Exhibit 10.6
EXECUTION COPY
SERVICING AND
CUSTODIAN AGREEMENT
among
AMERICREDIT FINANCIAL SERVICES, INC.,
as Servicer and Custodian,
AMERICREDIT MTN RECEIVABLES TRUST III,
as Debtor,
and
JPMORGAN CHASE BANK,
as Collateral Agent
dated as of
February 25, 2002
TABLE OF CONTENTS
ARTICLE I DEFINITIONS................................................................... 2
Section 1.1. Definitions.......................................................... 2
Section 1.2. Other Definitional Provisions........................................ 5
ARTICLE II ADMINISTRATION AND SERVICING OF RECEIVABLES.................................. 6
Section 2.1. Duties of the Servicer............................................... 6
Section 2.2. Collection of Receivable Payments; Modifications of
Receivables; Lock-Box Agreements..................................... 7
Section 2.3. Realization upon Receivables......................................... 9
Section 2.4. Insurance............................................................ 10
Section 2.5. Maintenance of Security Interests in Vehicles........................ 12
Section 2.6. Covenants, Representations, and Warranties of Servicer............... 12
Section 2.7. Purchase of Receivables Upon Breach of Covenant or
Representation and Warranty.......................................... 14
Section 2.8. Total Servicing Fee; Payment of Certain Expenses by Servicer......... 15
Section 2.9. Servicer's Certificate............................................... 15
Section 2.10. Annual Statement as to Compliance, Notice of Servicer
Termination Event.................................................... 15
Section 2.11. Annual Servicing Review.............................................. 16
Section 2.12. Access to Certain Documentation and Information Regarding
Receivables.......................................................... 16
Section 2.13. Monthly Tape......................................................... 17
Section 2.14. Fidelity Bond and Errors and Omissions Policy........................ 17
ARTICLE III THE SERVICER................................................................ 18
Section 3.1. Liability of Servicer; Indemnities................................... 18
Section 3.2. Merger or Consolidation of, or Assumption of the Obligations
of the Servicer...................................................... 19
Section 3.3. Limitation on Liability of Servicer and Others....................... 19
Section 3.4. Delegation of Duties................................................. 20
Section 3.5. Servicer Not to Resign............................................... 20
Section 3.6. Administrative Duties of Servicer.................................... 20
ARTICLE IV SERVICER TERMINATION......................................................... 21
Section 4.1. Servicer Termination Event........................................... 21
Section 4.2. Consequences of a Servicer Termination Event......................... 22
Section 4.3. Appointment of Successor............................................. 23
Section 4.4. Notification to Secured Parties...................................... 23
Section 4.5. Waiver of Past Defaults.............................................. 23
ARTICLE V THE CUSTODIAN.............................................................. 24
Section 5.1. Appointment of Custodian; Acknowledgment of Receipt;
Monthly Exception Reports.......................................... 24
Section 5.2. Maintenance of Records at Office................................... 24
Section 5.3. Duties of Custodian................................................ 24
Section 5.4. Instructions; Authority to Act..................................... 26
Section 5.5. Custodian Fee...................................................... 26
Section 5.6. Indemnification by the Custodian................................... 26
Section 5.7. Advice of Counsel.................................................. 26
Section 5.8. Effective Period, Termination, and Amendment; Interpretive
and Additional Provisions.......................................... 26
Section 5.9. Representations, Warranties and Covenants of Custodian............. 27
ARTICLE VI MISCELLANEOUS............................................................. 28
Section 6.1. Governing Law...................................................... 28
Section 6.2. Notices............................................................ 28
Section 6.3. Binding Effect..................................................... 30
Section 6.4. Severability....................................................... 30
Section 6.5. Separate Counterparts.............................................. 30
Section 6.6. Limitation of Liability of Trustee................................. 30
Section 6.7. Waivers; Amendment................................................. 31
Section 6.8. Nonpetition Covenants.............................................. 31
EXHIBITS AND SCHEDULES
Exhibit A - Form of Servicer's Certificate
Exhibit B - Form of Monthly Exception Report
Exhibit C - Scope of Quarterly Audit
Schedule A - Form of Custodian's Acknowledgment
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THIS SERVICING AND CUSTODIAN AGREEMENT, dated as of February 25, 2002,
is between AmeriCredit Financial Services, Inc. ("AmeriCredit"), as Servicer (in
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such capacity, the "Servicer") and as Custodian (in such capacity, the
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"Custodian"), AmeriCredit MTN Receivables Trust III (the "Trust") and JPMorgan
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Chase Bank, as Collateral Agent (in such capacity, the "Collateral Agent").
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W I T N E S S E T H
- - - - - - - - - -
WHEREAS, AmeriCredit MTN Receivables Trust III (the "Trust"),
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AmeriCredit, MBIA Insurance Corporation, as Administrative Agent, and Meridian
Funding Company, LLC ("Meridian") have entered into a Note Purchase Agreement,
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dated as of the date hereof (the "Note Purchase Agreement");
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WHEREAS, the Trust, AmeriCredit, AmeriCredit MTN Corp. III ("AMTN") and
the Collateral Agent have entered into a Security Agreement dated as of the date
hereof (the "Security Agreement");
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WHEREAS, AmeriCredit, AMTN, the Collateral Agent, and the Trust have
entered into a Master Receivables Purchase Agreement, dated as of the date
hereof (the "Receivables Purchase Agreement"), pursuant to which the Sellers (as
defined in the Receivables Purchase Agreement) agree to sell, transfer and
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assign to the Trust all of their right, title and interest in and to the
Receivables described in the Schedules of Receivables attached to the
Supplements (as defined below);
WHEREAS, pursuant to the Receivables Purchase Agreement, the Sellers
and the Trust will enter into Supplements to the Receivables Purchase Agreement
from time to time (each a "Supplement"), whereby the Sellers will sell, transfer
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and assign to the Trust on the applicable Receivables Transfer Date (as defined
in the Receivables Purchase Agreement) all of their right, title and interest in
and to Receivables listed on the Schedules of Receivables attached to such
Supplements;
WHEREAS, pursuant to the Security Agreement, the Trust will pledge to
the Collateral Agent for the benefit of the Secured Parties all of its right,
title and interest in the Collateral, including, but not limited to, the
Receivables and the Other Conveyed Property (as defined in the Receivables
Purchase Agreement);
WHEREAS, the Servicer is willing to service the Receivables; and
WHEREAS, the Collateral Agent wishes to appoint the Custodian to hold
the Receivable Files as the custodian on behalf of the Collateral Agent.
NOW, THEREFORE, in consideration of the mutual agreements herein
contained and of other good and valuable consideration the receipt and adequacy
of which are hereby acknowledged, the parties agree as follows:
ARTICLE 1
DEFINITIONS
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Section 1.1. Definitions. Whenever used in this Agreement, the
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following words and phrases shall have the following meanings:
"Accounting Date" means, with respect to any Settlement Period the last
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day of such Settlement Period.
"Agreement" means this Agreement, as the same may be amended and
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supplemented from time to time.
"AmeriCredit" means AmeriCredit Financial Services, Inc.
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"Amount Financed" means, with respect to a Receivable, the aggregate
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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 and warranty contracts, other items
customarily financed as part of retail automobile installment sale contracts or
promissory notes, and related costs.
"Annual Percentage Rate" of a Receivable means the annual percentage
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rate of finance charges or service charges, as stated in the related Contract.
"Collateral Agent" means JPMorgan Chase Bank, in its capacity as
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Collateral Agent under the Security Agreement.
"Collateral Insurance" shall have the meaning set forth in Section
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2.4(a).
"Collection Records" means all manually prepared or computer generated
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records relating to collection efforts or payment histories with respect to the
Receivables.
"Cram Down Loss" means, with respect to a Receivable, if a court of
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appropriate jurisdiction in a proceeding related to an Insolvency Event shall
have issued an order reducing the amount owed on a Receivable or otherwise
modifying or restructuring the Scheduled Receivables Payments to be made on a
Receivable, an amount equal to (i) the excess of the Outstanding Balance of such
Receivable immediately prior to such order over the Outstanding 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 excess of the
Outstanding Balance of such Receivable immediately prior to such order over the
net present value (using as the discount rate the higher of the Annual
Percentage Rate on such Receivable or the rate of interest, if any, specified by
the court in such order) of the Scheduled Receivables Payments as so modified or
restructured. A "Cram Down Loss" shall be deemed to have occurred on the date of
issuance of such order.
"Custodian" means AmeriCredit acting as agent for the Collateral Agent
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and any successor Custodian selected pursuant to Section 4.3(a) hereof.
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"Custodian's Acknowledgment" means an acknowledgment from the Custodian
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substantially in the form of Schedule A.
"Dealer" means a dealer who sold a Financed Vehicle and who originated
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and assigned the respective Receivable to AmeriCredit under a Dealer Agreement
or pursuant to a Dealer Assignment.
"Dealer Agreement" means any agreement between a Dealer and AmeriCredit
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relating to the acquisition of Receivables from a Dealer by AmeriCredit.
"Dealer Assignment" means, with respect to a Receivable, the executed
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assignment executed by a Dealer conveying such Receivable to AmeriCredit.
"Dealer Underwriting Guide" means the underwriting manual used by
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AmeriCredit in the purchase of Receivables as amended from time to time.
"Force-Placed Insurance" has the meaning ascribed thereto in Section
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2.4 hereof.
"Independent Accountants" means a firm of nationally recognized
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independent certified public accountants.
"Insolvency Event" means, with respect to a specified Person, (a) the
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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 sixty (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 Add-On Amount" means the premium charged to the Obligor in
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the event that the Servicer obtains Force-Placed Insurance pursuant to Section
2.4.
"Insurance Policy" means, with respect to a Receivable, any insurance
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policy (including the insurance policies described in Section 2.4 hereof)
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.
"Lien Certificate" means, with respect to a Financed Vehicle, an
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original certificate of title, certificate of lien or other notification issued
by the Registrar of Titles of the
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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.
"Monthly Records" means all records and data maintained by the Servicer
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with respect to the Receivables, including the following with respect to each
Receivable: the account number; the originating Dealer; Obligor name; Obligor
address; Obligor home phone number; Obligor business phone number; original
Outstanding Balance; original term; Annual Percentage Rate; current Outstanding
Balance; current remaining term; origination date; first payment date; final
scheduled payment date; next payment due date; date of most recent payment;
new/used classification; collateral description; days currently delinquent;
number of contract extensions (months) to date; amount of Scheduled Receivables
Payment; current Insurance Policy expiration date; and past due late charges.
"Net Liquidation Proceeds" means, with respect to a Defaulted
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Receivable, all amounts realized with respect to such Receivable 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
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any Receivable shall in no event be less than zero.
"Note Insurer" means MBIA Insurance Corporation.
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"Opinion of Counsel" means a written opinion of counsel addressed to
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and acceptable to the Note Insurer.
"Purchase Amount" means, with respect to a Receivable, the Outstanding
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Balance and all accrued and unpaid interest on the Receivable, 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
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business on the last day of a Settlement Period by AmeriCredit pursuant to
Section 2.7.
"Rating Agency" means Moody's and Standard & Poor's.
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"Receivable Files" means the following documents:
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(i) the fully executed original of the retail installment contract,
promissory note, security agreement, or similar document evidencing such
Receivable (together with any agreements modifying the Receivable, including
without limitation any extension agreements);
(ii) the original credit application, or a copy thereof, of each
Obligor, fully executed by each such Obligor on AmeriCredit's customary form, or
on a form approved by AmeriCredit, for such application; and
(iii) the original certificate of title (when received) and otherwise
such documents, if any, that AmeriCredit keeps on file in accordance with its
customary procedures
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indicating that the Financed Vehicle is owned by the Obligor and subject to the
interest of AmeriCredit as first lienholder or secured party (including any Lien
Certificate received by AmeriCredit), or, if such original certificate of title
has not yet been received, a copy of the application therefor, showing
AmeriCredit as secured party.
"Registrar of Titles" means, with respect to any state, the
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governmental agency or body responsible for the registration of, and the
issuance of certificates of title relating to, motor vehicles and liens thereon.
"Responsible Officer" means any officer in the corporate trust office
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of the Trustee or any agent of the Trustee under a power of attorney with direct
responsibility for the administration of this Agreement or any of the other
Transaction Documents on behalf of the Trustee.
"Scheduled Receivables Payment" means, with respect to any Settlement
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Period for any Receivable, the amount set forth in such Receivable as required
to be paid by the Obligor in such Settlement Period. If after the Closing Date,
the Obligor's obligation under a Receivable with respect to a Settlement Period
has been modified so as to differ from the amount specified in such Receivable
as a result of (i) the order of a court in an insolvency proceeding involving
the Obligor, (ii) pursuant to the Soldiers' and Sailors' Civil Relief Act of
1940 or (iii) modifications or extensions of the Receivable permitted by Section
2.2(b), the Scheduled Receivables Payment with respect to such Settlement Period
shall refer to the Obligor's payment obligation with respect to such Settlement
Period as so modified.
"Servicer" means AmeriCredit Financial Services, Inc., as the servicer
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of the Receivables, and
"Servicer Termination Event" each successor Servicer pursuant to
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Section 4.3. "Servicer Termination Event" means an event specified in Section
4.1.
"Servicer's Certificate" means an Officers' Certificate of the Servicer
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delivered pursuant to Section 2.9, substantially in the form of Exhibit A.
Section 1.2. Other Definitional Provisions.
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(a) Capitalized terms used herein and not otherwise defined herein have
meanings assigned to them in the Security Agreement or the Note Purchase
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
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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
ADMINISTRATION AND SERVICING OF RECEIVABLES
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Section 2.1. Duties of the Servicer.
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(a) The Servicer is hereby authorized to act as agent for the Trust and
in such capacity shall manage, service, administer and make collections on the
Receivables, and perform the other actions required by the Servicer under this
Agreement. The Servicer agrees that its servicing of the Receivables shall be
carried out in accordance with customary and usual procedures of institutions
which service motor vehicle retail installment sales contracts and, to the
extent more exacting, the degree of skill and attention that the Servicer
exercises from time to time with respect to all comparable motor vehicle
receivables that it services for itself or others. The Servicer's duties shall
include, without limitation, collection and posting of all payments, responding
to inquiries of Obligors on the Receivables, investigating delinquencies,
sending payment coupons to Obligors, reporting any required tax information to
Obligors, monitoring the collateral, complying with the terms of the Lock-Box
Agreement, accounting for collections and furnishing monthly and annual
statements to the Collateral Agent with respect to distributions, monitoring the
status of Insurance Policies with respect to the Financed Vehicles and
performing the other duties specified herein.
(b) The Servicer shall also administer and enforce all rights and
responsibilities of the holder of the Receivables provided for in the Dealer
Agreements and Third Party Loan Purchase Agreements (and shall maintain
possession of the Dealer Agreements and Third Party Loan Purchase Agreements, to
the extent it is necessary to do so), the Dealer Assignments, Third Party Lender
Assignments and the Insurance Policies, to the extent that such Dealer
Agreements,
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Third Party Loan Purchase Agreements, Dealer Assignments, Third Party Lender
Assignments and Insurance Policies relate to the Receivables, the Financed
Vehicles or the Obligors. The Servicer shall follow its customary standards,
policies, and procedures and shall have full power and authority, acting alone,
to do any and all things in connection with such managing, servicing,
administration and collection that it may deem necessary or desirable. Without
limiting the generality of the foregoing, the Servicer is hereby authorized and
empowered by the Trust to execute and deliver, on behalf of the Trust, any and
all instruments of satisfaction or cancellation, or of partial or full release
or discharge, and all other comparable instruments, with respect to the
Receivables and with respect to the Financed Vehicles; provided, however, that
notwithstanding the foregoing, the Servicer shall not, except pursuant to an
order from a court of competent jurisdiction, release an Obligor from payment of
any unpaid amount under any Receivable or waive the right to collect the unpaid
balance of any Receivable from the Obligor.
(c) The Servicer is hereby authorized to commence, in its own name or
in the name of the Trust, a legal proceeding to enforce a Receivable pursuant to
Section 2.3 or to commence or participate in any other legal proceeding
(including, without limitation, a bankruptcy proceeding) relating to or
involving a Receivable, an Obligor or a Financed Vehicle. If the Servicer
commences or participates in such a legal proceeding in its own name, the Trust
shall thereupon be deemed to have automatically assigned such Receivable to the
Servicer solely for purposes of commencing or participating in any such
proceeding as a party or claimant, and the Servicer is authorized and empowered
by the Trust to execute and deliver in the Servicer's name any notices, demands,
claims, complaints, responses, affidavits or other documents or instruments in
connection with any such proceeding. The Collateral Agent shall, in its
reasonable discretion, furnish the Servicer with any limited powers of attorney
and other documents which the Servicer may reasonably request and which the
Servicer deems necessary or appropriate and take any other steps which the
Servicer may deem necessary or appropriate to enable the Servicer to carry out
its servicing and administrative duties under this Agreement.
Section 2.2. Collection of Receivable Payments; Modifications of
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Receivables; Lock-Box Agreements.
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(a) Consistent with the standards, policies and procedures required by
this Agreement and the Credit and Collection Policy, 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
automobile receivables that it services for itself or others and otherwise act
with respect to the Receivables, the Dealer Agreements, the Dealer Assignments,
the Third Party Loan Purchase Agreements, the Third Party Lender Assignments,
the Insurance Policies and the Other Conveyed Property in such manner as will,
in the reasonable judgment of the Servicer, maximize the amount to be received
by the Trust with respect thereto. The Servicer is authorized in its discretion
to waive any prepayment charge, late payment charge or any other similar fees
that may be collected in the ordinary course of servicing any Receivable.
(b) So long as no Servicer Termination Event shall have occurred and be
continuing, and in accordance with the Credit and Collection Policy, the
Servicer may at any time agree to a modification or amendment of a Receivable in
order to (i) change the Obligor's regular due date to a date within the
Settlement Period in which such due date occurs or (ii) re-
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amortize the Scheduled Receivables Payments on the Receivable following a
partial prepayment of principal, in accordance with its customary procedures if
the Servicer believes in good faith that such extension, modification or
amendment is necessary to avoid a default on such Receivable, will maximize
Collections with respect to such Receivable, and is otherwise in the best
interests of the Trust.
(c) So long as no Servicer Termination Event shall have occurred and be
continuing, and in accordance with the Credit and Collection Policy, the
Servicer may grant payment extensions on, or other modifications or amendments
to, a Receivable (in addition to those modifications permitted by Section
2.2(b)) in accordance with its customary procedures if the Servicer believes in
good faith that such extension, modification or amendment is necessary to avoid
a default on such Receivable, will maximize Collections with respect to such
Receivable, and is otherwise in the best interests of the Trust; provided, that
any such amendment, modification or extension shall be delivered by the Servicer
to the Custodian promptly after execution thereof.
The Servicer shall use its best efforts to notify or direct Obligors to
make all payments on the Receivables, whether by check or by direct debit of the
Obligor's bank account, to be made directly to one or more Lock-Box Banks,
acting as agent for the Collateral Agent, on behalf of the Secured Parties
pursuant to a Lock-Box Agreement. The Servicer shall use its best efforts to
notify or direct any Lock-Box Bank to deposit all payments on the Receivables in
the Lock-Box Account no later than the Business Day after receipt, and to cause
all amounts credited to the Lock-Box Account on account of such payments to be
transferred to the Collection Account no later than the second Business Day
after receipt of such payments. The Lock-Box Account shall be a demand deposit
account held by the Lock-Box Bank, or at the request of the Note Insurer, an
Eligible Deposit Account.
Notwithstanding any Lock-Box Agreement, or any of the provisions of
this Agreement relating to the Lock-Box Agreement, the Servicer shall remain
obligated and liable to the Trust, the Collateral Agent and Secured Parties for
servicing and administering the Receivables and the Other Conveyed Property in
accordance with the provisions of this Agreement without diminution of such
obligation or liability by virtue thereof.
In the event of a termination of the Servicer, the successor Servicer
shall assume all of the rights and obligations of the outgoing Servicer under
the Lock-Box Agreement subject to the terms hereof. In such event, the successor
Servicer shall be deemed to have assumed all of the outgoing Servicer's interest
therein and to have replaced the outgoing Servicer as a party to each such
Lock-Box Agreement to the same extent as if such Lock-Box Agreement had been
assigned to the successor Servicer, except that the outgoing Servicer shall not
thereby be relieved of any liability or obligations on the part of the outgoing
Servicer to the Lock-Box Bank under such Lock-Box Agreement. The outgoing
Servicer shall, upon request of the Collateral Agent, but at the expense of the
outgoing Servicer, deliver to the successor Servicer all documents and records
relating to each such Lock-Box Agreement and an accounting of amounts collected
and held by the Lock-Box Bank and otherwise use its best efforts to effect the
orderly and efficient transfer of any Lock-Box Agreement to the successor
Servicer. In the event that the Note Insurer elects to change the identity of
the Lock-Box Bank, the outgoing Servicer, at its expense, shall cause the
Lock-Box Bank to deliver, at the direction of the Note Insurer to the Collateral
Agent
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or a successor Lock-Box Bank, all documents and records relating to the
Receivables and all amounts held (or thereafter received) by the Lock-Box Bank
(together with an accounting of such amounts) and shall otherwise use its best
efforts to effect the orderly and efficient transfer of the Lock-Box
arrangements and the Servicer shall notify the Obligors to make payments to the
Lock-Box established by the successor.
(d) The Servicer shall remit all payments by or on behalf of the
Obligors received directly by the Servicer to the Lock-Box Bank for deposit into
the Lock-Box Account and for transfer to the Collection Account in accordance
with Section 2.2(c) hereof, in either case, without deposit into any intervening
account and as soon as practicable, but in no event later than the Business Day
after receipt thereof.
Section 2.3 Realization upon Receivables.
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(a) Consistent with the standards, policies and procedures required by
this Agreement and the Credit and Collection Policy, the Servicer shall use its
best efforts to repossess (or otherwise comparably convert the ownership of) and
liquidate any Financed Vehicle securing a Receivable with respect to which the
Servicer has determined that payments thereunder are not likely to be resumed,
as soon as is practicable after default on such Receivable but in no event later
than the date on which all or any portion of a Scheduled Receivables Payment has
become ninety-one (91) days delinquent; provided, however, that the Servicer may
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elect not to repossess a Financed Vehicle within such time period if in its good
faith judgment it determines that the proceeds ultimately recoverable with
respect to such Receivable would be increased by forbearance. The Servicer is
authorized to follow such customary practices and procedures as it shall deem
necessary or advisable, consistent with the standard of care required by Section
2.1, which practices and procedures may include reasonable efforts to realize
upon any recourse to Dealers and Third Party Lenders, the sale of the related
Financed Vehicle at public or private sale, the submission of claims under an
Insurance Policy and other actions by the Servicer in order to realize upon such
a Receivable. The foregoing is 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 any repair or towards the repossession of such
Financed Vehicle unless it shall determine in its reasonable discretion that
such repair and/or repossession shall increase the proceeds of liquidation of
the related Receivable by an amount greater than the amount of such expenses.
All amounts received upon liquidation of a Financed Vehicle shall be remitted by
the Servicer to the Collection Account as soon as practicable, but in no event
later than the Business Day after receipt thereof. The Servicer shall be
entitled to recover all reasonable expenses incurred by it in the course of
repossessing and liquidating a Financed Vehicle into cash proceeds, but only out
of the cash proceeds of such Financed Vehicle, any deficiency obtained from the
Obligor with respect to such Financed Vehicle or any amounts received from the
related Dealer and Third Party Lender with respect to such Financed Vehicle,
which amounts in reimbursement may be retained by the Servicer to the extent of
such expenses. The Servicer shall pay on behalf of the Trust any personal
property taxes assessed on repossessed Financed Vehicles.
(b) If the Servicer elects to commence a legal proceeding to enforce a
Dealer Agreement, Third Party Loan Purchase Agreement, Dealer Assignment or
Third Party Lender Assignment, the act of commencement shall be deemed to be an
automatic assignment from the
9
Trust to the Servicer of the rights under such Dealer Agreement, Third Party
Loan Purchase Agreement, Dealer Assignment and Third Party Lender Assignment for
purposes of collection only. If, however, in any enforcement suit or legal
proceeding it is held that the Servicer may not enforce a Dealer Agreement,
Third Party Loan Purchase Agreement, Dealer Assignment or Third Party Lender
Assignment on the grounds that it is not a real party in interest or a Person
entitled to enforce the Dealer Agreement, Third Party Loan Purchase Agreement,
Dealer Assignment or Third Party Lender Assignment, the Sellers, at the Sellers'
expense, shall take such steps as the Servicer deems reasonably necessary to
enforce the Dealer Agreement, Third Party Loan Purchase Agreement, Dealer
Assignment or Third Party Lender Assignment, including bringing suit in its name
or the name of the Sellers or of the Trust. All amounts recovered in any legal
proceeding shall be remitted directly by the Servicer to the Lock-Box Bank as
provided in Section 2.2(d). Notwithstanding anything to the contrary contained
herein, (i) the Note Insurer may, in its reasonable discretion, direct the
Servicer (whether the Servicer is AmeriCredit or any other Person) to commence
or settle any legal action to enforce collection of any Receivable or to
foreclose upon or repossess any Related Security and (ii) the Servicer shall not
make the Collateral Agent or the Secured Parties a party to any litigation
without the prior written consent of such Person; provided, however, that in the
case of subsection (i) of this sentence, the Servicer may decline or refuse to
act on instructions provided by the Note Insurer if, in the reasonable
determination of the Servicer, such action is not consistent with any
Requirements of Law (as defined in the Note Purchase Agreement) or the Credit
and Collection Policy (as defined in the Security Agreement), or could result in
legal or regulatory action against the Servicer.
Section 2.4 Insurance.
---------
(a) The Servicer shall require, in accordance with its customary
servicing policies and procedures, that each Financed Vehicle be insured by the
related Obligor under the Insurance Policies and shall monitor the status of
such physical loss and damage insurance coverage thereafter, in accordance with
its customary servicing procedures. Each Receivable requires the Obligor to
maintain such physical loss and damage insurance, naming AmeriCredit and its
successors and assigns as additional insureds, and permits the holder of such
Receivable to obtain physical loss and damage insurance at the expense of the
Obligor if the Obligor fails to maintain such insurance. If the Servicer shall
determine that an Obligor has failed to obtain or maintain a physical loss and
damage Insurance Policy covering the related Financed Vehicle (including,
without limitation, during the repossession of such Financed Vehicle) the
Servicer may enforce the rights of the holder of the Receivable under the
Receivable to require the Obligor to obtain such physical loss and damage
insurance in accordance with its customary servicing policies and procedures.
The Servicer may maintain a vendor's single interest or other collateral
protection insurance policy with respect to all Financed Vehicles ("Collateral
----------
Insurance") which policy shall by its terms insure against physical loss and
---------
damage in the event any Obligor fails to maintain physical loss and damage
insurance with respect to the related Financed Vehicle. All policies of
Collateral Insurance shall be endorsed with clauses providing for loss payable
to the Servicer. Costs incurred by the Servicer in maintaining such Collateral
Insurance shall be paid by the Servicer. The Servicer will administer the filing
of claims under the Insurance Policies.
10
(b) The Servicer may, if an Obligor fails to obtain or maintain a
physical loss and damage Insurance Policy, obtain insurance with respect to the
related Financed Vehicle and advance on behalf of such Obligor, as required
under the terms of the insurance policy, the premiums for such insurance (such
insurance being referred to herein as "Force-Placed Insurance"). All policies of
Force-Placed Insurance shall be endorsed with clauses providing for loss payable
----------------------
to the Servicer. Any cost incurred by the Servicer in maintaining such
Force-Placed Insurance shall only be recoverable out of premiums paid by the
Obligors or Net Liquidation Proceeds with respect to the Receivable, as provided
in Section 2.4(c).
(c) In connection with any Force-Placed Insurance obtained hereunder,
the Servicer may, in the manner and to the extent permitted by applicable law,
require the Obligors to repay the entire premium to the Servicer. In no event
shall the Servicer include the amount of the premium in the Amount Financed
under the Receivable. For all purposes of this Agreement, the Insurance Add-On
Amount with respect to any Receivable having Force-Placed Insurance will be
treated as a separate obligation of the Obligor and will not be added to the
Outstanding Balance of such Receivable, and amounts allocable thereto will not
be available for distribution on the Note. The Servicer shall retain and
separately administer the right to receive payments from Obligors with respect
to Insurance Add-On Amounts or rebates of Forced-Placed Insurance premiums. If
an Obligor makes a payment with respect to a Receivable having Force-Placed
Insurance, but the Servicer is unable to determine whether the payment is
allocable to the Receivable or to the Insurance Add-On Amount, the payment shall
be applied first to any unpaid Scheduled Receivables Payments and then to the
Insurance Add-On Amount. Net Liquidation Proceeds on any Receivable will be used
first to pay the Outstanding Balance and accrued interest on such Receivable
(until reduced to zero) and then to pay the related Insurance Add-On Amount. If
an Obligor under a Receivable with respect to which the Servicer has placed
Force-Placed Insurance fails to make scheduled payments of such Insurance Add-On
Amount as due, and the Servicer has determined that eventual payment of the
Insurance Add-On Amount is unlikely, the Servicer may, but shall not be required
to, purchase such Receivable from the Trust for the Purchase Amount on any
subsequent Determination Date. Any such Receivable, and any Receivable with
respect to which the Servicer has placed Force-Placed Insurance which has been
paid in full (excluding any Insurance Add-On Amounts) will be assigned to the
Servicer.
(d) The Servicer may ▇▇▇ to enforce or collect upon the Insurance
Policies, in its own name, if possible, or as agent of the Trust. If the
Servicer elects to commence a legal proceeding to enforce an Insurance Policy,
the act of commencement shall be deemed to be an automatic assignment of the
rights of the Trust under such Insurance Policy to the Servicer for purposes of
collection only. If, however, in any enforcement suit or legal proceeding it is
held that the Servicer may not enforce an Insurance Policy on the grounds that
it is not a real party in interest or a holder entitled to enforce the Insurance
Policy, the Sellers, at the Sellers' expense, shall take such steps as the
Servicer deems necessary to enforce such Insurance Policy, including bringing
suit in its name or the name of the Trust.
(e)The Servicer will cause itself and may cause the Collateral Agent on
behalf of the Secured Parties to be named as named insured under all policies of
Collateral Insurance.
11
Section 2.5. Maintenance of Security Interests in Vehicles.
---------------------------------------------
(a) Consistent with the policies and procedures required by this
Agreement, the Servicer shall take such steps on behalf of the Trust as are
necessary to maintain perfection of the security interest created by each
Contract in the related Financed Vehicle with respect to each Receivable,
including, but not limited to, obtaining the execution by the Obligors and the
recording, registering, filing, re-recording, re-filing, and re-registering of
all security agreements, financing statements and continuation statements as are
necessary to maintain the security interest granted by the Obligors under the
respective Contracts. The Servicer shall take all action required under Section
2.1 and 2.6 of the Security Agreement with respect to the notation of Contracts
and the marking of records of the Trust. The Collateral Agent hereby authorizes
the Servicer, and the Servicer agrees, to take any and all steps necessary to
re-perfect such security interest on behalf of the Trust as necessary because of
the relocation of a Financed Vehicle or for any other reason. In the event that
the assignment of a Receivable to the Trust is insufficient, without a notation
on the related Financed Vehicle's certificate of title, or without fulfilling
any additional administrative requirements under the laws of the state in which
the Financed Vehicle is located, to perfect a security interest in the related
Financed Vehicle in favor of the Trust, the Servicer hereby agrees that
AmeriCredit's designation as the secured party on the certificate of title is in
its capacity as Servicer as agent of the Trust.
(b) Upon the occurrence of a Termination and Amortization Event, the
Note Insurer may instruct the Collateral Agent and the Servicer to take or cause
to be taken such action as may, in the discretion of the Note Insurer, be
necessary to perfect or re-perfect 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 to name the Collateral Agent on behalf of
the Secured Parties as lienholder or by such other reasonable means as may, in
the opinion of counsel to the Note Insurer, be necessary or prudent. Any costs
associated with such retitling shall be paid by the Servicer and to the extent
not so paid, the Note Insurer shall have the option to pay such costs and shall
be entitled to reimbursement therefor pursuant to Section 2.3(a)(ix) of the
Security Agreement and the Collateral Agent shall not be responsible for any
such costs.
Section 2.6. Covenants, Representations, and Warranties of Servicer.
------------------------------------------------------
(a) The Servicer covenants as follows:
(i) Liens in Force. The Financed Vehicle securing each Receivable
--------------
shall not be released in whole or in part from the security interest
granted by the related Contract, except upon payment in full of the
Receivable or as otherwise contemplated herein;
(ii) No Impairment. The Servicer shall do nothing to impair the
-------------
rights of the Trust or the Secured Parties in the Receivables, the Dealer
Agreements, the Third Party Loan Purchase Agreements, the Dealer
Assignments, the Third Party Lender Assignments, the Insurance Policies or
the Other Conveyed Property except as otherwise expressly provided herein;
(iii) No Amendments. The Servicer shall not extend or otherwise amend
-------------
the terms of any Receivable, except in accordance with Section 2.2; and
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(iv) Restrictions on Liens. The Servicer shall not (i) create, incur
---------------------
or suffer to exist, or agree to create, incur or suffer to exist, or
consent to cause or permit in the future (upon the happening of a
contingency or otherwise) the creation, incurrence or existence of any Lien
or restriction on transferability of the Receivables except for the Lien in
favor of the Collateral Agent for the benefit of the Secured Parties and
the restrictions on transferability imposed by this Agreement or (ii) sign
or file under the Uniform Commercial Code of any jurisdiction any financing
statement which names AmeriCredit or the Servicer as a debtor, or sign any
security agreement authorizing any secured party thereunder to file such
financing statement, with respect to the Receivables, except in each case
any such instrument solely securing the rights and preserving the Lien of
the Collateral Agent, for the benefit of the Secured Parties.
(b) The Servicer represents and warrants as follows:
(i) Representations and Warranties. Each Receivable is an Eligible
------------------------------
Receivable;
(ii) Organization and Good Standing. The Servicer has been duly
------------------------------
organized and is validly existing and in good standing under the laws of
its jurisdiction of organization, with power, authority and legal right to
own its properties and to conduct its business as such properties are
currently owned and such business is currently conducted, and had at all
relevant times, and now has, all power, authority and legal right required
to enter into and perform its obligations under this Agreement and each of
the other Transaction Documents to which it is a party;
(iii) Due Qualification. The Servicer is duly qualified to do business
-----------------
as a foreign corporation, is 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 (including
the servicing of the Receivables as required by this Agreement) requires or
shall require such qualification;
(iv) Power and Authority. The Servicer has the full power and
-------------------
authority to execute and deliver this Agreement and the other Transaction
Documents to which it is a party and to carry out its terms and their
terms, respectively, and the execution, delivery and performance of this
Agreement and the other Transaction Documents to which it is a party have
been duly authorized by the Servicer by all necessary corporate action;
(v) Binding Obligation. This Agreement and the other Transaction
------------------
Documents to which the Servicer is a party shall constitute legal, valid
and binding obligations of the Servicer enforceable in accordance with
their respective terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, or other similar laws affecting the
enforcement of creditors' rights generally and by equitable limitations on
the availability of specific remedies, regardless of whether such
enforceability is considered in a proceeding in equity or at law;
(vi) No Violation. The consummation of the transactions contemplated
------------
by this Agreement and the other Transaction Documents to which the Servicer
is a party, and the
13
fulfillment of the terms of this Agreement and the Transaction Documents to
which the Servicer is a party, shall not conflict with, 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 bylaws of the Servicer, or any indenture, agreement,
mortgage, deed of trust or other instrument to which the Servicer is a
party or by which it is 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, mortgage, deed of trust or other instrument, other
than this Agreement, or violate any law, 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 any of its
properties and do not require any action by or require the consent of or
the filing of any notice with any Official Body or other Person;
(vii) No Proceedings. There are no proceedings or investigations
--------------
pending or, to the Servicer's knowledge, threatened against the Servicer,
before any court, regulatory body, administrative agency or other tribunal
or governmental instrumentality having jurisdiction over the Servicer or
its properties (A) asserting the invalidity of this Agreement or any of the
Transaction Documents, (B) seeking to prevent the consummation of any of
the transactions contemplated by this Agreement or any of the Transaction
Documents, or (C) 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
Transaction Documents or (D) that could have a Material Adverse Effect on
the Receivables; and
(viii) No Consents. The Servicer is not required to obtain the consent
-----------
of any other party or any consent, license, approval or authorization, or
registration or declaration with, any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity or
enforceability of this Agreement which has not already been obtained.
Section 2.7. Purchase of Receivables Upon Breach of Covenant or
--------------------------------------------------
Representation and Warranty. Upon discovery by either of the Servicer or a
---------------------------
Responsible Officer of the Note Insurer of a breach of any of the covenants set
forth in Sections 2.5(a), 2.6(a), 5.1, 5.2, 5.3 or 5.9, the party discovering
such breach shall give prompt written notice to all of the parties hereto;
provided, however, that the failure to give any such notice shall not affect any
-------- -------
obligation of AmeriCredit as Servicer under this Section. As of the second
Accounting Date following its discovery or receipt of notice of any breach of
any covenant set forth in Sections 2.5(a), 2.6(a), 5.1, 5.2, 5.3 or 5.9 which
materially and adversely affects the interests of the Secured Parties in any
Receivable (including any Defaulted Receivable) (or, at AmeriCredit's election,
the first Accounting Date so following) or the related Financed Vehicle,
AmeriCredit shall, unless such breach shall have been cured in all material
respects by the last day of the second Settlement Period after such breach,
purchase from the Trust the Receivable affected by such breach and, on the
related Determination Date, AmeriCredit shall pay the related Purchase Amount to
the Trust. It is understood and agreed that the obligation of AmeriCredit to
purchase any Receivable (including any Defaulted Receivable) with respect to
which such a breach has occurred and is continuing shall, if such obligation is
fulfilled, constitute the sole remedy against AmeriCredit for such breach
available to the Secured Parties or the Collateral Agent except as
14
otherwise provided in the Insurance Agreement; provided, however, that
-------- -------
AmeriCredit shall indemnify the Trust, the Collateral Agent and the Secured
Parties from and against all costs, expenses, losses, damages, claims and
liabilities, including reasonable fees and expenses of counsel, which may be
asserted against or incurred by any of them as a result of third party claims
arising out of the events or facts giving rise to such breach.
Section 2.8. Total Servicing Fee; Payment of Certain Expenses by
---------------------------------------------------
Servicer. On each Remittance Date, the Servicer shall to the extent provided in
--------
Section 2.3(a) of the Security Agreement be entitled to receive out of the
Collection Account the Servicing Fee for the related Settlement Period. The
Servicer shall be required to pay all expenses incurred by it in connection with
its activities under this Agreement (including taxes imposed on the Servicer,
expenses incurred in connection with distributions and reports made by the
Servicer to Secured Parties and all other fees and expenses of the Collateral
Agent (to the extent such fees and expenses are not paid pursuant to Section
2.3(a) of the Security Agreement), except taxes levied or assessed against the
Trust, and claims against the Trust in respect of indemnification, which taxes
and claims in respect of indemnification against the Trust are expressly stated
to be for the account of AmeriCredit). The Servicer shall be liable for the fees
and expenses of the Custodian, the Collateral Agent, the Lock-Box Bank (and any
fees under the Lock-Box Agreement) and the Independent Accountants.
Section 2.9. Servicer's Certificate. No later than 5 p.m. Eastern
----------------------
time on each Determination Date, the Servicer shall deliver (facsimile delivery
being acceptable) to the Trust, the Note Insurer and the Collateral Agent a
Servicer's Certificate executed by a Responsible Officer of the Servicer in the
form attached hereto as Exhibit A. Receivables purchased by the Servicer or by
the Sellers on the related Accounting Date and each Receivable which became a
Defaulted Receivable or which was paid in full during the related Settlement
Period shall be identified by account number (as set forth in the Schedule of
Receivables). In addition to the information set forth in the preceding
sentence, the Servicer's Certificate shall also state whether to the knowledge
of the Servicer a Termination and Amortization Event or Potential Termination
and Amortization Event has occurred.
Section 2.10. Annual Statement as to Compliance, Notice of Servicer
------------------------------------------------------
Termination Event.
-----------------
(a) The Servicer shall deliver to the Note Insurer, the Trust, and
the Collateral Agent, on or before October 31 (or one hundred twenty (120) days
after the end of the Servicer's fiscal year, if other than June 30) of each
year, beginning on October 31, 2002, an officer's certificate signed by any
Responsible Officer of the Servicer, dated as of June 30 (or other applicable
date) of such year, stating that (i) a review of the activities of the Servicer
during the preceding 12-month period (or such other period as shall have elapsed
from the Closing Date to the date of the first such certificate) and of its
performance under this Agreement has been made under such officer's supervision,
and (ii) to such officer's knowledge, based on such review, the Servicer has
fulfilled all its obligations under this Agreement throughout such period, or,
if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officer and the nature and status
thereof.
15
(b) The Servicer shall deliver to the Trust, the Note Insurer and
the Collateral Agent, promptly after having obtained knowledge thereof, but in
no event later than two (2) 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 Termination Event under Section 4.1(a).
The Servicer shall, and shall cause the Sellers to, deliver to the Note Insurer,
the Collateral Agent and the Servicer promptly after having obtained knowledge
thereof, but in no event later than two (2) 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 Termination Event under any
other clause of Section 4.1.
Section 2.11. Annual Servicing Review. The Servicer shall cause a firm
-----------------------
of nationally recognized independent certified public accountants (the
"Independent Accountants"), who may also render other services to the Servicer,
-----------------------
to deliver to the Trustee, the Collateral Agent, the Note Insurer and each
Rating Agency, on or before October 31 (or 120 days after the end of the
Servicer's fiscal year, if other than June 30) of each year, beginning on
October 31, 2002, with respect to the twelve (12) months ended the immediately
preceding June 30 (or other applicable date) (or such other period as shall have
elapsed from the Closing Date to the date of such certificate (which period
shall not be less than six months)), a statement (the "Accountants' Report")
-------------------
addressed to the Board of Directors of the Servicer, to the Trustee, the
Collateral Agent, and to the Note Insurer, to the effect that such firm has
audited the books and records of AmeriCredit Corp., in which the Servicer is
included as a consolidated subsidiary, and issued its report thereon in
connection with the audit report on the consolidated financial statements of
AmeriCredit Corp. and that (1) such audit was made in accordance with generally
accepted auditing standards, and accordingly included such tests of the
accounting records and such other auditing procedures as such firm considered
necessary in the circumstances; (2) the firm is independent of the Servicer
within the meaning of the Code of Professional Ethics of the American Institute
of Certified Public Accountants, and (3) includes a report on the application of
agreed upon procedures to three (3) randomly selected Servicer's Certificates
including the delinquency, default and loss statistics required to be specified
therein noting whether any exceptions or errors in the Servicer's Certificates
were found. Without otherwise limiting the scope of the examination, the Note
Insurer may, using generally accepted audit procedures, verify the status of
each Receivable and review the Receivable Files and records relating thereto for
conformity to the Servicer's Certificates prepared pursuant to Section 2.09
hereof, conformity with the Dealer Underwriting Guide and with the Credit and
Collection Policy and compliance with the servicing standards and the Credit and
Collection Policy pursuant to this Agreement. In furtherance and not in
limitation of the foregoing, a quarterly operational audit shall be performed
with respect to the Receivable Files by an independent auditor approved in
writing by the Note Insurer commencing with the June 2002 quarter end and such
report shall be delivered 30 days after each quarter end. The scope of such
quarterly audit shall be as set forth in Exhibit C hereto.
Section 2.12. Access to Certain Documentation and Information
-----------------------------------------------
Regarding Receivables. The Servicer shall provide to representatives of the
---------------------
Collateral Agent and the Note Insurer reasonable access to the documentation
regarding the Receivables. In each case, such access shall be afforded without
charge and, provided no Servicer Termination Event or Potential Termination and
Amortization Event shall have occurred, only upon reasonable request and during
normal business hours. Nothing in this Section shall affect the obligation of
the Servicer
16
to observe any applicable law prohibiting disclosure of information regarding
the Obligors, and the failure of the Servicer to provide access as provided in
this Section as a result of such obligation shall not constitute a breach of
this Section.
Section 2.13. Monthly Tape. On or before the Remittance Date, the
------------
Servicer will deliver to the Collateral Agent and the Note Insurer a computer
tape or a diskette (or any other electronic transmission acceptable to the
Collateral Agent) in a format acceptable to the Collateral Agent containing the
information with respect to the Receivables as of the preceding Accounting Date
necessary for preparation of the Servicer's Certificate relating to the
immediately preceding Determination Date and necessary to review the application
of collections. The Collateral Agent shall use such tape or diskette (or other
electronic transmission acceptable to the Collateral Agent) to (i) confirm that
the Servicer's Certificate is complete, (ii) confirm that such tape, diskette or
other electronic transmission is in readable form, (iii) verify the mathematical
accuracy of all calculations contained within the Servicer's Certificate and
(iv) calculate and confirm any amounts distributed. The Collateral Agent shall
certify to the Note Insurer that it has verified the Servicer's Certificate in
accordance with this Section and shall notify the Servicer and the Note Insurer
of any discrepancies, in each case, on or before the second Business Day
following the Remittance Date. In the event that the Collateral Agent reports
any discrepancies, the Servicer and the Collateral Agent shall attempt to
reconcile such discrepancies prior to the next succeeding Remittance Date, but
in the absence of a reconciliation, the Servicer's Certificate shall control for
the purpose of calculations and distributions with respect to the next
succeeding Remittance Date. In the event that the Collateral Agent and the
Servicer are unable to reconcile discrepancies with respect to a Servicer's
Certificate by the next succeeding Remittance Date, the Servicer shall cause the
Independent Accountants, at the Servicer's expense, to audit the Servicer's
Certificate and, prior to the last day of the month after the month in which
such Servicer's Certificate was delivered, reconcile the discrepancies. The
effect, if any, of such reconciliation shall be reflected in the Servicer's
Certificate for the next succeeding Remittance Date, and/or the Servicer's
Certificate for such next succeeding Determination Date. In addition, upon the
occurrence of a Servicer Termination Event the Servicer shall, if so requested
by the Note Insurer, deliver to the Collateral Agent its Collection Records and
its Monthly Records within fifteen (15) days after demand therefor and a
computer tape containing as of the close of business on the date of demand all
of the data maintained by the Servicer in computer format in connection with
servicing the Receivables. Other than the duties specifically set forth in this
Agreement, the Collateral Agent shall have no obligations hereunder, including,
without limitation, to supervise, verify, monitor or administer the performance
of the Servicer. The Collateral Agent shall have no liability for any actions
taken or omitted by the Servicer.
Section 2.14. Fidelity Bond and Errors and Omissions Policy. The
---------------------------------------------
Servicer has obtained, and shall continue to maintain in full force and effect,
a fidelity bond and errors and omissions policy of a type and in such amount as
is customary for servicers engaged in the business of servicing automobile
receivables.
17
ARTICLE III
THE SERVICER
------------
Section 3.1. Liability of Servicer; Indemnities.
---------------------------------------
(a) The Servicer (in its capacity as such) shall be liable hereunder
only to the extent of the obligations in this Agreement and the Security
Agreement specifically undertaken by the Servicer and the representations made
by the Servicer herein and therein.
(b) The Servicer shall defend, indemnify and hold harmless the
Trust, the Trustee, the Collateral Agent, the Note Insurer, the Secured Parties
and their respective officers, directors, agents and employees, from and against
any and all costs, expenses, losses, damages, claims and liabilities, including
reasonable fees and expenses of counsel and expenses of litigation arising out
of or resulting from the use, ownership or operation by the Servicer or any
Affiliate thereof of any Financed Vehicle;
(c) AmeriCredit shall indemnify, defend and hold harmless the Trust,
the Trustee, the Collateral Agent, the Note Insurer, the Secured Parties and
their respective officers, directors, agents and employees from and against any
taxes that may at any time be asserted against any of such parties with respect
to the transactions contemplated in this Agreement, including, without
limitation, any sales, gross receipts, tangible or intangible personal property,
privilege or license taxes (but not including any federal or other income taxes,
including franchise taxes asserted with respect to, and as of the date of, the
sale of the Receivables and the Other Conveyed Property to the Trust) and costs
and expenses in defending against the same;
(d) The Servicer shall indemnify, defend and hold harmless the
Trust, the Trustee, and the Collateral Agent, the Secured Parties and their
respective officers, directors, agents and employees 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 the Trust, the Trustee, the Collateral Agent or the Secured Parties
by reason of the breach of this Agreement by the Servicer, the negligence,
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;
(e) AmeriCredit shall indemnify the Collateral Agent, the Trustee
and their officers, directors, agents and employees thereof against any and all
loss, liability or expense, (other than overhead and expenses incurred in the
normal course of business) incurred by each of them in connection with the
acceptance or administration of the Trust and the performance of their duties
under the Transaction Documents other than if such loss, liability or expense is
conclusively determined by a judicial proceeding to have been incurred by the
Collateral Agent as a result of any such entity's willful misconduct, bad faith
or negligence,; and
(f) Indemnification under this Article shall survive the termination
of the Transaction Documents or the resignation and removal of the Trustee and
the Collateral Agent and shall include, without limitation, reasonable fees and
expenses of counsel and expenses of litigation. If the Servicer has made any
indemnity payments pursuant to this Article and the
18
recipient thereafter collects any of such amounts from others, the recipient
shall promptly repay such amounts collected to the Servicer, without interest.
Section 3.2. Merger or Consolidation of, or Assumption of the
------------------------------------------------
Obligations of the Servicer. AmeriCredit shall not merge or consolidate with any
---------------------------
other person, convey, transfer or lease substantially all its assets as an
entirety to another Person, or permit any other Person to become the successor
to AmeriCredit's business unless, after the merger, consolidation, conveyance,
transfer, lease or succession, the successor or surviving entity shall be
capable of fulfilling the duties of AmeriCredit contained in this Agreement and
shall be acceptable to the Note Insurer in the Note Insurer's sole discretion.
Any corporation (i) into which AmeriCredit may be merged or consolidated, (ii)
resulting from any merger or consolidation to which AmeriCredit shall be a
party, (iii) which acquires by conveyance, transfer, or lease substantially all
of the assets of AmeriCredit, or (iv) succeeding to the business of AmeriCredit,
in any of the foregoing cases shall execute an agreement of assumption to
perform every obligation of AmeriCredit under this Agreement and, whether or not
such assumption agreement is executed, shall be the successor to AmeriCredit
under this Agreement without the execution or filing of any paper or any further
act on the part of any of the parties to this Agreement, anything in this
Agreement to the contrary notwithstanding; provided, however, that nothing
contained herein shall be deemed to release AmeriCredit from any obligation.
AmeriCredit shall provide notice of any merger, consolidation or succession
pursuant to this Section to the Collateral Agent and the Secured Parties.
Notwithstanding the foregoing, AmeriCredit shall not merge or consolidate with
any other Person or permit any other Person to become a successor to
AmeriCredit's business, unless (x) immediately after giving effect to such
transaction, no representation or warranty made pursuant to Section 2.6 shall
have been breached (for purposes hereof, such representations and warranties
shall speak as of the date of the consummation of such transaction) and no
Termination and Amortization Event or Potential Termination and Amortization
Event shall have occurred and be continuing, (y) AmeriCredit shall have
delivered to the Collateral Agent and the Note 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, and (z) AmeriCredit shall have
delivered to the Collateral Agent and the Note Insurer an Opinion of Counsel,
stating 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 to preserve and protect the interest of the Trust in the
Receivables and the Other Conveyed Property and reciting the details of the
filings or (B) no such action shall be necessary to preserve and protect such
interest.
Section 3.3. Limitation on Liability of Servicer and Others. None of
----------------------------------------------
AmeriCredit nor any of the directors or officers or employees or agents of
AmeriCredit shall be under any liability to the Trust or the Secured Parties,
except as provided in this Agreement, for any action taken or for refraining
from the taking of any action pursuant to this Agreement; provided, however,
that this provision shall not protect AmeriCredit or any such person against any
liability that would otherwise be imposed by reason of a breach of this
Agreement or willful misfeasance, bad faith or negligence in the performance of
duties; provided further that this provision shall not affect any liability to
indemnify the Collateral Agent for costs, taxes, expenses, claims, liabilities,
losses or damages paid by the Collateral Agent, in its individual capacity.
AmeriCredit and any director, officer, employee or agent of AmeriCredit may rely
in
19
good faith on the written advice of counsel selected by it with due care or on
any document of any kind prima facie properly executed and submitted by any
Person respecting any matters arising under this Agreement.
Section 3.4. Delegation of Duties. The Servicer may delegate duties
--------------------
under this Agreement to an Affiliate of AmeriCredit with the prior written
consent of the Note Insurer. The Servicer also may at any time perform through
sub-contractors the specific duties of (i) repossession of Financed Vehicles,
(ii) tracking Financed Vehicles' insurance and (iii) pursuing the collection of
deficiency balances on certain Defaulted Receivables, in each case, without the
consent of the Note Insurer and may perform other specific duties through such
sub-contractors in accordance with Servicer's customary servicing policies and
procedures, with the prior consent of the Note Insurer; provided, however, that
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no such delegation or sub-contracting duties by the Servicer shall relieve the
Servicer of its responsibility with respect to such duties. Neither AmeriCredit
or any party acting as Servicer hereunder shall appoint any subservicer
hereunder without the prior written consent of the Note Insurer.
Section 1.1. Servicer Not to Resign. Subject to the provisions of
----------------------
Section 3.2, the Servicer shall not resign from the obligations and duties
imposed on it by this Agreement as Servicer except upon a 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 have a material adverse effect on the Servicer and the Note
Insurer does not elect to waive the obligations of the Servicer to perform the
duties which render it legally unable to act or to delegate those duties to
another Person. Any such determination permitting the resignation of the
Servicer shall be evidenced by an Opinion of Counsel to such effect delivered
and acceptable to the Note Insurer. No resignation of the Servicer shall become
effective until a successor Servicer that is an eligible servicer as approved by
the Note Insurer, shall have assumed the responsibilities and obligations of the
Servicer.
Section 1.2. Administrative Duties of Servicer.
---------------------------------
(a) Duties with Respect to the Transaction Documents. The Servicer
shall perform the duties of the Debtor under the Transaction Documents. In
furtherance of the foregoing, the Servicer shall consult with the Trustee as the
Servicer deems appropriate regarding the duties of the Debtor under the
Transaction Documents. The Servicer shall monitor the performance of the Debtor
and shall advise the Trustee when action is necessary to comply with the
Debtor's duties under the Transaction Documents. The Servicer shall prepare for
execution by the 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 Debtor or the Trustee to prepare, file
or deliver pursuant to the Transaction Documents.
(b) Duties with Respect to the Debtor.
---------------------------------
(i) In addition to the duties of the Servicer set forth in this
Agreement or any of the Transaction Documents, the Servicer shall perform such
calculations and shall prepare, or shall cause the preparation, for execution by
the Trustee or other appropriate Persons of all such documents, reports,
filings, instruments, certificates and opinions as it shall be the duty of the
Debtor to prepare, file or deliver pursuant to state and federal tax and
securities laws. The
20
Servicer shall administer, perform or supervise the performance of such other
activities in connection with the Debtor as are not covered by any of the
foregoing provisions and as are expressly requested by the Trustee and are
reasonably within the capability of the Servicer.
(ii) Notwithstanding anything in this Agreement or any of the
Transaction Documents to the contrary, the Servicer shall be responsible for
promptly notifying the Trustee in the event that any withholding tax is imposed
on the Debtor's payments (or allocations of income) to a Certificateholder. Any
such notice shall be in writing and specify the amount of any withholding tax
required to be withheld by the Trustee pursuant to such provision.
(c) Records. The Servicer shall maintain appropriate books of account
-------
and records relating to services performed under this Agreement and as required
by the Transaction Documents, which books of account and records shall be
accessible for inspection by the Trustee and the Note Insurer at any time during
normal business hours.
(d) Additional Information to be Furnished to the Trustee and the
-------------------------------------------------------------
Note Insurer. The Servicer shall furnish to the Trustee from time to time such
------------
additional information regarding the Debtor or the Transaction Documents as the
Trustee and the Note Insurer shall reasonably request.
ARTICLE IV
SERVICER TERMINATION
--------------------
Section 4.1. Servicer Termination Event. For purposes of this
--------------------------
Agreement, each of the following shall constitute a "Servicer Termination
Event":
(a) Any failure by the Servicer to deliver to the Collateral Agent
for distribution to Secured Parties payment required to be so delivered under
the terms of the Transaction Documents;
(b) Failure on the part of the Servicer duly to observe or perform in
any material respect any covenant or agreement set forth in this Agreement or
any other Transaction Document to which it is a party, which failure continues
unremedied for a period of ten (10) days;
(c) Any representation, warranty, certification or statement made by
the Servicer (including AmeriCredit, if it is the Servicer) or the Trust, any
Seller or any Affiliate of the Trust or any Seller (in the event that the Trust,
any Seller or such Affiliate is then acting as the Servicer) in this Agreement,
the Receivables Purchase Agreement or in any of the other Transaction Documents
or in any certificate or report delivered by it pursuant to any of the foregoing
shall prove to have been incorrect in any material respect when made or deemed
made;
(d) The Servicer shall materially modify the Credit and Collection
Policy, unless it has given the Note Insurer prompt notification of such
modification and the Note Insurer has determined in its reasonable discretion
that such modification is not a material adverse change;
21
(e) The occurrence of a Termination and Amortization Event listed in
Section 6.1 of the Security Agreement;
(f) Any Event of Bankruptcy shall occur with respect to the Servicer
or any of its Subsidiaries or Affiliates;
(g) There shall have occurred a Material Adverse Effect with respect
to the Servicer since the end of the last fiscal year ending prior to the date
of its appointment as Servicer hereunder or any other event shall have occurred
which, in the commercially reasonable judgment of the Note Insurer, materially
and adversely affects the Servicer's ability to either collect the Receivables
or to perform under this Agreement; and
(h) Failure of the Servicer or any Subsidiary of the Servicer to
pay when due any amounts due under any agreement to which any such Person is a
party and under which any Indebtedness greater than $5,000,000, in the case of
AmeriCredit or any Subsidiary of AmeriCredit (other than the Debtor), is
governed; or the default by the Servicer or any Subsidiary of the Servicer in
the performance of any term, provision or condition contained in any agreement
to which any such Person is a party and under which any Indebtedness owing by
the Servicer or any Subsidiary of the Servicer greater than such respective
amounts was created or is governed, regardless of whether such event is an
"event of default" or "default" under any such agreement; or any Indebtedness
owing by the Servicer or any Subsidiary of the Servicer greater than such
respective amounts shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled payment) prior to the date of
maturity thereof.
Section 4.2. Consequences of a Servicer Termination Event. If a
--------------------------------------------
Servicer Termination Event shall occur and be continuing, the Collateral Agent,
with the consent of the Note Insurer, by notice given in writing to the Servicer
may, or at the direction of the Note Insurer shall, terminate all of the rights
and obligations of the Servicer under this Agreement. On or after the receipt by
the Servicer of such written notice or upon termination of the term of the
Servicer, all authority, power, obligations and responsibilities of the Servicer
under this Agreement, whether with respect to the Receivables or the Other
Conveyed Property (as defined in the Master Receivables Purchase Agreement) or
otherwise, automatically shall pass to, be vested in and become obligations and
responsibilities of a successor Servicer acceptable to the Note Insurer);
provided, however, that the successor Servicer shall have no liability with
-------- -------
respect to any obligation which was required to be performed by the terminated
Servicer prior to the date that the successor Servicer becomes the Servicer or
any claim of a third party based on any alleged action or inaction of the
terminated Servicer. The successor Servicer is authorized and empowered by this
Agreement to execute and deliver, on behalf of the terminated 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 Conveyed Property and related
documents to show the Trust as lienholder or secured party on the related Lien
Certificates, or otherwise. The terminated Servicer agrees to cooperate with the
successor Servicer in effecting the termination of the responsibilities and
rights of the terminated 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 terminated Servicer for
deposit, or have been deposited by the terminated Servicer, in the
22
Collection Account or thereafter received with respect to the Receivables and
the delivery to the successor Servicer of all Receivable Files, Monthly Records
and Collection Records and a computer tape in readable form as of the most
recent Business Day containing all information necessary to enable the successor
Servicer or a successor Servicer to service the Receivables and the Other
Conveyed Property. If requested by the Note Insurer, the successor Servicer
shall terminate the Lock-Box Agreement and direct the Obligors to make all
payments under the Receivables directly to the successor Servicer (in which
event the successor Servicer shall process such payments in accordance with
Section 2.2(d)), or to a Lock-Box Account established by the successor Servicer
at the direction of the Note Insurer, at the successor Servicer's expense. The
terminated Servicer shall grant the Collateral Agent, the successor Servicer and
the Note Insurer reasonable access to the terminated Servicer's premises at the
terminated Servicer's expense.
Section 4.3. Appointment of Successor.
------------------------
(a) On and after the time the Servicer receives a notice of
termination pursuant to Section 4.2, or upon the resignation of the Servicer,
the Collateral Agent shall appoint an alternate successor Servicer upon written
direction from the Note Insurer, provided that any successor Servicer may not be
an Affiliate (as defined in the Security Agreement) of the Note Insurer, who
shall be subject to all the rights, responsibilities, restrictions, duties,
liabilities and termination provisions relating thereto placed on the Servicer
by the terms and provisions of this Agreement except as otherwise stated herein.
The Collateral Agent and such successor shall take such action, consistent with
this Agreement, as shall be necessary to effectuate any such succession. If a
successor Servicer is acting as Servicer hereunder, it shall be subject to
termination under Section 4.2 upon the occurrence of any Servicer Termination
Event applicable to it as Servicer.
(b) Any successor Servicer shall be entitled to such compensation
(whether payable out of the Collection Account or otherwise) as the Servicer
would have been entitled to under this Agreement if the Servicer had not
resigned or been terminated hereunder. The Collateral Agent and such successor
Servicer may agree on additional reasonable compensation to be paid to such
successor Servicer. In addition, any successor Servicer shall be entitled to
reasonable transition expenses incurred in acting as successor Servicer.
Section 4.4. Notification to Secured Parties. Upon any termination of,
-------------------------------
or appointment of a successor to, the Servicer, the Collateral Agent shall give
prompt written notice thereof to each Secured Party.
Section 4.5. Waiver of Past Defaults. The Agent may, on behalf of all
-----------------------
Secured Parties, waive any default by the Servicer in the performance of its
obligations hereunder and its consequences. Upon any such waiver of a past
default, such default shall cease to exist, and any Servicer Termination Event
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.
23
ARTICKE V
THE CUSTODIAN
-------------
Section 5.1. Appointment of Custodian; Acknowledgment of Receipt;
----------------------------------------------------
Monthly Exception Reports. Subject to the terms and conditions hereof, the
-------------------------
Collateral Agent hereby revocably appoints the Custodian and the Custodian
hereby accepts such appointment, as custodian and bailee on behalf of the
Collateral Agent (for the benefit of the Secured Parties) to maintain exclusive
custody of the Receivable Files relating to the Receivables from time to time
held as part of the Collateral; provided, however, that neither the Collateral
-------- -------
Agent nor any Secured Party shall be responsible for the acts or omissions of
the Custodian. In performing its duties hereunder, the Custodian agrees to act
with that degree of care, skill and attention that a commercial bank acting in
the capacity of a custodian would exercise with respect to files relating to
comparable automotive or other receivables that it services or holds for itself
or others, and, in any event, to exercise at least that degree of care, skill
and attention that it exercises with respect to its own assets. The Custodian,
as of each Receivables Transfer Date with respect to the Receivables sold on
such date, hereby acknowledges receipt of the Receivable File for each
Receivable listed in the Schedules of Receivables attached to the related
Supplement, subject to any exceptions noted on the applicable Custodian's
Acknowledgment. As evidence of its acknowledgement of such receipt of such
Records, the Custodian shall execute and deliver to the Collateral Agent and the
Note Insurer on each Receivables Transfer Date with respect to the Receivables
sold on such date, the Custodian's Acknowledgement in the form attached hereto
as Schedule A. In addition, the Custodian shall deliver to the Collateral Agent
and the Note Insurer a monthly exception report in the form attached as Exhibit
B hereto. AmeriCredit shall be required to repurchase the Receivables listed on
the monthly exception report pursuant to Section 2.7 hereof, in the event that
the related Lien Certificates are indicated as not having been received by the
181st day following the date of origination of the related Receivables.
Section 5.2. Maintenance of Records at Office. The Custodian agrees to
--------------------------------
maintain the Receivable Files at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
or at such other office as shall from time to time be identified to the
Collateral Agent and the Note Insurer, and the Custodian will hold the
Receivable Files in such office on behalf of the Collateral Agent (for the
benefit of the Secured Parties), clearly identified on its records as being
separate from any other instruments and files, including other instruments and
files held by the Custodian, and in compliance with Section 5.3(b) hereof.
Section 5.3. Duties of Custodian.
-------------------
(a) Safekeeping. (i) The Custodian shall hold the Receivable Files on
-----------
behalf of the Collateral Agent (for the benefit of the Secured Parties) clearly
identified as being separate from all other files or records maintained by the
Custodian, whether at the same or any other location, and shall maintain such
accurate and complete accounts, records or computer systems pertaining to each
Receivable File as are required to comply with the terms and conditions of the
Note Purchase Agreement. Each Contract shall be stamped on both of the first
page and the signature page (if different) in accordance with the requirements
of any Opinion of Counsel or as otherwise is deemed necessary or desirable by
the Collateral Agent and the Note Insurer. Each
24
Receivable shall be identified on the books and records of the Custodian in an
manner that (x) is consistent with the practices of a commercial bank acting in
the capacity of custodian with respect to similar receivables, (y) indicates
that the Receivables are held by the Custodian on behalf of the Collateral Agent
and (z) is otherwise necessary, as reasonably determined by the Custodian, to
comply with the terms of this Agreement. The Custodian shall conduct, or cause
to be conducted, periodic physical inspections of the Receivable Files held by
it under this Agreement, and of the related accounts, records and computer
systems, in such a manner as shall enable the Collateral Agent, the Note Insurer
and the Custodian to verify the accuracy of the Custodian's inventory and
recordkeeping. Such inspections shall be conducted at such times, in such manner
and by such persons, including, without limitation, independent accountants, as
the Collateral Agent and the Note Insurer may request and the cost of such
inspections shall be borne by the Custodian. The Custodian shall promptly report
to the Collateral Agent and the Note Insurer any failure on the Custodian's part
to hold the Receivable Files and maintain its accounts, records and computer
systems as herein provided and the Custodian shall promptly take appropriate
action to remedy any such failure.
(ii) Notwithstanding the above paragraph (i), upon a Servicer
Termination Event, at the direction of the Note Insurer, the Custodian shall
deliver the Receivable Files within thirty (30) days of such notice to the
Collateral Agent and the Collateral Agent shall hold such Receivable Files on
behalf of the Secured Parties. Subject to Section 5.3(c) hereof and the
preceding sentence, the Custodian shall at all times maintain the original of
the fully executed original retail installment sales contract or promissory note
and of the Lien Certificate or application therefore, if no such Lien
Certificate has yet been issued, relating to each Receivable in a fire resistant
vault.
(b) Access to Records. The Custodian shall, subject only to the
-----------------
Custodian's security requirements applicable to its own employees having access
to similar records held by the Custodian, which requirements shall be consistent
with the practices of a commercial bank acting in the capacity of custodian with
respect to similar files or records, and at such times as may be reasonably
imposed by the Custodian, permit only the Secured Parties and the Collateral
Agent or their duly authorized representatives, attorneys or auditors to inspect
the Receivable Files and the related accounts, records, and computer systems
maintained by the Custodian pursuant hereto at such times as any of the Secured
Parties or the Collateral Agent may reasonably request.
(c) Release of Documents. The Custodian shall release such Receivable
--------------------
Files to the Servicer only (1) upon payment in full of such Receivable or (2) as
required from time to time as appropriate for servicing and enforcing any
Receivable but, in the case of clause (1) or (2), only as is consistent with the
terms of the Note Purchase Agreement and the Security Agreement.
(d) Administration; Reports. The Custodian shall, in general, attend
-----------------------
to all ministerial matters in connection with maintaining custody of the
Receivable Files on behalf of the Collateral Agent. In addition, the Custodian
shall assist the Collateral Agent or the Servicer, as the case may be, in the
preparation of any routine reports to Secured Parties or to regulatory bodies,
to the extent necessitated by the Custodian's custody of the Receivable Files.
25
Section 5.4. Instructions; Authority to Act. The Custodian shall be
------------------------------
deemed to have received proper instructions with respect to the Receivable Files
upon its receipt of written instructions signed by a Responsible Officer of the
Collateral Agent. Such instructions may be general or specific in terms.
Section 5.5. Custodian Fee. For its services under this Agreement, the
-------------
Custodian shall be entitled to reasonable compensation to be paid by the
Servicer.
Section 5.6. Indemnification by the Custodian. The Custodian agrees to
--------------------------------
indemnify the Secured Parties, the Trust, the Note Insurer, the Trustee and the
Collateral Agent for any and all liabilities, obligations, losses, damage,
payments, costs or expenses of any kind whatsoever (including the fees and
expenses of counsel) that may be imposed on, incurred or asserted against any of
the Secured Parties, the Trust, the Note Insurer and/or the Collateral Agent as
the result of any act or omission in any way relating to the maintenance and
custody by the Custodian of the Receivable Files or any default by the Custodian
of its obligations hereunder; provided, however, that the Custodian shall not be
-------- -------
liable to any party indemnified hereunder for any portion of any such
liabilities, obligations, losses, damages, payments or costs or expenses as are
due to the willful misfeasance, bad faith or gross negligence of such
indemnified party.
Section 5.7. Advice of Counsel. The Custodian shall be entitled to rely
-----------------
and act upon advice of counsel selected by it with due care with respect to its
performance hereunder as custodian and shall be without liability for any action
reasonably taken in good faith pursuant to such advice, provided that such
action is not in violation of applicable federal or state law.
Section 5.8. Effective Period, Termination, and Amendment; Interpretive
----------------------------------------------------------
and Additional Provisions. This Agreement shall become effective as of the date
-------------------------
hereof and shall continue in full force and effect until terminated as
hereinafter provided. This Agreement may be amended at any time by agreement of
the Collateral Agent, the Note Insurer and the Custodian and the rights and
obligations of the Servicer and the Custodian may be terminated by the Note
Insurer following a Termination and Amortization Event; provided so long as
--------
AmeriCredit is Custodian, the Custodian shall not resign from the obligations
and duties imposed on it by this Agreement, except upon a 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 have a material adverse effect on it and the Note Insurer
does not elect to waive the obligations of the Custodian to perform the duties
which render it legally unable to act or to delegate those duties to another
Person; provided, further, that any such determination permitting the
-------- -------
resignation of the Custodian shall be evidenced by an Opinion of Counsel to such
effect delivered to the Note Insurer and the Collateral Agent that is acceptable
to the Note Insurer. So long as AmeriCredit is serving as Custodian, any
termination of AmeriCredit as Servicer under the Note Purchase Agreement or the
Security Agreement shall terminate AmeriCredit as Custodian under this
Agreement. Immediately after receipt of notice of termination of this Agreement,
the Custodian shall deliver the Receivable Files to the Collateral Agent on
behalf of the Secured Parties, at such place or places as the Collateral Agent
may designate, and the Collateral Agent, or its agent, as the case may be, shall
act as custodian for such Records on behalf of the Secured Parties until such
times as a successor custodian acceptable to the Note Insurer has been appointed
by the Collateral
26
Agent. (For the avoidance of doubt, during any such period, the Collateral Agent
shall be acting in its capacity as Collateral Agent, including the standard of
care and liability in such capacity, and not as a successor "Custodian"
hereunder.) If, within thirty (30) days after the termination of this Agreement,
the Custodian has not delivered the Receivable Files in accordance with the
preceding sentence, the Collateral Agent may enter the premises of the Custodian
and remove the Receivable Files from such premises. In connection with the
administration of this Agreement, the parties may agree from time to time upon
the interpretation of the provisions of this Agreement as may in their joint
opinion be consistent with the general tenor and purposes of this Agreement, any
such interpretation to be signed by all parties and annexed hereto.
Section 5.9. Representations, Warranties and Covenants of Custodian.
------------------------------------------------------
(a) The Custodian hereby represents and warrants to, and covenants
with, the Collateral Agent and the Secured Parties that as of the date hereof
and as of each Receivables Transfer Date:
(i) The Custodian is duly organized, validly existing and in good
standing under the laws of the state of its incorporation;
(ii) The Custodian has the full power and authority to hold each
Receivable File on behalf of the Collateral Agent, and to execute, deliver
and perform, and to enter into and consummate all transactions contemplated
by this Agreement, has duly authorized the execution, delivery and
performance of this Agreement, has duly executed and delivered this
Agreement, and this Agreement constitutes a legal, valid and binding
obligation of the Custodian, enforceable against it in accordance with its
terms, except as enforcement of such terms may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally and by the availability of equitable remedies;
(iii) The consummation of the transactions contemplated by this
Agreement and the Transaction Documents to which the Custodian is a Party,
and the fulfillment of the terms of this Agreement and the Transaction
Documents to which the Custodian is a Party, shall not conflict with,
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 bylaws of the Custodian, or any indenture, agreement,
mortgage, deed of trust or other instrument to which the Custodian is a
party or by which it is 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, mortgage, deed of trust or other instrument, other
than this Agreement, or violate any law, order, rule or regulation
applicable to the Custodian of any court or of any federal or state
regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Custodian or any of its
properties and do not require any action by or require the consent of or
the filing of any notice with any Official Body or other Person;
(iv) There is no litigation pending or, to the Custodian's knowledge,
threatened, which if determined adversely to the Custodian, would adversely
affect the execution, delivery or enforceability of this Agreement, or any
of the duties or
27
obligations of the Custodian thereunder, or which would have a material
adverse effect on the financial condition of the Custodian;
(v) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Custodian of or compliance by the Custodian with this
Agreement or the consummation of the transactions contemplated hereby or
thereby;
(vi) Upon written request of the Collateral Agent or the Note Insurer,
the Custodian shall take such steps as requested by the Collateral Agent or
the Note Insurer to protect or maintain any interest in any Receivable; and
(vii) The Custodian has not been notified by any party that any third
party claims an interest in the Receivables or is requesting the Custodian
to act as a bailee with respect to the Records, except such interests that
are created under the Master Receivables Purchase Agreement, the Security
Agreement, the Note Purchase Agreement and any Supplement.
(b) The Custodian covenants and warrants to the Collateral Agent and
each of the Secured Parties that as of the date of each Custodian's
Acknowledgment: (i) it holds no adverse interest, by way of security or
otherwise, in any Receivable or Receivable File; and (ii) the execution of this
Agreement and the creation of the custodial relationship hereunder does not
create any interest, by way of security or otherwise, of the Custodian in or to
any Receivable or Receivable File, other than the Custodian's rights as
custodian hereunder.
(c) The Custodian shall, at its own expense, maintain at all times
during the existence of this Agreement and keep in full force and effect, a
fidelity bond and errors and omissions policy of a type and in such amount as is
customary for custodians engaged in the business of acting as custodian of
automobile receivables and shall maintain any other similar insurance policies
that are customarily maintained by custodians engaged in the business of acting
as custodian of automobile receivables. A certificate of the respective insurer
as to each such policy or a blanket policy for such coverage shall be furnished
to the Collateral Agent and the Note Insurer containing the insurer's statement
or endorsement that such insurance shall not terminate prior to receipt by such
party, by certified mail, of ten (10) days advance notice thereof.
ARTICLE VI
MISCELLANEOUS
-------------
Section 6.1. Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of New York without giving
effect to the conflict of law provisions thereof.
Section 6.2. Notices. All demands, notices and communications hereunder
-------
shall be in writing (including bank wire, telex, telecopy or electronic
facsimile transmission or similar writing) and shall be given to the other party
at its address or telecopy number set forth below or at such other address or
telecopy number as such party may hereafter specify for the
28
purposes of notice to such party. Each such notice or other communication shall
be effective (i) if given by telecopy, when such telecopy is transmitted to the
telecopy number specified in this Section and confirmation is received, (ii) if
given by mail three (3) Business Days following such posting, if postage
prepaid, or if sent via U.S. certified or registered mail, (iii) if given by
overnight courier, one (1) Business Day after deposit thereof with a national
overnight courier service, or (iv) if given by any other means, when received at
the address specified in this Section.
If to the Trust:
---------------
AmeriCredit MTN Receivables Trust III
c/o Bankers Trust (Delaware)
E.A. Delle Donne Corporate Center
▇▇▇▇▇▇▇▇▇▇ Building
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Bankers Trust Company
▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇/▇▇/ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Asset Backed Finance Unit
If to the Servicer or the Custodian:
-----------------------------------
AmeriCredit Financial Services, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Note Insurer:
----------------------
MBIA Insurance Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Insured Portfolio Management - SF
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
29
If to the Collateral Agent:
--------------------------
JPMorgan Chase Bank
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: AmeriCredit MTN Receivables Trust III
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Section 6.3. Binding Effect. This Agreement shall be binding upon and
--------------
shall inure to the benefit of the parties hereto and their respective successors
and assigns. In addition, each of the Secured Parties shall be an express third
party beneficiary hereof entitled to enforce the terms hereof as if it were a
party hereto. Concurrently with the appointment of a successor Collateral Agent
under the Security Agreement, the parties hereto shall amend this Agreement to
make said Collateral Agent, the successor to the Collateral Agent hereunder.
Section 6.4. 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 6.5. 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 6.6. Limitation of Liability of Trustee. It is expressly
----------------------------------
understood and agreed by the parties hereto that (a) this Agreement is executed
and delivered by Bankers Trust (Delaware), not individually or personally but
solely as Trustee of the Trust, in the exercise of the powers and authority
conferred and vested in it, (b) each of the representations, undertakings and
agreements herein made on the part of the Trust is made and intended not as
personal representations, undertakings and agreements by Bankers Trust
(Delaware) but is made and intended for the purpose for binding only the Trust,
(c) nothing herein contained shall be construed as creating any liability on
Bankers Trust (Delaware), individually or personally, to perform any covenant
either expressed or implied contained herein, all such liability, if any, being
expressly waived by the parties hereto and by any Person claiming by, through or
under the parties hereto and (d) under no circumstances shall Bankers Trust
(Delaware) be personally liable for the payment of any indebtedness or expenses
of the Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Trust under this
Agreement or any other Transaction Documents; provided, however, that no
provision of this Agreement shall be construed to relieve the Trustee from
liability for its own negligent action, its own negligent failure to act, its
action in bad faith or its own willful misconduct.
30
Section 6.7.Waivers; Amendment
------------------
(a) No failure or delay on the part of the Collateral Agent, the Note
Insurer, the Note Insurer or any of the Secured Parties in exercising any power,
right or remedy under this Agreement shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power, right or remedy preclude
any other further exercise thereof or the exercise of any other power, right or
remedy. The rights and remedies herein provided shall be cumulative and
nonexclusive of any rights or remedies provided by law.
(b) Any provision of this Agreement or any of the Transaction Documents
may be amended or waived if, but only if, such amendment is in writing and is
signed by the Debtor, the Collateral Agent, the Custodian, the Servicer and the
Purchaser and the Note Insurer.
Section 6.8. Nonpetition Covenants. None of the parties shall petition
---------------------
or otherwise invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against the Debtor, AMTN or Purchaser
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 Debtor, AMTN or the Purchaser (as defined in the Note
Purchase Agreement) or any substantial part of their respective property, or
ordering the winding up or liquidation of the affairs of the Debtor, AMTN and
the Purchaser. This Section 6.8 shall be continuing and shall survive any
termination of this Agreement.
Notwithstanding anything else herein to the contrary, in no event shall
the Collateral Agent be liable for any servicing fee or for any differential in
the amount of the servicing fee paid hereunder and the amount necessary to
induce any successor Servicer to act as successor Servicer under this Agreement
and the transactions set forth or provided for herein.
31
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed in its name and on its behalf by a duly authorized
officer on the day and year first above written.
JPMorgan Chase Bank
solely in its capacity as Collateral
Agent
By:_________________________________
Name:
Title:
AMERICREDIT FINANCIAL SERVICES, INC.,
as Servicer and Custodian
By:_________________________________
Name:
Title:
AMERICREDIT MTN RECEIVABLES TRUST III
By: BANKERS TRUST (DELAWARE),
not in its individual capacity but
solely as Trustee
By:_________________________________
Name:
Title:
[Servicing and Custodian Agreement]
32
EXHIBIT C
SCOPE OF QUARTERLY AUDIT
1. MBIA will provide an account listing of a random sample of 125 accounts on a
quarterly basis. The accounts will be selected from the pool of collateral
then backing the Meridian facilities. AmeriCredit will provide a pool cut to
MBIA on a quarterly basis for this purpose.
2. The auditor will specify any changes to AmeriCredit's underwriting guidelines
since the last quarterly review.
3. The auditor will review the random sample of 125 accounts for document
completeness and adherence to AmeriCredit's stated underwriting criteria.
4. The auditor will review the contract files for the following documents and
report on any missing items:
. Signed Credit Application
. Credit Report
. Title or Application for Title
. Income and Employment Confirmations
. Residence Confirmations
. Signed Installment Sales Contract
. Agreement to Obtain Insurance or Insurance Binder
. Odometer Statement
5. The auditor will review the selected sample and identify and document any
exceptions or deviations from the stated underwriting guidelines with regards
to the following items:
--------------------------------------------------------------------------------
Guideline Criteria
--------------------------------------------------------------------------------
Minimum Time at Residence 1 year
--------------------------------------------------------------------------------
Minimum Housing Payment $300 (Typically)
--------------------------------------------------------------------------------
Monthly Payment for Auto Insurance $100
--------------------------------------------------------------------------------
Minimum Age of Borrower 18 years
--------------------------------------------------------------------------------
Minimum Years on the Job 1 year
--------------------------------------------------------------------------------
Minimum Monthly Income $1,300 (Gross)
--------------------------------------------------------------------------------
Maximum Debt Ratio (Credit Score * 230) 55%
--------------------------------------------------------------------------------
Maximum Debt Ratio (Credit Score **** 230) 60%
--------------------------------------------------------------------------------
Maximum Payment to Income Ratio 21%
--------------------------------------------------------------------------------
Bankruptcy Score **** 200
--------------------------------------------------------------------------------
* means less than
**** means more than equal to
------------------------------------------------------------------------------------
Guideline Criteria
------------------------------------------------------------------------------------
Income and Employment Verification Required/1/
------------------------------------------------------------------------------------
Residence Verification Required/1/
------------------------------------------------------------------------------------
Minimum Internal Credit Score 210
------------------------------------------------------------------------------------
Maximum Mileage (Loan Term *** 60 months) 80,000 miles
------------------------------------------------------------------------------------
Maximum Mileage (Loan Term ** 60 months) 30,000 miles
------------------------------------------------------------------------------------
Maximum Loan Term (Credit Score *** 220) 60 months
------------------------------------------------------------------------------------
Maximum Loan Term (Credit Score **** 220) 72 months
------------------------------------------------------------------------------------
Maximum Unpaid Loan to Value (Credit Score * 200)/3/ 115%
------------------------------------------------------------------------------------
Maximum Unpaid Loan to Value (Credit Score *** 200)/3/ 120%
------------------------------------------------------------------------------------
Maximum Amount Financed to Value (Credit Score * 210) 120%
------------------------------------------------------------------------------------
Maximum Amount Financed to Value (Credit Score **** 210 *** 229) 136%
------------------------------------------------------------------------------------
Maximum Amount Financed to Value (Credit Score **** 230) 137%
------------------------------------------------------------------------------------
Excluded Vehicles vs. Current List/2/
------------------------------------------------------------------------------------
**** means more than equal to
*** means less than equal to
** means more than
* means less than
Any exceptions to stated policy should be checked as to whether or not they were
authorized/approved by management and documented as such.
___________________
/1/ This requirement is waived on transactions that are considered
"Preferred," "Select" or "Valued" customer programs.
/2/ Current List: Alfa Romeo, Daihatsu, Merkur, Peugeot, Yugo, Sterling
and Renault. Also 1998 and older Hyundai, Suzuki, Kia and Daewoo.
/3/ The unpaid loan to value ratio equals the sales price of the
vehicles plus sales tax less all down-payments including trade-in and
manufacturer's rebate (Contract line 3) divided by the value of the vehicle.
ii
SCHEDULE A
FORM OF CUSTODIAN'S ACKNOWLEDGMENT
AmeriCredit Financial Services, Inc. (the "Custodian"), acting as
---------
Custodian under a Servicing and Custodian Agreement, dated as of February 25,
2002 (the "Servicing and Custodian Agreement"), between the Custodian,
---------------------------------
AmeriCredit MTN Receivables Trust III, as Debtor, and JPMorgan Chase Bank, as
Collateral Agent, pursuant to which the Custodian holds on behalf of the Secured
Parties certain Receivable Files (as defined in the Servicing and Custodian
Agreement), hereby acknowledges receipt of the Receivable File for each
Receivable listed in the Schedules of Receivables attached as Exhibits to the
Supplements to the Receivables Purchase Agreement, dated [insert date of the
------------------
relevant Supplement], except as noted in the Exception List attached as Schedule
-------------------
I hereto, if any.
IN WITNESS WHEREOF, AmeriCredit Financial Services, Inc., has caused
this acknowledgment to be executed by its duly authorized officer as of this [_]
day of [_], [_].
AMERICREDIT FINANCIAL SERVICES, INC.
as Custodian
By:________________________
Name:
Title: