer's record keeping. The Servicer shall promptly report to the Issuer,
the Security Insurer and the Trustee any failure on its part to hold the
Receivables Files and maintain its accounts, records and computer systems as
herein provided and promptly take appropriate action to remedy any such failure.
(b) MAINTENANCE OF RECORDS. The Servicer shall maintain each
Receivable File at its office specified in Schedule B to the Agreement or at
such other office as shall be specified to the Issuer, the Trustee and the
Security Insurer by written notice not later than 10 days after any change in
location. The Servicer shall (i) at all times maintain the original of the fully
executed Receivable and store such original Receivable in a fireproof cabinet;
and (ii) stamp each Receivable on both the first and the signature page (if
different) as of the Closing Date or the related Subsequent Transfer Date, as
applicable, and in accordance with the instructions from time to time provided
by the Security Insurer, in the form attached hereto as Exhibit F, or such other
form as shall be acceptable to the Security Insurer.
(c) ACCESS TO RECORDS. The Servicer will provide, on the Closing Date,
an Officer's Certificate stating that the Receivables Files contain all
materials which are required to be kept therein by Section 3.3(a), (b), (c) and
(d). At any time following the Closing Date, the Security Insurer may conduct a
review of the Receivables Files, or a sample thereof as it may specify, at its
own expense but with the cooperation of the Servicer. Should the Security
Insurer find any documents missing or any other irregularities, then the Trustee
shall perform a review, for the benefit of the Security Insurer and at the
expense of the Servicer, of all the Receivables Files.
Upon reasonable prior notice, the Servicer shall make available to the
Issuer, the Trustee, the Security Insurer, or any duly authorized
representatives, attorneys or auditors of any of the foregoing, a list of
locations of, and access to, the Receivables Files and records and computer
systems maintained by the Servicer at such times during normal business hours as
the Issuer, the Trustee or the Security Insurer shall instruct.
(d) RELEASE OF DOCUMENTS. Upon written instruction from the Trustee or
the Security Insurer, at any time following a Servicer Default or termination of
the Servicer's appointment pursuant to Section 3.7 the Servicer shall release
any Receivable File to the Trustee, the Trustee's agent, or the Trustee's
designee, as the case may be, or the Security Insurer, as the case may be, at
such place or places as the Trustee or the Security Insurer, as the case may be,
may designate, as soon as practicable.
SECTION 3.5 INSTRUCTIONS; AUTHORITY TO ACT. The Servicer shall be
deemed to have received proper instructions with respect to the Receivables
Files upon its receipt of written instructions signed by a Trust Officer of the
Trustee. A copy of such instructions shall be furnished by the Trustee to the
Security Insurer. The Trustee shall not have any duty or obligation to provide
the Servicer with any such instructions with respect to the Receivables Files.
SECTION 3.6 CUSTODIAN'S INDEMNIFICATION. The Servicer as custodian
shall indemnify and hold harmless the Trust, the Security Insurer, the Owner
Trustee and the Trustee and each of their officers, directors, employees and
agents for any and all liabilities, obligations, losses, compensatory damages,
payments, costs or expenses (including reasonable attorneys' fees and expenses)
that may be imposed on, incurred by or asserted against the Trust, the Owner
Trustee or the Trustee or any of their officers, directors, employees and agents
as the result of any improper act or omission in any way relating to the
maintenance and custody by the Servicer as custodian of the Receivables Files;
PROVIDED, HOWEVER, that the Servicer shall not be liable to the Trust, the Owner
Trustee, the Trustee or the Security Insurer, as the case may be, for any
portion of any such amount resulting from the willful misfeasance, bad faith or
negligence of the Owner Trustee, the Trustee or the Security Insurer, as the
case may be. This provision shall not be considered to limit the Servicer's or
any other party's rights, obligations, liabilities, claims or defenses which
arise as a matter of law or pursuant to any other provision of this Agreement.
SECTION 3.7 EFFECTIVE PERIOD AND TERMINATION. The Servicer's
appointment as custodian shall become effective as of the Initial Cutoff Date
and shall continue in full force and effect until terminated pursuant to this
Section 3.7. If TMS Auto Finance shall resign as Servicer in accordance with the
provisions of this Agreement or if all of the rights and obligations of any
Servicer shall have been terminated under Section 8.1, the appointment of such
Servicer as custodian shall be terminated, in the same manner as the Servicer
may be terminated under Section 8.1. The Trustee or, with the consent of the
Trustee, the Owner Trustee may, in each case, with the consent of the Security
Insurer, and the Security Insurer may terminate the Servicer's appointment as
custodian (i) with cause or (ii) upon the occurrence of an Insurance Agreement
Event of Default, upon written notification to the Servicer and the Trustee or
Security Insurer, as the case may be. As soon as practicable after any
termination of such appointment, the Servicer shall deliver the Receivables
Files to the Trustee or the Trustee's agent at such place or places as the
Trustee, with the consent of the Security Insurer, or the Trustee shall, at the
direction of the Security Insurer, reasonably designate in writing. If the
Servicer shall be terminated as custodian hereunder for any reason but shall
continue to serve as Servicer, the Trustee shall, or shall cause its agent to,
make the Receivables Files available to the Servicer during normal business
hours upon reasonable notice so as to permit the Servicer to perform its
obligations as Servicer hereunder.
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1 DUTIES OF SERVICER. The Servicer, as agent for the Issuer
and the Security Insurer (to the extent provided herein), shall manage, service,
administer and make collections on the Receivables (other than Purchased
Receivables) with reasonable care, using that degree of skill and attention that
the Servicer exercises with respect to all comparable automotive receivables
that it services for itself or others, and in any event with no less degree of
skill and care than would be exercised by a prudent servicer of non-prime motor
vehicle retail installment sales contracts, except that the Servicer shall not
be obligated, and does not currently intend, to (i) pay any premium of
force-placed insurance concerning any Financed Vehicle or (ii) monitor any
Obligor's maintenance of such insurance. The Servicer's duties shall include
collection and posting of all payments, responding to inquiries of Obligors on
such Receivables, investigating delinquencies, sending payment statements to
Obligors, accounting for collections and furnishing monthly and annual
statements to the Owner Trustee, the Trustee and the Security Insurer with
respect to distributions. Subject to the provisions of Section 4.2, the Servicer
shall follow its customary standards, policies and procedures in performing its
duties as Servicer. Without limiting the generality of the foregoing, the
Servicer is authorized and empowered to execute and deliver, on behalf of
itself, the Issuer, the Owner Trustee, the Trustee, the Security Insurer, the
Certificateholders and the Noteholders or any of them, any and all instruments
of satisfaction or cancellation, or partial or full release or discharge, and
all other comparable instruments, with respect to such Receivables or to the
Financed Vehicles securing such Receivables. If the Servicer shall commence a
legal proceeding to enforce a Receivable, the Issuer (in the case of a
Receivable other than a Purchased Receivable) shall thereupon be deemed to have
automatically assigned, solely for the purpose of collection, such Receivable to
the Servicer. If in any enforcement suit or legal proceeding it shall be held
that the Servicer may not enforce a Receivable on the ground that it shall not
be a real party in interest or a holder entitled to enforce such Receivable the
Owner Trustee shall, at the Servicer's expense and direction, take steps to
enforce such Receivable, including bringing suit in its name or the name of the
Trust, the Trustee, the Certificateholders or the Noteholders. The Owner Trustee
and the Security Insurer shall upon the written request of the Servicer furnish
the Servicer with any powers of attorney and other documents reasonably
necessary or appropriate (as certified to the Owner Trustee and/or the Security
Insurer by the Servicer) to enable the Servicer to carry out its servicing and
administrative duties hereunder.
SECTION 4.2 COLLECTION AND ALLOCATION OF RECEIVABLE PAYMENTS. (a) The
Servicer shall make reasonable efforts to collect all payments called for under
the terms and provisions of the Receivables as and when the same shall become
due and shall follow such collection procedures as it follows with respect to
all comparable automotive receivables that it services for itself or others, and
in any event with no less degree of skill and care than would be exercised by a
prudent servicer of non-prime motor vehicle retail installment sales contracts.
The Servicer shall allocate collections between principal and interest in
accordance with its customary servicing procedures.
(b) The Servicer may grant extensions, rebates or adjustments on a
Receivable which shall not, for the purposes of this Agreement, modify the
original due dates (other than to permit payment on a different date in the
month) or amounts of the Scheduled Payments (unless the Obligor is in default
or, in the judgment of the Servicer, such default is imminent) on a Precomputed
Receivable or the original due dates (other than to permit payment on a
different date in the month) or amounts of the originally scheduled payments of
interest (unless the Obligor is in default or, in the judgment of the Servicer,
such default is imminent) on Simple Interest Receivables; PROVIDED, HOWEVER,
that if the Servicer extends the date for final payment by the Obligor of any
Receivable beyond the Final Scheduled Maturity Date, it shall promptly
repurchase such Receivable from the Trust in accordance with Section 4.7. The
Servicer may in its discretion waive any late payment charge or any other fees
that may be collected in the ordinary course of servicing a Receivable. The
Servicer shall not agree to any alteration of the interest rate on any
Receivable.
SECTION 4.3 REALIZATION UPON RECEIVABLES. On behalf of the Issuer and
the Security Insurer, the Servicer shall use its best efforts, consistent with
its customary servicing procedures, to repossess or otherwise convert the
ownership of the Financed Vehicle securing any Receivable as to which the
Servicer shall have determined eventual payment in full is unlikely. From time
to time, as appropriate for servicing or foreclosing upon any Receivable, the
Owner Trustee shall, upon written request of the Servicer, execute such
documents as shall be reasonably necessary to prosecute any such proceedings.
The Servicer shall follow such customary and usual practices and procedures as
it shall deem necessary or advisable in its servicing of automotive receivables,
which may include reasonable efforts to realize proceeds from Receivables
repurchased by a Dealer, pursuant to a Dealer Agreement, as a result of a breach
of representation or warranty in the related Dealer Agreement or a default by an
Obligor resulting in the repossession of the Financed Vehicle under such Dealer
Agreement. The foregoing shall be subject to the provision that, in any case in
which the Financed Vehicle shall have suffered damage, the Servicer shall not
expend funds in connection with the repair or the repossession of such Financed
Vehicle unless it shall determine in its reasonable discretion that such repair
and/or repossession will increase the Net Liquidation Proceeds by an amount
greater than the amount of such expenses.
SECTION 4.4 PHYSICAL DAMAGE INSURANCE. The Servicer shall, in
accordance with its customary servicing procedures, require that each Obligor
shall have obtained and shall maintain fire, theft and collision insurance or
comprehensive and collision insurance covering the Financed Vehicle as of the
execution of the Receivable. The Servicer shall enforce its rights under the
Receivables to require the Obligors to maintain fire, theft and collision
insurance or comprehensive and collision insurance, in accordance with the
Servicer's customary practices and procedures, and in any event with no less
degree of skill and care than would be exercised by a prudent servicer of
non-prime motor vehicle retail installment sales contracts, and in any event
with no less degree of skill and care than would be exercised by a prudent
servicer of non-prime motor vehicle retail installment sales contracts, with
respect to comparable new or used motor vehicle receivables that it services for
itself or others, except that the Servicer shall not be obligated, and does not
currently intend, to (i) pay any premium of force-placed insurance concerning
any Financed Vehicle or (ii) monitor any Obligor's maintenance of such
insurance.
SECTION 4.5 MAINTENANCE OF SECURITY INTERESTS IN FINANCED VEHICLES.
(a) The Servicer shall, in accordance with its customary servicing procedures,
take such steps as are necessary to maintain perfection of the security interest
created by each Receivable in the related Financed Vehicle in favor of the
Seller. The Servicer is hereby authorized to take such steps as are necessary to
re-perfect such security interest on behalf of the Issuer and the Indenture
Collateral Agent in the event of the relocation of a Financed Vehicle or for any
other reason.
(b) Upon the occurrence of an Insurance Agreement Event of Default,
and subject to the other provisions of this Agreement, the Security Insurer may
(so long as an Insurer Default shall not have occurred and be continuing)
instruct the Owner Trustee and the Servicer to take or cause to be taken, or, if
an Insurer Default shall have occurred, upon the occurrence of a Servicer
Default, the Owner Trustee and the Servicer shall take or cause to be taken such
action as may, in the opinion of counsel to the Security Insurer (or, if an
Insurer Default shall have occurred and be continuing, counsel to the Owner
Trustee), be necessary to perfect or reperfect the security interests in the
Financed Vehicles securing the Receivables in the name of the Trust by amending
the title documents of such Financed Vehicles or by such other reasonable means
as may, in the opinion of counsel to the Security Insurer or the Owner Trustee
(as applicable), be necessary or prudent. The Servicer hereby agrees to pay all
expenses related to such perfection or reperfection and to take all action
necessary therefor.
SECTION 4.5-A. SEGREGATION OF RECEIVABLES FILES. The Servicer shall
maintain the Receivables Files (containing the original Receivable and Lien
Certificate, when such Lien Certificate has been returned from the appropriate
recording office) physically segregated from other files of automotive
receivables owned or serviced by it at the location where the Receivables Files
are kept.
SECTION 4.6 COVENANTS OF SERVICER. The Servicer shall not release the
Financed Vehicle securing any Receivable from the security interest granted by
such Receivable in whole or in part except in the event of payment in full by
the Obligor thereunder or payment in full less a deficiency which the Servicer
would not attempt to collect in accordance with its customary procedures or in
connection with repossession or except as may be required by an insurer in order
to receive proceeds from insurance covering such Financed Vehicle, nor shall the
Servicer impair the rights of the Issuer, the Trustee, the Indenture Collateral
Agent, the Security Insurer, the Certificateholders or the Noteholders in such
Receivables (it being understood that no action of the Servicer taken in
compliance with the terms of this Agreement shall be deemed to impair such
rights), nor shall the Servicer increase the number of scheduled payments due
under a Receivable.
SECTION 4.7 PURCHASE OF RECEIVABLES UPON BREACH. The Representative,
the Seller, the Servicer, the Security Insurer or the Owner Trustee shall inform
the other parties and the Trustee promptly, in writing, upon the discovery of
any breach of the Servicer's covenants pursuant to Section 4.2(b), 4.4, 4.5 or
4.6, or of any breach of the Servicer's representations and warranties made
pursuant to Section 7.1(b). As of the last day of the second (or, if the
Representative or the Servicer so elects, the first) month following the
discovery by the Representative or the Servicer or receipt by the Representative
or the Servicer of notice from any of the Representative, the Seller, the
Servicer, the Security Insurer, the Owner Trustee or the Trustee of such breach,
unless such breach is cured by such date, the Representative and the Servicer
jointly and severally shall be obligated to purchase any Receivable in which the
interests of the Noteholders, the Certificateholders or the Security Insurer are
materially and adversely affected by such breach as of such date. The "second
month" shall mean the month following the month in which discovery occurs or
notice is given, and the "first month" shall mean the month in which discovery
occurs or notice is given. In consideration of the purchase of any such
Receivable pursuant to the preceding sentence, the Servicer shall remit (or, if
the Servicer shall fail to so remit, the Representative shall remit) the
Purchase Amount in the manner specified in Section 5.5. The sole remedy of the
Issuer, the Trustee, the Noteholders or the Certificateholders with respect to a
breach pursuant to Section 4.2(b), 4.4, 4.5 or 4.6, or to a breach of
representations and warranties pursuant to Section 7.1(b), shall be limited to
the purchase of Receivables in accordance with this Section 4.7. The Trustee and
the Owner Trustee shall have no duty to conduct any affirmative investigation as
to the occurrence of any condition requiring the purchase of any Receivable
pursuant to this Section 4.7.
SECTION 4.8 SERVICING FEE. The Servicing Fee for a Distribution Date
shall equal the sum of the Base Servicing Fee, the Supplemental Servicing Fee,
all Investment Earnings on the Collection Account plus any reimbursement
pursuant to Section 7.2. The Servicer also shall be entitled to retain from
collections the Base Servicing Fee and the Supplemental Servicing Fee, as
provided herein. The Servicer, in its discretion at its election, may defer
receipt of all or any portion of the Servicing Fee for any Monthly Period to and
until a later Monthly Period for any reason, including in order to avoid a
shortfall in any payments due on any Notes. Any such deferred amount shall be
payable to (or may be retained from subsequent collections by) the Servicer on
demand.
SECTION 4.9 SERVICER'S CERTIFICATE. (a) No later than 12:00 noon New
York City time on each Determination Date, the Servicer shall deliver to the
Owner Trustee, the Trustee, the Security Insurer or its fiscal agent, the
Indenture Collateral Agent and each Rating Agency a Servicer's Certificate
containing, among other things, (i) all information necessary to enable the
Trustee to make any withdrawal and deposit required by Section 5.6(a), 5.6(b),
5.6(c) and 5.6(d), to give any notice required by Section 5.4 or 5A.1 and make
the distributions required by Section 5.6 and 5.7, (ii) all information
necessary to enable the Trustee to send the statements required by Section 5.8
to the Owner Trustee, the Noteholders, each Rating Agency and the Security
Insurer, (iii) a listing of all Receivables purchased during the related Monthly
Period, identifying the Receivables so purchased, and (iv) all information
necessary to enable the Trustee to reconcile all deposits to, and withdrawals
from, the Collection Account for the related Monthly Period and Distribution
Date, including the accounting required by Section 5.9. Receivables purchased by
the Servicer, the Seller or the Representative and each receivable which became
a Liquidated Receivable or which was paid in full during the related Monthly
Period shall be identified by account number (as set forth in the Schedule of
Receivables). A copy of such certificate may be obtained by any Noteholder or
Certificateholder by a request in writing to the Trustee or the Owner Trustee
addressed to the applicable Corporate Trust Office. The Trustee shall not be
under any obligation to confirm or reconcile the information provided pursuant
to Section 4.9(a)(iv).
(b) If the Servicer's Certificate contains a manifest error, the
Security Insurer's written notice to the Servicer, the Owner Trustee and the
Trustee containing the corrected information shall be deemed to amend such
Servicer's Certificate.
SECTION 4.10 ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF DEFAULT. (a)
The Servicer shall deliver to the Owner Trustee, the Trustee and the Security
Insurer, on or before April 30 of each year beginning April 30, 1999 an
Officer's Certificate, dated as of the preceding December 31, stating that (i) a
review of the activities of the Servicer during the preceding 12-month period
and of its performance under this Agreement has been made under such officer's
supervision and (ii) to the best of such officer's knowledge, based on such
review, the Servicer has fulfilled all its obligations under this Agreement
throughout such year or, if there has been a default in the fulfillment of any
such obligation, specifying each such default known to such officers and the
nature and status thereof. The Trustee shall send a copy of such certificate and
the report referred to in Section 4.11 to the Rating Agencies. A copy of such
certificate and the report referred to in Section 4.11 may be obtained by any
Certificateholder by a request in writing to the Owner Trustee addressed to the
Corporate Trust Office or by any Noteholder by a request in writing to the
Trustee addressed to the Corporate Trust Office. Upon the telephone request of
the Owner Trustee, the Trustee will promptly furnish the Owner Trustee a list of
Noteholders as of the date specified by the Owner Trustee. Each Noteholder, by
its acceptance of a Note, shall be deemed to agree that the Trustee shall be
under no liability for providing the list of Noteholders to the Owner Trustee as
described in the immediately preceding sentence.
(b) The Servicer shall deliver to the Owner Trustee, the Trustee, the
Security Insurer and the Rating Agencies, promptly after having obtained
knowledge thereof, but in no event later than five (5) Business Days thereafter,
written notice in an Officer's Certificate of any event which with the giving of
notice or lapse of time, or both, would become a Servicer Default under Section
8.1(a) or (b).
SECTION 4.11 ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS' REPORT.
The Servicer shall cause a firm of independent certified public accountants,
which may also render other services to the Servicer or the Seller, to deliver
to the Seller, the Owner Trustee, the Trustee and the Security Insurer on or
before April 30 of each year beginning April 30, 1999, an agreed- upon
procedures report addressed to the Servicer, the Seller, the Owner Trustee, the
Trustee and the Security Insurer and each Rating Agency, expressing a summary of
findings, (based on certain procedures performed on the documents, records and
accounting records that such accountants considered appropriate under the
circumstances) relating to the servicing of the Receivables, or the
administration of the Receivables and of the Trust, as the case may be, during
the preceding calendar year and that, on the basis of the accounting and
auditing procedures considered appropriate under the circumstances, such firm is
of the opinion that such servicing or administration was conducted in compliance
with the terms of this Agreement, except for (i) such exceptions as such firm
shall believe to be immaterial and (ii) such other exceptions as shall be set
forth in such report.
Such report will also indicate that the firm is independent of the
Servicer within the meaning of the Code of Professional Ethics of the American
Institute of Certified Public Accountants.
SECTION 4.12 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
RECEIVABLES. The Servicer shall provide to representatives of the Trustee, the
Owner Trustee and the Security Insurer reasonable access to the Receivable
Files. The Servicer shall provide to the Certificateholders and Noteholders
access to the Receivable Files in such cases where the Certificateholders or
Noteholders shall be required by applicable statutes or regulations to review
such documentation as demonstrated by evidence satisfactory to the Servicer in
its reasonable judgment. Access shall be afforded without charge, but only upon
reasonable request and during the normal business hours at the respective
offices of the Servicer. Nothing in this Section shall affect the obligation of
the Servicer to observe any applicable law prohibiting disclosure of information
regarding the Obligors and the failure of the Servicer to provide access to
information as a result of such obligation shall not constitute a breach of this
Section.
SECTION 4.13 SERVICER EXPENSES. The Servicer shall be required to pay
all expenses incurred by it in connection with its activities hereunder and
under any of the Basic Documents, including fees and disbursements of
independent accountants, taxes imposed on the Servicer and expenses incurred in
connection with distributions and reports to Certificateholders and Noteholders.
SECTION 4.14 APPOINTMENT OF SUBSERVICER. The Servicer may at any time
appoint a subservicer to perform all or any portion of its obligations as
Servicer hereunder; PROVIDED, HOWEVER, that the Rating Agency Condition shall
have been satisfied in connection therewith; PROVIDED FURTHER that the Servicer
shall remain obligated and be liable to the Issuer, the Owner Trustee, the
Trustee, the Security Insurer, the Certificateholders and the Noteholders for
the servicing and administering of the Receivables in accordance with the
provisions hereof without diminution of such obligation and liability by virtue
of the appointment of such subservicer and to the same extent and under the same
terms and conditions as if the Servicer alone were servicing and administering
the Receivables. The fees and expenses of the subservicer shall be as agreed
between the Servicer and its subservicer from time to time and none of the
Issuer, the Owner Trustee, the Trustee, the Security Insurer, the
Certificateholders or the Noteholders shall have any responsibility therefor.
Any such subservicer shall perform its duties with the same standard of care
applicable to the Servicer pursuant to Section 4.1 of this Agreement.
SECTION 4.15 OBLIGATIONS UNDER BASIC DOCUMENTS. The Servicer shall
perform all of its obligations under the Basic Documents.
ARTICLE V
DISTRIBUTIONS;
STATEMENTS TO CERTIFICATEHOLDERS AND NOTEHOLDERS
SECTION 5.1 ESTABLISHMENT OF TRUST ACCOUNTS.
(a)(i) The Servicer, for the benefit of the Trustee on
behalf of the Noteholders, the Owner Trustee on behalf of the
Certificateholders, and the Security Insurer, shall establish and
maintain in the name of the Indenture Collateral Agent an Eligible
Deposit Account (the "Collection Account"), bearing a designation
clearly indicating that the funds deposited therein are held for the
benefit of the Trustee on behalf of the Noteholders, the Owner Trustee
on behalf of the Certificateholders and the Security Insurer.
Investment Earnings on funds in the Collection Account shall be paid
to the Servicer.
(ii) The Servicer, for the benefit of the Trustee on behalf
of the Noteholders, shall establish and maintain in the name of the
Indenture Collateral Agent an Eligible Deposit Account (the "Note
Distribution Account"), bearing a designation clearly indicating that
the funds deposited therein are held for the benefit of the Trustee on
behalf of the Noteholders and the Security Insurer. The Note
Distribution Account shall initially be established with the Trustee.
(iii) The Servicer, for the benefit of the Trustee on behalf
of the Noteholders, the Owner Trustee on behalf of the
Certificateholders, and the Security Insurer, shall establish and
maintain in the name of the Indenture Collateral Agent an Eligible
Deposit Account (the "Pre-Funding Account"), bearing a designation
clearly indicating that the funds deposited therein are held for the
benefit of the Trustee on behalf of the Noteholders, the Owner Trustee
on behalf of the Certificateholders and the Security Insurer.
(b) Funds on deposit in the Collection Account, the Pre-Funding
Account, the Note Distribution Account (collectively, along with the Capitalized
Interest Account, the "Trust Accounts") and the Certificate Distribution Account
shall be invested by the Indenture Collateral Agent with respect to Trust
Accounts and by the Owner Trustee with respect to the Certificate Distribution
Account (or any custodian with respect to funds on deposit in any such account)
in Eligible Investments selected in writing by the Servicer (pursuant to
standing instructions or otherwise); PROVIDED, HOWEVER, it is understood and
agreed that neither the Indenture Collateral Agent nor the Owner Trustee shall
be liable for any loss arising from such investment in Eligible Investments. All
such Eligible Investments shall be held by or on behalf of the Indenture
Collateral Agent or the Owner Trustee, as applicable, for the benefit of the
Noteholders and/or the Certificateholders, as applicable and the Security
Insurer. Other than as permitted by the Rating Agencies and the Security
Insurer, funds on deposit in the Collection Account, the Pre- Funding Account,
the Capitalized Interest Account, the Note Distribution Account and the
Certificate Distribution Account shall be invested in Eligible Investments that
will mature so that such funds will be available at the close of business on the
Business Day immediately preceding the following Distribution Date or, if the
Class A-1 Notes have not been paid in full prior to such date, at the close of
business on the Business Day prior to the Class A-1 Final Scheduled Distribution
Date. Funds deposited in a Trust Account or the Certificate Distribution Account
on the day immediately preceding a Distribution Date upon the maturity of any
Eligible Investments are not required to be invested overnight.
(c)(i) The Indenture Collateral Agent shall possess all right, title
and interest in all funds on deposit from time to time in the Trust Accounts and
in all proceeds thereof (excluding all Investment Earnings on the Collection
Account) and all such funds, investments, proceeds and income shall be part of
the Owner Trust Estate. Except as otherwise provided herein, the Trust Accounts
shall be under the sole dominion and control of the Indenture Collateral Agent
for the benefit of the Noteholders and the Certificateholders, or the
Noteholders, as the case may be, and the Security Insurer. If, at any time, any
of the Trust Accounts or the Certificate Distribution Account ceases to be an
Eligible Deposit Account, the Indenture Collateral Agent (or the Servicer on its
behalf) or the Owner Trustee, as applicable, shall within 10 Business Days (or
such longer period as to which each Rating Agency and the Security Insurer may
consent) establish a new Trust Account or a new Certificate Distribution
Account, as applicable, as an Eligible Deposit Account and shall transfer any
cash and/or any investments to such new Trust Account or a new Certificate
Distribution Account, as applicable. In connection with the foregoing, the
Servicer agrees that, in the event that any of the Trust Accounts are not
accounts with the Trustee, the Servicer shall notify the Trustee in writing
promptly upon any of such Trust Accounts ceasing to be an Eligible Deposit
Account.
(ii) With respect to the Trust Account Property, the
Indenture Collateral Agent, and with respect to the Certificate
Distribution Account, the Owner Trustee agrees, by its respective
acceptance hereof, that:
A any Trust Account Property or any property in the
Certificate Distribution Account that is held in deposit
accounts shall be held solely in the Eligible Deposit
Accounts subject to the penultimate sentence of Section
5.1(c)(i); and, except as otherwise provided herein, each
such Eligible Deposit Account shall be subject to the
exclusive custody and control of the Indenture Collateral
Agent with respect to the Trust Accounts and the Owner
Trustee with respect to the Certificate Distribution
Account, and the Indenture Collateral Agent or the Owner
Trustee, as applicable, shall have sole signature authority
with respect thereto;
B any Trust Account Property shall be Delivered to the
Indenture Collateral Agent in accordance with the definition
of "Delivery" and shall be held, pending maturity or
disposition, solely by the Indenture Collateral Agent or
such other Person acting solely for the Indenture Collateral
Agent as required for Delivery;
C In the event that the Indenture Collateral Agent, in
its capacity as securities intermediary has or subsequently
obtains by agreement, operation of law or otherwise a
security interest in the Trust Accounts or any security
entitlement credited thereto, the Indenture Collateral
Agent, in its capacity as securities intermediary hereby
agrees that such security interest shall be subordinate to
the security interest of the Indenture Collateral Agent. The
financial assets and other items deposited to the Trust
Accounts will not be subject to deduction, set-off, banker's
lien, or any other right in favor of any person (except that
the Indenture Collateral Agent, in its capacity as
securities intermediary may set off the face amount of any
checks which have been credited to the Trust Accounts but
are subsequently returned unpaid because of uncollected or
insufficient funds).
(d) The Servicer shall have the power, revocable by the Security
Insurer or, with the consent of the Security Insurer by the Trustee or by the
Owner Trustee with the consent of the Trustee, to instruct the Indenture
Collateral Agent to make withdrawals and payments from the Trust Accounts for
the purpose of permitting the Servicer or the Owner Trustee to carry out its
respective duties hereunder or permitting the Trustee to carry out its duties
under the Indenture.
(e) [RESERVED]
SECTION 5.1-A CAPITALIZED INTEREST ACCOUNT. (a) With respect to
amounts on deposit in the Pre-Funding Account, in order to assure that
sufficient amounts to make required distributions of interest to Noteholders and
Certificateholders will be available during the Funding Period, the Servicer
shall establish and maintain an Eligible Deposit Account (the "Capitalized
Interest Account") with the Indenture Collateral Agent, bearing a designation
clearly indicating that the funds deposited therein are held in trust for the
benefit of the Noteholders, Certificateholders and the Security Insurer.
On or prior to the Closing Date, the Seller shall deposit an amount
equal to the Capitalized Interest Account Initial Deposit into the Capitalized
Interest Account.
(b) On the Distribution Date occurring in January and February of 1998
the Trustee shall withdraw from the Capitalized Interest Account the Monthly
Capitalized Interest Amount for such Distribution Date as further provided in
Section 5.6. Any amounts remaining in the Capitalized Interest Account after
taking into account such transfer shall be remitted by the Trustee to the Seller
as set forth in Section 5.6. Upon any such distribution to the Seller, the
Noteholders, the Certificateholders and the Security Insurer will have no
further rights in, or claims to, such amounts.
SECTION 5.2 COLLECTIONS. (a) The Servicer shall remit within two
Business Days of receipt thereof to the Collection Account all payments by or on
behalf of the Obligors with respect to the Receivables (other than Purchased
Receivables) and all Liquidation Proceeds, both as collected during the Monthly
Period less any payments owed thereon to the Servicer. Notwithstanding the
foregoing, for so long as (i) TMS Auto Finance remains the Servicer, (ii) no
Servicer Default shall have occurred and be continuing, (iii) there exists no
Insurer Default and the Security Insurer has furnished its prior written consent
and (iv) the Rating Agency Condition shall have been satisfied (and any
conditions or limitations imposed by the Rating Agencies in connection therewith
are complied with), the Servicer may remit such collections with respect to the
preceding calendar month to the Collection Account on the Determination Date
immediately preceding the related Distribution Date or Class A-1 Final Scheduled
Distribution Date, as applicable. For purposes of this Article V the phrase
"payments by or on behalf of Obligors" shall mean payments made with respect to
the Receivables by Persons other than the Servicer or the Seller.
(b) The Servicer will be entitled to be reimbursed from amounts on
deposit in the Collection Account with respect to a Monthly Period for amounts
previously deposited in the Collection Account but later determined by the
Servicer to have resulted from mistaken deposits or postings or checks returned
for insufficient funds. The amount to be reimbursed hereunder shall be paid to
the Servicer on the related Distribution Date pursuant to Section 5.6(b)(ii)
upon certification by the Servicer of such amounts and the provision of such
information to the Trustee and the Security Insurer as may be necessary in the
opinion of the Security Insurer to verify the accuracy of such certification. In
the event that the Security Insurer has not received evidence satisfactory to it
of the Servicer's entitlement to reimbursement pursuant to Section 5.2(b), the
Security Insurer shall (unless an Insurer Default shall have occurred and be
continuing) give the Trustee notice to such effect, following receipt of which
the Trustee shall not make a distribution to the Servicer in respect of such
amount pursuant to Section 5.6, or if the Servicer prior thereto has been
reimbursed pursuant to Section 5.6 or Section 5.9, the Trustee shall withhold
such amounts from amounts otherwise distributable to the Servicer on the next
succeeding Distribution Date.
SECTION 5.3 APPLICATION OF COLLECTIONS. All collections for the
Monthly Period shall be applied by the Servicer as follows:
With respect to each Receivable (other than a Purchased Receivable),
payments by or on behalf of the Obligor, (other than Supplemental Servicing Fees
with respect to such Receivable, to the extent collected) shall be applied
first, in the case of Precomputed Receivables, to the Scheduled Payment and, in
the case of Simple Interest Receivables, to interest and principal in accordance
with the Simple Interest Method. With respect to any Precomputed Receivable, any
remaining excess shall be applied to prepay the principal of the Precomputed
Receivable.
All amounts collected that are payable to the Servicer as Supplemental
Servicing Fees hereunder shall, other than as provided in Section 5.9, be
deposited in the Collection Account and paid to the Servicer in accordance with
Section 5.6(b).
SECTION 5.4 DEFICIENCY NOTICE. (a) In the event that the Servicer's
Certificate with respect to any Determination Date shall state that the amount
of the Available Funds with respect to such Determination Date is less than the
sum of the amounts payable on (x) the related Distribution Date pursuant to
clauses (i) through (v) of Section 5.6(b) or (y) on the Class A-1 Final
Scheduled Distribution Date pursuant to clause (i) and (ii) of Section 5.6(c)
(in each case, such deficiency being a "Deficiency Claim Amount") then on the
Deficiency Claim Date immediately preceding such Distribution Date or the Class
A-1 Final Scheduled Distribution Date, as applicable, the Trustee shall deliver
to the Indenture Collateral Agent, the Security Insurer, the Owner Trustee, the
Insurer's Agent and the Servicer, by hand delivery, telex or facsimile
transmission, a written notice (a "Deficiency Notice") specifying the Deficiency
Claim Amount for such Distribution Date.
(b) Any Deficiency Notice shall be delivered by 10:00 am., New York
City time, on the related Deficiency Claim Date. The amounts distributed to the
Trustee pursuant to a Deficiency Notice shall be deposited by the Trustee into
the Collection Account pursuant to Section 5.5.
SECTION 5.5 ADDITIONAL DEPOSITS. The Servicer and the Seller, TMS Auto
Finance and the Representative, as applicable, shall deposit or cause to be
deposited in the Collection Account on the Determination Date following the date
on which such obligations are due the aggregate Purchase Amount with respect to
Purchased Receivables. On or before each Draw Date, the Trustee shall remit to
the Collection Account any amounts delivered to the Trustee pursuant to a
Deficiency Notice.
SECTION 5.6 DISTRIBUTIONS. (a) No later than 12:00 noon New York City
time on each Distribution Date, the Trustee shall (based solely on the
information contained in the Servicer's Certificate delivered on the related
Determination Date) cause to be made the following transfers and distributions
in the amounts set forth in the Servicer's Certificate for such Distribution
Date:
(i) During the Funding Period, from the Capitalized Interest
Account (a) to the Collection Account, in immediately available funds,
the Monthly Capitalized Interest Amount for such Distribution Date and
(b) to the Seller, in immediately available funds, all Investment
Earnings on funds in the Capitalized Interest Account with respect to
the Monthly Period related to such Distribution Date or, if such
Distribution Date is the Mandatory Redemption Date, all remaining
funds in the Capitalized Interest Account after distribution of
interest on the Notes on such date; and
(ii) During the Funding Period from the Pre-Funding Account
(a) if such Distribution Date is the Mandatory Redemption Date, to the
Collection Account, in immediately available funds, the Pre-Funded
Amount (exclusive of Pre-Funding Earnings) after giving effect to the
purchase of Subsequent Receivables, if any, on the Mandatory
Redemption Date (b) to the Collection Account, all Prefunding Earnings
up to 2.5% of the Pre-Funded Amount with respect to the Monthly Period
related to such Distribution Date, and to the Seller, in immediately
available funds, all Pre-Funding Earnings over 2.5% of the Pre-Funding
Account with respect to the Monthly Period related to such
Distribution Date or, if such Distribution Date is the Mandatory
Redemption Date, all remaining funds in the Pre-Funding Account over
and above the Pre-Funded Amount.
(b) On each Distribution Date other than the Distribution Date on
which Insolvency Proceeds are to be distributed, the Trustee shall (based solely
on the information contained in the Servicer's Certificate delivered with
respect to the related Determination Date) distribute the following amounts and
in the following order of priority:
(i) from the Distribution Amount, to each of the Trustee and
the Owner Trustee, their respective accrued and unpaid trustees' fees
and any accrued and unpaid fees of the Indenture Collateral Agent (in
each case, to the extent such fees have not been previously paid by
the Servicer or the Representative);
(ii) from the Distribution Amount, to the Servicer, the Base
Servicing Fee for the related Monthly Period, any Supplemental
Servicing Fees for the related Monthly Period, and any amounts
specified in Section 5.2(b), to the extent the Servicer has not
reimbursed itself in respect of such amounts pursuant to Section 5.9
and to the extent not retained by the Servicer;
(iii) from the Distribution Amount, to the Note Distribution
Account, the Noteholders' Interest Distributable Amount;
(iv) from the Distribution Amount, to the Note Distribution
Account, the Noteholders' Principal Distributable Amount;
(v) from the Distribution Amount, to the Security Insurer,
any premium amounts and any overdue premium amounts payable pursuant
to the Insurance Agreement, and, any payments made on the Note Policy
and any other amounts owing to the Security Insurer under the
Insurance Agreement and not paid;
(vi) from the Available Funds, to the Certificate
Distribution Account for distribution to the Certificateholders or
their designees, any remaining funds.
PROVIDED, HOWEVER, that, (A) following an acceleration of the Notes or, (B) if
an Insurer Default shall have occurred and be continuing, following the
occurrence of an Event of Default pursuant to Section 5.1(i), 5.1(ii), 5.1(iii),
5.1(v) or 5.1(vi) of the Indenture, or (C) following the receipt of Insolvency
Proceeds pursuant to Section 9.1(b), amounts deposited in the Note Distribution
Account shall be applied to the Noteholders to the extent necessary to pay
accrued and unpaid interest on the Notes and then, to the extent funds are
available therefore, principal on the Notes until the principal balance of the
Notes has been reduced to zero, in accordance with the provisions of Section 5.6
of the Indenture.
(c) On the Class A-1 Final Scheduled Distribution Date, the Trustee
shall (based solely on the information contained in the Servicer's Certificate
delivered with respect to the related Determination Date) distribute the
following amounts and in the following order of priority:
(i) from the Class A-1 Distribution Amount, to the Note
Distribution Account, the sum of (x) the Noteholders' Monthly Interest
Distributable Amount for the Class A-1 Notes (calculated as if the
Class A-1 Final Scheduled Distribution Date were a Distribution Date)
and (y) the Noteholders' Interest Carryover Shortfall for the Class
A-1 Notes (calculated as if the Class A-1 Final Scheduled Distribution
Date were a Distribution Date); and
(ii) from the Class A-1 Distribution Amount, to the Note
Distribution Account, the Noteholders' Principal Distributable Amount
for the Class A-1 Notes.
(d) In the event that the Collection Account is maintained with an
institution other than the Indenture Collateral Agent, the Servicer shall
instruct and cause such institution to make all deposits and distributions
pursuant to Section 5.6(b) and Section 5.6(c) on the related Distribution Date
or Class A-1 Final Scheduled Distribution Date, as applicable.
SECTION 5.7 PRE-FUNDING ACCOUNT. (a) On the Closing Date, the Trustee
will deposit, on behalf of the Seller, in the Pre-Funding Account $21,485,751.08
from the proceeds of the sale of the Notes. On each Subsequent Transfer Date,
the Servicer shall instruct the Trustee to withdraw from the Pre-Funding Account
an amount equal to the Principal Balance of the Subsequent Receivables
transferred to the Issuer on such Subsequent Transfer Date and to distribute
such amount to or upon the order of the Seller upon satisfaction of the
conditions set forth in this Agreement with respect to such transfer.
(b) If the Pre-Funded Amount has not been reduced to zero on the date
on which the Funding Period ends after giving effect to any reductions in the
Pre-Funded Amount on such date, the Servicer shall instruct the Trustee to
withdraw from the Pre-Funding Account on the Mandatory Redemption Date the
Pre-Funded Amount (exclusive of any Pre-Funding Earnings) and deposit an amount
equal to the Prepayment Amount in the Note Distribution Account.
SECTION 5.8 STATEMENTS TO CERTIFICATEHOLDERS AND NOTEHOLDERS. On or
prior to each Determination Date, the Servicer shall provide to the Trustee
(with a copy to the Security Insurer and the Rating Agencies) for the Trustee to
forward to each Noteholder of record, to each Paying Agent, if any, and to the
Owner Trustee for the Owner Trustee to forward to each Certificateholder of
record, a statement substantially in the form of Exhibit B and Exhibit C,
respectively, setting forth at least the following information with respect to
distributions on the related Distribution Date as to the Notes and the
Certificates to the extent applicable:
(i) the amount of such distribution allocable to principal
of each Class of Notes;
(ii) the amount of such distribution allocable to interest
on or with respect to each Class of Notes;
(iii) the amount of such distribution payable pursuant to a
claim on the Note Policy and any remaining outstanding balance
available to be drawn under the applicable Note Policy;
(iv) the Pool Balance as of the close of business on the
last day of the preceding Monthly Period;
(v) the aggregate outstanding principal amount of each Class
of the Notes, the Note Pool Factor for each such Class, after giving
effect to payments allocated to principal reported under (i) above;
(vi) the amount of the Servicing Fee paid to the Servicer
with respect to the related Monthly Period and/or due but unpaid with
respect to such Monthly Period or prior Monthly Periods, as the case
may be;
(vii) the Noteholders' Interest Carryover Shortfall and the
Noteholders' Principal Carryover Shortfall;
(viii) the amount of the aggregate Realized Losses, if any,
for the second preceding Monthly Period;
(ix) the aggregate Purchase Amounts for Receivables, if any,
that were repurchased in such period;
(x) for Distribution Dates during the Funding Period (if
any), the remaining Pre-Funded Amount, the amount in the Pre-Funding
Account and the amount remaining in the Capitalized Interest Account;
(xi) for the final Subsequent Transfer Date, the amount of
any remaining Pre-Funded Amount that has not been used to fund the
purchase of Subsequent Receivables and is passed through as principal
to Noteholders;
(xii) the amounts which were collected by the Servicer;
(xiii) the aggregate amount which was received by the Trust
from the Servicer;
(xiv) any reimbursements to the Security Insurer;
(xv) delinquency information relating to Receivables which
are 30, 60 or 90 days delinquent, and
(xvi) the aggregate amount distributed to the
Certificateholders.
Each amount set forth pursuant to paragraph (i), (ii), (iii), (vii), (x) and
(xi) above shall be expressed as a dollar amount per $1,000 of the initial
principal balance of the Notes (or Class thereof).
SECTION 5.9 NET DEPOSITS. As an administrative convenience, unless the
Servicer is required to remit collections within two Business Days of receipt
thereof, the Servicer will be permitted to make the deposit of collections on
the Receivables and Purchase Amounts for or with respect to each Monthly Period
net of distributions to be made to the Servicer with respect to such Monthly
Period. The Servicer, however, will account to the Owner Trustee, the Trustee,
the Indenture Collateral Agent, the Noteholders and the Certificateholders as if
all deposits, distributions and transfers were made individually.
SECTION 5.10 OPTIONAL DEPOSITS BY THE SECURITY INSURER. The Security
Insurer shall at any time, and from time to time, with respect to a Distribution
Date or the Class A-1 Final Scheduled Distribution Date, as applicable, have the
option (but shall not be required, except in accordance with the terms of the
Note Policy) to deliver amounts to the Trustee for deposit into the Collection
Account for any of the following purposes: (i) to provide funds in respect of
the payment of fees or expenses of any provider of services to the Trust with
respect to such Distribution Date or the Class A-1 Final Scheduled Distribution
Date, as applicable, or (ii) to include such amount to the extent that without
such amount a draw would be required to be made on the Note Policy.
ARTICLE VI
THE SELLER
SECTION 6.1 REPRESENTATIONS OF THE SELLER. The Seller makes the
following representations on which the Security Insurer shall be deemed to have
relied in executing and delivering the Note Policy and on which the Issuer is
deemed to have relied in acquiring the Receivables. The representations speak as
of the execution and delivery of this Agreement and as of the Closing Date, in
the case of Initial Receivables, and as of the applicable Subsequent Transfer
Date, in the case of Subsequent Receivables, and shall survive the sale of the
Receivables to the Issuer and the pledge thereof to the Trustee pursuant to the
Indenture.
(a) ORGANIZATION AND GOOD STANDING. The Seller is duly organized and
validly existing as a corporation in good standing under the laws of the State
of Delaware with the corporate power and authority to own its properties and to
conduct its business as such properties are currently owned and such business is
presently conducted, and had at all relevant times, and has, the power,
authority and legal right to acquire and own the Receivables.
(b) DUE QUALIFICATION. The Seller is duly qualified to do business as
a foreign corporation in good standing, and has obtained all necessary licenses
and approvals in all jurisdictions in which the ownership or lease of property,
including the Receivables, or the conduct of its business shall require such
qualifications.
(c) POWER AND AUTHORITY OF THE SELLER. The Seller has the corporate
power and authority to execute and deliver this Agreement and to perform its
obligations under each of the Basic Documents to which the Seller is a party;
the Seller has full corporate power and authority to sell and assign the
property to be sold and assigned to and deposited with the Issuer and the Seller
has duly authorized such sale and assignment to the Issuer by all necessary
corporate action; and the execution, delivery and performance of each of the
Basic Documents to which the Seller is a party and of each Subsequent Transfer
Agreement has been duly authorized by the Seller by all necessary corporate
action.
(d) BINDING OBLIGATION. This Agreement, each Subsequent Transfer
Agreement and each of the Basic Documents to which the Seller is a party
constitute legal, valid and binding obligations of the Seller, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
moratorium, fraudulent conveyance, reorganization and similar laws now or
hereafter in effect relating to creditors' rights generally and subject to
general principles of equity (whether applied in a proceeding at law or in
equity).
(e) NO VIOLATION. The consummation of the transactions contemplated by
this Agreement and by each Subsequent Transfer Agreement and the fulfillment of
the terms hereof and thereof do not result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of time or both)
a default under, the articles of association or by-laws of the Seller, or any
indenture, agreement or other instrument to which the Seller is a party or by
which it is bound; nor result in the creation or imposition of any Lien upon any
of its properties pursuant to the terms of any such indenture, agreement or
other instrument (other than pursuant to the Basic Documents); nor violate any
law or, to the best of its 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.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending
against the Seller or, to its best knowledge, threatened against the Seller,
before any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties: (i)
asserting the invalidity of this Agreement or any of the Basic Documents, the
Notes or the Certificates, (ii) seeking to prevent the issuance of the Notes or
the Certificates or the consummation of any of the transactions contemplated by
this Agreement or any of the Basic Documents, (iii) seeking any determination or
ruling that could reasonably be expected to have a material and adverse effect
on the performance by the Seller of its obligations under, or the validity or
enforceability of, the Basic Documents, the Notes or the Certificates or (iv)
that might adversely affect the federal income tax attributes of the Issuer, the
Notes or the Certificates.
(g) ALL CONSENTS. All authorizations, consents, orders or approvals of
or registrations or declarations with any court, regulatory body, administrative
agency or other government instrumentality required to be obtained, effected or
given by the Seller in connection with the execution and delivery by the Seller
of this Agreement, any Subsequent Transfer Agreement or any of the Basic
Documents to which it is a party and the performance by the Seller of the
transactions contemplated by this Agreement, any Subsequent Transfer Agreement
or any of the Basic Documents to which it is a party, have been duly obtained,
effected or given and are in full force and effect, except where failure to
obtain the same would not have a material and adverse effect upon the rights of
the Issuer, the Noteholders or the Certificateholders.
(h) CHIEF EXECUTIVE OFFICE. The chief executive office of the Seller
is at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
SECTION 6.2 CORPORATE EXISTENCE. (a) During the term of this
Agreement, the Seller will keep in full force and effect its existence, rights
and franchises as a corporation under the laws of the jurisdiction of its
incorporation and will obtain and preserve its qualification to do business in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, any Subsequent
Transfer Agreement, the Basic Documents and each other instrument or agreement
necessary or appropriate to the proper administration of this Agreement and the
transactions contemplated hereby.
(b) During the term of this Agreement, the Seller shall observe the
applicable legal requirements for the recognition of the Seller as a legal
entity separate and apart from its Affiliates, including as follows:
(i) the Seller shall maintain corporate records and books of
account separate from those of its Affiliates;
(ii) except as otherwise provided in this Agreement, the
Seller shall not commingle its assets and funds with those of its
Affiliates;
(iii) the Seller shall hold such appropriate meetings of its
Board of Directors as are necessary to authorize all the Seller's
corporate actions required by law to be authorized by the Board of
Directors, shall keep minutes of such meetings and of meetings of its
stockholder(s) and observe all other customary corporate formalities
(and any successor Seller not a corporation shall observe similar
procedures in accordance with its governing documents and applicable
law);
(iv) the Seller shall at all times hold itself out to the
public under the Seller's own name as a legal entity separate and
distinct from its Affiliates; and
(v) all transactions and dealings between the Seller and its
Affiliates will be conducted on an arm's-length basis.
SECTION 6.3 LIABILITY OF SELLER; INDEMNITIES. The Seller shall be
liable in accordance herewith only to the extent of the obligations specifically
undertaken by the Seller under this Agreement.
(a) The Seller shall indemnify, defend and hold harmless the Issuer,
the Owner Trustee, the Trust, the Security Insurer, the Trustee and the
Indenture Collateral Agent from and against any taxes that may at any time be
asserted against any such Person with respect to the transactions contemplated
in this Agreement and any of the Basic Documents (except any income taxes
arising out of fees paid to the Owner Trustee or the Trustee and except any
taxes to which the Owner Trustee or the Trustee may otherwise be subject to),
including any sales, gross receipts, general corporation, tangible personal
property, privilege or license taxes (but, in the case of the Issuer, not
including any taxes asserted with respect to, federal or other income taxes
arising out of distributions on the Certificates and the Notes) and costs and
expenses in defending against the same.
(b) The Seller shall indemnify, defend and hold harmless the Issuer,
the Owner Trustee, the Trustee, the Indenture Collateral Agent, the Security
Insurer, and the Noteholders from and against any loss, liability or expense
incurred by reason of (i) the Seller's willful misfeasance, bad faith or
negligence in the performance of its duties under this Agreement, or by reason
of reckless disregard of its obligations and duties under this Agreement and
(ii) the Seller's or the Issuer's violation of Federal or state securities laws
in connection with the offering and sale of the Notes.
(c) The Seller shall indemnify, defend and hold harmless the Owner
Trustee and its officers, directors, employees and agents from and against any
and 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 set forth herein and in the Basic Documents except to the extent that
such cost, expense, loss, claim, damage or liability shall be due to the willful
misfeasance, bad faith or negligence (except for errors in judgment) of the
Owner Trustee.
Indemnification under this Section shall survive the resignation or
removal of the Owner Trustee, the Trustee or the Indenture Collateral Agent and
the termination of this Agreement, the Indenture or the Trust Agreement, as
applicable, and shall include reasonable fees and expenses of counsel and other
expenses of litigation. If the Seller shall have made any indemnity payments
pursuant to this Section and the Person to or on behalf of whom such payments
are made thereafter shall collect any of such amounts from others, such Person
shall promptly repay such amounts to the Seller, without interest.
SECTION 6.4 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, SELLER. Any Person (a) into which the Seller may be merged or
consolidated, (b) which may result from any merger or consolidation to which the
Seller shall be a party or (c) which may succeed to the properties and assets of
the Seller substantially as a whole, which Person 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 hereunder without the
execution or filing of any document or any further act by any of the parties to
this Agreement; provided, however, that (i) the Seller shall have received the
written consent of the Security Insurer prior to entering into any such
transaction, (ii) immediately after giving effect to such transaction, no
representation or warranty made pursuant to Section 3.1 shall have been breached
and no Servicer Default, and no event which, after notice or lapse of time, or
both, would become a Servicer Default shall have happened and be continuing,
(iii) the Seller shall have delivered to the Owner Trustee, the Trustee and the
Security Insurer an Officer's Certificate and an Opinion of Counsel each stating
that such consolidation, merger or succession and such agreement of assumption
comply with this Section and that all conditions precedent, if any, provided for
in this Agreement relating to such transaction have been complied with, (iv) the
Rating Agency Condition shall have been satisfied with respect to such
transaction and (v) the Seller shall have delivered to the Owner Trustee, the
Trustee and the Security Insurer an Opinion of Counsel stating that, in the
opinion of such counsel, either (A) all financing statements and continuation
statements and amendments thereto have been executed and filed that are
necessary fully to preserve and protect the interest of the Owner Trustee and
the Trustee, respectively, in the Receivables and reciting the details of such
filings or (B) no such action shall be necessary to preserve and protect such
interest. Notwithstanding anything herein to the contrary, the execution of the
foregoing agreement of assumption and compliance with clauses (i), (ii), (iii),
(iv) and (v) above shall be conditions to the consummation of the transactions
referred to in clauses (a), (b) or (c) above.
SECTION 6.5 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 any Basic Document. The Seller shall not be under any obligation to appear
in, prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement, and that in its opinion may involve it in any
expense or liability.
SECTION 6.6 SELLER MAY OWN CERTIFICATES OR NOTES. The Seller and any
Affiliate thereof may in its individual or any other capacity become the owner
or pledgee of Certificates or Notes with the same rights as it would have if it
were not the Seller or an Affiliate thereof, except as expressly provided herein
or in any Basic Document. Notes or Certificates so owned by the Seller or such
Affiliate shall have an equal and proportionate benefit under the provisions of
the Basic Documents, without preference, priority, or distinction as among all
of the Notes or Certificates, PROVIDED, HOWEVER, that any Notes or Certificates
owned by the Seller or any Affiliate thereof, during the time such Notes or
Certificates are owned by them, shall be without voting rights for any purpose
set forth in the Basic Documents and will not be entitled to the benefits of the
Note Policy. The Seller shall notify the Owner Trustee, the Trustee and the
Security Insurer promptly after it or any of its Affiliates become the owner of
a Certificate or a Note. The Seller hereby notifies the Owner Trustee that
immediately following the issuance of the Certificates that it and the
Representative will own all the Certificates.
ARTICLE VII
THE SERVICER
SECTION 7.1 REPRESENTATIONS OF SERVICER. The Servicer makes the
following representations on which the Security Insurer shall be deemed to have
relied in executing and delivering the Note Policy and on which the Issuer is
deemed to have relied in acquiring the Receivables. The representations speak as
of the execution and delivery of this Agreement and as of the Closing Date, in
the case of the Initial Receivables, and as of the applicable Subsequent
Transfer Date, in the case of the Subsequent Receivables, and shall survive the
sale of the Receivables to the Issuer and the pledge thereof to the Trustee
pursuant to the Indenture.
(a) ORGANIZATION AND GOOD STANDING. The Servicer is duly organized and
validly existing as a corporation in good standing under the laws of the state
of its incorporation, with the corporate power and authority to own its
properties and to conduct its business as such properties are currently owned
and such business is presently conducted, and had at all relevant times, and
has, the power, authority and legal right to acquire, own, sell and service the
Receivables and to hold the Receivable Files as custodian.
(b) DUE QUALIFICATION. The Servicer is duly qualified to do business
and has obtained all necessary licenses and approvals in all jurisdictions in
which the ownership or lease of property or the conduct of its business
(including the servicing of the Receivables as required by this Agreement) shall
require such qualifications, and was duly qualified and had all licenses in all
relevant jurisdictions required for the origination of the Receivables.
(c) POWER AND AUTHORITY OF THE SERVICER. The Servicer has the
corporate power and authority to execute and deliver this Agreement and to
perform its obligations hereunder, and the execution, delivery and performance
of this Agreement have been duly authorized by the Servicer by all necessary
corporate action. All authorizations, consents, orders or approvals of or
registrations or declarations with any court, regulatory body, administrative
agency or other government instrumentality required to be obtained, effected or
given by the Servicer in connection with the execution and delivery by the
Servicer of this Agreement or any of the Basic Documents to which it is a party
and the performance by the Servicer of the transactions contemplated by this
Agreement or any of the Basic Documents to which it is a party, have been duly
obtained, effected or given and are in full force and effect, except where
failure to obtain the same would not have a material adverse effect upon the
rights of the Issuer or the Noteholders.
(d) BINDING OBLIGATION. This Agreement constitutes a legal, valid and
binding obligation of the Servicer, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, moratorium, fraudulent conveyance,
reorganization and similar laws now or hereafter in effect relating to
creditors' rights generally, and subject to general principles of equity
(whether applied in a proceeding at law or in equity).
(e) NO VIOLATION. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof do not result in any
breach of any of the terms and provisions of, or constitute (with or without
notice or lapse of time) a default under the articles of incorporation or
by-laws of the Servicer, or any indenture, agreement or other instrument to
which the Servicer is a party or by which it shall be bound; or result in the
creation or imposition of any Lien upon any of its properties pursuant to the
terms of any such indenture, agreement or other instrument (other than pursuant
to the Basic Documents); or 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.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending
against the Servicer, or, to its best knowledge, threatened against the
Servicer, before any court, regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over the Servicer or its
properties: (i) asserting the invalidity of this Agreement or any of the Basic
Documents or the Notes, (ii) seeking to prevent the issuance of the Notes or the
consummation of any of the transactions contemplated by this Agreement or any of
the Basic Documents, (iii) seeking any determination or ruling that might
materially and adversely affect the performance by the Servicer of its
obligations under, or the validity or enforceability of this Agreement or any of
the Basic Documents or the Notes or (iv) relating to the Servicer and which
might adversely affect the federal income tax or ERISA attributes of the Issuer
or the Notes.
(g) NO INSOLVENT OBLIGORS. As of the Initial Cutoff Date, no Obligor
on an Initial Receivable, and as of each Subsequent Cutoff Date, no Obligor on a
Subsequent Receivable being transferred on the related Subsequent Transfer Date,
shall be shown on the related Receivable Files as the subject of a bankruptcy
proceeding commenced following the execution of the related Contract.
SECTION 7.2 INDEMNITIES OF SERVICER. (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 the representations made by
the Servicer herein.
(b) The Servicer shall defend, indemnify and hold harmless the Owner
Trustee, the Trustee, the Trust, the Indenture Collateral Agent, the Security
Insurer, the Noteholders and the Seller from and against any and all costs,
expenses, losses, damages, claims, and liabilities, arising out of or resulting
from the use, ownership or operation by the Servicer or any Affiliate thereof of
a Financed Vehicle.
(c) The Servicer shall indemnify, defend and hold harmless the Owner
Trustee, the Trustee, the Seller, the Trust, the Indenture Collateral Agent, the
Security Insurer, their respective officers, directors, agents and employees and
the Noteholders 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, or was imposed upon any such Person 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.
(d) The Servicer shall indemnify, defend and hold harmless the Owner
Trustee and its officers, directors, employees and agents 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 herein and in the Trust Agreement contained, except to the extent that
such costs, expense, loss, claim, damage or liability shall be due to the
willful misfeasance, bad faith or negligence (except for errors in judgment) of
the Owner Trustee.
For purposes of this Section, in the event of the termination of the
rights and obligations of TMS Auto Finance (or any successor thereto pursuant to
Section 7.3) as Servicer pursuant to Section 8.1, or a resignation by such
Servicer pursuant to this Agreement, such Servicer shall be deemed to be the
Servicer pending appointment of a successor Servicer (other than the Trustee)
pursuant to Section 8.2.
Indemnification under this Section shall survive the resignation or
removal of the Owner Trustee or the Trustee or the termination of this
Agreement, the Indenture or the Trust Agreement, as applicable, and shall
include reasonable fees and expenses of counsel and expenses of litigation. If
the Servicer shall have made any indemnity payments pursuant to this Section and
the recipient thereafter collects any of such amounts from others, such Person
shall promptly repay such amounts to the Servicer, without interest.
SECTION 7.3 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, SERVICER. Any Person (a) into which the Servicer may be merged
or consolidated, (b) which may result from any merger or consolidation to which
the Servicer shall be a party or (c) which may succeed to the properties and
assets of the Servicer, substantially as a whole or (d) with respect to the
Servicer's obligations hereunder, which is a corporation 50% or more of the
voting stock of which is owned, directly or indirectly, by The Money Store Inc.,
which Person executed an agreement of assumption to perform every obligation of
the Servicer hereunder shall be the successor to the Servicer under the
Agreement without further act on the part of any of the parties to the
Agreement; PROVIDED, HOWEVER, that (i) the Servicer shall have received the
written consent of the Security Insurer prior to entering into any such
transaction; (ii) immediately after giving effect to such transaction, no
Servicer Default and no event which, after notice or lapse of time, or both,
would become a Servicer Default shall have happened and be continuing, (iii) the
Servicer shall have delivered to the Owner Trustee and the Trustee an Officer's
Certificate and an Opinion of Counsel each stating that such consolidation,
merger or succession and such agreement of assumption comply with this Section
and that all conditions precedent provided for in this Agreement relating to
such transaction have been complied with, (iv) the Rating Agency Condition shall
have been satisfied with respect to such transaction and (v) the Servicer shall
have delivered to the Owner Trustee and the Trustee an Opinion of Counsel
stating that, in the opinion of such counsel, either (A) all financing
statements and continuation statements and amendments thereto have been executed
and filed that are necessary fully to preserve and protect the interest of the
Owner Trustee and the Trustee in the Receivables and reciting the details of
such filings or (B) no such action shall be necessary to preserve and protect
such interest. Notwithstanding anything herein to the contrary, the execution of
the foregoing agreement of assumption and compliance with clauses (i), (ii),
(iii), (iv) and (v) above shall be conditions to the consummation of the
transactions referred to in clauses (a), (b), (c) or (d) above.
SECTION 7.4 LIMITATION ON LIABILITY OF SERVICER AND OTHERS. Neither
the Servicer nor any of its directors, officers, employees or agents shall be
under any liability to the Issuer, the Noteholders or the Certificateholders,
except as provided under 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 or any subservicer and any of their respective
directors, officers, employees or agents may rely in good faith on any document
of any kind prima facie properly executed and submitted by any Person respecting
any matters arising under this Agreement.
Except as provided in this Agreement, the 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 (but shall not be required to)
undertake any reasonable action that it may deem necessary or desirable to
protect the interests of the Certificateholders under the Trust Agreement and
the Noteholders under the Indenture.
SECTION 7.5 SERVICER NOT TO RESIGN. Subject to the provisions of
Section 7.3, the Servicer may not resign from the obligations and duties hereby
imposed on it as Servicer under this Agreement except upon determination that by
reason of a change in legal requirements the performance of its duties under
this Agreement would cause it to be in violation of such legal requirements in a
manner which would result in a material adverse effect on the Servicer and the
Security Insurer does not elect to waive the obligations of the Servicer to
perform the duties which render it legally unable to act or does not elect to
delegate those duties to another Person. Notice of any such determination
permitting the resignation of the Servicer shall be communicated to the Owner
Trustee, the Trustee and the Security Insurer at the earliest practicable time
(and, if such communication is not in writing, shall be confirmed in writing at
the earliest practicable time) and any such determination shall be evidenced by
an Opinion of Counsel to such effect delivered to and satisfactory to the Owner
Trustee, the Trustee and the Security Insurer concurrently with or promptly
after such notice. No such resignation of the Servicer shall become effective
until a successor servicer shall have assumed the responsibilities and
obligations of TMS Auto Finance in accordance with Section 8.2 of this
Agreement.
ARTICLE VIII
DEFAULT
SECTION 8.1 SERVICER DEFAULT. If any one of the following events (a
"Servicer Default") shall occur and be continuing:
(a) Any failure by the Servicer to deliver to the Owner Trustee or
Trustee for deposit in any of the Trust Accounts or the Certificate Distribution
Account any payment required to be so delivered under the terms of the Notes,
the Certificates or this Agreement that shall continue unremedied for a period
of five Business Days after written notice of such failure is received by the
Servicer from the Security Insurer, the Owner Trustee or the Trustee or after
discovery of such failure by an Officer of the Servicer; or
(b) Failure by the Servicer duly to observe or to perform in any
material respect any other covenants or agreements of the Servicer or the Seller
(as the case may be) set forth in the Notes, the Certificates, this Agreement or
any other Basic Document, which failure shall (i) materially and adversely
affect the rights of either the Certificateholders or the Noteholders and (ii)
continue unremedied for a period of 60 days after the date on which written
notice of such failure, requiring the same to be remedied, shall have been given
(A) to the Servicer by the Security Insurer, the Owner Trustee or the Trustee or
(B) to the Servicer, the Owner Trustee and the Trustee by the Holders of Notes
evidencing not less than 25% of the outstanding principal amount of the Notes or
the Holder of the Voting Interest, as applicable (or for such longer period, not
in excess of 120 days, as may be reasonably necessary to remedy such default;
provided that such default is capable of remedy within 120 days and the Servicer
delivers an Officers' Certificate to the Security Insurer, the Owner Trustee and
the Trustee to such effect and to the effect that the Servicer has commenced or
will promptly commence, and will diligently pursue, all reasonable efforts to
remedy such default); or
(c) An Insolvency Event occurs with respect to the Servicer or any
successor; or
(d) So long as an Insurer Default shall not have occurred and be
continuing, an Insurance Agreement Event of Default described in Section 5.01 of
the Insurance Agreement shall have occurred;
then, and in each and every case, (i) so long as no Insurer Default shall have
occurred and be continuing, the Trustee may, with the consent of the Security
Insurer and at the direction of the Security Insurer, the Trustee shall, subject
to subsection (b) of this Section 8.1, except in the case of an event arising
under Section 5.01(c) of the Insurance Agreement or (ii) if an Insurer Default
shall have occurred and be continuing, any of the Trustee or the Holders of
Notes evidencing not less than a majority of the principal amount of the Notes
then outstanding, or the Holder of the Voting Interest (as defined in the Trust
Agreement), as applicable, in the case of any default that does not adversely
affect the Trustee or the Noteholders, in any case by notice given in writing to
the Servicer (and to the Trustee if given by the Security Insurer or, as
applicable, the Noteholders or the Certificateholders) may terminate all of the
rights and obligations of the Servicer under this Agreement. For purposes of
Section 8.1(d), any determination of an adverse effect on the interest of the
Certificateholders or the Noteholders pursuant to Section 8.1(b) shall be made
without consideration of the availability of funds under the Policies. On or
after the receipt by the Servicer of such written notice, all authority, power,
obligations and responsibilities of the Servicer under this Agreement, whether
with respect to the Notes, the Certificates or the Receivables or otherwise,
automatically shall pass to, be vested in and become obligations and
responsibilities of the Trustee provided that the Trustee is not unwilling or
unable to act; PROVIDED, HOWEVER, that the Trustee shall have no liability with
respect to any obligation which was required to be performed by the prior
Servicer prior to the date that the Trustee becomes the Servicer or any claim of
a third party based on any alleged action or inaction of the prior Servicer. The
Trustee is authorized and empowered by this Agreement, as successor Servicer to
execute and deliver, on behalf of the prior 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 the other Trust Property and related documents, to show the
Owner Trustee as lienholder or secured party on the related Lien Certificates,
or otherwise. The prior Servicer agrees to cooperate with the successor Servicer
in effecting the termination of the responsibilities and rights of the prior
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 prior Servicer for deposit, or have been deposited by
the prior Servicer, in the Collection Account or thereafter received with
respect to the Receivables and the delivery to the successor Servicer of all
Receivables Files, records and a computer tape in readable form containing all
information necessary to enable the successor Servicer to service the
Receivables and the other Trust Property. The terminated Servicer shall grant
the Trustee, (in its capacity as Trustee and/or successor Servicer), the Owner
Trustee and the Security Insurer reasonable access to the terminated Servicer's
premises at the Servicer's expense.
SECTION 8.2 APPOINTMENT OF SUCCESSOR. (a) Upon the Servicer's receipt
of notice of termination, pursuant to Section 8.1 or the Servicer's resignation
in accordance with the terms of this Agreement, the predecessor Servicer shall
continue to perform its functions as Servicer under this Agreement, in the case
of termination, only until the date specified in such termination notice or, if
no such date is specified in a notice of termination, until receipt of such
notice and, in the case of resignation, until the later of (x) the date 45 days
from the delivery to the Owner Trustee and the Trustee of written notice of such
resignation (or written confirmation of such notice) in accordance with the
terms of this Agreement and (y) the date upon which the predecessor Servicer
shall become unable to act as Servicer, as specified in the notice of
resignation and accompanying Opinion of Counsel. In the event of the Servicer's
termination hereunder, the Trustee shall, provided it is not unwilling or unable
to act, assume the obligations of Servicer hereunder, and shall accept its
appointment by a written assumption in form acceptable to the Security Insurer.
Notwithstanding the above, the Trustee, with the prior written consent of the
Security Insurer, or the Security Insurer shall, if the Trustee shall be
unwilling or 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 shall include the servicing of
automotive receivables as the successor to the Servicer under the Agreement. Any
successor Servicer shall be acceptable to the Security Insurer.
(b) Upon appointment, the successor Servicer (including the Trustee
acting as successor Servicer) shall be the successor in all respects to the
predecessor Servicer and shall be subject to all the responsibilities, duties
and liabilities arising thereafter relating thereto placed on the predecessor
Servicer, subject to the exceptions set forth in Section 8.2(a) hereof, and
shall be entitled to the Servicing Fee and all the rights granted to the
predecessor Servicer by the terms and provisions of this Agreement.
SECTION 8.3 [RESERVED]
SECTION 8.4 NOTIFICATION TO NOTEHOLDERS AND CERTIFICATEHOLDERS. Upon
any termination of, or appointment of a successor to, the Servicer pursuant to
this Article VIII, the Owner Trustee shall give prompt written notice thereof to
Certificateholders, the Security Insurer and the Trustee shall give prompt
written notice thereof to Noteholders and to the Rating Agencies.
SECTION 8.5 WAIVER OF PAST DEFAULTS. So long as no Insurer Default
shall have occurred and be continuing, the Security Insurer (or, if an Insurer
Default shall have occurred and be continuing, the Holders of Notes evidencing
not less than a majority of the outstanding principal amount of the Notes, or
the Holder of the Voting Interest as applicable, in the case of any default
which does not adversely affect the Trustee or the Noteholders) may, on behalf
of all Noteholders and Certificateholders, waive any default by the Servicer in
the performance of its obligations hereunder and its consequences, except a
default in making any required deposits to or payments from any of the Trust
Accounts in accordance with this Agreement. Upon any such waiver of a past
default, such default shall cease to exist, and any Servicer 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 thereto.
ARTICLE IX
TERMINATION
SECTION 9.1 OPTIONAL PURCHASE OF ALL RECEIVABLES. (a) On the last day
of any Monthly Period as of which the Pool Balance shall be less than or equal
to 10% of the Original Pool Balance, the Servicer shall have the option to
purchase the Owner Trust Estate, other than the Trust Accounts and the
Certificate Distribution Account (with the consent of the Security Insurer if
such purchase would result in a claim on the Note Policy or would result in any
amount owing to the Security Insurer under the Insurance Agreement remaining
unpaid); PROVIDED, HOWEVER, that the amount to be paid for such purchase (as set
forth in the following sentence) shall be sufficient to pay the full amount of
principal, premium, if any, and interest then due and payable on the Notes. To
exercise such option, the Servicer shall deposit pursuant to Section 5.5 in the
Collection Account an amount equal to the aggregate Purchase Amount for the
Receivables (including Defaulted Receivables), plus any amounts then due and
owing to the Security Insurer plus the appraised value of any other property
held by the Trust, such value to be determined by an appraiser mutually agreed
upon by the Servicer, the Security Insurer, the Owner Trustee and the Trustee,
and shall succeed to all interests in and to the Trust.
(b) Upon any sale of the assets of the Trust pursuant to Section 9.2
of the Trust Agreement, the Servicer shall instruct the Trustee to deposit the
proceeds from such sale after all payments and reserves therefrom (including the
expenses of such sale) have been made (the "Insolvency Proceeds") in the
Collection Account. On the Distribution Date on which the Insolvency Proceeds
are deposited in the Collection Account (or, if such proceeds are not so
deposited on a Distribution Date, on the Distribution Date immediately following
such deposit), the Servicer shall instruct the Trustee to make, and the Trustee
shall make, the following deposits and distributions (after the application on
such Distribution Date of the Distribution Amount pursuant to Section 5.6(b))
from the Insolvency Proceeds and the Distribution Amount for such Distribution
Date:
(i) to the Note Distribution Account, any portion of the
Noteholders' Interest Distributable Amount not otherwise deposited
into the Note Distribution Account on such Distribution Date; and
(ii) to the Note Distribution Account, the outstanding
principal amount of the Notes (after giving effect to the reduction in
the outstanding principal amount of the Notes to result from the
deposits made in the Note Distribution Account on such Distribution
Date).
Any Insolvency Proceeds remaining after the deposits described above shall be
paid first to the Security Insurer to the extent of any amounts owing to the
Security Insurer under the Insurance
Agreement and not paid, and second, to the extent of any remaining funds, to
the Holder of the GP Interest.
(c) Notice of any termination of the Trust shall be given by the
Servicer to the Owner Trustee, the Trustee, the Security Insurer and the Rating
Agencies as soon as practicable after the Servicer has received notice thereof.
(d) Following the satisfaction and discharge of the Indenture and the
payment in full of the principal of and interest on the Notes, the
Certificateholders will succeed to the rights of the Noteholders hereunder and
the Owner Trustee will succeed to the rights of, and assume the obligations of,
the Trustee pursuant to this Agreement.
ARTICLE X
ADMINISTRATIVE DUTIES OF THE SERVICER
SECTION 10.1 ADMINISTRATIVE DUTIES. (a) DUTIES WITH RESPECT TO THE
INDENTURE AND DEPOSITORY AGREEMENTS. The Servicer shall perform all its duties
and the duties of the Issuer under the Indenture and the Depository Agreements.
In addition, the Servicer shall consult with the Owner Trustee as the Servicer
deems appropriate regarding the duties of the Issuer under the Indenture and the
Depository Agreements. The Servicer shall monitor the performance of the Issuer
and shall advise the Owner Trustee when action is necessary to comply with the
Issuer's duties under the Indenture and the Depository Agreements. The Servicer
shall prepare for execution by the Issuer or shall cause the preparation by
other appropriate Persons of all such documents, reports, filings, instruments,
certificates and opinions as it shall be the duty of the Issuer to prepare, file
or deliver pursuant to the Indenture and the Depository Agreements. In
furtherance of the foregoing, the Servicer shall take all necessary action that
is the duty of the Issuer to take pursuant to the Indenture and the Depository
Agreements, including, without limitation, pursuant to Sections 2.7, 3.5, 3.6,
3.7, 3.9, 7.2, 7.3, 11.1 and 11.15 of the Indenture.
(b) DUTIES WITH RESPECT TO THE ISSUER.
(i) In addition to the duties of the Servicer set forth in
this Agreement or any of the Basic Documents, the Servicer shall
perform such calculations and shall prepare for execution by the
Issuer or the Owner Trustee or shall cause the preparation by other
appropriate Persons of all such documents, reports, filings,
instruments, certificates and opinions as it shall be the duty of the
Issuer or the Owner Trustee to prepare, file or deliver pursuant to
this Agreement or any of the Basic Documents, and at the request of
the Owner Trustee shall take all appropriate action that it is the
duty of the Issuer to take pursuant to this Agreement or any of the
Basic Documents, including, without limitation, pursuant to Sections
2.6 and 2.11 of the Trust Agreement. In accordance with the directions
of the Issuer or the Owner Trustee, the Servicer shall administer,
perform or supervise the performance of such other activities in
connection with the Collateral (including the Basic Documents) as are
not covered by any of the foregoing provisions and as are expressly
requested by the Issuer or the Owner Trustee and are reasonably within
the capability of the Servicer.
(ii) Notwithstanding anything in this Agreement or any of
the Basic Documents to the contrary, the Servicer shall be responsible
for promptly notifying the Owner Trustee in the event that any
withholding tax is imposed on the Issuer's payments (or allocations of
income) to an Owner (as defined in the Trust Agreement) as
contemplated in Section 5.2(f) of the Trust Agreement. Any such notice
shall be in writing and specify the amount of any withholding tax
required to be withheld by the Owner Trustee pursuant to such
provision.
(iii) Notwithstanding anything in this Agreement or the
Basic Documents to the contrary, the Servicer shall be responsible for
performance of the duties of the Issuer or the Owner Trustee and the
General Partner set forth in Section 5.6(a), (b), (c) and (d) of the
Trust Agreement with respect to, among other things, accounting and
reports to Owners (as defined in the Trust Agreement); PROVIDED,
HOWEVER, that once prepared by the Servicer the Owner Trustee shall
retain responsibility for the distribution of the Schedule K-1s
necessary to enable each Certificateholder to prepare its federal and
state income tax returns.
(iv) The Servicer shall perform the duties of the Servicer
specified in Section 10.2 of the Trust Agreement required to be
performed in connection with the resignation or removal of the Owner
Trustee, and any other duties expressly required to be performed by
the Servicer under this Agreement or any of the Basic Documents.
(v) In carrying out the foregoing duties or any of its other
obligations under this Agreement, the Servicer may enter into
transactions with or otherwise deal with any of its Affiliates;
PROVIDED, HOWEVER, that the terms of any such transactions or dealings
shall be in accordance with any directions received from the Issuer
and shall be, in the Servicer's opinion, no less favorable to the
Issuer in any material respect.
(c) TAX MATTERS. The Servicer shall prepare and file, on behalf of the
Holder of the GP Interest, all tax returns, tax elections, financial statements
and such annual or other reports of the Issuer as are necessary for preparation
of tax reports as provided in Article V of the Trust Agreement, including
without limitation Forms 1099 and 1066. All tax returns will be signed by the
Holder of the GP Interest.
(d) NON-MINISTERIAL MATTERS. With respect to matters that in the
reasonable judgment of the Servicer are non-ministerial, the Servicer shall not
take any action pursuant to this Article X unless within a reasonable time
before the taking of such action, the Servicer shall have notified the Owner
Trustee and the Trustee of the proposed action and the Owner Trustee and, with
respect to items (A), (B), (C) and (D) below, the Trustee shall not have
withheld consent or provided an alternative direction. For the purpose of the
preceding sentence, "non-ministerial matters" shall include:
(A) the amendment of or any supplement to the Indenture;
(B) the initiation of any claim or lawsuit by the Issuer and
the compromise of any action, claim or lawsuit brought by or against
the Issuer (other than in connection with the collection of the
Receivables);
(C) the amendment, change or modification of this Agreement
or any of the Basic Documents;
(D) the appointment of successor Note Registrars, successor
Paying Agents and successor Trustees pursuant to the Indenture or the
appointment of Successor Servicers or the consent to the assignment by
the Note Registrar, Paying Agent or Trustee of its obligations under
the Indenture; and
(E) the removal of the Trustee.
(e) EXCEPTIONS. Notwithstanding anything to the contrary in this
Agreement, except as expressly provided herein or in the other Basic Documents,
the Servicer, in its capacity hereunder, shall not be obligated to, and shall
not, (1) make any payments to the Noteholders or Certificateholders under the
Basic Documents, (2) sell the Owner Trust Estate pursuant to Section 5.5 of the
Indenture, (3) take any other action that the Issuer directs the Servicer not to
take on its behalf or (4) in connection with its duties hereunder assume any
indemnification obligation of any other Person.
SECTION 10.2 RECORDS. The Servicer shall maintain appropriate books
of account and records relating to services performed under this Agreement,
which books of account and records shall be accessible for inspection by the
Issuer at any time during normal business hours.
SECTION 10.3 ADDITIONAL INFORMATION TO BE FURNISHED TO THE ISSUER. The
Servicer shall furnish to the Issuer from time to time such additional
information regarding the Collateral as the Issuer shall reasonably request.
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.1 AMENDMENT. This Agreement may be amended from time to
time by the Representative, the Seller, the Servicer and the Owner Trustee, with
the consent of the Trustee (which consent may not be unreasonably withheld),
with the prior written consent of the Security Insurer (so long as no Insurer
Default has occurred and is continuing) but without the consent of any of the
Noteholders or the Certificateholders, to cure any ambiguity, to correct or
supplement any provisions in this Agreement, to comply with any changes in the
Code, or to make any other provisions with respect to matters or questions
arising under this Agreement which shall not be inconsistent with the provisions
of this Agreement or the Insurance Agreement; PROVIDED, HOWEVER, that such
action shall not, as evidenced by an Opinion of Counsel delivered to the Owner
Trustee and the Trustee, adversely affect in any material respect the interests
of any Noteholder or Certificateholder; provided further that if an Insurer
Default has occurred and is continuing, such action shall not materially
adversely affect the interests of the Security Insurer in the Trust.
This Agreement may also be amended from time to time by the
Representative, the Seller, the Servicer and the Owner Trustee, with the consent
of the Security Insurer (so long as no Insurer Default has occurred and is
continuing), the consent of the Trustee, the consent of the Holders of Notes
evidencing not less than a majority of the outstanding principal amount of the
Notes and the consent of the Holder of the Voting Interest (as defined in the
Trust Agreement) for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Noteholders or the Certificateholders; PROVIDED,
HOWEVER, that no such amendment shall (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 for the benefit
of the Noteholders or the Certificateholders or (b) reduce the aforesaid
percentage of the outstanding principal amount of the Notes and the Certificate
Balance, the Holders of which are required to consent to any such amendment,
without the consent of the Holders of all the outstanding Notes and the Holder
of the Voting Interest (as defined in the Trust Agreement), of each class
affected thereby; provided further, that if an Insurer Default has occurred and
is continuing, such action shall not materially adversely affect the interest of
the Security Insurer.
Promptly after the execution of any such amendment or consent pursuant
to either of the preceding paragraphs, the Owner Trustee shall furnish written
notification of the substance of such amendment or consent to each
Certificateholder and the Rating Agencies.
It shall not be necessary for the consent of Certificateholders or
Noteholders pursuant to this Section 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 any
other consents of Noteholders or Certificateholders provided for in this
Agreement) and of evidencing the authorization of any action by Noteholders or
Certificateholders shall be subject to such reasonable requirements as the
Trustee or the Owner Trustee, as applicable, may prescribe.
Prior to the execution of any amendment to this Agreement, the Owner
Trustee, the Trustee and the Security Insurer shall be entitled to receive and
rely upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and the Opinion of Counsel referred to
in Section 11.2(i)(1) has been delivered. The Owner Trustee and the Trustee may,
but shall not be obligated to, enter into any such amendment which affects the
Issuer's, the Owner Trustee's or the Trustee's, as applicable, own rights,
duties or immunities under this Agreement or otherwise.
SECTION 11.2 PROTECTION OF TITLE TO TRUST. (a) The Seller shall
execute and file such financing statements and cause to be executed and filed
such continuation statements, all in such manner and in such places as may be
required by law fully to preserve, maintain and protect the interest of the
Issuer and the interests of the Indenture Collateral Agent on behalf of the
Noteholders, the Certificateholders and the Security Insurer in the Receivables
and in the proceeds thereof. The Seller shall deliver (or cause to be delivered)
to the Security Insurer, the Owner Trustee and the Indenture Collateral Agent
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 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 Security Insurer, the Owner Trustee
and the Trustee at least five days' prior written notice thereof and shall have
promptly filed appropriate amendments to all previously filed financing
statements or continuation statements. Promptly upon such filing, the Seller or
the Servicer, as the case may be, shall deliver an Opinion of Counsel in form
and substance reasonably satisfactory to the Security Insurer, stating either
(A) all financing statements and continuation statements have been executed and
filed that are necessary fully to preserve and protect the interest of the Trust
and the Trustee in the Receivables, and reciting the details of such filings or
referring to prior Opinions of Counsel in which such details are given, or (B)
no such action shall be necessary to preserve and protect such interest.
(c) Each of the Seller and the Servicer shall have an obligation to
give the Security Insurer, the Owner Trustee and the Trustee at least 60 days'
prior written notice of any relocation of its principal executive office if, as
a result of such relocation, the applicable provisions of the UCC would require
the filing of any amendment of any previously filed financing or continuation
statement or of any new financing statement and shall promptly file any such
amendment. The Servicer shall at all times maintain each office from which it
shall service Receivables, and its principal executive office, within the United
States of America.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit (i) the reader thereof
to know at any time the status of such Receivable, including payments and
recoveries made and payments owing (and the nature of each) and (ii)
reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Collection Account
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 Issuer,
the Servicer's master computer records (including any backup archives) that
refer to a Receivable shall indicate clearly the interest of the Issuer and the
Trustee on behalf of the Certificateholders, the Noteholders and the Security
Insurer in such Receivable and that such Receivable is owned by the Issuer and
has been pledged to the Trustee. Indication of the Issuer's and the Trustee's
interest in a Receivable shall be deleted from or modified on the Servicer's
computer systems when, and only when, the related Receivable shall have been
paid in full or repurchased.
(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 automotive
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 printouts (including any restored from backup
archives) that, if they shall refer in any manner whatsoever to any Receivable,
shall indicate clearly that such Receivable has been sold and is owned by the
Issuer and has been pledged to the Trustee on behalf of the Certificateholders,
the Noteholders and the Security Insurer.
(g) The Servicer shall permit the Trustee and the Security Insurer and
their respective agents at any time during normal business hours to inspect,
audit and make copies of and abstracts from the Servicer's records regarding any
Receivable or any other portion of the Trust Property. The preceding sentence
shall not create any duty or obligation on the part of the Trustee to perform
any such acts.
(h) Upon request, the Servicer shall furnish to the Security Insurer,
the Owner Trustee or 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 Security Insurer, the Owner
Trustee and the Trustee:
(1) promptly after the execution and delivery of the
Agreement and, if required pursuant to Section 11.1, of each
amendment, an Opinion of Counsel stating that, in the opinion of such
Counsel, in form and substance reasonably satisfactory to the Security
Insurer, either (A) all financing statements and continuation
statements have been executed and filed that are necessary fully to
preserve and protect the interest of the Trust and the Trustee in the
Receivables, and reciting the details of such filings or referring to
prior Opinions of Counsel in which such details are given, or (B) no
such action shall be necessary to preserve and protect such interest;
and
(2) within 90 days after the beginning of each calendar year
beginning with the first calendar year beginning more than three
months after the Cutoff Date, an Opinion of Counsel, dated as of a
date during such 90-day period, stating that, in the opinion of such
counsel, either (A) all financing statements and continuation
statements have been executed and filed that are necessary fully to
preserve and protect the interest of the Trust and the Trustee in the
Receivables, and reciting the details of such filings or referring to
prior Opinions of Counsel in which such details are given, or (B) no
such action shall be necessary to preserve and protect such interest.
Each Opinion of Counsel referred to in clause (l) or (2) above shall
specify any action necessary (as of the date of such opinion) to be taken in the
following year to preserve and protect such interest.
(j) The Seller shall, to the extent required by applicable law, cause
the Certificates and the Notes 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.
SECTION 11.3 NOTICES. All demands, notices and communications upon or
to the Seller, the Servicer, the Owner Trustee, the Trustee or the Rating
Agencies 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 (a) in the case of the Seller to TMS Auto Holdings,
Inc., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Executive Vice President with a copy to: The Money Store Inc., ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, Attention: Executive Vice President (b)
in the case of the Servicer to The Money Store Auto Finance Inc., ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
President, with a copy to: The Money Store Inc., ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇, Attention: Executive Vice President (c) in the case of the Issuer
or the Owner Trustee, at the Corporate Trust Office of the Owner Trustee, with a
copy to Bankers Trust Company, ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Agency, Structured Finance, 10th floor, (d) in the
case of the Trustee or the Indenture Collateral Agent, at the Corporate Trust
Office, (e) in the case of the Security Insurer, to MBIA Insurance Corporation,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Insured Portfolio
Management-SF; (f) in the case of Moody's, to ▇▇▇▇▇'▇ Investors Service, Inc.,
ABS Monitoring Department, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇; and (g)
in the case of Standard & Poor's, to Standard & Poor's Ratings Group, ▇▇
▇▇▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Asset Backed
Surveillance Department. Any notice required or permitted to be mailed to a
Noteholder or Certificateholder shall be given by first class mail, postage
prepaid, at the address of such Holder as shown in the Certificate Register or
Note Register, as applicable. Any notice so mailed within the time prescribed in
the Agreement shall be conclusively presumed to have been duly given, whether or
not the Certificateholder or Noteholder shall receive such notice.
SECTION 11.4 ASSIGNMENT. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 6.4 and 7.3 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 the Owner Trustee, the Trustee and the Security Insurer
(or if an Insurer Default shall have occurred and be continuing the Holders of
Notes evidencing not less than 66% of the principal amount of the outstanding
Notes.)
SECTION 11.5 LIMITATIONS ON RIGHTS OF OTHERS. The provisions of this
Agreement are solely for the benefit of the Seller, the Servicer, the Issuer,
the Owner Trustee and for the benefit of the Certificateholders (including the
General Partner), the Trustee, the Security Insurer and the Noteholders, as
third-party beneficiaries. Nothing in this Agreement, whether express or
implied, shall be construed to give to any other Person, other than express
third-party beneficiaries, any legal or equitable right, remedy or claim in the
Owner Trust Estate or under or in respect of this Agreement or any covenants,
conditions or provisions contained herein.
SECTION 11.6 SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 11.7 SEPARATE COUNTERPARTS. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 11.8 HEADINGS. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 11.9 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.10 ASSIGNMENT TO TRUSTEE. The Seller hereby acknowledges
and consents to any mortgage, pledge, assignment and grant of a security
interest by the Issuer to the Trustee pursuant to the Indenture for the benefit
of the Issuer Secured Parties (as defined in the Indenture) of all right, title
and interest of the Issuer in, to and under the Receivables and/or the
assignment of any or all of the Issuer's rights and obligations hereunder to the
Trustee.
SECTION 11.11 NONPETITION COVENANTS. (a) Notwithstanding any prior
termination of this Agreement, the parties hereto shall not, prior to the date
which is one year and one day after the termination of this Agreement with
respect to the Issuer, acquiesce, petition or otherwise invoke or cause the
Issuer to invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against the Issuer under any federal
or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Issuer or any substantial part of its property, or ordering the winding
up or liquidation of the affairs of the Issuer.
(b) Notwithstanding any prior termination of this Agreement, the
parties hereto shall not, prior to the date that is one year and one day after
the termination of this Agreement with respect to the Seller, acquiesce to,
petition or otherwise invoke or cause the Seller to invoke the process of any
court or government authority for the purpose of commencing or sustaining a case
against the Seller under any federal or state bankruptcy, insolvency or similar
law, appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator, or other similar official of the Seller or any substantial part of
its property, or ordering the winding up or liquidation of the affairs of the
Seller.
SECTION 11.12 LIMITATION OF LIABILITY OF OWNER TRUSTEE, TRUSTEE AND
INDENTURE COLLATERAL AGENT. (a) Notwithstanding anything contained herein to the
contrary, this Agreement has been countersigned by Bankers Trust (Delaware) not
in its individual capacity but solely in its capacity as Owner Trustee of the
Issuer and in no event shall Bankers Trust (Delaware) in its individual capacity
or, except as expressly provided in the Trust Agreement, as Owner Trustee have
any liability for the representations, warranties, covenants, agreements or
other obligations of the Issuer hereunder or in any of the certificates, notices
or agreements delivered pursuant hereto, as to all of which recourse shall be
had solely to the assets of the Issuer. For all purposes of this Agreement, in
the performance of its duties or obligations hereunder or in the performance of
any duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of
Articles VI, VII and VIII of the Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been accepted by The Chase Manhattan Bank, not in its individual
capacity but solely as Trustee and as Indenture Collateral Agent, and in no
event shall The Chase Manhattan Bank have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer hereunder
or in any of the certificates, notices or agreements delivered pursuant hereto,
as to all of which recourse shall be had solely to the assets of the Issuer.
SECTION 11.13 INDEPENDENCE OF THE SERVICER. For all purposes of this
Agreement, the Servicer shall be an independent contractor and shall not be
subject to the supervision of the Issuer or the Owner Trustee with respect to
the manner in which it accomplishes the performance of its obligations
hereunder. Unless expressly authorized by the Issuer, the Servicer shall have no
authority to act for or represent the Issuer or the Owner Trustee in any way and
shall not otherwise be deemed an agent of the Issuer or the Owner Trustee.
SECTION 11.14 NO JOINT VENTURE. Nothing contained in this Agreement
(i) shall constitute the Servicer and either of the Issuer or the Owner Trustee
as members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity, (ii) shall be construed to
impose any liability as such on any of them or (iii) shall be deemed to confer
on any of them any express, implied or apparent authority to incur any
obligation or liability on behalf of the others.
SECTION 11.15 THIRD-PARTY BENEFICIARIES. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. The Security Insurer and its successors and
assigns shall be a third-party beneficiary to the provisions of this Agreement,
and shall be entitled to rely upon and directly to enforce such provisions of
this Agreement so long as no Insurer Default shall have occurred and be
continuing. Except as expressly stated otherwise herein or in the Basic
Documents, any right of the Security Insurer to direct, appoint, consent to,
approve of, or take any action under this Agreement, shall be a right exercised
by the Security Insurer in its sole and absolute discretion.
SECTION 11.16 DISCLAIMER BY SECURITY INSURER. The Security Insurer may
disclaim any of its rights and powers under this Agreement (but not its duties
and obligations under the Note Policy) upon delivery of a written notice to the
Owner Trustee and the Trustee.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their respective duly authorized officers as
of the day and year first above written.
THE MONEY STORE AUTO TRUST 1997-4
By BANKERS TRUST (DELAWARE),
not in its individual capacity but
solely as Owner Trustee on behalf
of the Trust,
By_____________________________________
Name:
Title:
TMS AUTO HOLDINGS, INC.,
Seller,
By_____________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
THE MONEY STORE AUTO FINANCE INC.,
Servicer,
By_____________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
THE MONEY STORE INC.,
Representative,
By_____________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
Acknowledged and Accepted:
THE CHASE MANHATTAN BANK, not
in its individual capacity
but solely as Trustee,
By___________________________
Name:
Title:
Acknowledged and Accepted:
BANKERS TRUST (DELAWARE),
not in its individual capacity
but solely as Owner Trustee,
By____________________________
Name:
Title:
Acknowledged and Accepted:
THE CHASE MANHATTAN BANK, not
in its individual capacity
but solely as Indenture Collateral
Agent
By____________________________
Name:
Title:
SCHEDULE A
SCHEDULE OF RECEIVABLES
SCHEDULE B
LOCATION OF RECEIVABLES
The Money Store Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
EXHIBIT A
SUBSEQUENT TRANSFER AGREEMENT
TRANSFER No. OF SUBSEQUENT RECEIVABLES dated as of _________, 1998,
among THE MONEY STORE AUTO TRUST 1997-4, a Delaware business trust (the
"Issuer"), TMS AUTO HOLDINGS, INC., a Delaware corporation (the "Seller"), THE
MONEY STORE AUTO FINANCE INC. a Delaware corporation (the "Servicer"), and THE
MONEY STORE INC., a New Jersey corporation (the "Representative") pursuant to
the Sale and Servicing Agreement referred to below.
W I T N E S E T H:
WHEREAS the Issuer, the Seller, the Servicer and the Representative
are parties to the Sale and Servicing Agreement, dated as of November 30, 1997
(as amended or supplemented, the "Sale and Servicing Agreement");
WHEREAS pursuant to the Sale and Servicing Agreement, the Seller
wishes to convey the Subsequent Receivables to the Issuer; and
WHEREAS, the Issuer is willing to accept such conveyance subject to
the terms and conditions hereof.
NOW, THEREFORE, the Issuer, the Seller and the Servicer hereby agree
as follows:
l. DEFINED TERMS. Capitalized terms used herein shall have the
meanings ascribed to them in the Sale and Servicing Agreement unless otherwise
defined herein.
"SUBSEQUENT CUTOFF DATE" shall mean, with respect to the Subsequent
Receivables conveyed hereby, ____________, 1998.
"SUBSEQUENT TRANSFER DATE" shall mean, with respect to the Subsequent
Receivables conveyed hereby, , 1998.
2. SCHEDULE OF RECEIVABLES. Annexed hereto is a supplement to Schedule
A to the Sale and Servicing Agreement listing the Receivables that constitute
the Subsequent Receivables to be conveyed pursuant to this Agreement on the
Subsequent Transfer Date.
3. CONVEYANCE OF SUBSEQUENT RECEIVABLES. In consideration of the
Issuer's delivery to or upon the order of the Seller of $ , the Seller does
hereby sell, transfer, assign, set over and otherwise convey to the Issuer,
without recourse (except as expressly provided in the Sale and Servicing
Agreement), all right, title and interest of the Seller in and to:
(a) the Subsequent Receivables, and all moneys due thereon, on or
after the related Subsequent Cutoff Date;
(b) the security interests in the Financed Vehicles granted by
Obligors pursuant to the Subsequent Receivables and any other interest of
the Seller in such Financed Vehicles;
(c) any proceeds with respect to the Subsequent Receivables from
claims on any physical damage, credit life or disability insurance policies
covering Financed Vehicles or Obligors;
(d) any proceeds with respect to the Subsequent Receivables from
recourse to Dealers in respect to which the Servicer has determined in
accordance with its customary servicing procedures that eventual payment in
full is unlikely;
(e) the related Receivables Files;
(f) its rights and benefits, but none of its obligations or burdens,
under the Subsequent Transfer Agreement, including the delivery
requirements, representations and warranties and the cure and repurchase
obligations of TMS Auto Finance under the Subsequent Purchase Agreement, on
or after the Subsequent Cutoff Date; and
(g) the proceeds of any and all of the foregoing.
4. REPRESENTATIONS AND WARRANTIES OF THE SELLER. The Seller hereby
represents and warrants to the Issuer as of the date of this Agreement and as of
the Subsequent Transfer Date that:
(a) LEGAL, VALID AND BINDING OBLIGATION. This Agreement constitutes a
legal, valid and binding obligation of the Seller, enforceable against the
Seller in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect affecting the enforcement of
creditors' rights in general and except as such enforceability may be
limited by general principles of equity (whether considered in a suit at
law or equity).
(b) ORGANIZATION AND GOOD STANDING. The Seller is duly organized and
validly existing as a corporation in good standing under the laws of the
State of Delaware, with the power and authority to own its properties and
to conduct its business as such properties are currently owned and such
business is presently conducted, and had at all relevant times, and has,
the power, authority and legal right to acquire and own the Receivables.
(c) DUE QUALIFICATION. The Seller is duly qualified to do business as
a foreign corporation in good standing, and has obtained all necessary
licenses and approvals in all jurisdictions in which the ownership or lease
of property or the conduct of its business shall require such
qualifications.
(d) POWER AND AUTHORITY. The Seller has the power and authority to
execute and deliver this Agreement and to carry out its terms; the Seller
has full power and authority to sell and assign the property to be sold and
assigned to and deposited with the Issuer and the Seller and shall have
duly authorized such sale and assignment to the Issuer by all necessary
corporate action; and the execution, delivery and performance of this
Agreement has been duly authorized by the Seller by all necessary corporate
action.
(e) BINDING OBLIGATION. This Agreement constitutes a legal, valid and
binding obligation of the Seller enforceable in accordance with its terms.
(f) NO VIOLATION. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof do not conflict
with, result in any breach of any of the terms and provisions of, nor
constitute (with or without notice or lapse of time) a default under, the
articles of incorporation or by-laws 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 pursuant to the Basic Documents);
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.
(g) NO PROCEEDINGS. To the Seller's best knowledge, there are no
proceedings or investigations pending, or threatened, before any court,
regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties: (i)
asserting the invalidity of this Agreement, the Indenture or any of the
other Basic Documents or the Notes, (ii) seeking to prevent the issuance of
the Notes or the consummation of any of the transactions contemplated by
this Agreement, the Indenture or any of the other Basic Documents, (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, the Indenture, any of the
other Basic Documents or the Notes or (iv) which might adversely affect the
Federal or state income tax attributes of the Notes.
(h) PRINCIPAL BALANCE. The aggregate Principal Balance of the
Receivables listed on the supplement to Schedule A annexed hereto and
conveyed to the Issuer pursuant to this Agreement as of the Subsequent
Cutoff Date is $_____________.
5. CONDITIONS PRECEDENT. The obligation of the Issuer to acquire the
Receivables hereunder is subject to the satisfaction, on or prior to the
Subsequent Transfer Date, of the following conditions precedent:
(a) REPRESENTATIONS AND WARRANTIES. Each of the representations and
warranties made by the Seller in Section 4 of this Agreement and in Section
3.1 of the Sale and Servicing Agreement shall be true and correct as of the
date of this Agreement and as of the Subsequent Transfer Date.
(b) SALE AND SERVICING AGREEMENT CONDITIONS. Each of the conditions
set forth in Section 2.2(b) to the Sale and Servicing Agreement shall have
been satisfied.
(c) ADDITIONAL INFORMATION. The Seller shall have delivered to the
Issuer such information as was reasonably requested by the Issuer to
satisfy itself as to (i) the accuracy of the representations and warranties
set forth in Section 4 of this Agreement and in Section 3.1 of the Sale and
Servicing Agreement and (ii) the satisfaction of the conditions set forth
in this Section 5.
6. RATIFICATION OF AGREEMENT. As supplemented by this Agreement, the
Sale and Servicing Agreement is in all respects ratified and confirmed and the
Sale and Servicing Agreement as so supplemented by this Agreement shall be read,
taken and construed as one and the same instrument.
7. COUNTERPARTS. This Agreement may be executed in two or more
counterparts (and by different parties in separate counterparts), each of which
shall be an original but all of which together shall constitute one and the same
instrument.
8. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
9. THIRD PARTY BENEFICIARY. The Security Insurer is an express third
party beneficiary of this Agreement.
IN WITNESS WHEREOF, the Issuer, the Seller and the Servicer have
caused this Agreement to be duly executed and delivered by their respective duly
authorized officers as of the day and the year first above written.
THE MONEY STORE AUTO TRUST 1997-4
by BANKERS TRUST (DELAWARE)
not in its individual
capacity but solely as Owner
Trustee on behalf of the Trust,
by___________________________
Title:
TMS AUTO HOLDINGS, INC.
Seller,
by_________________________
Title:
THE MONEY STORE AUTO
FINANCE INC.
Servicer,
by_________________________
Title:
THE MONEY STORE INC.,
Representative
by_________________________
Title:
Acknowledged and Accepted:
THE CHASE MANHATTAN BANK,
not in its individual
capacity but solely as
Trustee and Indenture
Collateral Agent
by__________________________________
Title:
Exhibit B
[Intentionally Left Blank]
Exhibit C
FORM OF MONTHLY NOTEHOLDER STATEMENT
THE MONEY STORE AUTO TRUST 1997-4
Class A-1 5.90875% Asset Backed Notes
Class A-2 6.35% Asset Backed Notes
Class A-3 6.46% Asset Backed Notes
Distribution Date:
Monthly Period:
Under the Sale and Servicing Agreement dated as of November 30, 1997
among The Money Store Auto Finance, as Servicer, TMS Auto Holdings, Inc., as
seller, The Money Store Auto Trust 1997-4, as issuer, and The Money Store Inc.,
as representative, the Servicer is required to prepare certain information each
month regarding current distributions to Noteholders and the performance of the
Trust during the previous month. The information that is required to be prepared
with respect to the Distribution Date and Monthly Period listed above is set
forth below. Certain of the information is presented on the basis of an original
principal amount of $1,000 per Note, and certain other information is presented
based upon the aggregate amounts for the Trust as a whole.
A. Information Regarding the Current Monthly Distribution.
1. Notes.
(a) The aggregate amount of the
distribution with respect to:
the Class A-1 Notes..............................$________
the Class A-2 Notes..............................$________
the Class A-3 Notes..............................$________
(b) The amount of the distribution set forth in paragraph A.1.(a)
above in respect of interest on:
the Class A-1 Notes..............................$________
the Class A-2 Notes..............................$________
the Class A-3 Notes..............................$________
(c) The amount of the distribution set forth in paragraph A.1.(a)
above in respect of principal of:
the Class A-1 Notes..............................$________
the Class A-2 Notes..............................$________
the Class A-3 Notes..............................$________
(d) The amount of the distribution in A.1.(a) payable pursuant to a
claim on the Note Policy with respect to:
the Class A-1 Notes..............................$_______
the Class A-2 Notes..............................$_______
the Class A-3 Notes..............................$________
(e) The remaining outstanding balance
available to be drawn under the
Note Policy.........................................$_______
(f) The amount of the distribution set forth in paragraph A.1.(a)
above per $1,000 interest in:
the Class A-1 Notes.............................$________
the Class A-2 Notes.............................$________
the Class A-3 Notes.............................$________
(g) The amount of the distribution set forth in paragraph A.1.(b)
above per $1,000 interest in:
the Class A-1 Notes.............................$________
the Class A-2 Notes.............................$________
the Class A-3 Notes.............................$________
(h) The amount of the distribution set forth in paragraph A.1.(c)
above per $1,000 interest in:
the Class A-1 Notes.............................$________
the Class A-2 Notes.............................$________
the Class A-3 Notes.............................$________
(i) The amount of the distribution set forth in paragraph A.1.(d)
above per $1,000 interest in:
the Class A-1 Notes.............................$________
the Class A-2 Notes.............................$________
the Class A-3 Notes.............................$________
B. Information Regarding the Performance of the Trust.
1. Pool Balance and Note Principal Balance.
(a) The Pool Balance at the close of business on
the last day of the Monthly Period.................$_____
(b) The aggregate outstanding principal amount of each Class of
Notes after giving effect to payments allocated to principal as
set forth in Paragraph A.1(c) above with respect to:
the Class A-1 Notes.............................$________
the Class A-2 Notes.............................$________
the Class A-3 Notes.............................$________
(c) The Note Pool Factor for each Class of Notes after giving affect
to the payments set forth in paragraph A.1(c) with respect to:
the Class A-1 Notes..............................________
the Class A-2 Notes..............................________
the Class A-3 Notes.............................$________
(d) The amount of aggregate Realized Losses for
the second preceding Monthly Period...............$________
(e) The aggregate Purchase Amount for
all Receivables that were repurchased
in the Monthly Period..............................$________
2. Servicing Fee.
The aggregate amount of the Servicing
Fee paid to the Servicer with respect
to the preceding Monthly Period....................$_______
3. Payment Shortfalls.
(a) The amount of the Noteholders' Interest Carryover Shortfall
after giving effect to the payments set forth in paragraph
A.1(b) above with respect to:
the Class A-1 Notes............................$________
the Class A-2 Notes............................$________
the Class A-3 Notes............................$________
(b) The amount of the Noteholders' Interest Carryover Shortfall set
forth in paragraph B.3.(a) above per $1,000 interest with
respect to:
the Class A-1 Notes............................$________
the Class A-2 Notes............................$________
the Class A-3 Notes............................$________
(c) The amount of the Noteholders' Principal Carryover Shortfall
after giving effect to the payments set forth in paragraph
A.1(b) above with respect to:
the Class A-1 Notes............................$________
the Class A-2 Notes............................$________
the Class A-3 Notes............................$________
(d) The amount of the Noteholders' Principal Carryover Shortfall set
forth in paragraph B.3.(a) above per $1,000 interest with
respect to:
the Class A-1 Notes.............................$________
the Class A-2 Notes.............................$________
the Class A-3 Notes.............................$________
4. (a) The aggregate amount of collections by
the Servicer during the preceding
Monthly Period.....................................$______
(b) The aggregate amount which was received by
the Trust from the Servicer during the
preceding Monthly Period...........................$______
(c) The aggregate amount of reimbursements to
the Security Insurer during the preceding
Monthly Period.....................................$______
(d) The number of Receivables that are delinquent
for over:
30 days...........................................______
60 days...........................................______
90 days...........................................______
Exhibit D
Form of Servicer's Certificate
Exhibit E
Form of Note Policy
Exhibit F
Form of Stamp
THIS CONTRACT/NOTE IS SUBJECT TO A SECURITY INTEREST
GRANTED TO THE CHASE MANHATTAN BANK, AS TRUSTEE, FOR
WHICH UCC-1 FINANCING STATEMENTS HAVE BEEN FILED WITH
THE SECRETARY OF STATE OF DELAWARE. AS THE LIEN WILL
BE RELEASED ONLY BY FILINGS IN SUCH OFFICES, PURCHASE
DOCUMENTS MUST REFER TO SUCH FILINGS TO DETERMINE
WHETHER THE LIEN HAS BEEN RELEASED.