Exhibit 10.1
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WACHOVIA AUTO OWNER TRUST 200__-__,
as Issuer,
POOLED AUTO SECURITIES SHELF LLC,
as Depositor,
and
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Seller and Master Servicer
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SALE AND SERVICING AGREEMENT
Dated as of __________ 1, 200__
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TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS
Section 1.01. General Definitions................................................................................5
Section 1.02. Other Definitional Provisions.....................................................................23
Section 1.03. Interpretive Provisions...........................................................................23
ARTICLE TWO
CONVEYANCE OF TRUST PROPERTY
Section 2.01. Conveyance of Trust Property......................................................................24
Section 2.02. Representations and Warranties of the Seller as to the Receivables................................28
Section 2.03. Representations and Warranties of the Depositor as to the Receivables.............................28
Section 2.04. Repurchase of Receivables Upon Breach.............................................................30
Section 2.05. Custody of Receivable Files.......................................................................30
Section 2.06. Duties of Master Servicer as Custodian............................................................31
Section 2.07. Instructions; Authority to Act....................................................................32
Section 2.08. Indemnification by Custodian......................................................................32
Section 2.09. Effective Period and Termination..................................................................32
ARTICLE THREE
ADMINISTRATION AND SERVICING OF THE TRUST PROPERTY
Section 3.01. Duties of Master Servicer.........................................................................33
Section 3.02. Subservicers......................................................................................34
Section 3.03. Collection of Receivable Payments; Modification of Receivables....................................35
Section 3.04. Realization Upon Receivables......................................................................36
Section 3.05. Maintenance of Physical Damage Insurance Policies.................................................37
Section 3.06. Maintenance of Security Interests in Financed Vehicles............................................37
Section 3.07. Covenants of Master Servicer......................................................................37
Section 3.08. Purchase of Receivables Upon Breach...............................................................37
Section 3.09. Servicing Compensation; Payment of Certain Expenses by Master Servicer............................38
Section 3.10. Master Servicer's Certificate.....................................................................38
Section 3.11. Annual Statement as to Compliance; Notice of Servicer Termination Events..........................39
Section 3.12. Annual Accountants' Report........................................................................39
Section 3.13. Access to Certain Documentation and Information Regarding Receivables.............................40
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Section 3.14. Reports to the Commission.........................................................................40
Section 3.15. Reports to Rating Agencies........................................................................40
ARTICLE FOUR
DISTRIBUTIONS; RESERVE FUND; STATEMENTS TO SECURITYHOLDERS
Section 4.01. Establishment of Accounts.........................................................................41
Section 4.02. Collections.......................................................................................42
Section 4.03. Application of Collections........................................................................42
Section 4.04. Advances..........................................................................................43
Section 4.05. Additional Deposits...............................................................................43
Section 4.06. Determination Date Calculations; Application of Available Funds...................................44
Section 4.07. Reserve Fund......................................................................................45
Section 4.08. Pre-Funding Account...............................................................................47
Section 4.09. Negative Carry Account............................................................................47
Section 4.10. Yield Supplement Account..........................................................................48
Section 4.11. Net Deposits......................................................................................48
Section 4.12. Statements to Securityholders.....................................................................48
Section 4.13. Control of Accounts...............................................................................50
ARTICLE FIVE
THE DEPOSITOR
Section 5.01. Representations and Warranties of Depositor.......................................................51
Section 5.02. Liability of Depositor; Indemnities...............................................................52
Section 5.03. Merger, Consolidation or Assumption of the Obligations of Depositor; Certain Limitations..........53
Section 5.04. Limitation on Liability of Depositor and Others...................................................56
Section 5.05. Depositor Not to Resign...........................................................................56
Section 5.06. Depositor May Own Securities......................................................................56
ARTICLE SIX
THE SERVICER
Section 6.01. Representations and Warranties of Master Servicer.................................................57
Section 6.02. Liability of Master Servicer; Indemnities.........................................................58
Section 6.03. Merger, Consolidation or Assumption of the Obligations of Master Servicer.........................60
Section 6.04. Limitation on Liability of Master Servicer and Others.............................................60
Section 6.05. Wachovia Bank Not to Resign as Master Servicer....................................................61
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Section 6.06. Master Servicer May Own Securities................................................................61
ARTICLE SEVEN
SERVICER TERMINATION EVENTS
Section 7.01. Servicer Termination Events.......................................................................62
Section 7.02. Appointment of Successor Servicer.................................................................63
Section 7.03. Effect of Servicing Transfer......................................................................64
Section 7.04. Notification to Noteholders, Certificateholders and Rating Agencies...............................65
Section 7.05. Waiver of Past Servicer Termination Events........................................................65
Section 7.06. Repayment of Advances.............................................................................65
ARTICLE EIGHT
TERMINATION
Section 8.01. Optional Purchase of All Receivables..............................................................66
ARTICLE NINE
EXCHANGE ACT REPORTING
Section 9.01. Further Assurances................................................................................67
Section 9.02. Form 10-D Filings.................................................................................67
Section 9.03. Form 8-K Filings..................................................................................67
Section 9.04. Form 10-K Filings.................................................................................68
Section 9.05. Report on Assessment of Compliance and Attestation................................................68
Section 9.06. Back-up ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification..............................................................69
Section 9.07. Use of Subcontractors.............................................................................69
Section 9.08. Representations and Warranties....................................................................70
Section 9.09. Indemnification...................................................................................70
Section 9.10. Amendments........................................................................................71
ARTICLE TEN
MISCELLANEOUS
Section 10.01. Amendment........................................................................................72
Section 10.02. Protection of Title to Issuer....................................................................73
Section 10.03. Notices..........................................................................................75
Section 10.04. Assignment.......................................................................................76
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Section 10.05. Severability.....................................................................................76
Section 10.06. Further Assurances...............................................................................76
Section 10.07. No Waiver; Cumulative Remedies...................................................................76
Section 10.08. Third-Party Beneficiaries........................................................................76
Section 10.09. Actions by Securityholders.......................................................................76
Section 10.10. Separate Counterparts............................................................................77
Section 10.11. Headings.........................................................................................77
Section 10.12. GOVERNING LAW....................................................................................77
Section 10.13. Nonpetition Covenants............................................................................77
Section 10.14. Limitation of Liability of Owner Trustee and Indenture Trustee...................................77
SCHEDULES
Schedule A - Location of Receivable Files......................................................................SA-1
Schedule B - Item 1119 Parties.................................................................................SB-1
Schedule C - Minimum Servicing Criteria (To Be Addressed in Assessment of Compliance Statement)................SC-1
Schedule D - Performance Certification (Trustee/Reporting Subcontractor).......................................SD-1
Schedule E - Performance Certification (Servicer)..............................................................SE-1
EXHIBITS
Exhibit A - Representations and Warranties as to the Receivables................................................A-1
Exhibit B - Form of Distribution Statement......................................................................B-1
Exhibit C - Form of Master Servicer's Certificate...............................................................C-1
Exhibit D - Form of Second-Tier Subsequent Assignment...........................................................D-1
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This Sale and Servicing Agreement, dated as of _________ 1, 200__, is
among Pooled Auto Securities Shelf LLC, a Delaware limited liability company
("PASS"), as depositor (the "Depositor"), Wachovia Bank, National Association,
a national banking association ("Wachovia Bank"), as seller (in such capacity,
the "Seller") and as servicer (in such capacity, the "Master Servicer"), and
Wachovia Auto Owner Trust 200__-__, a Delaware statutory trust, as issuer (the
"Issuer").
WHEREAS, the Issuer desires to purchase from the Depositor portfolios
of receivables arising in connection with motor vehicle retail installment
sale contracts (the "Receivables") purchased by Wachovia Bank in the ordinary
course of its business and sold to the Depositor as of the date hereof and
from time to time hereafter but no later than _________ ___, 200__;
WHEREAS, the Depositor is willing to sell the Receivables to the
Issuer pursuant to the terms hereof; and
WHEREAS, the Master Servicer is willing to service the Receivables
pursuant to the terms hereof.
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, and of other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE ONE
DEFINITIONS
Section 1.01. General Definitions. Whenever used in this Agreement,
the following words and phrases, unless the context otherwise requires, shall
have the following meanings:
"Account Collateral" means, with respect to each Account, such
Account, together with all cash, securities, Financial Assets and investments
and other property from time to time deposited or credited to such Account and
all proceeds thereof, including, with respect to (i) the Reserve Fund, the
Reserve Fund Initial Deposit and any Reserve Fund Subsequent Deposits, (ii)
the Yield Supplement Account, the Yield Supplement Account Initial Deposit and
any Yield Supplement Account Subsequent Deposit, (iii) the Pre-Funding
Account, the Pre-Funding Account Initial Deposit, and (iv) the Negative Carry
Account, the Maximum Negative Carry Amount.
"Accounts" means the Collection Account, the Note Payment Account,
the Yield Supplement Account, the Reserve Fund, the Pre-Funding Account and
the Negative Carry Account.
"Administration Agreement" means the administration agreement, dated
as of _______ 1, 200__, among the Administrator, the Issuer, the Depositor and
the Indenture Trustee.
"Administrator" means Wachovia Bank, in its capacity as administrator
under the Administration Agreement, and its successors in such capacity.
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"Advance" means, with respect to a Receivable, the amount which is
being advanced with respect to such Receivable as of the last day of a
Collection Period by the Master Servicer pursuant to Section 4.04.
"Affiliate" means, with respect to any specified Person, any other
Person directly or indirectly controlling or controlled by or under common
control with such specified Person. For purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agreement" means this Sale and Servicing Agreement.
"Amount Financed" means, with respect to any Receivable, the
aggregate amount advanced under such Receivable toward the purchase price of
the related Financed Vehicle and any related costs, including accessories,
insurance premiums, service and warranty contracts and other items customarily
financed as part of a motor vehicle retail installment sale contract.
"Available Collections" means, for any Distribution Date and the
related Collection Period, (i) all Obligor payments received by the Master
Servicer with respect to the Receivables during the related Collection Period
(including Subsequent Receivables acquired during the Pre-Funding Period with
amounts on deposit in the Pre-Funding Account) that were received after the
related Cutoff Date or Dates (other than amounts comprising the Supplemental
Servicing Fee), (ii) all Net Liquidation Proceeds, Insurance Proceeds,
Recoveries and Dealer Recourse received with respect to the Receivables during
such Collection Period, (iii) in the event that collections on or in respect
of the Receivables are required to be deposited by the Master Servicer into
the Collection Account on a daily basis pursuant to Section 4.02, all
investment earnings on funds on deposit in the Collection Account, (iv) the
aggregate Purchase Amount deposited in the Collection Account on the related
Deposit Date, (v) all Prepayments received with respect to the Receivables
during such Collection Period attributable to any refunded item included in
the Amount Financed (including amounts received as a result of rebates of
extended warranty contract costs and insurance premiums and proceeds received
under physical damage, theft, credit life and credit disability insurance
policies) and (vi) all Advances deposited into the Collection Account by the
Master Servicer on the related Deposit Date; provided, however, that Available
Collections shall not include any payments or other amounts (including Net
Liquidation Proceeds) received with respect to any (a) Purchased Receivable,
the Purchase Amount for which was included in Available Collections for a
previous Distribution Date and (b) Receivable to the extent that the Master
Servicer has made an unreimbursed Advance with respect to such Receivable and
is entitled to reimbursement from payments in respect of such Receivables or
other Receivables or other amounts pursuant to Section 4.04.
"Available Funds" means, with respect to any Distribution Date, the
sum of (i) Available Collections, (ii) the Reserve Fund Draw Amount, if any,
(iii) the Yield Supplement Account Draw Amount, if any, (iv) the Negative
Carry Account Draw Amount, if any, (v) if such Distribution Date immediately
follows the end of the Collection Period in which the Pre-Funding Period ends,
any funds remaining in the Negative Carry Account and (vi) investment earnings
on amounts on deposit in the Pre-Funding Account.
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"Basic Documents" means this Agreement, the Administration Agreement,
the Indenture, the Control Agreement, the Note Depository Agreement, the
Receivables Purchase Agreement, the Trust Agreement, each Subsequent Transfer
Document and any other documents or certificates delivered in connection
herewith or therewith including, the Power of Attorney pursuant to Section
1.02(c) of the Administration Agreement.
"Bankruptcy Code" means Title 11 of the United States Code, 11 U.S.C.
ss. 101 et seq.
"Business Day" means any day other than a Saturday, a Sunday or a day
on which banking institutions or trust companies in New York, New York,
Wilmington, Delaware, St. ▇▇▇▇, Minnesota or Charlotte, North Carolina are
authorized by law, regulation or executive order to be closed.
"Certificate" has the meaning specified in the Trust Agreement.
"Certificate Payment Account" means the account established and
maintained pursuant to Section 4.01.
"Certificate Percentage Interest" means, with respect to a
Certificate, the percentage specified on such Certificate as the Certificate
Percentage Interest, which percentage represents the beneficial interest of
the holder of such Certificate in the Issuer. The initial Certificate
Percentage Interest held by PASS Holding LLC shall be 100%.
"Certification Parties" means, collectively, the Certifying Person
and the entity for which the Certifying Person acts as an officer, and such
entity's officers, directors and Affiliates.
"Certificateholder" has the meaning specified in the Trust Agreement.
"Certifying Person" means the Person who signs the ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Certification.
"Class" has the meaning specified in the Indenture.
"Class A Notes" has the meaning specified in the Indenture.
"Class B Final Scheduled Distribution Date" has the meaning specified
in the Indenture.
"Class B Noteholder" has the meaning specified in the Indenture.
"Class B Notes" has the meaning specified in the Indenture.
"Closing Date" has the meaning specified in the Indenture.
"Code" has the meaning specified in the Indenture.
"Collateral" has the meaning specified in the Indenture.
"Collection Account" means the account designated as such, and
established and maintained pursuant to Section 4.01.
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"Collection Period" has the meaning specified in the Indenture.
"Commission" means the Securities and Exchange Commission.
"Contract Rate" means, with respect to any Receivable, the annual
percentage rate of interest stated in such Receivable.
"Control" has the meaning specified in Section 8-106 of the UCC.
"Control Agreement" means the control agreement, dated as of
___________ 1, 200__, among the Issuer, the Master Servicer, Wachovia Bank and
the Indenture Trustee, relating to the Accounts.
"Controlling Class" has the meaning specified in the Indenture.
"Corporate Trust Office" has the meaning specified in the Indenture
or the Trust Agreement, depending on whether reference is made to the
Indenture Trustee or the Owner Trustee.
"Cumulative Net Loss Percentage" has the meaning specified in the
Indenture.
"Cutoff Date" means the date after which the Issuer will be entitled
to receive all amounts related to the Receivables, which will be, in the case
of (i) the Initial Receivables, the Initial Cutoff Date, and (ii) a Subsequent
Receivable, the related Subsequent Cutoff Date.
"Cutoff Date Pool Balance" means the sum of the aggregate principal
balance of (i) the Initial Receivables as of the Initial Cutoff Date and (ii)
the Subsequent Receivables as of their respective Subsequent Cutoff Dates.
"Dealer" means the dealer of motor vehicles who sold a Financed
Vehicle and who originated and assigned the Receivable relating to such
Financed Vehicle to the Seller under an existing agreement between such dealer
and the Seller.
"Dealer Agreement" means an agreement between the Seller and a
Dealer, entered into by the Seller in the ordinary course of its business,
providing for the sale of Receivables by the Dealer to the Seller.
"Dealer Recourse" means, with respect to a Receivable, all recourse
rights against the Dealer which originated the Receivable, and any successor
to such Dealer.
"Defaulted Receivable" means a Receivable as to which, the earlier of
(i) any payment, or any part of any payment, due under such Receivable has
become 120 days or more delinquent (whether or not the Master Servicer has
repossessed the related Financed Vehicle), (ii) the Master Servicer has
repossessed and sold the related Financed Vehicle or (iii) the Master Servicer
has determined in accordance with its customary practices that such Receivable
is uncollectible; provided, however, that (a) a Receivable will not become a
Defaulted Receivable until the last day of the Collection Period during which
one of the foregoing events first occurs and (b) a Purchased Receivable will
not be deemed to be a Defaulted Receivable.
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"Deposit Date" means, with respect to any Distribution Date and the
related Collection Period, the Business Day immediately preceding such
Distribution Date.
"Depositor" has the meaning specified in the Trust Agreement.
"Determination Date" means, with respect to any Distribution Date,
the third Business Day preceding such Distribution Date, commencing on
_________ ___, 200__.
"Distribution Date" has the meaning specified in the Indenture.
"Dollars" or "$" mean the lawful currency of the United States.
"Eligible Deposit Account" means either (i) a segregated deposit
account over which the Indenture Trustee or the Owner Trustee, as the case may
be, has sole signature authority, maintained with an Eligible Institution
meeting the requirements of clause (i) of the definition of the term "Eligible
Institution" or (ii) a segregated trust account maintained with the trust
department of an Eligible Institution meeting the requirements of clause (ii)
of the definition of the term "Eligible Institution", in each case bearing a
designation clearly indicating that the funds deposited therein are held for
the benefit of the Securityholders, the Noteholders or the Certificateholders,
as the case may be.
"Eligible Institution" means (i) Wachovia Bank, the corporate trust
department of the Indenture Trustee or the corporate trust department of the
Owner Trustee or (ii) any other depository institution organized under the
laws of the United States or any State or incorporated under the laws of a
foreign jurisdiction with a branch or agency located in the United States or
any State qualified to take deposits and subject to supervision and
examination by federal or state banking authorities which at all times has
either a long-term unsecured debt rating of at least "Baa3" from Moody's or a
long-term unsecured debt rating, a short-term unsecured debt rating or a
certificate of deposit rating acceptable to Moody's and whose deposits are
insured by the Federal Deposit Insurance Corporation; provided, however, that
(a) the commercial paper, short-term debt obligations or other short-term
deposits of the depository institution described in clause (ii) above must be
rated at least "Prime-1" by Moody's and at least "A-1+" by Standard & Poor's
if deposits are to be held in an account maintained with such depository
institution pursuant to this Agreement for fewer than 30 days and (b) the
long-term unsecured debt obligations of the depository institution described
in clause (ii) above must be rated at least "AA-" by Standard & Poor's if
deposits are to be held in an account maintained with such depository
institution pursuant to this Agreement for more than 30 days.
"Eligible Servicer" means a Person which, at the time of its
appointment as Master Servicer, (i) has a net worth of not less than
$50,000,000, (ii) is servicing a portfolio of motor vehicle retail installment
sale contracts or motor vehicle loans, (iii) is legally qualified, and has the
capacity, to service the Receivables, (iv) has demonstrated the ability to
service a portfolio of motor vehicle retail installment sale contracts or
motor vehicle loans similar to the Receivables professionally and competently
in accordance with standards of skill and care that are consistent with
prudent industry standards and (v) is qualified and entitled to use pursuant
to a license or other written agreement, and agrees to maintain the
confidentiality of, the software which the Master Servicer uses in connection
with performing its duties and responsibilities under this
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Agreement or obtains rights to use, or develops at its own expense, software
which is adequate to perform its duties and responsibilities under this
Agreement.
"Entitlement Holder" has the meaning specified in Section 8-102 of
the UCC.
"Entitlement Order" has the meaning specified in Section 8-102 of the
UCC.
"Event of Default" has the meaning specified in the Indenture.
"Excess Collections" has the meaning specified in the Indenture.
"Exchange Act" has the meaning specified in the Indenture.
"Exchange Act Reports" shall mean any reports on Form 10-D, Form 8-K
and Form 10-K required to be filed by the Depositor with respect to the Issuer
under the Exchange Act.
"FDIC Rule" has the meaning specified in the Receivables Purchase
Agreement.
"Final Scheduled Distribution Date" has the meaning specified in the
Indenture.
"Financed Vehicle" means, with respect to any Receivable, the related
new or used motor vehicle, together with all accessions thereto, securing the
related Obligor's indebtedness under such Receivable.
"Financial Asset" has the meaning specified in Section 8-102(a)(9) of
the UCC.
"First-Tier Subsequent Assignment" means a first tier subsequent
assignment, dated not later than ________ ____, 200__, between the Seller and
the Depositor.
"Form 10-D Disclosure Item" shall mean with respect to any Person,
any litigation or governmental proceedings pending against such Person, or any
of the Issuer, the Depositor, the Indenture Trustee, the Owner Trustee or the
Master Servicer if such Person or in the case of the Owner Trustee or
Indenture Trustee, a Responsible Officer of such Person, has actual knowledge
thereof, in each case that would be material to the Noteholders.
"Form 10-K Disclosure Item" shall mean with respect to any Person,
(a) any Form 10-D Disclosure Item and (b) any affiliations or relationships
between such Person and any Item 1119 Party to the extent a Responsible
Officer of such Person (in the case of the Indenture Trustee and the Owner
Trustee) has actual knowledge thereof.
"Holders" has the meaning specified in the Indenture.
"Indenture" means the indenture, dated as of __________ 1, 200__,
between the Issuer and the Indenture Trustee.
"Indenture Trustee" has the meaning specified in the Indenture.
"Independent" has the meaning specified in the Indenture.
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"Initial Note Balance" means, as the context may require, with
respect to (i) all of the Notes, $_______________ or (ii) any Note, an amount
equal to the initial denomination of such Note.
"Initial Cutoff Date" means the close of business on __________ ___,
200__.
"Initial Overcollateralization Percentage" means ____%.
"Initial Receivables" means the Receivables described in the Schedule
of Initial Receivables and transferred by the Depositor to the Issuer on the
Closing Date, having an aggregate principal balance as of the Initial Cutoff
Date of $________________.
"Insolvency Event" means with respect to the Depositor or the Master
Servicer, (i) the filing 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 the assets of such Person 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 of such Person or for any substantial part of
the assets of such Person, or ordering the winding-up or liquidation of such
Person's affairs, and such decree or order shall remain unstayed and in effect
for a period of 60 consecutive days; or (ii) 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 or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of such person or for any substantial part of
the assets of such Person, 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 any
action by such Person in furtherance of any of the foregoing.
"Insurance Proceeds" means proceeds paid by any insurer under a
comprehensive and collision or limited dual interest insurance relating to a
Receivable, other than funds used for the repair of the related Financed
Vehicle or otherwise released to the related Obligor in accordance with normal
servicing procedures, after reimbursement to the Master Servicer for expenses
recoverable under the related insurance policy.
"Interest Distributable Amount" has the meaning specified in the
Indenture.
"Interest Rate" has the meaning specified in the Indenture.
"Issuer" has the meaning specified in the Indenture.
"Item 1119 Party" shall mean the Depositor, the Seller, the Master
Servicer, the Indenture Trustee, the Owner Trustee and any other material
transaction party, as identified in Schedule B hereto.
"Lien" means any security interest, lien, claim, charge, pledge,
equity or encumbrance of any kind other than tax liens, mechanics' or
materialmen's liens, judicial liens and any liens that may attach to a
Financed Vehicle by operation of law.
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"Master Servicer" means Wachovia Bank, in its capacity as servicer of
the Receivables under this Agreement, and its successors in such capacity.
"Master Servicer's Certificate" means an Officer's Certificate signed
by a Servicing Officer of the Master Servicer delivered pursuant to Section
3.10, substantially in the form of Exhibit C.
"Maximum Negative Carry Amount" means an amount deposited into the
Negative Carry Account on the Closing Date equal to $_______________.
"Monthly Payment" means, with respect to any Receivable, the amount
of each fixed monthly payment payable to the obligee under such Receivable in
accordance with the terms thereof, net of any portion of such monthly payment
that represents late payment charges, extension fees or similar items.
"Monthly Remittance Condition" means that (i) (a) Wachovia Bank is
the Master Servicer, (b) Wachovia Bank's short-term unsecured debt is rated at
least "Prime-1" by Moody's and "A-1" by Standard & Poor's and (c) no Servicer
Termination Event shall have occurred and be continuing or (ii) each Rating
Agency has agreed that the deposit of collections on or in respect of the
Receivables into the Collection Account may be made by the Master Servicer on
a monthly, rather than a daily, basis.
"Monthly Servicing Fee" means, for any Collection Period, the fee
payable to the Master Servicer on the related Distribution Date for services
rendered during such Collection Period as determined pursuant to Section 3.09.
"Monthly Trustee Fees" has the meaning specified in the Indenture.
"Moody's" has the meaning specified in the Indenture.
"Motor Vehicle Receivables" has the meaning specified in Section
5.03(b)(ii)(A).
"Motor Vehicle Securities" has the meaning specified in Section
5.03(b)(ii)(B).
"Negative Carry Account" means the account designated as such, and
established and maintained pursuant to Sections 4.01 and 4.09.
"Negative Carry Account Amount" means, as of any date, the amount on
deposit in the Negative Carry Account.
"Negative Carry Account Draw Amount" means, with respect to any
Distribution Date (including and prior to the Distribution Date following the
Collection Period in which the Pre-Funding Period ends), the excess (if
positive) of (i) the balance on deposit in the Negative Carry Account as of
such date over (ii) the product of (a) ______%, (b) the Pre-Funding Account
Amount as of the last day of the related Collection Period and (c) the
percentage equivalent of a fraction, the numerator of which is the actual
number of days from and including such Distribution Date to but excluding the
_______ 200__ Distribution Date and the denominator of which is 360.
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"Net Liquidation Proceeds" means all amounts received by the Master
Servicer with respect to any Defaulted Receivable during the Collection Period
in which such Receivable became a Defaulted Receivable, minus the sum of (i)
any amount required by law to be remitted to the related Obligor and (ii) any
expenses incurred by the Master Servicer in connection with collection of such
Receivable and the repossession and disposition of the related Financed
Vehicle (to the extent not previously reimbursed).
"Net Losses" means, with respect to any Collection Period, the
difference (which may be positive or negative) of (i) the aggregate Principal
Balance of all Receivables that became Defaulted Receivables during such
Collection Period and (ii) the aggregate Net Liquidation Proceeds and
Recoveries received by the Master Servicer during such Collection Period.
"Nonrecoverable Advance" means an Advance which the Master Servicer
determines in its sole discretion is not recoverable from payments made on or
in respect of the related Receivable.
"Note Balance" has the meaning specified in the Indenture.
"Note Depository Agreement" has the meaning specified in the
Indenture.
"Note Payment Account" means the account designated as such, and
established and maintained pursuant to Section 4.01.
"Note Pool Factor" means, with respect to each Class of Notes as of
any Distribution Date, a seven-digit decimal figure equal to the Note Balance
of such Class of Notes as of such Distribution Date (after giving effect to
any reductions thereof to be made on such Distribution Date) divided by the
original principal amount of such Class of Notes.
"Noteholder" has the meaning specified in the Indenture.
"Notes" has the meaning specified in the Indenture.
"Obligor" means, with respect to any Receivable, the purchaser or
co-purchasers of the related Financed Vehicle purchased in part or in whole by
the execution and delivery of a Receivable or any other Person who owes or may
be liable for payments under a Receivable.
"Officer's Certificate" means a certificate signed by the chairman,
the president, any Vice President, the treasurer or the secretary of the
Depositor or the Master Servicer, as the case may be, and delivered to the
Indenture Trustee or the Owner Trustee.
"Opinion of Counsel" means a written opinion of counsel (who may be
an employee of or outside counsel to the Depositor or the Master Servicer),
which counsel shall be acceptable to the related Trustee or the Rating
Agencies, as the case may be.
"Outstanding" has the meaning specified in the Indenture.
"Overcollateralization Target Amount" has the meaning specified in
the Indenture.
13
"Owner Trust Estate" has the meaning specified in the Trust
Agreement.
"Owner Trustee" has the meaning specified in the Trust Agreement.
"PASS" has the meaning specified in the Receivables Purchase
Agreement.
"Performance Certification" means each certification delivered to the
Certifying Person pursuant to Section 9.06.
"Permitted Investments" means, at any time, any one or more of the
following obligations, instruments, investments and securities:
(i) direct obligations of, and obligations fully guaranteed
by, the United States or any agency or instrumentality thereof the
obligations of which are backed by the full faith and credit of the
United States;
(ii) demand deposits, time deposits, bankers' acceptances or
certificates of deposit, having maturities of not more than 365 days,
of any depository institution or trust company incorporated under the
laws of the United States or any State (or any domestic branch of a
foreign bank) and subject to supervision and examination by federal
or State banking or depository institution authorities; provided,
however, that (a) such investment shall not have an `r' highlighter
affixed to its rating and its terms shall have a predetermined fixed
dollar amount of principal due at maturity that cannot vary or change
and (b) at the time of the investment, the commercial paper or other
short-term unsecured debt obligations (other than such obligations
the rating of which is based on the credit of a Person other than
such depository institution or trust company) of such depository
institution or trust company shall have a rating from Standard &
Poor's of at least "A-1+" and from Moody's of at least "Prime-1";
(iii) repurchase obligations, having maturities of not more
than 365 days, with respect to any security that is a direct
obligation of, or fully guaranteed by, the United States or any
agency or instrumentality thereof the obligations of which are backed
by the full faith and credit of the United States, in either case
entered into with a depository institution or trust company (acting
as principal) described in clause (ii) above;
(iv) short-term corporate securities bearing interest or
sold at a discount issued by any corporation incorporated under the
laws of the United States or any State thereof; provided, however,
that (a) such investment shall not have an `r' highlighter affixed to
its rating and its terms shall have a predetermined fixed dollar
amount of principal due at maturity that cannot vary or change and
(b) at the time of the investment, the short-term unsecured debt
obligations (other than such obligations the rating of which is based
on the credit of a Person other than such corporation) of such
corporation shall have a rating from Standard & Poor's of at least
"A-1+" and from Moody's of at least "Prime-1";
(v) commercial paper having, maturities of not more than 365
days, at the time of the investment, a rating from Standard & Poor's
of at least "A-1+" and from Moody's of at least "Prime-1"; provided,
however, that such investment shall not have an
14
`r' highlighter affixed to its rating and its terms shall have a
predetermined fixed dollar amount of principal due at maturity that
cannot vary or change;
(vi) guaranteed investment contracts issued by an insurance
company or other corporation as to which the Rating Agency Condition
shall have been satisfied;
(vii) investments in money market funds having a rating from
Standard & Poor's of at least "AAA-m" or "AAAm-G" and from Moody's of
"Aaa" (including funds for which the Indenture Trustee, the Owner
Trustee or any of their respective Affiliates is investment manager
or advisor); and
(viii) any other investment as to which the Rating Agency
Condition shall have been satisfied; provided, however, that in no
event shall any such investment have a long-term rating of less than
"AA" by Standard & Poor's or "Aa3" by Moody's or a short-term rating
of less than "A-1" by Standard & Poor's or "Prime-1" by Moody's;
provided, that, except as otherwise provided in Section 4.07(b), each of the
foregoing investments shall mature no later than the Deposit Date immediately
following the Collection Period in which such investment was made (other than
in the case of the investment of monies in instruments of which the entity at
which the related Account, as the case may be, is located is the obligor,
which may mature on the related Distribution Date following the Collection
Period in which such investment was made), and shall be required to be held to
such maturity.
Notwithstanding anything to the contrary contained in this
definition, (a) no Permitted Investment may be purchased at a premium, (b) no
obligation or security shall be a "Permitted Investment" unless (i) the
Indenture Trustee has Control over such obligation or security and (ii) at the
time the Indenture Trustee first obtained Control or the Indenture Trustee
became the Entitlement Holder with respect to such obligation or security, the
Indenture Trustee did not have notice of any adverse claim with respect
thereto within the meaning of Section 8-102 of the UCC and (c) with respect to
investments above that require a rating of "A-1+" from Standard and Poor's,
such investments in certain short-term debt of issuers or deposits in
institutions rated "A-1" by S&P will be permitted so long as (1) the total
amount of investments in "A-1" issuers or deposits in "A-1" institutions must
be limited to investments of the amount on deposit in the Collection Account
and the Pre-Funding Account and (2) the total amount of "A-1" investments
shall not represent more than 20% of the Note Balance as of any date.
For purposes of this definition, any reference to the highest
available credit rating of an obligation means the highest available credit
rating for such obligation, or such lower credit rating (as approved in
writing by each Rating Agency) as will not result in the qualification,
downgrading or withdrawal of the rating then assigned to any Securities by
such Rating Agency.
"Person" means any legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, limited liability partnership, trust,
unincorporated organization or government or any agency or political
subdivision thereof, or any other entity of whatever nature.
"Pool Balance" means, as of the first or last day of any Collection
Period, the aggregate Principal Balance of the Receivables as of such first or
last day, as the case may be; provided,
15
however, that if the Receivables are purchased by the Master Servicer pursuant
to Section 8.01(a) or are sold or otherwise liquidated by the Indenture
Trustee following an Event of Default pursuant to Section 5.04 of the
Indenture, the Pool Balance shall be deemed to be zero as of the last day of
the Collection Period during which such purchase, sale or other liquidation
occurs.
"Pre-Funding Account" means the account established and maintained as
such pursuant to Sections 4.01 and 4.08.
"Pre-Funding Account Amount" means, as of any date, the amount on
deposit in the Pre-Funding Account, excluding the net investment earnings on
amounts on deposit in the Pre-Funding Account.
"Pre-Funding Account Initial Deposit" means $___________________.
"Pre-Funding Period" means, the period from and including the Closing
Date to and ending on the earliest of the (i) date on which the Pre-Funding
Account Amount has been reduced to less than $100,000 because of purchases of
Subsequent Receivables, (ii) date on which an Event of Default or Servicer
Termination Event occurs, (iii) date on which an Insolvency Event occurs with
respect to the Depositor or the Master Servicer and (iv) close of business on
___________ ____, 200__.
"Prepayment" means any prepayment, whether in part or in full, in
respect of a Receivable.
"Principal Balance" means, with respect to any Receivable as of any
date, the Amount Financed under such Receivable minus the sum of (i) that
portion of all Monthly Payments actually received on or prior to such date
allocable to principal using the Simple Interest Method, (ii) any rebates of
extended warranty contract costs or physical damage, theft, credit life or
credit disability insurance premiums included in the Amount Financed and (iii)
any Prepayment applied to reduce the unpaid principal balance of such
Receivable; provided, however, that the Principal Balance of a (a) Defaulted
Receivable shall be zero as of the last day of the Collection Period during
which it became a Defaulted Receivable and (b) Purchased Receivable shall be
zero as of the last day of the Collection Period during which it became a
Purchased Receivable.
"Priority Principal Distributable Amount" has the meaning specified
in the Indenture.
"Provided Information" means (i) with respect to the Indenture
Trustee, the servicing criteria assessment provided under Article Nine by or
on behalf of the Indenture Trustee and (ii) with respect to the Master
Servicer, the information provided pursuant to Section 3.11 and Section 3.12,
by or on behalf of the Master Servicer.
"Purchase Amount" means the price at which the Seller must repurchase
or the Master Servicer must purchase a Receivable in an amount equal to the
sum of (i) the Principal Balance of such Receivable plus (ii) the amount of
accrued but unpaid interest on such Principal Balance at the related Contract
Rate to the last day of the month of repurchase.
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"Purchased Receivable" means a Receivable repurchased as of the last
day of a Collection Period as to which payment of the Purchase Amount has been
made by the Seller pursuant to Section 2.04 or by the Master Servicer pursuant
to Section 3.08 or 8.01.
"Rating Agency" has the meaning specified in the Indenture.
"Rating Agency Condition" has the meaning specified in the Indenture.
"Receivable" means each motor vehicle retail installment sales
contract transferred by the Depositor to the Issuer hereunder on the Closing
Date or on a Subsequent Transfer Date pursuant to the related Second-Tier
Subsequent Assignment, and all rights and obligations thereunder.
"Receivable Files" has the meaning specified in Section 2.05.
"Receivables Purchase Agreement" means the receivables purchase
agreement, dated as of ___________ 1, 200__, between the Seller and PASS.
"Recoveries" means, with respect to any Collection Period following
the Collection Period in which a Receivable became a Defaulted Receivable, all
amounts received by the Master Servicer with respect to such Defaulted
Receivable during such Collection Period, net of the sum of (i) any amount
required by law to be remitted to the related Obligor and (ii) any expenses
incurred by the Master Servicer in connection with collection of such
Receivable and the repossession and disposition of the related Financed
Vehicle (to the extent not previously reimbursed).
"Regular Principal Distributable Amount" has the meaning specified in
the Indenture.
"Regulation AB" shall mean subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, subject to such
clarification and interpretation as has been provided by the Commission in the
adopting release (Asset-Backed Securities, Securities Act Release No. 33-8518,
70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the Commission,
or as may be provided by the Commission or its staff from time to time.
"Reportable Event" shall mean any event required to be reported on
Form 8-K, and in any event, the following:
(i) entry into a definitive agreement related to the Issuer,
the Notes or the Receivables, or an amendment to a Basic Document,
even if the Depositor is not a party to such agreement (e.g., a
servicing agreement with a servicer contemplated by Item 1108(a)(3)
of Regulation AB);
(ii) termination of a Basic Document (other than by
expiration of the agreement on its stated termination date or as a
result of all parties completing their obligations under such
agreement), even if the Depositor is not a party to such agreement
(e.g., a servicing agreement with a servicer contemplated by Item
1108(a)(3) of Regulation AB);
(iii) the occurrence of a Servicer Termination Event or an
Event of Default;
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(iv) the resignation, removal, replacement, substitution of
the Indenture Trustee or the Owner Trustee;
(v) a required distribution to holders of the Notes is not
made as of the required Distribution Date under the Indenture; and
(vi) any bankruptcy or receivership of the Seller, the
Depositor, the Indenture Trustee, the Owner Trustee, any enhancement
or support provider contemplated by Item 1114(b) or 1115 of
Regulation AB, or other material party contemplated by Item
1101(d)(1) of Regulation AB.
"Reporting Subcontractor" shall mean any Subcontractor determined
pursuant to Section 9.07 to be "participating in the servicing function"
within the meaning of Item 1122 of Regulation AB.
"Representative" means Wachovia Capital Markets, LLC, as
representative of the Underwriters.
"Required Payment Amount" has, with respect to each Distribution
Date, the meaning specified in Section 4.06(a)(viii).
"Required Rating" means, with respect to any entity, the short-term
credit rating of the related entity is at least equal to "Prime-1" by Moody's
and "A-1+" by Standard & Poor's.
"Required Reserve Fund Amount" means, for any Distribution Date, an
amount equal to _____% of the Cutoff Date Pool Balance; provided, however,
that the Required Reserve Fund Amount (i) may not exceed the Note Balance and
(ii) will be zero if the Pool Balance as of the last day of the related
Collection Period is zero.
"Reserve Fund" means the account designated as such, and established
and maintained pursuant to Section 4.07.
"Reserve Fund Amount" means, with respect to any Distribution Date,
the amount on deposit in and available for withdrawal from the Reserve Fund on
such Distribution Date (after giving effect to all deposits to and withdrawals
from the Reserve Fund on such Distribution Date), including all interest and
other investment earnings (net of losses and investment expenses) earned on
such amount during the related Collection Period.
"Reserve Fund Deficiency" has the meaning specified in Section
4.06(b)(iii).
"Reserve Fund Draw Amount" has the meaning specified in Section
4.06(b)(i).
"Reserve Fund Initial Deposit" means an amount equal to
$________________.
"Reserve Fund Property" has the meaning specified in Section 4.07(a).
"Reserve Fund Subsequent Deposit" means, with respect to any
Subsequent Receivables transferred to the Issuer on a Subsequent Transfer
Date, an amount equal to ____% of the
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aggregate principal balance of such Subsequent Receivables as of the related
Subsequent Cutoff Date.
"Responsible Officer" means, in the case of (i) the Indenture
Trustee, any officer within the Corporate Trust Office of the Indenture
Trustee, including any principal, managing director, president, Vice
President, assistant treasurer, assistant secretary or any other officer of
the Indenture Trustee customarily performing functions similar to those
performed by any of the above-designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because
of such officer's knowledge of and familiarity with the particular subject and
(ii) the Owner Trustee, any officer in the Corporate Trust Administration
department of the Owner Trustee with direct responsibility for the
administration of the Issuer and, with respect to a particular corporate trust
matter, any other officer of the Owner Trustee to whom such matter is referred
because of such officer's knowledge of and familiarity with the particular
subject.
"▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification" means the certification concerning the
Issuer, to be signed by an officer of the Master Servicer or the Depositor and
submitted to the Commission pursuant to the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002.
"Schedule of Initial Receivables" means the Schedule of Receivables
attached as Schedule A to the Receivables Purchase Agreement, reflecting the
Receivables transferred on the Closing Date.
"Schedule of Receivables" means the schedule of Receivables attached
as Schedule A to the Receivables Purchase Agreement, which may include, as the
context requires, the Schedule of Initial Receivables, as supplemented by one
or more Schedules of Subsequent Receivables.
"Schedule of Subsequent Receivables" means any list of Subsequent
Receivables attached as Schedule A to the related First-Tier Subsequent
Assignment.
"Second-Tier Subsequent Assignment" means a second tier subsequent
assignment, dated as of the date of the related First-Tier Subsequent
Assignment, between the Depositor and the Issuer, in substantially the form of
Exhibit D hereto.
"Secondary Principal Distributable Amount" has the meaning specified
in the Indenture.
"Securities Act" means the Securities Act of 1933.
"Securitization Trust" has the meaning specified in Section
5.03(b)(ii).
"Security" means a Note or a Certificate, as the case may be.
"Security Entitlement" has the meaning specified in Section
8-102(a)(17) of the UCC.
"Securityholders" means the Noteholders and the Certificateholders.
"Seller" has the meaning specified in the Receivables Purchase
Agreement.
19
"Sequential Payment Trigger" has the meaning specified in the
Indenture.
"Servicer Termination Event" has the meaning specified in Section
7.01.
"Servicer Termination Notice" has the meaning specified in Section
7.01.
"Servicing Criteria" shall mean the "servicing criteria" set forth in
Item 1122(d) of Regulation AB.
"Servicing Officer" means any officer of the Master Servicer involved
in, or responsible for, the administration and servicing of the Receivables
whose name appears on a list of servicing officers attached to an Officer's
Certificate furnished on the Closing Date to the Trustees by the Master
Servicer, as such list may be amended from time to time by the Master Servicer
in writing.
"Servicing Rate" means ____% per annum.
"Simple Interest Method" means the method of allocating a fixed level
payment between principal and interest, pursuant to which a portion of such
payment is allocated to interest in an amount equal to the product of the
Contract Rate of the related Receivable multiplied by the unpaid Principal
Balance of such Receivable multiplied by the period of time (expressed as a
fraction of a year, based on the actual number of days in the applicable
calendar month and a 365-day year) elapsed since the preceding payment was
made and the remainder of such payment is allocated to principal.
"Simple Interest Receivable" means any Receivable under which each
payment is allocated between principal and interest in accordance with the
Simple Interest Method.
"Standard & Poor's" has the meaning specified in the Indenture.
"State" has the meaning specified in the Indenture.
"Subcontractor" shall mean any vendor, subcontractor or other Person
that is not responsible for the overall servicing (as "servicing" is commonly
understood by participants in the asset-backed securities market) of
Receivables but performs one or more discrete functions identified in Item
1122(d) of Regulation AB with respect to the Receivables under the direction
or authority of the Indenture Trustee or the Master Servicer.
"Subsequent Cutoff Date" means, with respect to the Subsequent
Receivables, the close of business on the date specified by the Depositor in
the Second-Tier Subsequent Assignment for the related Subsequent Transfer
Date.
"Subsequent Receivable" means Receivables described in a Schedule of
Subsequent Receivables (an identical copy of which is attached as Schedule A
to the related Second-Tier Subsequent Assignment) and transferred by the
Depositor to the Issuer on a Subsequent Transfer Date.
20
"Subsequent Transfer Date" means, with respect to any Subsequent
Receivable, the Business Day, occurring on or before the last day of the
Pre-Funding Period, on which the related Second-Tier Subsequent Assignment is
executed and delivered and such Subsequent Receivable is transferred to the
Issuer.
"Subsequent Transfer Documents" means each First-Tier Subsequent
Assignment, Second-Tier Subsequent Assignment and, if required, each
Third-Tier Subsequent Assignment.
"Successor Servicer" means any entity appointed as a successor to the
Master Servicer pursuant to Section 7.02.
"Supplemental Servicing Fee" means the sum of (i) all extension fees
charged in connection with extensions of Receivables and (ii) any
administration fees and charges and all late payment fees and prepayment fees
actually collected (from whatever source) on the Receivables.
"Third-Tier Subsequent Assignment" means a third tier subsequent
assignment, dated as of the date of the related First-Tier Subsequent
Assignment, between the Issuer and the Indenture Trustee.
"Total Servicing Fee" means, for any Collection Period and the
related Distribution Date, the sum of (i) the Monthly Servicing Fee for such
Collection Period and (ii) all accrued but unpaid Monthly Servicing Fees for
one or more prior Collection Periods.
"Total Trustee Fees" has the meaning specified in the Indenture.
"Transition Costs" means the reasonable costs and expenses (including
reasonable attorneys' fees but excluding overhead) incurred or payable by the
Successor Servicer in connection with the transfer of servicing (whether due
to termination, resignation or otherwise), including allowable compensation of
employees and overhead costs incurred or payable in connection with the
transfer of the Receivable Files or any amendment to this Agreement required
in connection with the transfer of servicing.
"Trust Agreement" means the amended and restated trust agreement,
dated as of _________, 1 200__, between the Depositor and the Owner Trustee.
"Trust Fees and Expenses" means all accrued and unpaid fees of the
Trustees, any amounts due to the Trustees for reimbursement of expenses or in
respect of indemnification and other administrative fees of the Issuer.
"Trust Property" means, as of any date, the Initial Receivables and
other property related thereto sold, transferred, assigned and conveyed to the
Issuer pursuant to Section 2.01(a), together with the Subsequent Receivables
and other property related thereto sold, transferred, assigned and conveyed to
the Issuer pursuant to Section 2.01(b), on or prior to such date pursuant to a
Second-Tier Subsequent Assignment.
"Trustees" has the meaning specified in the Indenture.
21
"UCC" has the meaning specified in the Indenture.
"Underwriters" means the underwriters named in Schedule A to the
Underwriting Agreement.
"Underwriting Agreement" means the underwriting agreement, dated
______________ ___, 200__, between PASS and the Representative, relating to
the purchase of the Class A Notes by the Underwriters from PASS.
"United States" has the meaning specified in the Indenture.
"Vice President" of any Person means any vice president of such
Person, whether or not designated by a number or words before or after the
title "Vice President", who is a duly elected officer of such Person.
"Wachovia Bank" means Wachovia Bank, National Association.
"Yield Supplement Account" means the account designated as such, and
established and maintained pursuant to Section 4.01(a).
"Yield Supplement Account Amount" means, with respect to any
Distribution Date, the amount listed below for that Distribution Date or to
the extent any Yield Supplement Account Subsequent Deposits are made to the
Yield Supplement Account in connection with a transfer of Subsequent
Receivables to the Issuer, the amount listed below plus the portion of any
such Yield Supplement Account Subsequent Deposits related to such Distribution
Date.
Yield Yield
Yield Supplement Supplement
Supplement Account Account
Distribution Date Account Amount Distribution Date Amount Distribution Date Amount
-------------------- ----------------- --------------------- ---------- ---------------------- -----------
Closing Date $ April 2008 $ May 2010 $
April 2006 $ May 2008 $ June 2010 $
May 2006 $ June 2008 $ July 2010 $
June 2006 $ July 2008 $ August 2010 $
July 2006 $ August 2008 $ September 2010 $
August 2006 $ September 2008 $ October 2010 $
September 2006 $ October 2008 $ November 2010 $
October 2006 $ November 2008 $ December 2010 $
November 2006 $ December 2008 $ January 2011 $
December 2006 $ January 2009 $ February 2011 $
January 2007 $ February 2009 $ March 2011 $
February 2007 $ March 2009 $ April 2011 $
March 2007 $ April 2009 $ May 2011 $
April 2007 $ May 2009 $ June 2011 $
May 2007 $ June 2009 $ July 2011 $
June 2007 $ July 2009 $ August 2011 $
July 2007 $ August 2009 $ September 2011 $
August 2007 $ September 2009 $ October 2011 $
September 2007 $ October 2009 $ November 2011 $
October 2007 $ November 2009 $ December 2011 $
November 2007 $ December 2009 $ January 2012 $
December 2007 $ January 2010 $ February 2012 $
January 2008 $ February 2010 $ On and after March
February 2008 $ March 2010 $ 2012 $
22
March 2008 $ April 2010 $
"Yield Supplement Account Draw Amount" means, with respect to any
Distribution Date, the amount equal to the difference between (i) the amount
on deposit in the Yield Supplement Account and (ii) the Yield Supplement
Account Amount for such Distribution Date.
"Yield Supplement Account Initial Deposit" means $______________.
"Yield Supplement Account Subsequent Deposit" means a deposit made by
the Depositor to the Yield Supplement Account on any Subsequent Transfer Date
in an amount required so that, to the extent that more than _____% of the
related Subsequent Receivables (based on aggregate principal balance) as of
the related Subsequent Cutoff Date have Contract Rates less than ____%, after
giving effect to the supplemental collections provided by the withdrawal of a
portion of such deposit on each Distribution Date, the effective Contract
Rates of such Subsequent Receivables with Contract Rates less than ____% being
transferred on such Subsequent Transfer Date shall be approximately ____%
(assuming that monthly payments on such Subsequent Receivables with Contract
Rates less than ___% are made according to the terms of such Subsequent
Receivables with no prepayments or defaults).
Section 1.02. Other Definitional Provisions.
(a) Capitalized terms used herein that are not otherwise defined
herein shall have the meanings ascribed thereto in the Indenture.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
Section 1.03. Interpretive Provisions. With respect to all terms in
this Agreement, unless the context otherwise requires: (i) a term has the
meaning assigned to it; (ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted accounting
principles as in effect from time to time in the United States; (iii) "or" is
not exclusive; (iv) "including" means including without limitation; (v) words
in the singular include the plural and words in the plural include the
singular; (vi) 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; (vii) references to a Person are also to its successors
and permitted assigns; (viii) the words "hereof", "herein" and "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;
(ix) Section, subsection, Schedule and Exhibit references in this Agreement
are references to Sections, subsections, Schedules and Exhibits in or to this
Agreement unless otherwise specified; (x) references to "writing" include
printing, typing, lithography and other means of reproducing words in a
visible form; and (xi) the term "proceeds" has the meaning set forth in the
applicable UCC.
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ARTICLE TWO
CONVEYANCE OF TRUST PROPERTY
Section 2.01. Conveyance of Trust Property.
(a) In consideration of the Issuer's delivery to or upon the order of
the Depositor on the Closing Date of authenticated Notes, in authorized
denominations in an aggregate principal amount equal to the Initial Note
Balance, and authenticated Certificates, the Depositor hereby irrevocably
sells, transfers, assigns and otherwise conveys to the Issuer, without
recourse (subject to the obligations of the Depositor set forth herein), all
right, title and interest of the Depositor, whether now owned or existing or
hereafter acquired or arising, and wheresoever located, in, to and under the
following:
(i) the Initial Receivables and all amounts due and
collected on or in respect of the Initial Receivables (including
proceeds of the repurchase of Initial Receivables by the Seller
pursuant to Section 2.04 or the purchase of Initial Receivables by
the Master Servicer pursuant to Section 3.08 or 8.01) after the
Initial Cutoff Date;
(ii) the security interests in the Financed Vehicles granted
by the Obligors pursuant to the Initial Receivables and any other
interest of the Depositor in such Financed Vehicles;
(iii) all proceeds from claims on or refunds of premiums of
any physical damage or theft insurance policies and extended
warranties covering such Financed Vehicles and any proceeds of or
refunds of premiums of any credit life or credit disability insurance
policies relating to the Initial Receivables, the related Financed
Vehicles or the related Obligors;
(iv) the Receivable Files that relate to the Initial
Receivables;
(v) any proceeds of Dealer Recourse that relate to the
Initial Receivables;
(vi) the Collection Account, the Note Payment Account, the
Certificate Payment Account, the Yield Supplement Account, the
Reserve Fund, the Pre-Funding Account and the Negative Carry Account
and all amounts, securities, Financial Assets, investments and other
property deposited in or credited to any of the foregoing and all
proceeds thereof;
(vii) all rights of the Depositor, but none of the
obligations, under the Receivables Purchase Agreement, including the
right to require the Seller to repurchase Receivables from the
Depositor;
(viii) the right to realize upon any property (including the
right to receive future Net Liquidation Proceeds and Recoveries) that
shall have secured an Initial Receivable and have been repossessed by
or on behalf of the Issuer; and
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(ix) all present and future claims, demands, causes of
action and choses in action in respect of any or all of the
foregoing, and all payments on or under and all proceeds of every
kind and nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all accounts,
accounts receivable, general intangibles, chattel paper, documents,
money, investment property, deposit accounts, letters of credit,
letter of credit rights, insurance proceeds, condemnation awards,
notes, drafts, acceptances, rights to payment of any and every kind
and other forms of obligations and receivables, instruments and other
property which at any time constitutes all or part of, or is included
in, the proceeds of any of the foregoing.
(b) Subject to the satisfaction of the conditions set forth in
Section 2.01(d), in consideration of the delivery by the Indenture Trustee on
or prior to any Subsequent Transfer Date to the Depositor of the amount
described in Section 4.08 to be delivered to the Depositor, the Depositor
shall, pursuant to a Second-Tier Subsequent Assignment, irrevocably sell,
transfer, assign and otherwise convey to the Issuer, without recourse (subject
to the obligations of the Depositor set forth herein), all right, title and
interest of the Depositor, whether now owned or existing or hereafter acquired
or arising, wheresoever located, in, to and under the following:
(i) the Subsequent Receivables listed on Schedule A to the
related Second-Tier Subsequent Assignment and all amounts due and
collected on or in respect of the Subsequent Receivables (including
proceeds of the repurchase of Subsequent Receivables by the Seller
pursuant to Section 2.04 or the purchase of Subsequent Receivables by
the Master Servicer pursuant to Section 3.08 or 8.01) after the
related Subsequent Cutoff Date;
(ii) the security interest in the Financed Vehicles granted
by the Obligors pursuant to the Subsequent Receivables and any other
interest of the Depositor in such Financed Vehicles;
(iii) all proceeds from claims on or refunds of premiums of
any physical damage or theft insurance policies and extended
warranties covering such Financed Vehicles and any proceeds of or
refunds of premiums of any credit life or credit disability insurance
policies relating to the Subsequent Receivables, the related Financed
Vehicles or the related Obligors;
(iv) the Receivable Files that relate to the Subsequent
Receivables;
(v) any proceeds of Dealer Recourse that relate to the
Subsequent Receivables;
(vi) the right to realize upon any property (including the
right to receive future Net Liquidation Proceeds and Recoveries) that
shall have secured a Subsequent Receivable and have been repossessed
by or on behalf of the Issuer;
(vii) all of the Depositor's rights under the related
First-Tier Subsequent Assignment; and
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(viii) all present and future claims, demands, causes of
action or choses in action in respect of any or all of the foregoing,
and all payments on or under and all proceeds of every kind and
nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all accounts,
accounts receivable, general intangibles, chattel paper, instruments,
documents, money, investment property, deposit accounts, notes,
drafts, acceptances, letters of credit, letter of credit rights,
insurance proceeds, condemnation awards, rights to payment of any and
every kind and other forms of obligations and receivables,
instruments and other property which at any time constitutes all or
part of, or is included in, the proceeds of any of the foregoing.
(c) The Depositor and the Issuer intend that each transfer of Trust
Property contemplated by Section 2.01(a) or 2.01(b) constitute a sale of such
Trust Property from the Depositor to the Issuer, conveying good title to the
Trust Property free and clear of any Liens and, in the event of the filing of
a bankruptcy petition by or against the Depositor under any bankruptcy or
similar law, that the Trust Property shall not be part of the Depositor's
estate. However, in the event that any such transfer is deemed to be a pledge,
the Depositor hereby grants to the Issuer a first priority security interest
in all of the Depositor's right, title and interest in, to and under such
Trust Property, and all proceeds thereof, to secure the payment of the Notes
and accrued interest thereon, and in such event, this Agreement shall
constitute a security agreement under applicable law.
(d) The Depositor shall sell, transfer, assign and otherwise convey
to the Issuer on any Subsequent Transfer Date the related Subsequent
Receivables and the other property and rights related thereto described in
Section 2.01(b) only upon the satisfaction of each of the following conditions
on or prior to such Subsequent Transfer Date:
(i) the Depositor shall have provided the Indenture Trustee,
the Owner Trustee and each Rating Agency (A) written notification of
the addition of such Subsequent Receivables at least three Business
Days prior to the Subsequent Transfer Date and (B) on or prior to the
Subsequent Transfer Date, a statement listing the approximate
aggregate Principal Balance of such Subsequent Receivables as of the
related Subsequent Cutoff Date and any other information reasonably
requested by any of the foregoing;
(ii) the Depositor shall have delivered to each of the Owner
Trustee and the Indenture Trustee a duly executed Second-Tier
Subsequent Assignment, which shall include a Schedule A attached
thereto listing each Subsequent Receivable to be transferred to the
Issuer on such Subsequent Transfer Date (and such Schedule A shall be
deemed to modify the Schedule of Receivables delivered at the Closing
Date and all Schedule As delivered after the Closing Date and prior
to such Subsequent Transfer Date);
(iii) the Depositor shall, to the extent required by Section
4.02, have deposited into the Collection Account all Available
Collections in respect of the Subsequent Receivables that are
property of the Issuer;
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(iv) as of such Subsequent Transfer Date: (A) the Depositor
shall not be insolvent and shall not become insolvent as a result of
the transfer of the Subsequent Receivables on such Subsequent
Transfer Date, (B) the Depositor shall not intend to incur or believe
that it would incur debts that would be beyond the Depositor's
ability to pay as such debts matured, (C) such transfer shall not be
made by the Depositor with actual intent to hinder, delay or defraud
any Person and (D) the assets of the Depositor shall not constitute
unreasonably small capital to carry out its business as conducted;
(v) the Pre-Funding Period shall not have terminated prior
to the Subsequent Transfer Date;
(vi) each of the representations and warranties made by the
Depositor in Sections 2.03 and 5.01 of this Agreement and by the
Seller pursuant to Sections 3.02 and 3.03 of the Receivables Purchase
Agreement, with respect to the Depositor, the Seller or the
Subsequent Receivables, as the case may be, shall be true and correct
as of the date as of which such representations and warranties are
made;
(vii) the Depositor shall, at its own expense, on or prior
to the Subsequent Transfer Date, indicate in its computer files that
the Subsequent Receivables have been sold to the Issuer pursuant to
this Agreement and the related Second-Tier Subsequent Assignment and
deliver to the Owner Trustee the related Schedule of Subsequent
Receivables certified by an officer of the Depositor to be true,
correct and complete;
(viii) the Depositor shall have taken any action required to
maintain the first perfected ownership interest of the Issuer in the
Trust Property and the first priority perfected security interest of
the Indenture Trustee in the Collateral;
(ix) no selection procedures believed by the Depositor to be
adverse to the interests of the Issuer or Securityholders shall have
been utilized in selecting the Subsequent Receivables;
(x) the addition of the Subsequent Receivables will not
result in a material adverse tax consequence to the Issuer or
Securityholders;
(xi) the Master Servicer shall have provided to the Issuer
and the Indenture Trustee the Officer's Certificate required to be
provided by the Master Servicer pursuant to Section 2.05;
(xii) pursuant to Section 4.07(a), the applicable Reserve
Fund Subsequent Deposit has been deposited into the Reserve Fund;
(xiii) pursuant to Section 4.01, the applicable Yield
Supplement Account Subsequent Deposit has been deposited into the
Yield Supplement Account;
(xiv) the Depositor shall have delivered to the Underwriters
and the Rating Agencies Opinions of Counsel relating to the
enforceability of the Subsequent Transfer Documents and the security
interests of the Issuer and the Indenture Trustee, respectively, in
the Subsequent Receivables in substantially the form of the
respective Opinions of
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Counsel delivered to the Underwriters and the Rating Agencies
regarding such matters pertaining to the Initial Contracts on the
Closing Date;
(xv) all the conditions to the transfer of the Subsequent
Receivables by the Seller to the Depositor specified in Section
4.01(b) of the Receivables Purchase Agreement shall be satisfied; and
(xvi) the Depositor shall have delivered to the Owner
Trustee and the Indenture Trustee an Officer's Certificate confirming
the satisfaction of each condition specified in this Section 2.01(d).
(e) The sales, transfers, assignments and conveyances of Trust
Property made under this Section shall not constitute, and is not intended to
result in, an assumption by the Issuer of any obligation of the Depositor or
the Seller to the Obligors or any other Person in connection with the
Receivables and the other Trust Property or any obligation of the Depositor or
the Seller under any agreement, document or instrument related thereto.
(f) Each of the parties hereto intend that the (i) FDIC Rule shall
apply to the transactions contemplated by this Agreement and the other Basic
Documents and (ii) transactions contemplated by this Agreement and the other
Basic Documents, taken as a whole, constitute a "securitization" within the
meaning of the FDIC Rule.
Section 2.02. Representations and Warranties of the Seller as to the
Receivables. The Seller has made, under the Receivables Purchase Agreement,
each of the representations and warranties as to the Receivables set forth in
Exhibit A. The Issuer shall be deemed to have relied on such representations
and warranties in accepting the Receivables. The representations and
warranties set forth in Exhibit A speak as of the date of execution and
delivery of this Agreement and as of the Closing Date in the case of the
Initial Receivables or as of the related Subsequent Transfer Date in the case
of the related Subsequent Receivables, except to the extent otherwise
provided, but shall survive the sale, transfer, assignment and conveyance of
the Receivables to the Issuer pursuant to this Agreement and the pledge of the
Receivables to the Indenture Trustee pursuant to the Indenture. Pursuant to
Section 2.01(a), the Depositor has sold, transferred, assigned and otherwise
conveyed to the Issuer, as part of the Trust Property, its rights under the
Receivables Purchase Agreement, including its right to require the Seller to
repurchase Receivables in accordance with the Receivables Purchase Agreement
upon a breach of the representations and warranties set forth in Exhibit A.
The Seller hereby agrees that the Issuer shall have the right to
enforce any and all rights under the Receivables Purchase Agreement assigned
to the Issuer under this Agreement, including the right to require the Seller
to repurchase Receivables in accordance with the Receivables Purchase
Agreement upon a breach of the representations and warranties set forth in
Exhibit A, directly against the Seller as though the Issuer were a party to
the Receivables Purchase Agreement and that the Issuer shall not be obligated
to enforce any such right indirectly through the Depositor.
Section 2.03. Representations and Warranties of the Depositor as to
the Receivables. The Depositor makes the following representations and
warranties as to the Receivables on
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which the Issuer shall be deemed to have relied in accepting the Receivables.
The representations and warranties speak as of the date of execution and
delivery of this Agreement and as of the Closing Date in the case of the
Initial Receivables or as of the related Subsequent Transfer Date in the case
of the related Subsequent Receivables, except to the extent otherwise
provided, but shall survive the sale, transfer, assignment and conveyance of
the Receivables to the Issuer pursuant to this Agreement and the pledge of the
Receivables to the Indenture Trustee pursuant to the Indenture.
(a) Title. The Depositor has purchased the Receivables from
the Seller. The Depositor intends that each transfer of the
Receivables contemplated by Section 2.01 constitute a sale of the
Receivables from the Depositor to the Issuer and that the beneficial
interest in, and title to, the Receivables not be part of the
Depositor's estate in the event of the filing of a bankruptcy
petition by or against the Depositor under any bankruptcy law. The
Depositor has not sold, transferred, assigned or pledged any
Receivable to any Person other than the Issuer. The Depositor has not
created, incurred or suffered to exist any Lien on any Receivable
except for the Lien of (i) this Agreement and (ii) Indenture.
(b) Security Interest Matters. This Agreement creates a
valid and continuing "security interest" (as defined in the UCC) in
the Receivables in favor of the Issuer, which security interest is
prior to all other Liens and is enforceable as such as against
creditors of and purchasers from the Depositor. The Receivables
constitute "tangible chattel paper" (as defined in the UCC). The
Depositor owns and has good and marketable title to the Receivables
free and clear of any Lien of any Person. The Depositor has caused or
will cause prior to the Closing Date (in the case of the Initial
Receivables) and prior to each Subsequent Transfer Date (in the case
of the related Subsequent Receivables) the filing of all appropriate
financing statements in the proper filing offices in the appropriate
jurisdictions under applicable law necessary to perfect the security
interest in the Receivables granted to the Issuer under this
Agreement. Other than the security interest granted to the Issuer
under this Agreement, the Depositor has not pledged, assigned, sold,
granted a security interest in or otherwise conveyed any of the
Receivables. The Depositor has not authorized the filing of and is
not aware of any financing statements against the Depositor that
include a description of collateral covering the Receivables other
than any financing statement relating to the security interest
granted to the Issuer under this Agreement or that has been
terminated. The Depositor is not aware of any judgment or tax lien
filings against the Depositor. The security interest of the Seller in
each Financed Vehicle has been validly assigned by the Depositor to
the Issuer.
(c) Financing Statements. All financing statements filed or
to be filed against the Depositor in favor of the Indenture Trustee
(as assignee of the Issuer) contain a statement substantially to the
following effect: "A purchase of or security interest in any
collateral described in this financing statement will violate the
rights of the Indenture Trustee".
(d) No Transfer Restrictions. The Depositor has not created,
incurred or suffered to exist any restriction on transferability of
the Receivables except for the
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restrictions on transferability imposed by this Agreement. The
transfer of the Receivables and the Receivable Files by the Depositor
to the Issuer pursuant to this Agreement is not subject to the bulk
transfer laws or any similar statutory provisions in effect in any
applicable jurisdiction.
Section 2.04. Repurchase of Receivables Upon Breach. The Depositor,
the Seller, the Master Servicer or the Owner Trustee, as the case may be,
shall inform the other parties to this Agreement and the Indenture Trustee
promptly, in writing, upon the discovery of any breach or failure to be true
of the representations and warranties set forth in Exhibit A. If such breach
or failure shall not have been cured by the close of business on the last day
of the Collection Period which includes the 30th day after the date on which
the Seller becomes aware of, or receives written notice from the Depositor,
the Master Servicer or the Owner Trustee of, such breach or failure, and such
breach or failure materially and adversely affects the interest of the Issuer
in a Receivable, the Seller shall repurchase such Receivable from the Issuer
on the Distribution Date immediately following such Collection Period. In
consideration of the repurchase of a Receivable hereunder, the Seller shall
remit the Purchase Amount of such Receivable in the manner specified in
Section 4.05. The sole remedy of the Issuer, the Owner Trustee, the Indenture
Trustee, the Noteholders and the Certificateholders with respect to a breach
or failure to be true of the representations and warranties set forth in
Exhibit A shall be to require the Seller to repurchase Receivables pursuant to
this Section or Section 3.03(c) of the Receivables Purchase Agreement. Neither
the Owner Trustee nor the Indenture Trustee shall have any duty to conduct an
affirmative investigation as to the occurrence of any condition requiring the
repurchase of any Receivable pursuant to this Section or the eligibility of
any Receivable for purposes of this Agreement.
Section 2.05. Custody of Receivable Files. To assure uniform quality
in servicing the Receivables and to reduce administrative costs, the Issuer
hereby revocably appoints the Master Servicer as its agent, and the Master
Servicer hereby accepts such appointment, to act as custodian on behalf of the
Issuer and the Indenture Trustee of the following documents or instruments
which are hereby constructively delivered to the Indenture Trustee (or, in the
case of the Subsequent Receivables, will be constructively delivered to the
Indenture Trustee on the related Subsequent Transfer Date), as pledgee of the
Trust Property pursuant to the Indenture with respect to each Receivable
(collectively, a "Receivable File"):
(a) the fully executed original of the Receivable;
(b) the original (or image of the original) credit
application with respect to such Receivable fully executed by the
related Obligor or a photocopy thereof or a record thereof on a
computer file or disc or on microfiche;
(c) the original certificate of title for the related
Financed Vehicle (or evidence that such certificate of title has been
applied for) or such other documents that the Seller or the Master
Servicer shall keep on file, in accordance with its customary
practices and procedures, evidencing the security interest of the
Seller in such Financed Vehicle;
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(d) documents evidencing the commitment of the related
Obligor to maintain physical damage insurance covering the related
Financed Vehicle; and
(e) any and all other documents (including any computer file
or disc or microfiche) that the Seller or the Master Servicer shall
keep on file, in accordance with its customary practices and
procedures, relating to the Receivable, the related Obligor or the
related Financed Vehicle.
Section 2.06. Duties of Master Servicer as Custodian.
(a) Safekeeping. The Master Servicer, in its capacity as custodian,
shall hold the Receivable Files for the benefit of the Issuer and the
Indenture Trustee and maintain such accurate and complete accounts, records
and computer systems pertaining to each Receivable File as shall enable the
Master Servicer and the Issuer to comply with this Agreement and the Indenture
Trustee to comply with the Indenture. In performing its duties as custodian,
the Master Servicer shall act with reasonable care, using that degree of skill
and attention that it exercises with respect to the files of comparable motor
vehicle installment sale contracts that the Master Servicer services for
itself or others. The Master Servicer shall conduct, or cause to be conducted,
in accordance with its customary practices and procedures, periodic
examinations of the files of all receivables owned or serviced by it which
shall include 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 Issuer or the Indenture Trustee to verify the accuracy of the
Master Servicer's record keeping. The Master Servicer shall promptly report to
the Trustees any failure on its part to hold the Receivable Files and to
maintain its accounts, records and computer systems as herein provided and
promptly take appropriate action to remedy any such failure. Nothing herein
shall be deemed to require an initial review or any periodic review of the
Receivable Files by the Issuer or the Trustees, and none of the Issuer or
either Trustee shall be liable or responsible for any action or failure to act
by the Master Servicer in its capacity as custodian hereunder.
(b) Maintenance of and Access to Records. The Master Servicer shall
maintain each Receivable File at one of the locations specified in Schedule A
or at such other location as shall be specified to the Issuer and the
Indenture Trustee by 30 days' prior written notice. The Master Servicer may
temporarily move individual Receivable Files or any portion thereof without
notice as necessary to conduct collection and other servicing activities in
accordance with its customary practices and procedures. The Master Servicer
shall make available to the Issuer and the Indenture Trustee or its duly
authorized representatives, attorneys or auditors a list of locations of the
Receivable Files, the Receivable Files and the related accounts, records and
computer systems maintained by the Master Servicer at such times during normal
business hours as the Issuer and the Indenture Trustee shall reasonably
request.
(c) Release of Documents. As soon as practicable after receiving
written instructions from the Indenture Trustee, the Master Servicer shall
release any document in the Receivable Files to the Indenture Trustee or its
agent or designee, as the case may be, at such place or places as the
Indenture Trustee may reasonably designate. The Master Servicer shall not be
responsible for any loss occasioned by the failure of the Indenture Trustee to
return any document or any delay in so doing.
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(d) Title to Receivables. The Master Servicer shall not at any time
have, or in any way attempt to assert, any interest in any Receivable held by
it as custodian hereunder or in the related Receivable File, other than for
collecting or enforcing such Receivable for the benefit of the Issuer. The
entire equitable interest in such Receivable and the related Receivable File
shall at all times be vested in the Issuer.
Section 2.07. Instructions; Authority to Act. The Master Servicer
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 Indenture Trustee. A certified copy of excerpts of
authorizing resolutions of the board of directors of the Indenture Trustee
shall constitute conclusive evidence of the authority of any such Responsible
Officer to act and shall be considered in full force and effect until receipt
by the Master Servicer of written notice to the contrary given by the
Indenture Trustee.
Section 2.08. Indemnification by Custodian. The Master Servicer, in
its capacity as custodian of the Receivable Files, shall indemnify and hold
harmless the Issuer, the Trustees and each of their respective officers,
directors, employees and agents from and against any and all liabilities,
obligations, losses, compensatory damages, payments, costs or expenses
(including reasonable legal fees, if any) of any kind whatsoever that may be
imposed on, incurred or asserted against the Issuer, the Trustees and each of
their respective officers, directors, employees and agents as the result of
any improper act or omission in any way relating to the maintenance and
custody of the Receivable Files by the Master Servicer, as custodian;
provided, however, that the Master Servicer shall not be liable for any
portion of any such liabilities, obligations, losses, compensatory damages,
payments, costs or expenses resulting from the willful misfeasance, bad faith
or negligence of either Trustee.
Section 2.09. Effective Period and Termination. The Master Servicer's
appointment as custodian shall become effective as of the Initial Cutoff Date
and shall continue in full force and effect until terminated pursuant to this
Section. If the Master Servicer shall resign as Master Servicer under Section
6.05, or if all of the rights and obligations of the Master Servicer shall
have been terminated under Section 7.01, the appointment of the Master
Servicer as custodian hereunder may be terminated by (i) the Issuer, with the
consent of the Indenture Trustee, (ii) Holders of Notes evidencing not less
than 25% of the Note Balance of the Controlling Class or, if the Notes have
been paid in full, by Certificateholders evidencing not less than 25% of the
aggregate Certificate Percentage Interest or (iii) the Owner Trustee, with the
consent of Holders of Notes evidencing not less than 25% of the Note Balance
of the Controlling Class, in each case by notice then given in writing to the
Depositor and the Master Servicer (with a copy to the Trustees if given by the
Noteholders or the Certificateholders). As soon as practicable after any
termination of such appointment, the Master Servicer shall deliver, or cause
to be delivered, the Receivable Files and the related accounts and records
maintained by the Master Servicer to the Indenture Trustee, the Indenture
Trustee's agent or the Indenture Trustee's designee, as the case may be, at
such place as the Indenture Trustee may reasonably designate or, if the Notes
have been paid in full, at such place as the Owner Trustee may reasonably
designate.
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ARTICLE THREE
ADMINISTRATION AND SERVICING OF THE TRUST PROPERTY
Section 3.01. Duties of Master Servicer. The Master Servicer, acting
alone or through one or more subservicers to the extent permitted hereunder,
for the benefit of the Issuer, shall manage, service, administer and make
collections on the Receivables with reasonable care but in no event less than
the care that the Master Servicer exercises with respect to all comparable
motor vehicle receivables that it services for itself or others. The Master
Servicer's duties shall include collection and posting of all payments,
responding to inquiries of Obligors or by federal, State or local government
authorities with respect to the Receivables, investigating delinquencies,
sending payment coupons to Obligors, reporting tax information to Obligors in
accordance with its customary practices, policing the collateral, accounting
for collections and furnishing monthly and annual statements to the Trustees
with respect to distributions, providing collection and repossession services
in the event of Obligor default, generating federal income tax information and
performing the other duties specified herein. The Master Servicer shall have
full power and authority to do any and all things in connection with such
managing, servicing, administration and collection that it may deem necessary
or desirable, it being understood, however, that the Master Servicer shall at
all times remain responsible to the Issuer and the Indenture Trustee for the
performance of its duties and obligations hereunder. Subject to the foregoing
and to Section 3.02, the Master Servicer shall follow its customary standards,
policies, practices and procedures in performing its duties hereunder as
Master Servicer. Without limiting the generality of the foregoing, the Master
Servicer shall be authorized and empowered to execute and deliver, on behalf
of itself, the Depositor, the Issuer, the Trustees, the Securityholders or any
of them, any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge and all other comparable instruments,
with respect to the Receivables and the Financed Vehicles.
The Master Servicer is hereby authorized to commence, in its own name
or in the name of the Issuer, a legal proceeding to enforce a Receivable
pursuant to Section 3.04 or to commence or participate in a legal proceeding
(including a bankruptcy proceeding) relating to or involving a Receivable,
including a Defaulted Receivable. If the Master Servicer commences or
participates in such a legal proceeding in its own name, the Issuer shall
thereupon be deemed to have automatically assigned, solely for the purpose of
collection on behalf of the party retaining an interest in such Receivable,
such Receivable and the other property conveyed to the Issuer pursuant to
Section 2.01 with respect to such Receivable to the Master Servicer for
purposes of commencing or participating in any such proceeding as a party or
claimant, and the Master Servicer is authorized and empowered by the Issuer to
execute and deliver in the Master Servicer's name any notices, demands,
claims, complaints, responses, affidavits or other documents or instruments in
connection with any such proceeding. If in any enforcement suit or legal
proceeding it shall be held that the Master Servicer may not enforce a
Receivable on the grounds that it shall not be a real party in interest or a
holder entitled to enforce such Receivable, the Owner Trustee shall, at the
Master Servicer's expense and written direction, take steps to enforce such
Receivable, including bringing suit in the Master Servicer's or the Issuer's
name or the name of the Owner Trustee, the Indenture Trustee, the Noteholders,
the Certificateholders or any of them.
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The Owner Trustee, on behalf of the Issuer, shall furnish the Master
Servicer with any powers of attorney and other documents and take any other
steps which the Master Servicer may deem necessary or appropriate to enable
the Master Servicer to carry out its servicing and administrative duties
hereunder. The Master Servicer, at its expense, shall obtain on behalf of the
Issuer or the Owner Trustee all licenses, if any, required by the laws of any
jurisdiction to be held by the Issuer or the Owner Trustee in connection with
ownership of the Receivables and shall make all filings and pay all fees as
may be required in connection therewith during the term of this Agreement. The
Master Servicer shall, or cause the Administrator to, prepare, execute and
deliver all certificates or other documents required to be delivered by the
Issuer pursuant to the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 or the rules and regulations
promulgated thereunder.
Section 3.02. Subservicers. The Master Servicer may enter into
subservicing agreements with one or more subservicers for the servicing and
administration of certain of the Receivables (including holding the related
Receivable Files as custodian). References herein to actions taken or to be
taken by the Master Servicer in servicing the Receivables include actions
taken or to be taken by a subservicer on behalf of the Master Servicer. Each
subservicing agreement will be upon such terms and conditions as are not
inconsistent with this Agreement and as the Master Servicer and the
subservicer have agreed. With the approval of the Master Servicer, a
subservicer may delegate its servicing obligations to third-party servicers,
but such subservicer will remain obligated under the related subservicing
agreement. The Master Servicer and a subservicer may enter into amendments
thereto or different forms of subservicing agreements; provided, however, that
any such amendments or different forms shall be consistent with and not
violate the provisions of this Agreement or materially adversely affect the
rights of the Securityholders hereunder.
The Master Servicer shall be entitled to terminate any subservicing
agreement that may exist in accordance with the terms and conditions of such
subservicing agreement and without any limitation by virtue of this Agreement;
provided, however, that in the event of termination of any subservicing
agreement by the Master Servicer or the related subservicer, the Master
Servicer shall either act directly as servicer of the related Receivable or
enter into a subservicing agreement with a successor subservicer which will be
bound by the terms of the related subservicing agreement.
Notwithstanding any subservicing agreement, any of the provisions of
this Agreement relating to agreements or arrangements between the Master
Servicer or a subservicer or reference to actions taken through such Persons
or otherwise, the Master Servicer shall remain obligated and liable to the
Indenture Trustee, the Owner Trustee, the Issuer and the Securityholders for
the servicing and administering of the Receivables in accordance with the
provisions of this Agreement without diminution of such obligation or
liability by virtue of such subservicing agreements or arrangements or by
virtue of indemnification from a subservicer and to the same extent and under
the same terms and conditions as if the Master Servicer alone were servicing
and administering the Receivables. The Master Servicer shall be entitled to
enter into an agreement with a subservicer for indemnification of the Master
Servicer and nothing contained in this Agreement shall be deemed to limit or
modify such indemnification.
Any subservicing agreement that may be entered into and any other
transactions or servicing arrangements relating to the Receivables involving a
subservicer or an Affiliate of the
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Master Servicer in its capacity as such, and not as an originator of
Receivables, shall be deemed to be between the subservicer or such Affiliate,
as the case may be, and the Master Servicer alone, and none of the Indenture
Trustee, the Owner Trustee, the Issuer, the Noteholders nor the
Certificateholders shall be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect to the subservicer
except as set forth in the immediately succeeding paragraph.
In the event the Master Servicer shall for any reason no longer be
acting as servicer under this Agreement (including by reason of termination of
the Master Servicer following the occurrence of a Servicer Termination Event),
the Indenture Trustee or its designee may, at the sole discretion of the
Indenture Trustee, thereupon assume all of the rights and obligations of such
Master Servicer under each subservicing agreement selected by the Indenture
Trustee in its sole discretion. In such event, the Indenture Trustee, its
designee or such other Successor Servicer that is appointed pursuant to
Section 7.02 and assumes the obligations and duties of the Master Servicer
under this Agreement shall be deemed to have assumed all of the Master
Servicer's interest therein and to have replaced the Master Servicer as a
party to each such subservicing agreement to the same extent as if such
subservicing agreement had been assigned to the assuming party except that the
Master Servicer shall not thereby be relieved of any liability or obligations
under the subservicing agreement. The Master Servicer shall, upon request of
the Indenture Trustee but at the expense of the Master Servicer, deliver to
the assuming party all documents and records relating to each such
subservicing agreement and the Receivables then being serviced and an
accounting of amounts collected and held by it and otherwise use its best
efforts to effect the orderly and efficient transfer of the subservicing
agreement to the assuming party.
The Master Servicer, each subservicer and any Successor Servicer
shall at all times comply with all applicable federal, State and local laws,
rules, regulations and ordinances governing or relating to the privacy rights
of the Obligors in connection with its performance of its duties under this
Agreement, including the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act. The Master Servicer, each
subservicer and any Successor Servicer shall implement such physical and other
security measures as shall be necessary to (i) ensure the security and
confidentiality of the "nonpublic personal information" of each Obligor, (ii)
protect against any threats or hazards to the security and integrity of such
nonpublic personal information and (iii) protect against any unauthorized
access to or use of such nonpublic personal information.
Section 3.03. Collection of Receivable Payments; Modification of
Receivables. The Master 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 otherwise act with respect to the
Receivables and the other Trust Property in such manner as will, in the
reasonable judgment of the Master Servicer, maximize the amount to be received
by the Issuer with respect thereto and in accordance with the standard of care
required by Section 3.01. The Master Servicer shall allocate collections on or
in respect of the Receivables between principal and interest in accordance
with the Simple Interest Method and the customary servicing practices and
procedures it follows with respect to all comparable motor vehicle retail
installment sale contracts that it services for itself or others. The Master
Servicer shall not increase or decrease the number or amount of any Monthly
Payment, the Amount Financed under any Receivable or the Contract Rate of any
Receivable, or extend, rewrite or otherwise modify the payment terms
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of any Receivable; provided, however, that the Master Servicer may extend the
due date for one or more payments due on any Receivable for credit-related
reasons that would be acceptable to the Master Servicer with respect to
comparable motor vehicle retail installment sale contracts that it services
for itself or others and in accordance with its customary standards, policies,
practices and procedures if the cumulative extensions with respect to any
Receivable shall not cause the term of such Receivable to extend beyond the
last day of the Collection Period relating to the Class B Final Scheduled
Distribution Date. If the Master Servicer fails to comply with the provisions
of the preceding sentence, the Master Servicer shall be required to purchase
each Receivable affected thereby for the related Purchase Amount, in the
manner specified in Section 3.08, as of the close of business on the last day
of the Collection Period which includes the 30th day after the Master Servicer
becomes aware of such failure. The Master Servicer may, in its discretion (but
only in accordance with its customary standards, policies, practices and
procedures), waive any late payment charge or any other fee that may be
collected in the ordinary course of servicing a Receivable. In addition, in
the event that any such extension of a Receivable modifies the terms of such
Receivable in such a manner as to constitute a cancellation of such Receivable
and the creation of a new motor vehicle receivable that results in a deemed
exchange thereof within the meaning of Section 1001 of the Code, the Master
Servicer shall purchase such Receivable pursuant to Section 3.08, and the
Receivable created shall not be included in the Trust Property.
Section 3.04. Realization Upon Receivables.
(a) The Master Servicer shall use commercially reasonable efforts on
behalf of the Issuer, in accordance with the standard of care required under
Section 3.01, to repossess or otherwise convert the ownership of each Financed
Vehicle securing a Defaulted Receivable. In taking such action, the Master
Servicer shall follow such customary and usual practices and procedures as it
shall deem necessary or advisable in its servicing of comparable motor vehicle
installment sale contracts, and as are otherwise consistent with the standard
of care required under Section 3.01. The Master Servicer shall be entitled to
recover all reasonable expenses incurred by it with respect to realizing on a
Defaulted Receivable, including such expenses incurred in the course of
repossessing and liquidating a Financed Vehicle into cash proceeds, but only
out of the cash proceeds of such Financed Vehicle and any deficiency amount
obtained from the Obligor. The foregoing is subject to the proviso that, in
any case in which the Financed Vehicle shall have suffered damage, the Master
Servicer shall not expend funds in connection with any repair or towards the
repossession of such Financed Vehicle unless it shall determine in its
discretion that such repair or repossession shall increase the Net Liquidation
Proceeds or Recoveries of the related Receivable.
(b) If the Master Servicer elects to commence a legal proceeding to
enforce a Dealer Agreement, the act of commencement shall be deemed to be an
automatic assignment from the Issuer to the Master Servicer of the rights of
recourse under such Dealer Agreement. If, however, in any enforcement suit or
legal proceeding, it is held that the Master Servicer may not enforce a Dealer
Agreement on the grounds that it is not a real party in interest or a Person
entitled to enforce the Dealer Agreement, the Owner Trustee, at the Master
Servicer's expense and direction, shall take such steps as the Master Servicer
deems necessary to enforce the Dealer Agreement, including bringing suit in
its name or the names of the Indenture Trustee, the Securityholders or any of
them.
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Section 3.05. Maintenance of Physical Damage Insurance Policies. The
Master Servicer shall follow its customary practices and procedures to
determine whether or not each Obligor shall have maintained physical damage
insurance covering the related Financed Vehicle. In the event that the Master
Servicer has determined that an Obligor fails to maintain the required
insurance, the Master Servicer shall treat the Obligor as being in default
under the related Receivable.
Section 3.06. Maintenance of Security Interests in Financed Vehicles.
The Master Servicer shall take such steps, in accordance with the standard of
care required under Section 3.01, as are necessary to maintain perfection of
the security interest created by each Receivable in the related Financed
Vehicle. The Issuer hereby authorizes the Master Servicer, and the Master
Servicer hereby agrees, to take such steps as are necessary to re-perfect such
security interest on behalf of the Issuer and the Indenture Trustee in the
event the Master Servicer receives notice of, or otherwise has actual
knowledge of, the fact that such security interest is not perfected as a
result of the relocation of a Financed Vehicle or for any other reason. In the
event that the assignment of a Receivable to the Issuer is insufficient,
without a notation on the related Financed Vehicle's certificate of title, to
grant to the Issuer a first priority perfected security interest in the
related Financed Vehicle, the Master Servicer hereby agrees to serve as the
agent of the Issuer for the purpose of perfecting the security interest of the
Issuer in such Financed Vehicle and agrees that the Master Servicer's listing
as the secured party on the certificate of title is solely in its capacity as
agent of the Issuer. The Master Servicer shall not release, in whole or in
part, any security interest in a Financed Vehicle created by the related
Receivable except as permitted herein or in accordance with its customary
standards, policies, practices and procedures.
Section 3.07. Covenants of Master Servicer. The Master Servicer makes
the following covenants:
(a) Liens in Force. Except upon the payment in full of a
Receivable or as otherwise contemplated by this Agreement or
applicable law, the Master Servicer shall not release in whole or in
part any Financed Vehicle from the security interest securing the
related Receivable.
(b) No Impairment. The Master Servicer shall not impair in
any material respect the rights of the Depositor, the Issuer, the
Trustees or the Securityholders in the Receivables or, except as
permitted under Section 3.03, otherwise amend or alter the terms of
the Receivables and as a result of such amendment or modification or
alteration, the interests of the Depositor, the Issuer, the Trustees
or the Securityholder would be materially adversely affected.
(c) Schedule of Receivables to Indenture Trustee. The Master
Servicer shall on or before the Closing Date (and, at any time
thereafter, upon the request of the Indenture Trustee) deliver to the
Indenture Trustee a copy of the Schedule of Receivables.
Section 3.08. Purchase of Receivables Upon Breach. The Depositor, the
Seller, the Master Servicer or the Owner Trustee, as the case may be, shall
inform the other parties to this
37
Agreement and the Indenture Trustee promptly, in writing, upon the discovery
of any breach of Section 3.03, 3.06 or 3.07. If such breach shall not have
been cured by the close of business on the last day of the Collection Period
which includes the 30th day after the date on which the Master Servicer
becomes aware of, or receives written notice from the Depositor, the Seller,
or the Owner Trustee of, such breach, and such breach materially and adversely
affects the interest of the Issuer in a Receivable, the Master Servicer shall
purchase such Receivable from the Issuer on the related Deposit Date;
provided, however, that, with respect to a breach of Section 3.03, the Master
Servicer shall purchase the affected Receivable from the Issuer at the end of
the Collection Period in which such breach occurs. In consideration of the
purchase of a Receivable hereunder, the Master Servicer shall remit the
related Purchase Amount of such Receivable to the Collection Account in the
manner specified in Section 4.05. The sole remedy of the Issuer, the Owner
Trustee, the Indenture Trustee, the Noteholders and the Certificateholders
with respect to a breach of Section 3.03, 3.06 or 3.07 shall be to require the
Master Servicer to purchase Receivables pursuant to this Section. Neither the
Owner Trustee nor the Indenture Trustee shall have any duty to conduct an
affirmative investigation as to the occurrence of any condition requiring the
purchase of any Receivable pursuant to this Section.
Section 3.09. Servicing Compensation; Payment of Certain Expenses by
Master Servicer. The Master Servicer shall receive the Monthly Servicing Fee
for servicing the Receivables. The Monthly Servicing Fee for any Collection
Period shall equal the product of one-twelfth of the Servicing Rate and the
Pool Balance as of the first day of such Collection Period (or, in the case of
the initial Collection Period, the Pool Balance as of the Initial Cutoff
Date). As additional servicing compensation, the Master Servicer shall be
entitled to receive or retain the Supplemental Servicing Fee. The Master
Servicer shall pay all expenses incurred by it in connection with the
activities under this Agreement (including fees and expenses of the Trustees,
the Independent accountants and any subservicer, taxes imposed on the Master
Servicer, expenses incurred in connection with distributions and reports to
Securityholders and all other fees and expenses not expressly stated under
this Agreement to be for the account of the Securityholders), except expenses
incurred in realizing upon Receivables under Section 3.04.
Section 3.10. Master Servicer's Certificate. On or before each
Determination Date, the Master Servicer shall deliver to the Depositor, the
Seller, the Trustees and each Rating Agency a Master Servicer's Certificate
containing all information necessary to make the transfers and distributions
required by Sections 4.05, 4.06, 4.07 and 4.08 in respect of the related
Collection Period on the related Distribution Date and all information
necessary for the Trustees, as applicable, to send statements to
Securityholders pursuant to Section 4.12 and pursuant to Section 6.06 of the
Indenture. The Master Servicer shall also specify to the Trustees, no later
than the Determination Date following the last day of a Collection Period as
of which the Seller shall separately identify (by account number) in a written
notice to the Depositor and the Trustees, the Receivables to be repurchased by
the Seller or purchased by the Master Servicer, as the case may be, on the
related Deposit Date and, upon request of one of the foregoing parties, each
Receivable that became a Defaulted Receivable during the related Collection
Period. The Master Servicer shall deliver to the Rating Agencies any
information, to the extent that it is available to the Master Servicer, that
the Rating Agencies reasonably request in order to monitor the Issuer.
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Section 3.11. Annual Statement as to Compliance; Notice of Servicer
Termination Events.
(a) The Master Servicer shall deliver to the Depositor, the Trustees
and each Rating Agency, within 90 days after each year end, beginning with the
first year end that is at least four months after the Closing Date, an
Officer's Certificate of the Master Servicer, stating that (i) a review of the
activities of the Master Servicer during the preceding 12-month period ended
December 31 (or, if applicable, such shorter period in the case of the first
such Officer's Certificate) and of its performance under this Agreement has
been made under such officer's supervision and (ii) to such officer's
knowledge, based on such review, the Master Servicer has fulfilled all its
obligations under this Agreement throughout such period, or, if there has been
a default in the fulfillment of any such obligation, specifying each such
default known to such officer and the nature and status thereof.
(b) Notwithstanding Section 3.11(a), to the extent that Regulation AB
requires the delivery by the Master Servicer of an annual report on an
assessment of servicing compliance on the basis of detailed servicing criteria
or other report, the delivery of a copy of such report to the Depositor, the
Trustees and each Rating Agency shall be deemed to satisfy the provisions of
Subsection 3.11(a).
(c) The Master Servicer shall deliver to the Depositor, the Trustees
and each Rating Agency, promptly after having obtained knowledge thereof, but
in no event later than five Business Days thereafter, an Officer's Certificate
specifying any event which constitutes or, with the giving of notice or lapse
of time, or both, would become, a Servicer Termination Event.
(d) The Master Servicer shall cause each Reporting Subcontractor to
deliver to the Depositor an assessment of compliance and accountant's
attestation as and when provided in paragraph (a)(i) or (ii) of this Section
3.11 and Section 3.12. The Master Servicer shall execute (provided the Master
Servicer is not an Affiliate of the Depositor) (and shall cause each Reporting
Subcontractor to execute) a reliance certificate to enable the Certification
Parties to rely upon each (i) annual report on assessments of compliance with
servicing criteria provided pursuant to Section 3.11 and (ii) accountant's
report provided pursuant to Section 3.12 and shall include a certification
that each such annual compliance statement or report discloses any
deficiencies or defaults described to the registered public accountants of
such Person to enable such accountants to render the certificates provided for
in Section 3.12.
Section 3.12. Annual Accountants' Report.
(a) The Master Servicer shall cause a firm of Independent certified
public accountants (who may also render other services to the Master Servicer
or to the Depositor or their respective Affiliates) to deliver to the
Depositor and the Trustees within 90 days after each year end, beginning with
the first year end that is at least four months after the Closing Date, a
report with respect to the preceding 12-month period ended December 31 (or, if
applicable, such shorter period in the case of the first such report) or other
report to the effect that such accountants have examined, on a test basis,
evidence of the Master Servicer's compliance with the covenants and conditions
set forth in this Agreement. The report will express an opinion on the Master
Servicer's assertion that the Master Servicer complied in all material
respects with the
39
aforementioned covenants and conditions is fairly stated, in all material
respects or the reason why such an opinion cannot be expressed. Such report
shall also indicate that the firm is Independent with respect to the Depositor
and the Master Servicer within the meaning of the Code of Professional Ethics
of the American Institute of Certified Public Accountants.
(b) Notwithstanding Section 3.12(a), to the extent that Regulation AB
requires the delivery of an annual attestation of a firm of Independent public
accountants with respect to the assessment of servicing compliance with
specified servicing criteria by the Master Servicer, the delivery of a copy of
such attestation to the Depositor and the Trustees shall be deemed to satisfy
the provisions of this Section. Any such attestation shall be in accordance
with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the Securities Act
and the Exchange Act, stating, among other things, that the Master Servicer's
assertion of compliance with the specified servicing criteria is fairly stated
in all material respects, or the reason why such an opinion cannot be
expressed.
Section 3.13. Access to Certain Documentation and Information
Regarding Receivables. Subject to Section 2.06(b), the Master Servicer shall
provide the Depositor, the Trustees and the Securityholders with access to the
Receivables Files in the cases where the related Trustee or such
Securityholder is required by applicable statutes or regulations to have
access to such documentation. Such access shall be afforded without charge but
only upon reasonable request and during normal business hours which does not
unreasonably interfere with the normal operations or customer or employee
relations of the Master Servicer, at the offices of the Master Servicer.
Nothing in this Section shall affect the obligation of the Master Servicer to
observe any applicable law prohibiting disclosure of information regarding the
Obligors, and the failure of the Master Servicer to provide access to
information as a result of such obligation shall not constitute a breach of
this Section. Each Securityholder, by its acceptance of the related Security
or a beneficial interest therein, shall be deemed to have agreed to keep any
information obtained by it pursuant to this Section confidential, except as
may be required by applicable law.
Section 3.14. Reports to the Commission. The Master Servicer shall,
on behalf of the Issuer, cause to be filed with the Commission any periodic
reports required to be filed under the provisions of the Exchange Act, and the
rules and regulations of the Commission thereunder. The Depositor shall, at
its expense, cooperate in any reasonable request made by the Master Servicer
in connection with such filings.
Section 3.15. Reports to Rating Agencies. The Master Servicer shall
deliver to each Rating Agency, at such address as such Rating Agency may
request, a copy of all reports or notices furnished or delivered pursuant to
this Article and a copy of any amendments, supplements or modifications to
this Agreement and any other information reasonably requested by such Rating
Agency to monitor this transaction.
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ARTICLE FOUR
DISTRIBUTIONS; RESERVE FUND;
STATEMENTS TO SECURITYHOLDERS
Section 4.01. Establishment of Accounts.
(a) Wachovia Bank (as Master Servicer hereunder and as Securities
Intermediary under the Control Agreement) shall establish, on or before the
Closing Date, and maintain an Eligible Deposit Account in the name of the
Indenture Trustee at an Eligible Institution (which shall initially be
Wachovia Bank) for the benefit of (i) the Securityholders, the Master Servicer
and the Trustees, designated as the "Wachovia Auto Owner Trust 200__-__
Collection Account, U.S. Bank National Association, Indenture Trustee" (the
"Collection Account"), (ii) the Noteholders, the Master Servicer and the
Trustees, designated as the "Wachovia Auto Owner Trust 200__-__ Note Payment
Account, U.S. Bank National Association, Indenture Trustee" (the "Note Payment
Account"), (iii) the Securityholders, designated as the "Wachovia Auto Owner
Trust 200__-__ Yield Supplement Account, U.S. Bank National Association,
Indenture Trustee" (the "Yield Supplement Account"), (iv) the Securityholders,
designated as the "Wachovia Auto Owner Trust 200__-__ Pre-Funding Account,
U.S. Bank National Association, Indenture Trustee" (the "Pre-Funding Account")
and (v) the Securityholders, designated as the "Wachovia Auto Owner Trust
200__-__ Negative Carry Account, U.S. Bank National Association, Indenture
Trustee" (the "Negative Carry Account"), in each case bearing a designation
clearly indicating that the funds deposited therein are held in trust for the
benefit of the related Persons. On the Closing Date, the Depositor shall
deposit the Yield Supplement Account Initial Deposit into the Yield Supplement
Account, the Pre-Funding Account Initial Deposit into the Pre-Funding Account
and the Maximum Negative Carry Amount into the Negative Carry Account from the
net proceeds of the sale of the Notes. On each Subsequent Transfer Date, as a
condition precedent to the acquisition of any Subsequent Receivables on such
Subsequent Transfer Date, the Depositor shall deposit the Yield Supplement
Account Subsequent Deposit, if any, into the Yield Supplement Account. The
Collection Account, the Note Payment Account, the Yield Supplement Account,
the Pre-Funding Account and the Negative Carry Account shall be under the sole
dominion and control of the Indenture Trustee; provided, however, that the
Master Servicer may direct the Indenture Trustee in writing to make deposits
to and withdrawals from such Accounts in accordance with this Agreement and
the other Basic Documents. All monies deposited from time to time in the
Collection Account, the Note Payment Account, the Yield Supplement Account,
the Pre-Funding Account and the Negative Carry Account shall be held by the
Indenture Trustee as part of the Trust Property, and all deposits to and
withdrawals therefrom shall be made only upon the terms and conditions of the
Basic Documents.
(b) All interest and other income (net of losses and investment
expenses) on funds on deposit in the Accounts shall be retained on deposit in
the related Account.
(c) The Master Servicer shall establish, on or before the Closing
Date, and maintain in the name of the Owner Trustee at an Eligible Institution
(which shall initially be Wachovia Bank) a segregated trust account designated
as the "Wachovia Auto Owner Trust 200__-__ Certificate Payment Account" (the
"Certificate Payment Account"). The Certificate Payment Account shall be held
in trust for the benefit of the Certificateholders. The Certificate Payment
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Account shall be under the sole dominion and control of the Owner Trustee;
provided, however, that the Master Servicer may direct the Indenture Trustee
in writing to make deposits to and withdrawals from the Certificate Payment
Account in accordance with this Agreement and the other Basic Documents. All
monies deposited from time to time in the Certificate Payment Account shall be
held by the Owner Trustee as part of the Trust Property and shall be applied
as provided in the Basic Documents. The amounts on deposit in the Certificate
Payment Account shall not be invested.
Section 4.02. Collections. The Master Servicer shall remit to the
Collection Account all amounts received by the Master Servicer on or in
respect of the Receivables (including Net Liquidation Proceeds and all amounts
received by the Master Servicer in connection with the repossession and sale
of a Financed Vehicle (whether or not the related Receivable has been
classified as a Defaulted Receivable) but excluding payments with respect to
Purchased Receivables) as soon as practicable and in no event after the close
of business on the second Business Day after such receipt; provided, however,
that for so long as the Monthly Remittance Condition shall be satisfied, the
Master Servicer may remit all such amounts received on or in respect of the
Receivables during any Collection Period to the Collection Account in
immediately available funds on the related Deposit Date. As of the Closing
Date, the Master Servicer shall make remittances to the Collection Account on
a monthly basis. Neither Trustee shall be deemed to have knowledge of any
event or circumstance under clause (i) or (ii) of the definition of the term
"Monthly Remittance Condition" that would require daily remittances by the
Master Servicer to the Collection Account unless such Trustee has received
notice of such event or circumstance from the Depositor or the Master Servicer
in an Officer's Certificate or from the Holders of Notes evidencing not less
than 25% of the Note Balance of the Controlling Class or a Responsible Officer
of such Trustee has actual knowledge of such event or circumstance. If the
Master Servicer shall fail to satisfy the Monthly Remittance Condition, the
Master Servicer shall remit to the Collection Account on the Closing Date all
amounts received by the Master Servicer on or in respect of the Receivables
(including Net Liquidation Proceeds and all amounts received by the Master
Servicer in connection with the repossession and sale of a Financed Vehicle
(whether or not the related Receivable has been classified as a Defaulted
Receivable)) during the period from but excluding the Cutoff Date to and
including the second Business Day preceding the Closing Date. If the Master
Servicer shall satisfy the Monthly Remittance Condition, the Master Servicer
shall remit to the Collection Account on the related Deposit Date for the
initial Collection Period, all amounts received by the Master Servicer on or
in respect of the Receivables (including Net Liquidation Proceeds and all
amounts received by the Master Servicer in connection with the repossession
and sale of a Financed Vehicle (whether or not the related Receivable has been
classified as a Defaulted Receivable)) during the period from but excluding
the Cutoff Date to and including the last day of the initial Collection
Period.
Section 4.03. Application of Collections. For purposes of this
Agreement, all amounts received on or in respect of a Receivable during any
Collection Period (including Net Liquidation Proceeds and all amounts received
by the Master Servicer in connection with the repossession and sale of a
Financed Vehicle (whether or not the related Receivable has been classified as
a Defaulted Receivable) but excluding payments with respect to Purchased
Receivables) shall be applied by the Master Servicer, as of the last day of
such Collection Period, to interest and principal on such Receivable in
accordance with the Simple Interest Method.
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Section 4.04. Advances.
(a) If, as of the end of any Collection Period, the payments received
during such Collection Period by or on behalf of an Obligor in respect of a
Receivable (other than a Purchased Receivable) shall be less than the related
Monthly Payment, whether as a result of any extension granted to the Obligor
or otherwise, then an amount equal to the product of the Principal Balance of
such Receivable as of the first day of the related Collection Period and
one-twelfth of its Contract Rate minus the amount of interest actually
received on such Receivable during such Collection Period (each, an "Advance")
may be deposited by the Master Servicer, at its option, into the Collection
Account on the related Deposit Date. If such a calculation in respect of a
Receivable results in a negative number, an amount equal to such negative
amount shall be paid to the Master Servicer in reimbursement of any
outstanding Advances. In addition, in the event that a Receivable becomes a
Defaulted Receivable, the amount of accrued and unpaid interest thereon (but
not including interest for the current Collection Period) shall, up to the
amount of outstanding Advances, be withdrawn from the Collection Account and
paid to the Master Servicer in reimbursement of such outstanding Advances. No
Advances will be made with respect to the Principal Balance of Receivables.
The Master Servicer shall not be required to make an Advance to the extent
that the Master Servicer, in its sole discretion, shall determine that such
Advance is likely to become a Nonrecoverable Advance.
(b) Notwithstanding the provisions of Section 4.02, the Master
Servicer shall be entitled to reimbursement for an outstanding Advance made in
respect of a Receivable, without interest, from the following sources with
respect to such Receivable: (i) subsequent payments made by or on behalf of
the related Obligor, (ii) Net Liquidation Proceeds and Recoveries and (iii)
the Purchase Amount. If the Master Servicer determines that it has made a
Nonrecoverable Advance, the Master Servicer shall reimburse itself, without
interest, from unrelated amounts received by the Master Servicer on or in
respect of the Receivables (including Net Liquidation Proceeds and all amounts
received by the Master Servicer in connection with the repossession and sale
of a Financed Vehicle (whether or not the related Receivable has been
classified as a Defaulted Receivable)) to the extent it shall, concurrently
with the withholding of any such amounts from deposit in or credit to the
Collection Account, furnish to the Trustees a certificate of a Servicing
Officer setting forth the basis for the Master Servicer's determination, the
amount of, and Receivable with respect to which, such Nonrecoverable Advance
was made and the installment or installments or other proceeds respecting
which such reimbursement has been taken.
Section 4.05. Additional Deposits.
(a) The following additional deposits shall be made: (i) the Seller
shall remit to the Collection Account the aggregate Purchase Amount with
respect to Purchased Receivables pursuant to Section 2.04, (ii) Master
Servicer shall remit to the Collection Account (A) the aggregate Purchase
Amount with respect to Purchased Receivables pursuant to Section 3.08 and (B)
the amount required upon the optional purchase of all Receivables by the
Master Servicer pursuant to Section 8.01 and (iii) the Indenture Trustee shall
remit or shall cause to be remitted, pursuant to Section 4.06, the Reserve
Fund Draw Amount to the Collection Account, the Yield Supplement Account Draw
Amount to the Collection Account, the Negative Carry Account Draw Amount to
the Collection Account and, in the case of the Distribution Date following the
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Collection Period in which the Pre-Funding Period ends, the Pre-Funding
Account Amount as of the end of the Pre-Funding Period to the Note Payment
Account and the Negative Carry Account Amount to the Collection Account.
(b) All deposits required to be made in respect of a Collection
Period pursuant to this Section by the Master Servicer may be made in the form
of a single deposit and shall be made in immediately available funds, no later
than 5:00 p.m., New York City time, on the related Deposit Date.
Section 4.06. Determination Date Calculations; Application of
Available Funds.
(a) On each Determination Date, the Master Servicer shall calculate
the following amounts with respect to the related Distribution Date and
Collection Period:
(i) the Available Collections;
(ii) the Total Servicing Fee;
(iii) the Total Trustee Fees;
(iv) the Interest Distributable Amount for each Class of
Class A Notes;
(v) the Priority Principal Distributable Amount;
(vi) the Interest Distributable Amount for the Class B
Notes;
(vii) the Secondary Principal Distributable Amount;
(viii) the sum of the amounts described in clauses (ii)
through (vii) above (the "Required Payment Amount") provided,
however, that the aggregate amount to be included in the Required
Payment Amount pursuant to clause (iii) above shall not exceed
$________ in any given calendar year; and
(ix) the Regular Principal Distributable Amount.
(b) On each Determination Date, the Master Servicer shall calculate
the following amounts with respect to the related Distribution Date and
Collection Period:
(i) the lesser of (A) the amount, if any, by which the
Required Payment Amount exceeds Available Funds (calculated without
respect to any Reserve Fund Draw Amount for such Distribution Date)
and (B) the Reserve Fund Amount (before giving effect to any deposits
to or withdrawals from the Reserve Fund on such Distribution Date)
(such lesser amount, the "Reserve Fund Draw Amount"); provided,
however, that the Reserve Fund Draw Amount will equal the Reserve
Fund Amount if (1) the sum of Available Collections, the amount on
deposit in the Yield Supplement Account and the Reserve Fund Amount
equals or exceeds the Note Balance, accrued and unpaid interest
therein and all amounts on the related Distribution Date required to
be paid to the Master
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Servicer and the Trustees or (2) on the last day of the related Collection
Period the Pool Balance is zero;
(ii) the Required Reserve Fund Amount (after giving effect
to the withdrawal of the Reserve Fund Draw Amount for such
Distribution Date);
(iii) the amount, if any, by which the Required Reserve Fund
Amount exceeds the Reserve Fund Amount (after giving effect to the
withdrawal of the Reserve Fund Draw Amount for such Distribution
Date) (such excess, the "Reserve Fund Deficiency");
(iv) the Yield Supplement Account Draw Amount;
(v) the Negative Carry Account Draw Amount (to the extent
such Distribution Date is or precedes the Distribution Date following
the Collection Period in which the Pre-Funding Period ends); and
(vi) the investment earnings on amounts on deposit in the
Pre-Funding Account.
On or prior to each Distribution Date, the Master Servicer shall
instruct the Indenture Trustee to transfer and deposit, (i) the Reserve Fund
Draw Amount, if any, from the Reserve Fund into the Collection Account, (ii)
the Yield Supplement Account Draw Amount from the Yield Supplement Account
into the Collection Account, (iii) the Negative Carry Draw Amount, if any,
into the Collection Account, (iv) investment earnings on amounts on deposit in
the Pre-Funding Account, if any, into the Collection Account and (v) in the
case of the first Distribution Date following the Collection Period in which
the Pre-Funding Period ends, the Pre-Funding Account Amount as of the end of
the Pre-Funding Period from the Pre-Funding Account and into the Note Payment
Account and the Negative Carry Account Amount from the Negative Carry Account
into the Collection Account.
(c) On each Distribution Date, the Master Servicer shall instruct the
Indenture Trustee in writing to apply the Available Funds for such
Distribution Date, together with, in the case of the Distribution Date
following the Collection Period in which the Pre-Funding Period ends, only,
any Pre-Funding Account Amount as of the end of the Pre-Funding Period as set
forth the last paragraph of Section 2.08(b) of the Indenture, to make the
related payments and deposits set forth in Section 2.08 of the Indenture.
Section 4.07. Reserve Fund.
(a) The Master Servicer shall establish, on or before the Closing
Date, and maintain as an Eligible Deposit Account in the name of the Indenture
Trustee at an Eligible Institution (which shall initially be Wachovia Bank), a
segregated trust account designated as the "Wachovia Auto Owner Trust 200__-__
Reserve Fund" (the "Reserve Fund"). The Reserve Fund shall be held in trust
for the benefit of the Securityholders. The Reserve Fund shall be under the
sole dominion and control of the Indenture Trustee; provided, however, that
the Master Servicer may direct the Indenture Trustee in writing to make
deposits to and withdrawals from the Reserve Fund in accordance with this
Agreement and the other Basic Documents. On the Closing Date, the Depositor
shall deposit the Reserve Fund Initial Deposit into the Reserve Fund
45
from the net proceeds of the sale of the Receivables. On or prior to each
Subsequent Transfer Date, an amount equal to the related Reserve Fund
Subsequent Deposit will be deposited into the Reserve Fund. The Reserve Fund
and all amounts, securities, investments, Financial Assets and other property
deposited in or credited to the Reserve Fund (the "Reserve Fund Property") has
been conveyed by the Depositor to the Issuer pursuant to Section 2.01(a).
Pursuant to the Indenture, the Issuer will pledge all of its right, title and
interest in, to and under the Reserve Fund and the Reserve Fund Property to
the Indenture Trustee on behalf of the Securityholders to secure its
obligations under the Notes and the Indenture.
(b) The Reserve Fund Property shall, to the extent permitted by
applicable law, rules and regulations, be invested, as directed in writing by
the Master Servicer, by the bank or trust company then maintaining the Reserve
Fund in Permitted Investments that mature not later than the Deposit Date
following the date of investment. All such Permitted Investments shall be held
to maturity. All interest and other income (net of losses and investment
expenses) on funds on deposit in the Reserve Fund shall be retained on deposit
therein. If the Reserve Fund is no longer to be maintained at Wachovia Bank,
the Master Servicer shall, with Wachovia Bank's assistance as necessary,
promptly (and in any case within ten calendar days) cause the Reserve Fund to
be moved to an Eligible Institution. The Master Servicer shall promptly notify
the Rating Agencies and the Trustees in writing of any change in the account
number or location of the Reserve Fund.
(c) With respect to any Reserve Fund Property:
(i) any Reserve Fund Property that is a Financial Asset
shall be physically delivered to, or credited to an account in the
name of, the Eligible Institution maintaining the Reserve Fund, in
accordance with such institution's customary procedures such that
such institution establishes a Security Entitlement in favor of the
Indenture Trustee with respect thereto;
(ii) any Reserve Fund Property that is held in deposit
accounts shall be held solely in the name of the Indenture Trustee at
one or more depository institutions having the Required Rating and
each such deposit account shall be subject to the exclusive custody
and control of the Indenture Trustee and the Indenture Trustee shall
have sole signature authority with respect thereto; and
(iii) except for any deposit accounts specified in clause
(ii) above, the Reserve Fund shall only be invested in securities or
in other assets which the Eligible Institution maintaining the
Reserve Fund agrees to treat as Financial Assets.
(d) If any Class of Notes has not been paid in full on any
Distribution Date on and after its Final Scheduled Distribution Date (after
giving effect to the distribution of Available Funds on such Distribution
Date), the Master Servicer shall instruct the Indenture Trustee to distribute
from amounts on deposit in the Reserve Fund to the Noteholders of that Class
of Notes, an amount equal to the lesser of (i) the amount on deposit in the
Reserve Fund and (ii) the outstanding principal amount of that Class of Notes.
If the Reserve Fund Amount for any Distribution Date (after giving effect to
the withdrawal of the Reserve Fund Draw Amount for such Distribution Date and
the distribution described in the preceding sentence) exceeds the
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Required Reserve Fund Amount for such Distribution Date, the Master Servicer
shall instruct the Indenture Trustee in writing to distribute the amount of
such excess to the Certificate Payment Account for payment to the
Certificateholders. The Trustees hereby release, on each Distribution Date,
their security interest in, to and under Reserve Fund Property distributed to
the Certificateholders.
(e) If the Note Balance and all other amounts owing or to be
distributed hereunder or under the Indenture or the Trust Agreement to the
Noteholders or the Certificateholders have been paid in full and the Issuer
has been terminated, any remaining Reserve Fund Property shall be distributed
to the Certificateholders.
Section 4.08. Pre-Funding Account.
(a) On or prior to the day that is three Business Days following each
Subsequent Cutoff Date, the Master Servicer shall calculate the aggregate
principal balance of the Subsequent Receivables to be transferred to the
Issuer on the related Subsequent Transfer Date (as of such Subsequent Cutoff
Date). The Master Servicer shall instruct the Indenture Trustee in writing to
distribute an amount equal to the product of (i) 100.00% minus the Initial
Overcollateralization Percentage and (ii) the aggregate principal balance of
the related Subsequent Receivables (as of such Subsequent Cutoff Date), from
amounts on deposit in the Pre-Funding Account, to the Depositor on such
Subsequent Transfer Date to purchase the Subsequent Receivables from the
Seller. The Depositor will in turn transfer the related Subsequent Receivables
to the Issuer on such Subsequent Transfer Date, at which time such Subsequent
Receivables will become part of the Trust Property.
(b) If the amount on deposit in the Pre-Funding Account has not been
reduced to zero by the end of the Pre-Funding Period, on the first Deposit
Date following the Collection Period in which the Pre-Funding Period ends, the
Master Servicer shall instruct the Indenture Trustee in writing to withdraw
the Pre-Funding Account Amount from the Pre-Funding Account on such Deposit
Date and to deposit such funds into the Note Payment Account pursuant to
Section 4.06.
(c) Amounts on deposit in the Pre-Funding Account shall, to the
extent permitted by applicable law, rules and regulations, be invested, as
directed in writing by the Master Servicer, by the bank or trust company then
maintaining the Pre-Funding Account in Permitted Investments that mature not
later than the Business Day following the date of investment. All such
Permitted Investments shall be held to maturity. All interest and other income
(net of losses and investment expenses) on funds on deposit in the Pre-Funding
Account shall be calculated by the Master Servicer in accordance with Section
4.06(b) and deposited into the Collection Account on the Deposit Date.
Section 4.09. Negative Carry Account.
(a) On the Deposit Date relating to the Distribution Date following
the Collection Period in which the Pre-Funding Period ends, the Master
Servicer shall instruct the Indenture Trustee in writing to withdraw the
Negative Carry Account Amount from the Negative Carry Account on such Deposit
Date and to deposit such funds into the Collection Account pursuant to Section
4.06.
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(b) Amounts on deposit in the Negative Carry Account shall, to the
extent permitted by applicable law, rules and regulations, be invested, as
directed in writing by the Master Servicer, by the bank or trust company then
maintaining the Negative Carry Account in Permitted Investments that mature
not later than the Deposit Date following the date of investment. All such
Permitted Investments shall be held to maturity.
Section 4.10. Yield Supplement Account. Amounts on deposit in the
Yield Supplement Account shall, to the extent permitted by applicable law,
rules and regulations, be invested, as directed in writing by the Master
Servicer, by the bank or trust company then maintaining the Yield Supplement
Account in Permitted Investments that mature not later than the Deposit Date
following the date of investment. All such Permitted Investments shall be held
to maturity.
Section 4.11. Net Deposits. For so long as the Monthly Remittance
Condition is met, unless the Master Servicer is required to remit collections
on a daily basis pursuant to the first sentence of Section 4.02, the Depositor
and the Master Servicer may make any remittances pursuant to this Article with
respect to a Collection Period net of distributions or reimbursements to be
made to the Depositor or the Master Servicer with respect to such Collection
Period; provided, however, that such obligations shall remain separate
obligations, no party shall have a right of offset, and each such party shall
account for all of the above described remittances and distributions as if the
amounts were deposited or transferred separately.
Section 4.12. Statements to Securityholders.
(a) On or before each Distribution Date, the Master Servicer shall
provide to the Owner Trustee (with copies to the Depositor and the Rating
Agencies) to forward to each Certificateholder of record, and to the Indenture
Trustee, to forward to each Noteholder of record, a statement, based on the
related Master Servicer's Certificate setting forth at least the following
information as to the Securities with respect to the related Distribution Date
and Collection Period, in substantially the form of Exhibit B, to the extent
applicable:
(i) the amount of such distribution allocable to principal
for each Class of Notes;
(ii) the Priority Principal Distributable Amount;
(iii) the Secondary Principal Distributable Amount;
(iv) the Regular Principal Distributable Amount;
(v) the amount of such distribution allocable to current and
overdue interest (including any interest on overdue interest) for
each Class of Notes;
(vi) the Total Servicing Fee;
(vii) the Total Trustee Fees;
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(viii) the aggregate outstanding principal amount of each
Class of Notes and the Note Pool Factor with respect to each Class of
Notes (in each case after giving effect to payments allocated to
principal reported under clause (i) above);
(ix) the Pool Balance as of the close of business on the
last day of the related Collection Period;
(x) the Reserve Fund Amount on such Distribution Date (after
giving effect to all deposits to or withdrawals from the Reserve Fund
on such Distribution Date) and the Reserve Fund Draw Amount;
(xi) the aggregate Purchase Amount of Receivables
repurchased by the Seller or purchased by the Master Servicer, if
any, with respect to the related Collection Period;
(xii) the number and aggregate Principal Balance of
Receivables that were 30-59 days, 60-89 days or 90 days or more
delinquent as of the last day of the related Collection Period;
(xiii) the Nonrecoverable Advances, if any;
(xiv) the Net Losses with respect to the related Collection
Period;
(xv) the Overcollateralization Target Amount and the amount
by which the Pool Balance exceeds the Note Balance (after giving
effect to any payments made to the Noteholders on such Distribution
Date);
(xvi) the amount of Available Collections;
(xvii) the Cumulative Net Loss Percentage and the Sequential
Payment Trigger;
(xviii) the Yield Supplement Account Draw Amount;
(xix) the amount of Excess Collections;
(xx) the amount, if any, withdrawn from the Pre-Funding
Account to purchase Subsequent Receivables;
(xxi) the Pre-Funding Account Amount, if any;
(xxii) the Negative Carry Account Draw Amount;
(xxiii) investment earnings on amounts on deposit in the
Pre-Funding Account during such Collection Period, if any; and
(xxiv) for the Distribution Date following the Collection
Period in which the Pre-Funding Period ends, the Pre-Funding Account
Amount that is being paid to the Noteholders as an additional payment
of principal on the Notes in accordance with the final paragraph of
Section 2.08(b) of the Indenture.
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(b) Within the prescribed period of time for tax reporting purposes
after the end of each calendar year during the term of the Issuer, but not
later than the latest date permitted by law, the related Trustee, upon receipt
thereof, shall mail to each Person who at any time during such calendar year
shall have been a Securityholder, a statement, prepared by the Master
Servicer, containing certain information for such calendar year or, in the
event such Person shall have been a Securityholder during a portion of such
calendar year, for the applicable portion of such year, for the purposes of
such Securityholder's preparation of federal income tax returns. In addition,
the Master Servicer shall furnish to the Trustees for distribution to such
Person at such time any other information necessary under applicable law for
the preparation of such income tax returns.
Section 4.13. Control of Accounts. Notwithstanding anything to the
contrary contained herein, the Issuer agrees that each Account will be
established only with an Eligible Institution which agrees substantially as
follows: (i) it will comply with Entitlement Orders related to such account
issued by the Indenture Trustee, without further consent by the Master
Servicer, (ii) until termination of this Agreement, it will not enter into any
other agreement related to such account pursuant to which it agrees to comply
with Entitlement Orders of any Person other than the Indenture Trustee, (iii)
all Account Collateral delivered or credited to it in connection with such
account and all proceeds thereof will be promptly credited to such account,
(iv) it will treat all Account Collateral as Financial Assets and (v) all
Account Collateral will be physically delivered (accompanied by any required
endorsements) to, or credited to an account in the name of, the Eligible
Institution maintaining the related Account in accordance with such Eligible
Institution's customary procedures such that such Eligible Institution
establishes a Security Entitlement in favor of the Indenture Trustee with
respect thereto over which the Indenture Trustee (or such other Eligible
Institution) has Control.
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ARTICLE FIVE
THE DEPOSITOR
Section 5.01. Representations and Warranties of Depositor. The
Depositor makes the following representations and warranties on which the
Issuer is deemed to have relied in acquiring the Trust Property. The
representations and warranties speak as of the date of execution and delivery
of this Agreement, as of the Closing Date and as of each Subsequent Transfer
Date, and shall survive the sale, transfer, assignment and conveyance of the
Trust Property to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture.
(a) Organization and Good Standing. The Depositor has been
duly organized and is validly existing as a limited liability company
in good standing under the laws of the State of Delaware, with power
and authority to own its properties and to conduct its business as
such properties are currently owned and such business is presently
conducted, and had at all relevant times, and has, power, authority
and legal right to acquire, own and sell the Receivables.
(b) Due Qualification. The Depositor is duly qualified to do
business as a foreign limited liability company in good standing and
has obtained all necessary licenses and approvals in each
jurisdiction in which the failure to so qualify or to obtain such
licenses and approvals would, in the reasonable judgment of the
Depositor, materially and adversely affect the performance by the
Depositor of its obligations under, or the validity or enforceability
of, this Agreement, each other Basic Document to which the Depositor
is a party, the Receivables, the Notes or the Certificates.
(c) Power and Authority. The Depositor has the power and
authority to execute, deliver and perform its obligations under this
Agreement and each other Basic Document to which it is a party. The
Depositor has the power and authority to sell, assign, transfer and
convey the property to be transferred to and deposited with the
Issuer and has duly authorized such sale, assignment, transfer and
conveyance by all necessary limited liability company action; and the
execution, delivery and performance of this Agreement and each other
Basic Document to which the Depositor is a party has been duly
authorized by the Depositor by all necessary limited liability
company action.
(d) Valid Sale; Binding Obligation. This Agreement effects a
valid sale, transfer, assignment and conveyance to the Issuer of the
Receivables and the other Trust Property, enforceable against all
creditors of and purchasers from the Depositor. Each of this
Agreement and each other Basic Document to which the Depositor is a
party constitutes a legal, valid and binding obligation of the
Depositor enforceable against the Depositor in accordance with its
terms, except as enforceability may be subject to or limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors' rights in general and by
general principles of equity, regardless of whether such
enforceability shall be considered in a proceeding in equity or at
law.
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(e) No Violation. The execution, delivery and performance by
the Depositor of this Agreement and the other Basic Documents to
which the Depositor is a party and the consummation of the
transactions contemplated hereby and thereby and the fulfillment of
the terms hereof and thereof does not conflict with, result in any
breach of any of the terms and provisions of, nor constitute (with or
without notice or lapse of time, or both) a default under, the
certificate of formation or limited liability company agreement of
the Depositor, or conflict with or violate any of the material terms
or provisions of, or constitute (with or without notice or lapse of
time, or both) a default under, any indenture, agreement or other
instrument to which the Depositor is a party or by which it shall be
bound or to which any of its properties is subject; nor result in the
creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such indenture, agreement or other
instrument (other than this Agreement); nor violate any law or, to
the Depositor's knowledge, any order, rule or regulation applicable
to the Depositor or of any federal or State regulatory body, court,
administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties, which breach,
default, conflict, Lien or violation would have a material adverse
effect on the earnings, business affairs or business prospects of the
Depositor.
(f) No Proceedings. There are no proceedings or
investigations pending, or to the Depositor's knowledge, threatened
against the Depositor, before any court, regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Depositor or its properties: (i) asserting the
invalidity of this Agreement, any other Basic Document or the
Securities, (ii) seeking to prevent the issuance of the Securities or
the consummation of any of the transactions contemplated by the Basic
Documents, (iii) seeking any determination or ruling that, in the
reasonable judgment of the Depositor, would materially and adversely
affect the performance by the Depositor of its obligations under, or
the validity or enforceability of, the Basic Documents, the
Receivables or the Securities or (iv) relating to the Depositor and
which might adversely affect the federal income tax attributes of the
Issuer or the Securities.
Section 5.02. Liability of Depositor; Indemnities.
(a) The Depositor shall be liable in accordance herewith only to the
extent of the obligations specifically undertaken by the Depositor under this
Agreement.
(b) The Depositor shall indemnify, defend and hold harmless the
Issuer, the Owner Trustee and the Indenture Trustee from and against any taxes
that may at any time be asserted against any such Person with respect to the
transactions contemplated by the Basic Documents, including any sales, gross
receipts, general corporation, tangible personal property, privilege or
license taxes (but not including any taxes asserted with respect to, and as of
the date of the sale of the Receivables to the Issuer or the issuance and
original sale of the Securities, or asserted with respect to ownership of the
Receivables or federal or State income taxes arising out of distributions on
the Securities), and all costs and expenses in defending against such taxes.
(c) The Depositor shall indemnify, defend and hold harmless the
Issuer, the Trustees and the Securityholders from and against any loss,
liability, claim, damage or expense incurred by reason of the Depositor's
willful misfeasance, bad faith or negligence (other than errors in
52
judgment) in the performance of its duties under this Agreement or any other
Basic Document to which it is a party, or by reason of reckless disregard of
its obligations and duties under this Agreement or any other Basic Document to
which it is a party.
(d) The Depositor shall indemnify, defend and hold harmless the
Trustees from and against all losses, liabilities, claims, damages or expenses
arising out of or incurred in connection with the acceptance or performance of
the trusts and duties contained herein, in the Trust Agreement (in the case of
the Owner Trustee) and in the Indenture (in the case of the Indenture
Trustee), except to the extent that such loss, liability, claim, damage or
expense (i) shall be due to the willful misfeasance, bad faith or negligence
of the Owner Trustee or the Indenture Trustee, as applicable, (ii) in the case
of the Owner Trustee, shall arise from the breach by the Owner Trustee of any
of its representations or warranties set forth in the Trust Agreement, (iii)
in the case of the Indenture Trustee, shall arise from the breach by the
Indenture Trustee of any of its representations and warranties set forth in
the Indenture or shall arise out of or be incurred in connection with the
performance by the Indenture Trustee of duties of a Successor Servicer
hereunder, (iv) shall be one as to which the Master Servicer is required to
indemnify the Owner Trustee or the Indenture Trustee, as the case may be, or
(v) relates to any tax other than the taxes with respect to which the Master
Servicer shall be required to indemnify the Owner Trustee or the Indenture
Trustee, as the case may be.
(e) The Depositor shall pay any and all taxes levied or assessed upon
all or any part of the Trust Property.
(f) Indemnification under this Section shall survive the resignation
or removal of the Owner Trustee or the Indenture Trustee, as the case may be,
and the termination of this Agreement and shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Depositor shall have
made any indemnity payments pursuant to this Section and the Person to or on
behalf of whom such payments are made thereafter shall collect any of such
amounts from others, such Person shall promptly repay such amounts to the
Depositor, without interest. Notwithstanding anything to the contrary
contained herein, the Depositor shall only be required to pay (i) any fees,
expenses, indemnities or other liabilities that it may incur under the Basic
Documents from funds available pursuant to, and in accordance with, the
payment priorities set forth in this Agreement and the other Basic Documents
and (ii) to the extent the Depositor has additional funds available (other
than funds described in clause (i)) that would be in excess of amounts that
would be necessary to pay the debt and other obligations of the Depositor in
accordance with the Depositor's certificate of formation, operating agreement
and all financing documents to which the Depositor is a party. The agreement
set forth in the preceding sentence shall constitute a subordination agreement
for purposes of Section 510(a) of the Bankruptcy Code. In addition, no amount
owing by the Depositor hereunder in excess of liabilities that it is required
to pay in accordance with the preceding sentence shall constitute a "claim"
(as defined in Section 101(5) of the Bankruptcy Code) against it.
Section 5.03. Merger, Consolidation or Assumption of the Obligations
of Depositor; Certain Limitations.
(a) Any Person (i) into which the Depositor shall be merged or
consolidated, (ii) resulting from any merger, conversion or consolidation to
which the Depositor shall be a
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party or (iii) that shall succeed by purchase and assumption to all or
substantially all of the business of the Depositor, which Person in any of the
foregoing cases executes an agreement of assumption to perform every
obligation of the Depositor under this Agreement, shall be the successor to
the Depositor under this Agreement without the execution or filing of any
other document or any further act on the part of any of the parties to this
Agreement; provided, however, that (A) the Depositor shall have delivered to
the Trustees an Officer's Certificate and an Opinion of Counsel each stating
that such merger, conversion, consolidation or succession and such agreement
of assumption comply with this Section, (B) the Depositor shall have delivered
to the Trustees an Opinion of Counsel stating that, in the opinion of such
counsel, either (1) all financing statements and continuation statements and
amendments thereto have been authorized and filed that are necessary to fully
preserve and protect the interest of the Issuer and the Indenture Trustee,
respectively, in the Receivables, and reciting the details of such filings or
referring to prior Opinions of Counsel in which such details are given, or (2)
no such action shall be necessary to fully preserve and protect such interest
and (C) the Rating Agency Condition shall have been satisfied. Notwithstanding
anything to the contrary contained herein, the execution of the foregoing
agreement of assumption and compliance with clauses (A), (B) and (C) above
shall be conditions to the consummation of the transactions referred to in
clauses (i), (ii) and (iii) above.
(b) (i) Subject to paragraph (ii) below, the purpose of the Depositor
shall be to engage in any lawful activity for which a limited liability
company may be organized under the general limited liability company law of
Delaware other than the banking business, the trust company business or the
practice of a profession permitted to be incorporated by the Delaware Limited
Liability Company Act.
(ii) Notwithstanding paragraph (b)(i) above, the purpose of
the Depositor shall be limited to the conduct or promotion of the
following activities: (A) to acquire retail installment sales
contracts, purchase money notes or other notes between motor vehicle
dealers or lenders and purchasers of new and used automobiles,
minivans, sport utility vehicles, light-duty trucks, motorcycles or
commercial vehicles (the "Motor Vehicle Receivables"); (B) to act as
settlor or grantor of one or more trusts or special purpose entities
(each, a "Securitization Trust") formed pursuant to a trust agreement
or other agreement for the purpose of issuing one or more series or
classes of certificates, bonds, notes or other evidences of interest
or indebtedness (collectively, the "Motor Vehicle Securities")
secured by or representing beneficial interests in the Motor Vehicle
Receivables; (C) to acquire, lease, own, hold, sell, transfer,
convey, dispose of, pledge, assign, borrow money against, finance,
refinance or otherwise deal with, publicly or privately and whether
with unrelated third parties or with affiliated entities, retail
installment sales contracts, purchase money notes or other notes
between motor vehicle dealers or lenders and purchasers of Motor
Vehicle Receivables; (D) to acquire Motor Vehicle Securities or other
property of a Securitization Trust (including remainder interests in
collateral or reserve accounts) or any interest in any of the
foregoing; (E) to issue, authorize, sell and deliver Motor Vehicle
Securities or other instruments secured or collateralized by the
Motor Vehicle Securities; (F) to own equity interests in other
limited liability companies or partnerships whose purposes are
substantially restricted to those described in clauses (A) through
(E) above; (G) to borrow money other than pursuant to clause (C)
above, but only to the extent that such borrowing is permitted by the
terms of
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the transactions contemplated by clauses (A) through (F) above; and
(H) to (1) negotiate, authorize, execute, deliver or assume or
perform the obligations under any agreement, instrument or document
relating to the activities set forth in clauses (A) through (G)
above, including the Basic Documents and (2) engage in any lawful act
or activity and to exercise any powers permitted to limited liability
companies organized under the laws of the State of Delaware that are
incidental to and necessary, convenient or advisable for the
accomplishment of the above-mentioned purposes, including the
entering into of interest rate or basis swap, cap, floor or collar
agreements, currency exchange agreements or similar hedging
transactions and referral, management, servicing and administration
agreements. So long as any outstanding debt of the Depositor or
securities are rated by any nationally recognized statistical rating
organization, the Depositor shall not issue notes or otherwise borrow
money unless (A) the Depositor has made a written request to the
related nationally recognized statistical rating organization to
issue notes or incur borrowings, which notes or borrowings are rated
by the related nationally recognized statistical rating organization
the same as or higher than the rating afforded any outstanding rated
debt or securities, or (B) such notes or borrowings (1) are fully
subordinated (and which shall provide for payment only after payment
in respect of all outstanding rated debt or securities) or are
nonrecourse against any assets of the Depositor other than the assets
pledged to secure such notes or borrowings, (2) do not constitute a
claim against the Depositor in the event such assets are insufficient
to pay such notes or borrowings and (3) where such notes or
borrowings are secured by the rated debt or securities, are fully
subordinated (and which shall provide for payment only after payment
in respect of all outstanding rated debt or securities) to such rated
debt or securities.
(c) Notwithstanding any other provision of this Section and any
provision of law, the Depositor shall not do any of the following:
(i) engage in any business or activity other than as set
forth in Section 5.03(b);
(ii) without the unanimous written consent of the members of
the Depositor and the members of the Board of Directors of the
Depositor (including all independent directors of the Depositor), (A)
consolidate or merge the Depositor with or into any Person or sell
all or substantially all of the assets of the Depositor, (B)
institute proceedings to have the Depositor be adjudicated bankrupt
or insolvent, or consent to the institution of bankruptcy or
insolvency proceedings against Depositor, (C) file a petition
seeking, or consent to, reorganization or relief with respect to the
Depositor under any applicable federal or state law relating to
bankruptcy, (D) consent to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the
Depositor or a substantial part of its property, (E) make any
assignment for the benefit of creditors of the Depositor, (F) admit
in writing the Depositor's inability to pay its debts generally as
they become due, (G) take any action in furtherance of any action set
forth in clauses (A) through (F) above or (H) to the fullest extent
permitted by law, dissolve or liquidate the Depositor; or
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(iii) change the current number of independent special
members under the limited liability company agreement of the
Depositor.
(d) The Depositor shall not amend its organizational documents except
in accordance with the provisions thereof.
Section 5.04. Limitation on Liability of Depositor and
Others. The Depositor and any director or officer or employee or
agent of the Depositor may rely in good faith on any document of any
kind, prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Depositor and any
director or officer or employee or agent of the Depositor shall be
reimbursed by the Owner Trustee or the Indenture Trustee, as the case
may be, for any contractual damages, liability or expense incurred by
reason of the Owner Trustee's or the Indenture Trustee's willful
misfeasance, bad faith or negligence (except for errors in judgment)
in the performance of their respective duties hereunder, or by reason
of reckless disregard of their respective obligations and duties
hereunder. The Depositor shall not be under any obligation to appear
in, prosecute or defend any legal action that shall not be incidental
to its obligations under this Agreement, and that in its opinion may
involve it in any expense or liability. The indemnities contained in
this Section shall survive the resignation or termination of the
Owner Trustee or the termination of this Agreement.
Section 5.05. Depositor Not to Resign. Subject to the
provisions of Section 5.03, the Depositor shall not resign from the
obligations and duties hereby imposed on it as Depositor hereunder.
Section 5.06. Depositor May Own Securities. The Depositor
and any of its Affiliates may, in its individual or any other
capacity, become the owner or pledgee of Securities with the same
rights as it would have if it were not the Depositor or an Affiliate
of the Depositor, except as otherwise expressly provided herein or in
any other Basic Document (including in the definition of the term
"Note Balance"). Except as otherwise expressly provided herein or in
the other Basic Documents (including in the definition of the term
"Note Balance"), Securities so owned by or pledged to the Depositor
or such Affiliate shall have an equal and proportionate benefit under
the provisions of this Agreement and the other Basic Documents,
without preference, priority or distinction as among the Notes and
the Certificates as the case may be.
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ARTICLE SIX
THE SERVICER
Section 6.01. Representations and Warranties of Master Servicer. The
Master Servicer makes the following representations and warranties on which
the Issuer is deemed to have relied in acquiring the Trust Property. The
representations and warranties speak as of the date of execution and delivery
of this Agreement, as of the Closing Date and as of each Subsequent Transfer
Date, and shall survive the sale, transfer, assignment and conveyance of the
Trust Property to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture:
(a) Organization and Good Standing. The Master Servicer is a national
banking association duly organized and validly existing as a banking
institution under the laws of the United States and continues to hold a valid
certificate to do business as such. It is duly authorized to own its
properties and transact its business and is in good standing in each
jurisdiction in which the character of the business transacted by it or any
properties owned or leased by it requires such authorization and in which the
failure to be so authorized would have a material adverse effect on its
business, properties, assets, or condition (financial or other) and those of
its subsidiaries, considered as one enterprise. The Master Servicer has, and
at all relevant times had, the power, authority and legal right to service the
Receivables and to hold the Receivable Files as custodian on behalf of the
Issuer.
(b) Due Qualification. The Master Servicer is duly qualified to do
business in good standing and has obtained all necessary licenses and
approvals in each jurisdiction in which the failure to so qualify or to obtain
such licenses and approvals would, in the reasonable judgment of the Master
Servicer, materially and adversely affect the performance by the Master
Servicer of its obligations under, or the validity or enforceability of, this
Agreement, each other Basic Document to which the Master Servicer is a party,
the Receivables, the Notes or the Certificates.
(c) Power and Authority. The Master Servicer has the power and
authority to execute, deliver and perform its obligations under this Agreement
and each other Basic Document to which it is a party; and the execution,
delivery and performance of this Agreement and each other Basic Document to
which it is a party have been duly authorized by the Master Servicer by all
necessary action.
(d) Binding Obligation. This Agreement and each other Basic Document
to which the Master Servicer is a party constitute legal, valid and binding
obligations of the Master Servicer, enforceable against the Master Servicer in
accordance with their respective terms, except that such enforceability may be
subject to bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance, fraudulent transfer and other similar laws relating to or
affecting creditors' rights generally, and creditors of national banking
associations and financial institutions the accounts of which are insured by
the Federal Deposit Insurance Corporation in particular, and to general
equitable principles (regardless of whether considered in a proceeding in
equity or at law), including concepts of commercial reasonableness, good faith
and fair dealing and the possible unavailability of specific performance or
injunctive relief.
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(e) No Violation. The execution, delivery and performance by the
Master Servicer of this Agreement and each other Basic Document to which the
Master Servicer is a party, the consummation of the transactions contemplated
hereby and thereby and the fulfillment of their respective terms 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 or both) a default under,
the articles of association or bylaws of the Master Servicer, or any material
indenture, agreement, mortgage, deed of trust or other instrument to which the
Master Servicer is a party, by which the Master Servicer is bound or to which
any of its properties are subject; 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 and the other Basic Documents, or violate any law, order, rule
or regulation applicable to the Master Servicer or its properties of any
federal or State regulatory body, court, administrative agency or other
governmental instrumentality having jurisdiction over the Master Servicer or
any of its properties.
(f) No Proceedings. There are no proceedings or investigations
pending or, to the knowledge of the Master Servicer, threatened, against the
Master Servicer before any court, regulatory body, administrative agency or
other tribunal or governmental instrumentality having jurisdiction over the
Master Servicer or its properties: (i) asserting the invalidity of this
Agreement or any of the other Basic Documents, (ii) seeking to prevent the
issuance of the Securities or the consummation of any of the transactions
contemplated by this Agreement or any of the other Basic Documents, (iii)
seeking any determination or ruling that, in the reasonable judgment of the
Master Servicer, would materially and adversely affect the performance by it
of its obligations under, or the validity or enforceability of, this Agreement
or the Receivables or (iv) seeking to adversely affect the federal income tax
or other federal, State or local tax attributes of the Securities.
Section 6.02. Liability of Master Servicer; Indemnities. The Master
Servicer shall be liable in accordance herewith only to the extent of the
obligations specifically undertaken by the Master Servicer under this
Agreement. Such obligations shall include the following:
(a) The Master Servicer shall indemnify, defend and hold
harmless the Issuer, the Trustees, the Securityholders and the
Depositor from and against all losses, liabilities, claims, damages
and expenses arising out of or incurred in connection with the use,
ownership or operation by the Master Servicer or any Affiliate of the
Master Servicer of a Financed Vehicle.
(b) The Master Servicer shall indemnify, defend and hold
harmless the Issuer, the Depositor and the Trustees from and against
any taxes that may at any time be asserted against any such Person
with respect to the transactions contemplated herein and in the other
Basic Documents, including any sales, gross receipts, general
corporation, tangible personal property, privilege or license taxes
(but not including any taxes asserted with respect to, and as of the
date of, the sale of the Receivables to the Issuer or the issuance
and original sale of the Securities, or asserted with respect to
ownership of the Receivables, or federal or State income taxes
arising out of distributions on the Securities) and costs and
expenses in defending against such taxes.
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(c) The Master Servicer shall indemnify, defend and hold
harmless the Issuer, the Trustees, the Securityholders and the
Depositor from and against any loss, liability, claim, damage or
expense incurred by reason of the Master Servicer's willful
misfeasance, bad faith or negligence in the performance of its duties
under this Agreement or any other Basic Document to which it is a
party or by reason of a reckless disregard of its obligations and
duties under this Agreement or any other Basic Document to which it
is a party.
(d) The Master Servicer shall indemnify, defend and hold
harmless the Trustees and their respective officers, directors,
employees and agents from and against all losses, liabilities,
claims, damages and expenses arising out of or incurred in connection
with the acceptance or performance of the trusts and duties herein
and contained in the Trust Agreement (in the case of the Owner
Trustee) and contained in the Indenture (in the case of the Indenture
Trustee), except to the extent that such loss, liability, claim,
damage or expense: (i) shall be due to the willful misfeasance, bad
faith or negligence (except for errors in judgment) of the Owner
Trustee or the Indenture Trustee, as applicable, (ii) in the case of
the Owner Trustee, shall arise from the breach by the Owner Trustee
of any of its representations or warranties set forth in Section 7.03
of the Trust Agreement, (iii) in the case of the Indenture Trustee,
shall arise from the breach by the Indenture Trustee of any of its
representations and warranties set forth in the Indenture or shall
arise out of or be incurred in connection with the performance by the
Indenture Trustee of the duties of a Successor Servicer hereunder or
(iv) relates to any tax other than to the taxes with respect to which
either the Depositor or the Master Servicer shall be required to
indemnify the Owner Trustee or the Indenture Trustee, as applicable.
(e) The Master Servicer shall pay the Owner Trustee
compensation, reimbursement or other payments owed to it pursuant to
Sections 8.01 and 8.02 of the Trust Agreement.
In addition to the foregoing indemnities, if the Owner Trustee or the
Indenture Trustee is entitled to indemnification by the Depositor pursuant to
Section 5.02 and the Depositor is unable for any reason to provide such
indemnification to the Owner Trustee or the Indenture Trustee, then the Master
Servicer shall be liable for any indemnification that the Owner Trustee or the
Indenture Trustee is entitled to under Section 5.02. For purposes of this
Section, in the event of a termination of the rights and obligations of the
Master Servicer (or any Successor Servicer) pursuant to Section 7.01 or a
resignation by such Master Servicer pursuant to Section 6.05, such Master
Servicer shall be deemed to be the Master Servicer pending appointment of a
Successor Servicer (other than the Indenture Trustee) pursuant to Section
7.02. Indemnification under this Section by the Master Servicer (or any
Successor Servicer), with respect to the period such Person was (or was deemed
to be) the Master Servicer, shall survive the termination of each Person as
Master Servicer or a resignation by such Person as Master Servicer, as well as
the resignation or removal of the Owner Trustee or the Indenture Trustee, as
the case may be, or the termination of this Agreement and shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Master Servicer shall have made any indemnity payments pursuant to this
Section and the Person to or on behalf of whom such payments are made
thereafter
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collects any of such amounts from others, such Person shall promptly repay
such amounts to the Master Servicer, as the case may be, without interest.
Section 6.03. Merger, Consolidation or Assumption of the Obligations
of Master Servicer. Any Person (i) into which the Master Servicer shall be
merged or consolidated, (ii) which may result from any merger, conversion or
consolidation to which the Master Servicer shall be a party or (iii) which may
succeed to all or substantially all of the business of the Master Servicer,
which Person in any of the foregoing cases is an Eligible Servicer and
executes an agreement of assumption to perform every obligation of the Master
Servicer under this Agreement, shall be the successor to the Master Servicer
under this Agreement without the execution or filing of any other document or
any further act on the part of any of the parties hereto; provided, however,
(a) the Master Servicer shall have delivered to the Depositor and the Trustees
an Officer's Certificate and an Opinion of Counsel each stating that such
merger, conversion or consolidation and such agreement of assumption comply
with this Section and (b) the Master Servicer shall have delivered to the
Depositor and the Trustees an Opinion of Counsel stating that, in the opinion
of such counsel, either (A) all financing statements and continuation
statements and amendments thereto have been authorized and filed that are
necessary to preserve and protect the interest of the Issuer and the Indenture
Trustee, respectively, in the assets of the Issuer and reciting the details of
such filings or referring to prior Opinions of Counsel in which such details
are given or (B) no such action shall be necessary to preserve and protect
such interest. Notwithstanding anything to the contrary contained herein, the
execution of the foregoing agreement of assumption and compliance with clauses
(a) and (b) above shall be conditions to the consummation of the transactions
referred to in clauses (i), (ii) and (iii) above. The Master Servicer shall
provide prior written notice of any merger, conversion, consolidation or
succession pursuant to this Section to the Trustees, the Rating Agencies and
the Depositor. The Master Servicer shall provide such information in writing
as reasonably requested by the Depositor to allow the Depositor to comply with
its Exchange Act reporting obligations with respect to a Successor Servicer.
Section 6.04. Limitation on Liability of Master Servicer and Others.
(a) Neither the Master Servicer nor any of its directors, officers,
employees or agents shall be under any liability to the Issuer or any
Securityholders for any action taken or for refraining from the taking of any
action pursuant hereto, or for errors in judgment; provided, however, that
this provision shall not protect the Master Servicer or any such Person
against any liability that would otherwise be imposed by reason of willful
misfeasance, bad faith or negligence in the performance of duties or by reason
of reckless disregard of obligations and duties hereunder. The Master Servicer
and any of its respective directors, officers, employees or agents may rely in
good faith on any document of any kind prima facie properly executed and
submitted by any Person in respect of any matters arising under this
Agreement.
(b) Except as provided herein, the Master Servicer shall not be under
any obligation to appear in, prosecute or defend any legal action that shall
not be incidental to its duties to administer and service the Receivables in
accordance with this Agreement, and that in its opinion may involve it in any
expense or liability; provided, however, that the Master Servicer may
undertake any reasonable action that it may deem necessary or desirable in
respect of this Agreement and the rights and duties of the parties to this
Agreement and the interests of the
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Noteholders and the Certificateholders under this Agreement. In such event,
the legal expenses and costs of such action and any liability resulting
therefrom shall be expenses, costs and liabilities of the Master Servicer.
Section 6.05. Wachovia Bank Not to Resign as Master Servicer. Subject
to the provisions of Section 6.03, Wachovia Bank shall not resign from the
obligations and duties imposed on it pursuant hereto as Master Servicer under
this Agreement except upon determination that the performance of its duties
hereunder is no longer permissible under applicable law. Any such
determination permitting the resignation of the Master Servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the Depositor
and the Trustees. No such resignation shall become effective until the
Indenture Trustee or a Successor Servicer shall have (i) assumed the
obligations and duties of the Master Servicer in accordance with Section 7.02,
(ii) become the Administrator under the Administration Agreement pursuant to
Section 1.20 thereof and (iii) provided such information in writing as
reasonably requested by the Depositor to allow the Depositor to comply with
its Exchange Act reporting obligations with respect to a Successor Servicer.
Section 6.06. Master Servicer May Own Securities. The Master Servicer
and any of its Affiliates may, in its individual or other capacity, become the
owner or pledgee of Securities with the same rights as it would have if it
were not the Master Servicer or an Affiliate of the Master Servicer, except as
otherwise expressly provided herein or in any other Basic Document (including
in the definition of the term "Note Balance"). Except as otherwise expressly
provided herein or in the other Basic Documents (including in the definition
of the term "Note Balance"), Securities so owned by or pledged to the Master
Servicer or such Affiliate shall have an equal and proportionate benefit under
the provisions of this Agreement and the other Basic Documents, without
preference, priority or distinction as among the Notes and the Certificates,
as the case may be.
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ARTICLE SEVEN
SERVICER TERMINATION EVENTS
Section 7.01. Servicer Termination Events. The occurrence of any one
of the following events shall constitute an event of servicing termination
hereunder (each, a "Servicer Termination Event"):
(a) any failure by the Master Servicer to deliver to the
Owner Trustee or the Indenture Trustee the Master Servicer's
Certificate for any Collection Period, which failure shall continue
unremedied beyond the earlier of three Business Days following the
date such Master Servicer's Certificate was required to be delivered
and the related Deposit Date, or any failure by the Master Servicer
to make any required payment or deposit under this Agreement, which
failure shall continue unremedied beyond the earlier of five Business
Days following the date such payment or deposit was due and, in the
case of a payment or deposit to be made no later than a Distribution
Date or the related Deposit Date, such Distribution Date or Deposit
Date, as applicable;
(b) any failure by the Master Servicer to duly observe or to
perform in any material respect any other covenant or agreement of
the Master Servicer set forth in this Agreement, which failure shall
materially and adversely affect the rights of the Depositor or the
Noteholders and shall continue unremedied for a period of 60 days
after the date on which written notice of such failure, requiring the
same to be remedied, shall have been given (i) to the Master Servicer
by the Depositor, the Owner Trustee or the Indenture Trustee or (ii)
to the Depositor, the Master Servicer and the Trustees by the Holders
of Notes evidencing not less than 25% of the Note Balance of the
Controlling Class;
(c) any representation or warranty of the Master Servicer
made in this Agreement, or in any certificate delivered pursuant
hereto or in connection herewith, other than any representation or
warranty relating to a Receivable that has been purchased by the
Master Servicer, proving to have been incorrect in any material
respect as of the time when the same shall have been made, and the
circumstance or condition in respect of which such representation or
warranty was incorrect shall not have been eliminated or otherwise
cured for a period of 30 days after the date on which written notice
of such circumstance or condition, requiring the same to be
eliminated or cured, shall have been given (i) to the Master Servicer
by the Depositor, the Owner Trustee or the Indenture Trustee or (ii)
to the Depositor, the Master Servicer and the Trustees by the Holders
of Notes evidencing not less than 25% of the Note Balance of the
Controlling Class;
(d) the entry of a decree or order by a court or agency or
supervisory authority of competent jurisdiction for the appointment
of a conservator, receiver, liquidator or trustee for the Master
Servicer in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceeding, or for the winding up
or liquidation of its affairs, which decree or order continues
unstayed and in effect for a period of 60 consecutive days; or
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(e) the consent by the Master Servicer to the appointment of
a conservator, receiver, liquidator or trustee in any insolvency,
readjustment of debt, marshalling of assets and liabilities or
similar proceeding of or relating to the Master Servicer or relating
to substantially all of its property, the admission in writing by the
Master Servicer of its inability to pay its debts generally as they
become due, the filing by the Master Servicer of a petition to take
advantage of any applicable insolvency or reorganization statute, the
making by the Master Servicer of an assignment for the benefit of its
creditors or the voluntary suspension by the Master Servicer of
payment of its obligations.
If a Servicer Termination Event shall have occurred and not have been
remedied, either the Indenture Trustee or the Holders of Notes evidencing not
less than 51% of the Note Balance of the Controlling Class, in each case by
notice then given in writing to the Depositor, the Owner Trustee and the
Master Servicer (and to the Trustees if given by the Noteholders) (each, a
"Servicer Termination Notice") may terminate all the rights and obligations of
the Master Servicer under this Agreement; provided, however, that the
indemnification obligations of the Master Servicer under Section 6.02 shall
survive such termination. On or after the receipt by the Master Servicer of
such written notice, all authority and power of the Master Servicer under this
Agreement, whether with respect to the Notes, the Certificates, the Trust
Property or otherwise, shall, without further action, pass to and be vested in
the Indenture Trustee or such Successor Servicer as may be appointed under
Section 7.02; and, without limitation, the Trustees are hereby authorized and
empowered to execute and deliver, on behalf of the outgoing Master 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 Receivable Files or the certificates of title
to the Financed Vehicles, or otherwise. The outgoing Master Servicer shall
cooperate with the Indenture Trustee, the Owner Trustee and such Successor
Servicer in effecting the termination of the responsibilities and rights of
the outgoing Master Servicer under this Agreement, including the transfer to
the Indenture Trustee or such Successor Servicer for administration by it of
all cash amounts that shall at the time be held by the outgoing Master
Servicer for deposit, or have been deposited by the outgoing Master Servicer,
in the Accounts or thereafter received with respect to the Receivables, all
Receivable Files and all information or documents that the Indenture Trustee
or such Successor Servicer may require. In addition, the Master Servicer shall
transfer its electronic records relating to the Receivables to the Successor
Servicer in such electronic form as the Successor Servicer may reasonably
request. All Transition Costs shall be paid by the outgoing Master Servicer
(or by the initial Master Servicer if the outgoing Master Servicer is the
Indenture Trustee acting on an interim basis) upon presentation of reasonable
documentation of such costs and expenses.
The Trustees shall have no obligation to notify the Noteholders, the
Certificateholders or any other Person of the occurrence of any event
specified in this Section prior to the continuance of such event through the
end of any cure period specified in this Section.
Section 7.02. Appointment of Successor Servicer. Upon the resignation
of the Master Servicer pursuant to Section 6.05 or the termination of the
Master Servicer pursuant to Section 7.01, the Indenture Trustee shall be the
successor in all respects to the Master Servicer in its capacity as Master
Servicer under this Agreement and shall be subject to all the obligations and
duties placed on the Master Servicer by the terms and provisions of this
Agreement, and
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shall provide such information in writing as reasonably requested by the
Depositor to allow the Depositor to comply with its Exchange Act reporting
obligations with respect to the Indenture Trustee in its capacity as Successor
Servicer; provided, however, that the Indenture Trustee, as Successor
Servicer, shall not, in any event, be required to make any Advances pursuant
to Section 4.04 and shall have no obligations pursuant to Section 3.09 with
respect to the fees and expenses of the Owner Trustee or the Indenture
Trustee, the fees and expenses of the Owner Trustee's attorneys or the
Indenture Trustee's attorneys, the fees and expenses of any custodian
appointed by the Trustees, the fees and expenses of Independent accountants or
expenses incurred in connection with distributions and reports to the
Certificateholders and the Noteholders. As compensation therefor, the
Indenture Trustee shall be entitled to such compensation (whether payable out
of the Collection Account or otherwise) as the Master Servicer would have been
entitled to under this Agreement if no such resignation or termination had
occurred, except that all collections on or in respect of the Receivables
shall be deposited in the Collection Account within two Business Days of
receipt and shall not be retained by the Master Servicer. Notwithstanding the
foregoing, the Indenture Trustee may, if it shall be unwilling so to act, or
shall, if it is legally unable so to act, appoint, or petition a court of
competent jurisdiction to appoint, an Eligible Servicer as the successor to
the terminated Master Servicer under this Agreement. In connection with such
appointment, the Indenture Trustee may make such arrangements for the
compensation of such Successor Servicer out of collections on or in respect of
the Receivables as it and such successor shall agree; provided, however, that
such compensation shall not be greater than that payable to Wachovia Bank as
initial Master Servicer hereunder without the prior consent of the Holders of
Notes evidencing not less than 51% of the Note Balance of the Controlling
Class. The Indenture Trustee and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession, including providing such information in writing as reasonably
requested by the Depositor to allow the Depositor to comply with its Exchange
Act reporting obligations with respect to such Successor Servicer. The
Indenture Trustee shall not be relieved of its duties as Successor Servicer
under this Section until a newly appointed Master Servicer shall have assumed
the obligations and duties of the terminated Master Servicer under this
Agreement. Notwithstanding anything to the contrary contained herein, in no
event shall the Indenture Trustee 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
hereunder.
Section 7.03. Effect of Servicing Transfer.
(a) After a transfer of servicing hereunder, the Indenture Trustee or
Successor Servicer shall notify the Obligors to make directly to the Successor
Servicer payments that are due under the Receivables after the effective date
of such transfer.
(b) Except as provided in Section 7.02, after a transfer of servicing
hereunder, the outgoing Master Servicer shall have no further obligations with
respect to the administration, servicing, custody or collection of the
Receivables and the Successor Servicer shall have all of such obligations,
except that the outgoing Master Servicer will transmit or cause to be
transmitted directly to the Successor Servicer for its own account, promptly
on receipt and in the same form in which received, any amounts or items held
by the outgoing Master Servicer (properly endorsed where required for the
Successor Servicer to collect any such items) received as payments upon or
otherwise in connection with the Receivables.
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(c) Any Successor Servicer shall provide the Depositor with access to
the Receivable Files and to the Successor Servicer's records (whether written
or automated) with respect to the Receivable Files. Such access shall be
afforded without charge, but only upon reasonable request and during normal
business hours at the offices of the Successor Servicer. Nothing in this
Section shall affect the obligation of a Successor Servicer to observe any
applicable law prohibiting disclosure of information regarding the Obligors,
and the failure of the Master Servicer to provide access to information as a
result of such obligation shall not constitute a breach of this Section.
(d) Any transfer of servicing hereunder shall not constitute an
assumption by the related Successor Servicer of any liability of the related
outgoing Master Servicer arising out of any breach by such outgoing Master
Servicer of such outgoing Master Servicer's duties hereunder prior to such
transfer of servicing.
Section 7.04. Notification to Noteholders, Certificateholders and
Rating Agencies. Upon any notice of a Servicer Termination Event or upon any
termination of, or any appointment of a successor to, the Master Servicer
pursuant to this Article, the Indenture Trustee shall give prompt written
notice thereof to the Noteholders and the Owner Trustee shall give prompt
written notice thereof to the Certificateholders and to the Rating Agencies.
Section 7.05. Waiver of Past Servicer Termination Events. The
Noteholders evidencing not less than 51% of the Note Balance of the
Controlling Class may, on behalf of all Noteholders, waive any Servicer
Termination Event and its consequences, except an event resulting from the
failure to make any required deposits to or payments from the Collection
Account, the Note Payment Account, the Certificate Payment Account or the
Reserve Fund in accordance with this Agreement. Upon any such waiver of a
Servicer Termination Event, such event shall cease to exist, and shall be
deemed to have been remedied for every purpose of this Agreement. No such
waiver shall extend to any subsequent or other event or impair any right
arising therefrom, except to the extent expressly so waived.
Section 7.06. Repayment of Advances. If the identity of the Master
Servicer shall change, the outgoing Master Servicer shall be entitled to
receive reimbursement for outstanding and unreimbursed Advances made pursuant
to Section 4.04 by the outgoing Master Servicer.
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ARTICLE EIGHT
TERMINATION
Section 8.01. Optional Purchase of All Receivables.
(a) If, as of the last day of any Collection Period, the Pool Balance
shall be less than or equal to 10% of the Cutoff Date Pool Balance, the Master
Servicer shall have the option to purchase on the following Distribution Date
the Owner Trust Estate, other than the Collection Account, the Note Payment
Account, the Certificate Payment Account, the Yield Supplement Account, the
Pre-Funding Account, the Negative Carry Account and the Reserve Fund. To
exercise such option, the Master Servicer shall notify the Depositor, the
Seller, the Owner Trustee, the Indenture Trustee and the Rating Agencies no
later than 30 days prior to the Distribution Date on which such repurchase is
to be effected and shall deposit into the Collection Account on the related
Deposit Date an amount equal to the lesser of the (i) fair market value of the
Receivables and (ii) aggregate Purchase Amount for the Receivables (including
Receivables that became Defaulted Receivables during the related Collection
Period); provided, however, that the Master Servicer shall not be permitted to
exercise such option unless the amount to be deposited in the Collection
Account (together with amounts on deposit in the Reserve Fund, the Yield
Supplement Account and the Collection Account) pursuant to this Section is at
least equal to the sum of all amounts due to the Master Servicer under this
Agreement plus the Note Balance plus all accrued but unpaid interest
(including any overdue interest) on the Notes plus all amounts due to the
Master Servicer for any outstanding and unreimbursed Advances and
Nonrecoverable Advances plus all accrued but unpaid Total Trustee Fees. Upon
such payment, the Master Servicer shall succeed to and own all interests in
and to the Issuer. The aggregate amount so deposited in respect of such
Distribution Date, plus, to the extent necessary, all amounts in the Reserve
Fund and the Yield Supplement Account, shall be used to make payments in full
to the Noteholders in the manner set forth in Article Four.
(b) Following the satisfaction and discharge of the Indenture and the
payment in full of the principal of and interest on the Notes, the
Certificateholders shall succeed to the rights of the Noteholders hereunder
and the Indenture Trustee shall continue to carry out its obligations
hereunder with respect to the Certificateholders, including making
distributions from the Collection Account in accordance with Section 4.06(c)
and making withdrawals from the Reserve Fund in accordance with Sections
4.06(b) and 4.07 and the Yield Supplement Account pursuant to 4.06(b).
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ARTICLE NINE
EXCHANGE ACT REPORTING
Section 9.01. Further Assurances. The Indenture Trustee, the Owner
Trustee and the Master Servicer shall reasonably cooperate with the Depositor
in connection with the satisfaction of the Depositor's reporting requirements
under the Exchange Act with respect to the Issuer. The Depositor shall not
exercise its right to request delivery of information or other performance
under these provisions other than in good faith. In addition to the other
information specified in this Article Nine, if so requested by the Depositor
for the purpose of satisfying its reporting obligation under the Exchange Act,
the Indenture Trustee, the Owner Trustee and the Master Servicer shall provide
the Depositor with (a) such information which is available to such Person
without unreasonable effort or expense and within such timeframe as may be
reasonably requested by the Depositor to comply with the Depositor's reporting
obligations under the Exchange Act and (b) to the extent such Person is a
party (and the Depositor is not a party) to any agreement or amendment
required to be filed, copies of such agreement or amendment in
▇▇▇▇▇-compatible form. Each of the Master Servicer, the Indenture Trustee and
the Owner Trustee acknowledges that interpretations of the requirements of
Regulation AB may change over time, whether due to interpretive guidance
provided by the Commission or its staff, consensus among participants in the
asset-backed securities markets, advice of counsel, or otherwise, and agrees
to comply with requests made by the Depositor in good faith for delivery of
information under these provisions on the basis of evolving interpretations of
Regulation AB.
Section 9.02. Form 10-D Filings. So long as the Depositor is required
to file Exchange Act Reports with respect to the Issuer, no later than each
Distribution Date, each of the Indenture Trustee, the Owner Trustee and the
Master Servicer shall notify (and the Master Servicer shall cause any
Subservicer to notify) the Depositor of any Form 10-D Disclosure Item with
respect to such Person, together with a description of any such Form 10-D
Disclosure Item in form and substance reasonably acceptable to the Depositor.
In addition to such information as the Master Servicer is obligated to provide
pursuant to other provisions of this Agreement, if so requested by the
Depositor, the Master Servicer shall provide such information which is
available to the Master Servicer, without unreasonable effort or expense
regarding the performance or servicing of the Receivables as is reasonably
required to facilitate preparation of distribution reports in accordance with
Item 1121 of Regulation AB. Such information shall be provided concurrently
with the statements to Securityholders pursuant to Section 4.12, commencing
with the first such report due not less than five Business Days following such
request.
Section 9.03. Form 8-K Filings. So long as the Depositor is required
to file Exchange Act Reports with respect to the Issuer, each of the Indenture
Trustee, the Owner Trustee and the Master Servicer shall promptly notify the
Depositor, but in no event later than one (1) Business Day after its
occurrence, of any Reportable Event (in the case of the Owner Trustee, only an
event in clause (iv) of the definition of "Reportable Event") of which such
Person (or in the case of the Owner Trustee and the Indenture Trustee, a
Responsible Officer of such Person) has actual knowledge. Each Person shall be
deemed to have actual knowledge of any such event to the extent that it
relates to such Person or any action or failure to act by such Person.
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Section 9.04. Form 10-K Filings. So long as the Depositor is required
to file Exchange Act Reports: (i) if the Item 1119 Parties listed on Schedule
B have changed since the Closing Date, no later than March 1 of each year, the
Depositor shall provide each of the Indenture Trustee, the Owner Trustee and
the Master Servicer with an updated Schedule B setting forth the Item 1119
Parties and (ii) no later than March 15 of each year, commencing in 200__, the
Indenture Trustee, the Owner Trustee and the Master Servicer shall notify the
Depositor of any Form 10-K Disclosure Item, together with a description of any
such Form 10-K Disclosure Item in form and substance reasonably acceptable to
the Depositor.
Section 9.05. Report on Assessment of Compliance and Attestation. So
long as the Depositor is required to file Exchange Act Reports, on or before
March 15 of each calendar year, commencing in 200__:
(a) The Indenture Trustee shall deliver to the Depositor and the
Master Servicer a report of the Indenture Trustee's assessment of compliance
with the Servicing Criteria during the immediately preceding calendar year, as
set forth under Rules 13a-18 and 15d-18 of the Exchange Act (or any successor
provisions) and Item 1122 of Regulation AB. Such report shall be signed by an
authorized officer of the Indenture Trustee and shall at a minimum address
each of the Servicing Criteria specified on a certification substantially in
the form of Schedule C hereto delivered to the Depositor concurrently with the
execution of this Agreement (provided that such certification may be revised
after the date of this Agreement as agreed by the Depositor and the Indenture
Trustee to reflect any guidance with respect to such criteria from the
Commission). To the extent any of the Servicing Criteria are not applicable to
the Indenture Trustee, with respect to asset-backed securities transactions
taken as a whole involving the Indenture Trustee and that are backed by the
same asset type backing the Notes, such report shall include such a statement
to that effect. The Indenture Trustee acknowledges and agrees that the
Depositor and the Master Servicer with respect to its duties as the Certifying
Person, and each of their respective officers and directors shall be entitled
to rely on upon each such servicing criteria assessment and the attestation
delivered pursuant to Section 9.05(b) below.
(b) The Indenture Trustee shall deliver to the Depositor and the
Master Servicer a report of a registered public accounting firm that attests
to, and reports on, the assessment of compliance made by the Indenture Trustee
and delivered pursuant to the preceding paragraph. Such attestation shall be
in accordance with Rules 13a-18 and 15d-18 of the Exchange Act (or any
successor provisions), Rules 1-02(a)(3) and 2-02(g) of Regulation S-X (or any
successor provisions) under the Securities Act and the Exchange Act,
including, without limitation that in the event that an overall opinion cannot
be expressed, such registered public accounting firm shall state in such
report why it was unable to express such an opinion. Such report must be
available for general use and not contain restricted use language.
(c) The Indenture Trustee shall cause each Reporting Subcontractor to
deliver to the Depositor and the Master Servicer an assessment of compliance
and accountant's attestation as and when provided in paragraphs (a) and (b) of
this Section. An assessment of compliance provided by a Subcontractor need not
address any elements of the Servicing Criteria other than those specified by
the Indenture Trustee pursuant to Section 9.05(a).
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(d) In the event the Indenture Trustee or Reporting Subcontractor is
terminated or resigns during the term of this Agreement, such Person shall
provide the documents and information pursuant to this Section 9.05 with
respect to the period of time it was subject to this Agreement or provided
services with respect to the Issuer or the Receivables.
Section 9.06. Back-up ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification.
(a) No later than March 15 of each year, beginning in 200__, (i) the
Indenture Trustee shall and shall cause each Reporting Subcontractor to
provide the Performance Certification to the Certifying Person, in the form
attached hereto as Schedule D (in the case of the Indenture Trustee or a
Reporting Subcontractor) and (ii) the Master Servicer shall provide the
Performance Certification to the Certifying Person as Schedule E (in the case
of the Master Servicer), in each case on which the Certification Parties can
reasonably rely; provided that so long as the Master Servicer is an Affiliate
of the Depositor, the Master Servicer may, but is not required to deliver the
Performance Certificate.
(b) The Depositor will not request delivery of a certification under
this clause unless the Depositor is required under the Exchange Act to file an
annual report on Form 10-K with respect to the Issuer. In the event that prior
to the filing date of the Form 10-K in March of each year, the Indenture
Trustee or the Master Servicer has actual knowledge of information material to
the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Certification, the Indenture Trustee or the Master Servicer
shall promptly notify the Depositor. Each of the Indenture Trustee and the
Master Servicer agrees to cooperate with all reasonable requests made by any
Certifying Person or Certification Party in connection with such Person's
attempt to conduct any due diligence that such Person reasonably believes to
be appropriate in order to allow it to deliver any ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Certification or portion thereof with respect to the Issuer.
Section 9.07. Use of Subcontractors.
(a) It shall not be necessary for the Indenture Trustee or the Master
Servicer to seek the consent of the Depositor or any other party hereto to the
utilization of any Subcontractor. Each of the Indenture Trustee and the Master
Servicer shall promptly upon request provide to the Depositor (or any designee
of the Depositor, such as the Master Servicer or the Administrator) a written
description (in form and substance satisfactory to the Depositor) of the role
and function of each Subcontractor utilized by such Person, specifying (i) the
identity of each such Subcontractor, (ii) which (if any) of such
Subcontractors are "participating in the servicing function" within the
meaning of Item 1122 of Regulation AB and (iii) which elements of the
Servicing Criteria will be addressed in assessments of compliance provided by
each Subcontractor identified pursuant to clause (ii) of this paragraph.
(b) As a condition to the utilization of any Subcontractor determined
to be a Reporting Subcontractor, the Indenture Trustee shall cause any such
Subcontractor for the benefit of the Depositor to comply with the provisions
of Sections 9.05 and 9.06 to the same extent as if such Subcontractor were the
Indenture Trustee. The Indenture Trustee shall be responsible for obtaining
from each Subcontractor and delivering to the Depositor, any assessment of
compliance and attestation required to be delivered by such Subcontractor
under Section 9.05 and Section 9.06, in each case as and when required to be
delivered.
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(c) As a condition to the utilization of any Subcontractor determined
to be a Reporting Subcontractor, the Master Servicer shall cause any such
Subcontractor for the benefit of the Depositor to comply with the provisions
of Section 3.11(a), Section 3.12 and Section 9.06, to the same extent as if
such Subcontractor were the Master Servicer. The Master Servicer shall be
responsible for obtaining from each Subcontractor and delivering to the
Depositor, any assessment of compliance and attestation required to be
delivered by such Subcontractor under this Agreement, in each case as and when
required to be delivered.
Section 9.08. Representations and Warranties. Each of the Indenture
Trustee and the Owner Trustee represents that:
(i) there are no affiliations, relating to such Person with
respect to any Item 1119 Party,
(ii) there are no relationships or transactions with respect
to any Item 1119 Party and such Person that are outside the ordinary
course of business or on terms other than would be obtained in an
arm's length transaction with an unrelated third party, apart from
the transactions contemplated under the Basic Documents, and that are
material to the investors' understanding of the Notes and
(iii) there are no legal proceedings pending, or known to be
contemplated by governmental authorities, against such Person, or of
which the property of such Person is subject, that is material to the
Noteholders.
Section 9.09. Indemnification.
(a) Each of the Indenture Trustee and the Master Servicer (if the
Master Servicer is not the Seller) shall indemnify the Depositor, each
affiliate of the Depositor, the Master Servicer with respect to its duties as
Certifying Person or each Person who controls any of such parties (within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act) and the respective present and former directors, officers, employees and
agents of each of the foregoing, and shall hold each of them harmless from and
against any losses, damages, penalties, fines, forfeitures, legal fees and
expenses and related costs, judgments, and any other costs, fees and expenses
that any of them may sustain arising out of or based upon:
(i) (A) any untrue statement of a material fact contained or
alleged to be contained in the Provided Information or (B) the
omission or alleged omission to state in the Provided Information a
material fact required to be stated in the Provided Information, or
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
provided, by way of clarification, that clause (B) of this paragraph
shall be construed solely by reference to the related Provided
Information and not to any other information communicated in
connection with a sale or purchase of securities, without regard to
whether the Provided Information or any portion thereof is presented
together with or separately from such other information; or
(ii) with respect to the Indenture Trustee, any failure by
the Indenture Trustee to deliver any servicing criteria assessment
when and as required under this Article Nine
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and with respect to the Master Servicer, any failure by the Master
Servicer to deliver any information, report, certification,
accountant's letter or other material when and as required under
Section 3.11, Section 3.12 or Article Nine, as applicable.
(b) In the case of any failure of performance described in Section
9.09(a)(ii), each of the Indenture Trustee and the Master Servicer shall
promptly reimburse the Depositor for all costs reasonably incurred by each
such party in order to obtain the information, report, certification,
accountants' letter or other material not delivered as required by the
Indenture Trustee or the Master Servicer, as applicable.
(c) Each of the Indenture Trustee and the Master Servicer shall
require that any Reporting Subcontractor agree to the provisions of paragraphs
(a) and (b) of this Section 9.09, or shall be responsible for all such
indemnification, costs or expenses if the Reporting Subcontractor will not
agree to such provisions.
(d) Notwithstanding anything to the contrary contained herein, in no
event shall the Indenture Trustee be liable for special, indirect or
consequential damages of any kind whatsoever, including but not limited to
lost profits, even if the Indenture Trustee has been advised of the likelihood
of such loss or damage and regardless of the form of action.
Section 9.10. Amendments. Notwithstanding the provisions of Section
10.01, in the event the parties to this Agreement desire to further clarify or
amend any provision of this Article Nine, this Agreement shall be amended to
reflect the new agreement between the parties covering matters in this Article
Nine pursuant to Section 9.01, provided such amendment will not require any
Opinion of Counsel or satisfaction of the Rating Agency Condition or the
consent of any Noteholder or Certificateholder.
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ARTICLE TEN
MISCELLANEOUS
Section 10.01. Amendment.
(a) This Agreement may be amended from time to time by the Depositor,
the Seller, the Master Servicer and the Owner Trustee, on behalf of the
Issuer, with the consent of the Indenture Trustee, but without the consent of
any of the Noteholders, to cure any ambiguity, to correct or supplement any
provision in this Agreement that may be inconsistent with any other provisions
in this Agreement or any offering document used in connection with the initial
offer and sale of the Notes, to add, change or eliminate any other provisions
with respect to matters or questions arising under this Agreement that are not
inconsistent with the provisions of this Agreement; provided, however, that no
such amendment (i) may materially adversely affect the interests of any
Noteholder and (ii) will be permitted unless an Opinion of Counsel is
delivered to the Depositor, the Owner Trustee and the Indenture Trustee to the
effect that such amendment will not cause the Issuer to be characterized for
federal income tax purposes as an association taxable as a corporation or
otherwise have any material adverse impact on the federal income taxation of
any Notes Outstanding or any Noteholder.
(b) This Agreement may also be amended from time to time by the
Depositor, the Seller, the Master Servicer and the Owner Trustee, on behalf of
the Issuer, with the consent of the Indenture Trustee and the consent of the
Holders of Notes evidencing at least 66 2/3% of the Note Balance of the
Controlling Class, for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement, or of
modifying in any manner the rights of the Noteholders; provided, however, that
no such amendment (1) will be permitted unless an Opinion of Counsel is
delivered to the Depositor and the Trustees to the effect that such amendment
will not cause the Issuer to be characterized for federal income tax purposes
as an association or publicly traded partnership taxable as a corporation or
otherwise have any material adverse impact on the federal income taxation of
any Notes Outstanding or any Noteholder and (2) may:
(i) increase or reduce in any manner the amount of, or
accelerate or delay the timing of, or change the allocation or
priority of, collections of payments on or in respect of the
Receivables or distributions that are required to be made for the
benefit of the Noteholders or change any Interest Rate or the
Required Reserve Fund Amount, without the consent of 100% of the
Noteholders of Notes then Outstanding; or
(ii) reduce the percentage of the Note Balance of the
Controlling Class, the consent of the Noteholders of which is
required for any amendment to this Agreement without the consent of
100% of the Noteholders of Notes then Outstanding.
(c) An amendment to this Agreement shall be deemed not to materially
adversely affect the interests of any Noteholder if (i) the Person requesting
such amendment obtains and delivers to the Trustees an Opinion of Counsel to
that effect or (ii) the Rating Agency Condition is satisfied.
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(d) Prior to the execution of any amendment or consent pursuant to
this Section, the Master Servicer shall provide written notification of the
substance of such amendment or consent to each Rating Agency.
(e) Promptly after the execution of any amendment or consent pursuant
to Section 9.01(b), the Owner Trustee shall furnish written notification of
the substance of such amendment or consent to each Certificateholder. It shall
not be necessary for the consent of the Noteholders pursuant to Section
10.01(b) to approve the particular form of any proposed amendment or consent,
but it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents (and any other consents of the
Noteholders provided for in this Agreement) and of evidencing the
authorization of the execution thereof by the Noteholders shall be subject to
such reasonable requirements as the Trustees may prescribe.
(f) Prior to the execution of any amendment pursuant to this Section,
the Depositor and the Trustees shall be entitled to receive and rely upon (i)
an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and (ii) an Officer's Certificate of
the Master Servicer that all conditions precedent provided for in this
Agreement to the execution of such amendment have been complied with. The
Owner Trustee or the Indenture Trustee may, but shall not be obligated to,
enter into any such amendment which affects such Owner Trustee's or Indenture
Trustee's own rights, duties or immunities under this Agreement or otherwise.
Section 10.02. Protection of Title to Issuer.
(a) The Depositor or the Master Servicer, or both, shall authorize
and file such financing statements and cause to be authorized and filed such
continuation statements, all in such manner and in such places as may be
required by law fully to preserve, maintain and protect the interest of the
Issuer and of the Indenture Trustee for the benefit of the Noteholders in the
Receivables and in the proceeds thereof. The Depositor or the Master Servicer,
or both, shall deliver (or cause to be delivered) to the Trustees file-stamped
copies of, or filing receipts for, any document filed as provided above, as
soon as available following such filing.
(b) Neither the Depositor nor the Master Servicer shall change its
name, identity or organizational structure in any manner that would make any
financing statement or continuation statement filed in accordance with Section
10.02(a) seriously misleading within the meaning of Section 9-506 of the UCC,
unless it shall have given the Trustees at least 60 days' prior written notice
thereof and shall have promptly filed such amendments to previously filed
financing statements or continuation statements or such new financing
statements as may be necessary to continue the perfection of the interest of
the Issuer and the Indenture Trustee for the benefit of the Noteholders in the
Receivables and the proceeds thereof.
(c) Each of the Seller, the Depositor and the Master Servicer shall
give the Trustees at least 60 days' prior written notice of any change in its
name, identity, organizational structure or jurisdiction of organization or
any relocation of its principal place of business or chief executive office
if, as a result of such change or relocation, the applicable provisions of the
UCC would require the filing of any amendment to any previously filed
financing statement or continuation statement or of any new financing
statement and shall promptly file any such
73
amendment, continuation statement or new financing statement. The Depositor
shall at all times maintain its jurisdiction of organization, its principal
place of business and its chief executive office within the United States. The
Master Servicer shall at all times maintain each office from which it shall
service Receivables, and each office at which the Receivable Files are
located, within the United States.
(d) The Master Servicer shall maintain accounts and records as to
each Receivable accurately and in sufficient detail to permit (i) the reader
thereof to know at any time the status of such Receivable, including payments
and recoveries made and payments owing (and the nature of each) and (ii)
reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Collection
Account and held by the Reserve Fund in respect of such Receivable.
(e) The Master Servicer shall maintain its computer systems so that,
from and after the time of transfer of the Receivables to the Issuer pursuant
to this Agreement, the Master Servicer's master computer records (including
any back-up archives) that refer to a Receivable shall indicate clearly and
unambiguously the interest of the Issuer and the Indenture Trustee in such
Receivable and that such Receivable is owned by the Issuer and has been
pledged to the Indenture Trustee pursuant to the Indenture. Indication of the
Issuer's and the Indenture Trustee's interest in a Receivable shall be deleted
from or modified on the Master Servicer's computer systems when, and only
when, such Receivable shall have been paid in full or repurchased by the
Seller or purchased by the Master Servicer.
(f) If at any time the Depositor or the Master Servicer shall propose
to sell, grant a security interest in, or otherwise transfer any interest in
any motor vehicle retail installment sale contract to any prospective
purchaser, lender or other transferee, the Master Servicer shall give to such
prospective purchaser, lender or other transferee computer tapes, CDs, records
or printouts (including any restored from back-up archives) that, if they
shall refer in any manner whatsoever to any Receivable, shall indicate clearly
and unambiguously that such Receivable has been sold and is owned by the
Issuer and has been pledged to the Indenture Trustee (unless such Receivable
has been paid in full or repurchased by the Seller or purchased by the Master
Servicer).
(g) The Master Servicer shall permit the Trustees and their
respective agents at any time during normal business hours to inspect, audit
and make copies of and abstracts from the Master Servicer's records regarding
any Receivable.
(h) If the Seller has repurchased one or more Receivables from the
Issuer pursuant to Section 2.04 or the Master Servicer has purchased one or
more Receivables from the Issuer pursuant to Section 3.08, the Master Servicer
shall, upon request, furnish to the Owner Trustee or to the Indenture Trustee,
within ten Business Days, a list of all Receivables (by contract number and
name of Obligor) then held as part of the Issuer, together with a
reconciliation of such list to the Schedule of Receivables (as amended or
supplemented to date) and to each of the Master Servicer's Certificates
furnished before such request indicating removal of Receivables from the
Issuer.
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(i) The Master Servicer shall deliver to the Depositor and the
Trustees:
(i) promptly after the authorization and delivery of each
amendment to any financing statement delivered pursuant to this
Agreement, an Opinion of Counsel stating that, in the opinion of such
counsel, either (A) all financing statements and continuation
statements have been authorized and filed that are necessary fully to
preserve and protect the interest of the Depositor (in the case of an
opinion delivered by the Master Servicer) or the Issuer and the
Indenture Trustee (in the case of an opinion delivered by the
Depositor) in the Receivables, and reciting the details of such
filings or referring to prior Opinions of Counsel in which such
details are given, or (B) no such action shall be necessary to
preserve and protect such interest; and
(ii) within 90 days after the beginning of each calendar
year (beginning with the first year beginning more than three months
after the Cutoff Date) an Opinion of Counsel, dated as of a date
during such 90-day period, stating that, in the opinion of such
counsel, either (A) all financing statements and continuation
statements have been authorized and filed that are necessary fully to
preserve and protect the interest of the Depositor (in the case of an
opinion delivered by the Master Servicer) or the Issuer and the
Indenture Trustee (in the case of an opinion delivered by the
Depositor) in the Receivables, and reciting the details of such
filings or referring to prior Opinions of Counsel in which such
details are given, or (B) no such action shall be necessary to
preserve and protect such interest.
Each Opinion of Counsel referred to in clause (i) or (ii) above shall
specify any action necessary (as of the date of such opinion) to be taken on
or before March 31 of the following year to preserve and protect such
interest.
(j) The Depositor shall, to the extent required by applicable law,
cause the Notes to be registered with the Commission pursuant to Section 12(b)
or Section 12(g) of the Exchange Act within the time periods specified in such
sections.
Section 10.03. Notices. All demands, notices and communications under
this Agreement shall be in writing, personally delivered, sent by telecopier,
overnight courier or mailed by certified mail, return receipt requested, or,
where electronic delivery is applicable and requested, shall be delivered by
electronic delivery, and shall be deemed to have been duly given upon receipt
in the case of (i) the Depositor, at One Wachovia Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Treasury ABS
Department, (ii) the Seller or the Master Servicer, at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Treasury
Department, (iii) the Issuer or the Owner Trustee, at the Corporate Trust
Office (as such term is defined in the Trust Agreement), (iv) the Indenture
Trustee, at the Corporate Trust Office, (v) Moody's, to ▇▇▇▇▇'▇ Investors
Service, Inc., ABS Monitoring Department, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ (e-mail: ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇), (vi) Standard & Poor's, to
Standard & Poor's Ratings Services, a Division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Asset Backed
Surveillance Department (e-mail: ▇▇▇▇▇▇▇▇_▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇) or (vii) as to
each of the foregoing, at such other address as shall be designated by written
notice to the other parties.
75
Section 10.04. Assignment.
(a) Notwithstanding anything to the contrary contained herein, except
as provided in the remainder of this Section or as provided in Sections 6.03
and 7.02, this Agreement may not be assigned by the Depositor or the Master
Servicer without the prior written consent of the Trustees and the Holders of
Notes evidencing at least 66 2/3% of the Note Balance of the Controlling
Class.
(b) The Depositor hereby acknowledges and consents to the mortgage,
pledge, assignment and grant of a security interest by the Issuer to the
Indenture Trustee pursuant to the Indenture for the benefit of the Noteholders
of all right, title and interest of the Issuer in, to and under the Trust
Property and the assignment of any or all of the Issuer's rights and
obligations hereunder to the Indenture Trustee.
Section 10.05. Severability. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements, provisions
and terms of this Agreement and shall in no way affect the validity or
enforceability of the other covenants, agreements, provisions and terms of
this Agreement.
Section 10.06. Further Assurances. The Depositor, the Seller, the
Master Servicer and the Issuer agree to do and perform, from time to time, any
and all acts and to authorize or execute any and all further instruments
required or reasonably requested by the Owner Trustee or the Indenture Trustee
more fully to effect the purposes of this Agreement, including the
authorization and execution of any financing statements or continuation
statements relating to the Receivables for filing under the provisions of the
UCC of any applicable jurisdiction.
Section 10.07. No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Depositor, the Owner Trustee,
the Indenture Trustee, the Noteholders or the Certificateholders, any right,
remedy, power or privilege hereunder, shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, remedy, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of
any other right, remedy, power or privilege. The rights, remedies, powers and
privileges provided in this Agreement are cumulative and not exhaustive of any
rights, remedies, powers and privileges provided by law.
Section 10.08. Third-Party Beneficiaries. This Agreement shall inure
to the benefit of and be binding upon the parties hereto, the Owner Trustee,
the Noteholders, the Certificateholders and their respective successors and
permitted assigns. Except as otherwise provided in this Article, no other
Person shall have any right or obligation hereunder. The parties hereto hereby
acknowledge and consent to the pledge of this Agreement by the Issuer to the
Indenture Trustee for the benefit of the Noteholders pursuant to the
Indenture.
Section 10.09. Actions by Securityholders.
(a) Wherever in this Agreement a provision is made that an action may
be taken or a notice, demand or instruction given by the Noteholders or the
Certificateholders, such action, notice or instruction may be taken or given
by any Noteholder or any Certificateholder, as
76
applicable, unless such provision requires a specific percentage of the
Noteholders or the Certificateholders.
(b) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Noteholder or a Certificateholder shall bind such
Noteholder or Certificateholder and every subsequent Holder of the related
Note or Certificate issued upon the registration of transfer thereof or in
exchange therefor or in lieu thereof in respect of anything done or omitted to
be done by the Owner Trustee, the Indenture Trustee or the Master Servicer in
reliance thereon, whether or not notation of such action is made upon such
Note or Certificate.
Section 10.10. 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 10.11. Headings. The Article and Section headings herein and
the Table of Contents are for convenience of reference only and shall not
affect the meaning or interpretation of the terms or provisions hereof.
Section 10.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 10.13. Nonpetition Covenants. The Owner Trustee, the
Indenture Trustee and the Master Servicer each covenants and agrees that it
will not at any time institute against, or join any other Person in
instituting against, the Depositor or the Issuer any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
proceedings under any federal or State bankruptcy or similar law. This Section
shall survive the resignation or removal of the Owner Trustee under the Trust
Agreement and the Indenture Trustee under the Indenture and shall survive the
termination of the Trust Agreement and the Indenture.
Section 10.14. Limitation of Liability of Owner Trustee and Indenture
Trustee.
(a) Notwithstanding anything to the contrary contained herein, this
Agreement has been executed by the Owner Trustee not in its individual
capacity but solely in its capacity as Owner Trustee of the Issuer and in no
event shall the Owner Trustee in its individual capacity have any liability
for the representations, warranties, covenants, agreements or other
obligations of the Issuer hereunder or in any of the certificates, notices or
agreements delivered pursuant hereto, as to all of which recourse shall be had
solely to the assets of the Issuer. For all purposes of this Agreement, in the
performance of its duties or obligations hereunder or in the performance of
any duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of
Articles Six, Seven and Eight of the Trust Agreement.
(b) Notwithstanding anything to the contrary contained herein, this
Agreement has been accepted by the Indenture Trustee, not in its individual
capacity but solely as Indenture
77
Trustee and in no event shall the Indenture Trustee in its individual capacity
have any liability for the representations, warranties, covenants, agreements
or other obligations of the Issuer hereunder or in any of the certificates,
notices or agreements delivered pursuant hereto, as to all of which recourse
shall be had solely to the assets of the Issuer.
78
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers, thereunto duly authorized, as
of the day and year first above written.
WACHOVIA AUTO OWNER TRUST 200__-__
By: ______________________________, not in
its individual capacity but solely as
Owner Trustee on behalf of the Issuer
By:
---------------------------------------
Name:
Title:
POOLED AUTO SECURITIES SHELF LLC,
as Depositor
By:
---------------------------------------
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Seller and Master Servicer
By:
---------------------------------------
Name:
Title:
Acknowledged and accepted and, solely for p
urposes of Article Nine, agreed as
of the day and year first above written:
------------------------------,
not in its individual capacity but
solely as Indenture Trustee
By:
------------------------------------------------
Name:
Title:
Sale and Servicing Agreement
------------------------------,
not in its individual capacity but solely as
Owner Trustee
By:
-------------------------------------
Name:
Title
Sale and Servicing Agreement
SCHEDULE A
LOCATION OF RECEIVABLE FILES
SA-1
SCHEDULE B
ITEM 1119 PARTIES
SB-1
SCHEDULE C
SERVICING CRITERIA
(TO BE ADDRESSED IN THE REPORT ON ASSESSMENT OF COMPLIANCE)
The assessment of compliance to be delivered by the Master Servicer
shall address, at a minimum, the criteria identified as below as "Applicable
Servicing Criteria":
--------------------------------------------------------------------------------------------------------------------
Reg AB Reference Servicing Criteria Applicable Servicing Criteria
--------------------------------------------------------------------------------------------------------------------
General Servicing Considerations
--------------------------------------------------------------------------------------------------------------------
Policies and procedures are instituted to
monitor any performance or other triggers and
events of default in accordance with the
1122(d)(1)(i) transaction agreements.
--------------------------------------------------------------------------------------------------------------------
If any material servicing activities are
outsourced to third parties, policies and
procedures are instituted to monitor the third
party's performance and compliance with such
1122(d)(1)(ii) servicing activities.
--------------------------------------------------------------------------------------------------------------------
Any requirements in the transaction agreements
to maintain a back-up servicer for the Pool
1122(d)(1)(iii) Assets are maintained.
--------------------------------------------------------------------------------------------------------------------
A fidelity bond and errors and omissions policy
is in effect on the party participating in the
servicing function throughout the reporting
period in the amount of coverage required by
and otherwise in accordance with the terms of
1122(d)(1)(iv) the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Cash Collection and Administration
--------------------------------------------------------------------------------------------------------------------
Payments on pool assets are deposited into the
appropriate custodial bank accounts and related
bank clearing accounts no more than two
business days following receipt, or such other
number of days specified in the transaction
1122(d)(2)(i) agreements.
--------------------------------------------------------------------------------------------------------------------
Disbursements made via wire transfer on behalf
of an obligor or to an investor are made only by
1122(d)(2)(ii) authorized personnel.
--------------------------------------------------------------------------------------------------------------------
Advances of funds or guarantees regarding
collections, cash flows or distributions, and
any interest or other fees charged for such
advances, are made, reviewed and approved as
1122(d)(2)(iii) specified in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
The related accounts for the transaction, such
as cash reserve accounts or accounts established
as a form of over collateralization, are
separately maintained (e.g., with respect to
commingling of cash) as set forth in the
1122(d)(2)(iv) transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Each custodial account is maintained at a
federally insured depository institution as set
forth in the transaction agreements. For
purposes of this criterion, "federally insured
depository institution" with respect to a
foreign financial institution means a foreign
financial institution that meets the
requirements of Rule 13k-1(b)(1) of the
1122(d)(2)(v) Securities Exchange Act.
--------------------------------------------------------------------------------------------------------------------
Unissued checks are safeguarded so as to
1122(d)(2)(vi) prevent unauthorized access.
--------------------------------------------------------------------------------------------------------------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis
for
--------------------------------------------------------------------------------------------------------------------
SC-1
--------------------------------------------------------------------------------------------------------------------
Reg AB Reference Servicing Criteria Applicable Servicing Criteria
--------------------------------------------------------------------------------------------------------------------
all asset-backed securities related bank
accounts, including custodial accounts and
related bank clearing accounts. These
reconciliations are (A) mathematically accurate;
(B) prepared within 30 calendar days after the
bank statement cutoff date, or such other number
of days specified in the transaction agreements;
(C) reviewed and approved by someone other than
the person who prepared the reconciliation; and
(D) contain explanations for reconciling items.
These reconciling items are resolved within 90
calendar days of their original identification,
or such other number of days specified in the
transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Investor Remittances and Reporting
--------------------------------------------------------------------------------------------------------------------
Reports to investors, including those to be
filed with the Commission, are maintained in
accordance with the transaction agreements and
applicable Commission requirements.
Specifically, such reports (A) are prepared in
accordance with timeframes and other terms set
forth in the transaction agreements; (B)
provide information calculated in accordance
with the terms specified in the transaction
agreements; (C) are filed with the Commission
as required by its rules and regulations; and
(D) agree with investors' or the trustee's
records as to the total unpaid principal
balance and number of Pool Assets serviced by
1122(d)(3)(i) the Servicer.
--------------------------------------------------------------------------------------------------------------------
Amounts due to investors are allocated and
remitted in accordance with timeframes,
distribution priority and other terms set forth
1122(d)(3)(ii) in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Disbursements made to an investor are posted
within two business days to the Servicer's
investor records, or such other number of days
1122(d)(3)(iii) specified in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Amounts remitted to investors per the investor
reports agree with cancelled checks, or other
1122(d)(3)(iv) form of payment, or custodial bank statements.
--------------------------------------------------------------------------------------------------------------------
Pool Asset Administration
--------------------------------------------------------------------------------------------------------------------
Collateral or security on pool assets is
maintained as required by the transaction
1122(d)(4)(i) agreements or related pool asset documents.
--------------------------------------------------------------------------------------------------------------------
Pool assets and related documents are
safeguarded as required by the transaction
1122(d)(4)(ii) agreements
--------------------------------------------------------------------------------------------------------------------
Any additions, removals or substitutions to the
asset pool are made, reviewed and approved in
accordance with any conditions or requirements
1122(d)(4)(iii) in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Payments on pool assets, including any payoffs,
made in accordance with the related pool asset
documents are posted to the Servicer's obligor
records maintained no more than two business
days after receipt, or such other number of
days specified in the transaction agreements,
and allocated to principal, interest or other
items (e.g., escrow) in accordance with the
1122(d)(4)(iv) related pool asset documents.
--------------------------------------------------------------------------------------------------------------------
1122(d)(4)(v) The Servicer's records regarding the pool assets
agree
SC-2
--------------------------------------------------------------------------------------------------------------------
Reg AB Reference Servicing Criteria Applicable Servicing Criteria
--------------------------------------------------------------------------------------------------------------------
with the Servicer's records with respect
to an obligor's unpaid principal balance.
--------------------------------------------------------------------------------------------------------------------
Changes with respect to the terms or status of
an obligor's pool assets (e.g., loan
modifications or re-agings) are made, reviewed
and approved by authorized personnel in
accordance with the transaction agreements and
1122(d)(4)(vi) related pool asset documents.
--------------------------------------------------------------------------------------------------------------------
Loss mitigation or recovery actions (e.g.,
forbearance plans, modifications and deeds in
lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated,
conducted and concluded in accordance with the
timeframes or other requirements established by
1122(d)(4)(vii) the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Records documenting collection efforts are
maintained during the period a pool asset is
delinquent in accordance with the transaction
agreements. Such records are maintained on at
least a monthly basis, or such other period
specified in the transaction agreements, and
describe the entity's activities in monitoring
delinquent pool assets including, for example,
phone calls, letters and payment rescheduling
plans in cases where delinquency is deemed
1122(d)(4)(viii) temporary (e.g., illness or unemployment).
--------------------------------------------------------------------------------------------------------------------
Adjustments to interest rates or rates of return
for pool assets with variable rates are computed
1122(d)(4)(ix) based on the related pool asset documents.
--------------------------------------------------------------------------------------------------------------------
Regarding any funds held in trust for an
obligor (such as escrow accounts): (A) such
funds are analyzed, in accordance with the
obligor's pool asset documents, on at least an
annual basis, or such other period specified in
the transaction agreements; (B) interest on
such funds is paid, or credited, to obligors in
accordance with applicable pool asset documents
and state laws; and (C) such funds are returned
to the obligor within 30 calendar days of full
repayment of the related pool assets, or such
other number of
1122(d)(4)(x) days specified in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Payments made on behalf of an obligor (such as
tax or insurance payments) are made on or
before the related penalty or expiration dates,
as indicated on the appropriate bills or
notices for such payments, provided that such
support has been received by the servicer at
least 30 calendar days prior to these dates, or
such other number of days specified in the
1122(d)(4)(xi) transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Any late payment penalties in connection with
any payment to be made on behalf of an obligor
are paid from the Servicer's funds and not
charged to the obligor, unless the late payment
1122(d)(4)(xii) was due to the obligor's error or omission.
--------------------------------------------------------------------------------------------------------------------
Disbursements made on behalf of an obligor are
posted within two business days to the obligor's
records maintained by the servicer, or such
other number of days specified in the
1122(d)(4)(xiii) transaction agreements.
--------------------------------------------------------------------------------------------------------------------
Delinquencies, charge-offs and uncollectible
accounts are recognized and recorded in
1122(d)(4)(xiv) accordance with the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
SC-3
--------------------------------------------------------------------------------------------------------------------
Reg AB Reference Servicing Criteria Applicable Servicing Criteria
--------------------------------------------------------------------------------------------------------------------
Any external enhancement or other support,
identified in Item 1114(a)(1) through (3) or
Item 1115 of Regulation AB, is maintained as
1122(d)(4)(xv) set forth in the transaction agreements.
--------------------------------------------------------------------------------------------------------------------
SC-4
SCHEDULE D
PERFORMANCE CERTIFICATION
(TRUSTEE / REPORTING SUBCONTRACTOR)
Re: Wachovia Auto Owner Trust 200__-__
The undersigned [Indenture Trustee] [Reporting Subcontractor] hereby
certifies to the [ ] and its officers, directors and Affiliates (collectively,
the "Certification Parties") as follows, with the knowledge and intent that
the Certification Parties will rely on this Certification in connection with
the certification concerning the Issuer to be signed by an officer of the
Servicer and submitted to the Securities and Exchange Commission pursuant to
the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002:
1. The [Indenture Trustee] [Reporting Subcontractor] has reviewed the
information and reports provided by it to the Depositor and the Servicer
pursuant to the Agreement with respect to the assessment of the Servicing
Criteria under Section 9.05 of the Agreement (the "Information");
2. Based on the [Indenture Trustee] [Reporting Subcontractor]'s
knowledge, the Information, taken as a whole, does not contain any untrue
statement of a material fact or omit to state a material fact required in the
Information and necessary to make the statements made, in the light of the
circumstances under which such statements were made, not misleading with
respect to the period covered by the 10-K report; and
3. The assessment of the Servicing Criteria required to be provided
by the [Indenture Trustee] [Reporting Subcontractor] pursuant to the
Agreement, has been provided to the Depositor and the Servicer. Any material
instance of noncompliance with the applicable Servicing Criteria has been
disclosed in such report.
[4. Any assessment of compliance with Servicing Criteria required to
be provided by any Reporting Subcontractor of the Indenture Trustee has been
provided by such Reporting Subcontractor.]
Capitalized terms not otherwise defined herein have the meanings
ascribed thereto in the Sale and Servicing Agreement (the "Agreement"), dated
as of ______________ ___, 200__, among Wachovia Auto Owner Trust 200__-__, as
issuer, Pooled Auto Securities Shelf LLC, as depositor and Wachovia Bank,
National Association, as seller and as master servicer.
SD-1
[__________________________, not in its
individual capacity but solely as Indenture
Trustee] [REPORTING SUBCONTRACTOR]
By:________________________________
Name:
Title:
Date: _________________________
SD-2
SCHEDULE E
PERFORMANCE CERTIFICATION
(MASTER SERVICER)
Re: Wachovia Auto Owner Trust 200__-__
The undersigned Master Servicer hereby certifies to the [ ] and its
officers, directors and Affiliates (collectively, the "Certification Parties")
as follows, with the knowledge and intent that the Certification Parties will
rely on this Certification in connection with the certification concerning the
Issuer to be signed by an officer of the Servicer and submitted to the
Securities and Exchange Commission pursuant to the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002:
1. I have reviewed:
(i) the servicer compliance statement of the Master Servicer
provided in accordance with Item 1123 of Regulation AB (the
"Compliance Statement"),
(ii) the report on assessment of the Master Servicer's
compliance with the servicing criteria set forth in Item 1122(d) of
Regulation AB (the "Servicing Criteria"), provided in accordance with
Rules 13a-18 and 15d-18 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act") and Item 1122 of Regulation AB (the
"Servicing Assessment"),
(iii) the registered public accounting firm's attestation
report provided in accordance with Rules 13a-18 and 15d-18 under the
Exchange Act and Section 1122(b) of Regulation AB (the "Attestation
Report"), and
(iv) all servicing reports, officer's certificates and other
information relating to the servicing of the Receivables by the Master
Servicer during 200__ that were delivered by the Master Servicer to
the Indenture Trustee pursuant to the Agreement (collectively, the
"Servicing Information").
2. Based on my knowledge, the Servicing Information, taken as a whole,
does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in the light of the
circumstances under which such statements were made, not misleading with
respect to the period of time covered by the Servicing Information.
3. Based on my knowledge, all of the Servicing Information required to
be provided by the Master Servicer under the Agreement has been provided to
the Indenture Trustee.
4. I am responsible for reviewing the activities performed by Wachovia
Bank, National Association, as master servicer (the "Master Servicer") under
the Sale and Servicing Agreement (the "Agreement"), dated as of _________ 1,
200__, among Wachovia Auto Owner Trust 200__-__, as issuer (the "Issuer"),
Pooled Auto Securities Shelf LLC, as depositor and
SE-1
Wachovia Bank, National Association, as seller and as Master Servicer, and
based on my knowledge and the compliance review conducted in preparing the
Compliance Statement and except as disclosed in the Compliance Statement, the
Servicing Assessment or the Attestation Report, the Servicer has fulfilled its
obligations under the Agreement in all material respects.
5. The Compliance Statement required to be delivered by the Servicer
pursuant to the Agreement, and the Servicing Assessment and Attestation Report
required to be provided by the Servicer and by any Reporting Subcontractor
pursuant to the Agreement, have been provided to the Indenture Trustee. Any
material instances of noncompliance described in such reports have been
disclosed to the Depositor. Any material instance of noncompliance with the
Servicing Criteria has been disclosed in such reports.
Capitalized terms not otherwise defined herein have the meanings
ascribed thereto in the Agreement.
WACHOVIA BANK, NATIONAL ASSOCIATION
By:
----------------------------------------
Name:
Title:
Date:
--------------------------------------
SE-2
EXHIBIT A
REPRESENTATIONS AND WARRANTIES AS TO THE RECEIVABLES
The following representations and warranties shall be made in respect
of the Initial Receivables being transferred to the Issuer on the Closing Date
as of the Initial Cutoff Date, the Subsequent Receivables being transferred to
the Issuer on a Subsequent Transfer Date as of the related Subsequent Cutoff
Date, or all of the Receivables being transferred to the Issuer on their
respective Cutoff Dates. In the case of Subsequent Receivables, references to
the Closing Date shall be deemed to be references to the related Subsequent
Transfer Date.
(i) Characteristics of Receivables. Each Receivable (A) was originated
in the United States by a Dealer located in the United States for the retail
sale of a Financed Vehicle in the ordinary course of the applicable Dealer's
business in accordance with the Seller's credit policies as of the date of
origination or acquisition of the related Receivable, is payable in United
States dollars, has been fully and properly executed by the parties thereto,
has been purchased by the Seller from such Dealer under an existing Dealer
Agreement (or approved form of assignment) and has been validly assigned by
such Dealer to the Seller, (B) has created a valid, subsisting and enforceable
first priority security interest in favor of the Seller in the Financed
Vehicle, which security interest shall be perfected and prior to any other
interest in such Financed Vehicle, and which security interest is assignable
by the Seller and reassignable by the assignee, (C) contains customary and
enforceable provisions such that the rights and remedies of the holder thereof
are adequate for realization against the collateral of the benefits of the
security, (D) shall, except as otherwise provided in the Sale and Servicing
Agreement, provide for level Monthly Payments (provided that the payment in
the first or last month in the life of the Receivable may be minimally
different from the level payment) that fully amortize the Amount Financed over
its original term and shall provide for a finance charge or shall yield
interest at its Contract Rate, (E) is a Simple Interest Receivable, (F) is due
from an Obligor with a mailing address within the United States or its
territories, (G) to the best of the Seller's knowledge, is due from an Obligor
who is a natural person and (H) to the best of the Seller's knowledge, is not
assumable by another person in a manner which would release the Obligor
thereof from such Obligor's obligations to the Seller with respect to such
Receivable.
(ii) Schedule of Receivables. The information set forth in the
Schedule of Receivables shall be true and correct in all material respects as
of the close of business on the Cutoff Date, and the Receivables were selected
(a) from those motor vehicle receivables of the Seller which met the selection
criteria set forth in this Agreement and (b) using selection procedures,
believed by the Seller, not to be adverse to the Noteholders.
(iii) Compliance with Law. Each Receivable complied at the time it was
originated or made, and at the Closing Date complies, in all material respects
with all requirements of applicable federal, State and, to the best knowledge
of the Seller, local laws, rulings and regulations thereunder (including usury
laws).
(iv) Binding Obligation. Each Receivable represents the genuine,
legal, valid and binding payment obligation in writing of the related Obligor,
enforceable by the holder thereof in
A-1
accordance with its terms, except as (A) enforceability thereof may be limited
by bankruptcy, insolvency, reorganization or 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 and (B) such Receivable may
be modified by the application after the Cutoff Date of the Servicemembers
Civil Relief Act or by any similar applicable State law.
(v) No Government Obligor. No Receivable is due from the United
States or any State or any agency, department, subdivision or instrumentality
thereof.
(vi) Obligor Bankruptcy. To the best of the Seller's knowledge, at
the Cutoff Date, no Obligor is the subject of a bankruptcy proceeding.
(vii) Security Interest in Financed Vehicles. Immediately prior to
the transfer of the Receivables by the Seller to the Depositor, each
Receivable was secured by a valid, binding and enforceable first priority
perfected security interest in favor of the Seller in the related Financed
Vehicle, which security interest has been validly assigned by the Seller to
the Depositor. The Master Servicer has received, or will receive within 180
days after the Closing Date, the original certificate of title for each
Financed Vehicle (other than any Financed Vehicle that is subject to a
certificate of title statute or motor vehicle registration law that does not
require that the original certificate of title for such Financed Vehicle be
delivered to the Seller).
(viii) Receivables in Force. No Receivable shall have been satisfied,
subordinated or rescinded, nor shall any Financed Vehicle have been released
in whole or in part from the Lien granted by the related Receivable.
(ix) No Waivers. No provision of a Receivable shall have been waived
in such a manner that such Receivable fails to meet all of the other
representations and warranties made by the Seller herein with respect thereto.
(x) No Amendments. No Receivable shall have been amended or modified
in such a manner that the total number of Monthly Payments has been increased
or decreased or that the related Amount Financed has been increased or
decreased or that such Receivable fails to meet all of the other
representations and warranties made by the Seller herein with respect thereto.
(xi) No Defenses. No Receivable is subject to any right of
rescission, setoff, counterclaim or defense, including the defense of usury,
and the operation of any of the terms of any Receivable, or the exercise of
any right thereunder, will not render such Receivable unenforceable in whole
or in part or subject to any right of rescission, setoff, counterclaim or
defense, including the defense of usury, and the Seller has not received
written notice of the assertion with respect to any Receivable of any such
right of rescission, setoff, counterclaim or defense.
(xii) No Liens. No Liens or claims shall have been filed, including
Liens for work, labor or materials or for unpaid local, State or federal taxes
relating to any Financed Vehicle that shall be prior to, or equal or
coordinate with, the security interest in such Financed Vehicle granted by the
related Receivable.
A-2
(xiii) No Defaults; Repossessions. Except for payment defaults that,
as of the Cutoff Date, have been continuing for a period of not more than 30
days, no default, breach or violation under the terms of any Receivable,
permitting acceleration, shall have occurred as of the Cutoff Date and no
continuing condition that with notice or the lapse of time or both would
constitute a default, breach or violation under the terms of any Receivable,
permitting acceleration, shall have arisen; and the Seller shall not have
waived any of the foregoing except as otherwise permitted hereunder. On or
prior to the Cutoff Date, no Financed Vehicle has been repossessed.
(xiv) Insurance. Each Receivable requires the related Obligor to
obtain physical damage insurance covering the related Financed Vehicle and to
maintain such insurance.
(xv) Title. It is the intention of the Seller that the transfers and
assignments herein contemplated constitute a sale of the Receivables from the
Seller to the Purchaser and that the beneficial interest in and title to the
Receivables not be part of the debtor's estate in the event of the appointment
of a receiver or conservator for the Seller under any receivership, bankruptcy
law, insolvency or banking law; no Receivable has been sold, transferred,
assigned or pledged by the Seller to any Person other than the Purchaser, and
no provision of a Receivable shall have been waived, except as provided in
clause (ix) above; immediately prior to the transfer and assignment herein
contemplated, the Seller had good and marketable title to each Receivable free
and clear of all Liens and rights of others, except for Liens that shall be
released on or before the Closing Date; immediately upon the transfer and
assignment thereof, the Purchaser shall have good and marketable title to each
Receivable, free and clear of all Liens and rights of others; and the transfer
and assignment herein contemplated has been perfected under the UCC.
(xvi) Security Interest Matters. This Agreement creates a valid and
continuing "security interest" (as defined in the UCC) in the Receivables in
favor of the Depositor, which security interest is prior to all other Liens
and is enforceable as such as against creditors of and purchasers from the
Seller. With respect to each Receivable, the Seller has taken all steps
necessary to perfect its security interest against the related Obligor in the
related Financed Vehicle. The Receivables constitute "tangible chattel paper"
(as defined in the UCC). The Seller has caused or will cause prior to the
Closing Date the filing of all appropriate financing statements in the proper
filing offices in the appropriate jurisdictions under applicable law necessary
to perfect the security interest in the Receivables granted to the Depositor
under the Receivables Purchase Agreement. Other than the security interest
granted to the Depositor under the Receivables Purchase Agreement, the Seller
has not pledged, assigned, sold, granted a security interest in or otherwise
conveyed any of the Receivables. The Seller has not authorized the filing of
and is not aware of any financing statements against the Seller that include a
description of collateral covering the Receivables other than any financing
statement relating to the security interest granted to the Depositor under the
Sale and Servicing Agreement or that has been terminated. The motor vehicle
retail installment sale contracts that constitute or evidence the Receivables
do not have any marks or notations indicating that they have been pledged,
assigned or otherwise conveyed to any Person other than the Depositor, the
Issuer or the Indenture Trustee. The Seller is not aware of any judgment or
tax lien filings against the Seller.
(xvii) Financing Statements. All financing statements filed or to be
filed against the Seller in favor of the Issuer (as assignee of the Depositor)
contain a statement substantially to the following effect: "A purchase of or
security interest in any collateral described in this financing
A-3
statement will violate the rights of the Issuer". All financing statements
filed or to be filed against the Seller in favor of the Indenture Trustee (as
assignee of the Issuer) contain a statement substantially to the following
effect: "A purchase of or security interest in any collateral described in
this financing statement will violate the rights of the Indenture Trustee".
(xviii) Lawful Assignment. No Receivable has been originated in, or
is subject to the laws of, any jurisdiction under which the sale, transfer,
assignment and conveyance of such Receivable under this Agreement or the Sale
and Servicing Agreement or the pledge of such Receivables hereunder or under
the Indenture is unlawful, void or voidable or under which such Receivable
would be rendered void or voidable as a result of any such sale, transfer,
assignment, conveyance or pledge. The Seller has not entered into any
agreement with any account debtor that prohibits, restricts or conditions the
assignment of the Receivables.
(xix) All Filings Made. All filings (including UCC filings) necessary
in any jurisdiction to give the Purchaser, the Issuer and the Indenture
Trustee a first priority security interest in the Receivables shall have been
made or will be made on the Closing Date.
(xx) One Original. There shall be only one original executed copy of
each Receivable.
(xxi) Location of Receivable Files. Each Receivable File shall be
kept at one of the locations listed in Schedule A.
(xxii) Custodial Agreements. Immediately prior to the transfer of the
Receivables by the Seller to the Purchaser, the Seller, an Affiliate of the
Seller or an agent on behalf of the Seller had possession of the Receivable
Files and there were no, and there will not be, any custodial agreements in
effect affecting the right or ability of the Seller to make, or cause to be
made, any delivery required under this Agreement.
(xxiii) Bulk Transfer Laws. The transfer of the Receivables and the
Receivable Files by the Seller to the Purchaser pursuant to this Agreement is
not subject to the bulk transfer laws or any similar statutory provisions in
effect in any applicable jurisdiction.
(xxiv) Principal Balance. Each Receivable had an original Principal
Balance of not more than $_____________ and a remaining Principal Balance, as
of the Cutoff Date, of not less than $___________.
(xxv) New and Used Vehicles. As of the Initial Cutoff Date,
approximately _____% of the Pool Balance was secured by new Financed Vehicles
and approximately ______% of the Pool Balance was secured by used Financed
Vehicles.
(xxvi) Origination. Each Receivable was originated after ____________
___, _____.
(xxvii) Original Term to Maturity. Each Receivable had an original
term to maturity of not more than __ months and not less than __ months and a
remaining term to maturity as of the Cutoff Date, of not more than __ months
and not less than three months.
(xxviii) Weighted Average Remaining Term to Maturity. As of the
Initial Cutoff Date, the weighted average remaining term to maturity of the
Receivables owned by the Seller was
A-4
approximately _____ months, and following the end of the Pre-Funding Period,
the weighted average remaining term to maturity of the Receivables as of their
respective Cutoff Dates will not exceed __ months.
(xxix) Annual Percentage Rate. Each Receivable has a Contract Rate of
at least _____% and not more than ____%, and following the end of the
Pre-Funding Period, the weighted average Contract Rate of the Receivables as
of their respective Cutoff Dates will be at least ____%.
(xxx) Simple Interest Method. All payments with respect to the
Receivables have been allocated consistently in accordance with the Simple
Interest Method.
(xxxi) Marking Records. As of the Closing Date, the Seller will have
caused its computer and accounting records relating to each Receivable to be
marked to show that the Receivables have been sold to the Purchaser by the
Seller and transferred and assigned by the Purchaser to the Issuer in
accordance with the terms of the Sale and Servicing Agreement and pledged by
the Issuer to the Indenture Trustee in accordance with the terms of the
Indenture.
(xxxii) Chattel Paper. Each Receivable constitutes "tangible chattel
paper" within the meaning of the UCC as in effect in the State of origination.
(xxxiii) Final Scheduled Distribution Date. No Receivable has a final
scheduled payment date later than six months prior to the Class B Final
Scheduled Distribution Date.
(xxxiv) No Fleet Sales. None of the Receivables have been included in
a "fleet" sale (i.e., a sale to any single Obligor of more than seven Financed
Vehicles).
(xxxv) No Fraud or Misrepresentation. Each Receivable that was
originated by a Dealer and was sold by the Dealer to the Seller, to the best
of the Seller's knowledge, was so originated and sold without fraud or
misrepresentation on the part of such Dealer in either case.
(xxxvi) No Impairment. The Seller has not done anything to convey any
right to any Person that would result in such Person having a right to
payments due under a Receivable or otherwise to impair the rights of the
Depositor in any Receivable or the proceeds thereof.
(xxxvii) Servicing. Each Receivable has been serviced in conformity
with all applicable laws, rules and regulation and in conformity with the
Seller's policies and procedures which are consistent with customary, prudent
industry standards.
(xxxviii) No Consent. To the best of the Seller's knowledge, no
notice to or consent from any Obligor is necessary to effect the acquisition
of the Receivables by the Purchaser or the Issuer or the pledge of the
Receivables by the Issuer to the Indenture Trustee.
(xxxix) Other Receivables. To the best of the Seller's knowledge,
neither the Obligor on any Receivable nor any of its Affiliates is the obligor
on Receivables with an aggregate principal amount representing more than
_____% of the aggregate Principal Balance of the Receivables as of the Cutoff
Date.
A-5
(xl) FICO Score. Following the end of the Pre-Funding Period, the
weighted average FICO score of the Receivables as of their respective Cutoff
Dates (based on the FICO score recorded at the respective dates of origination
of such Receivables) will be at least _____.
(xli) Obligor Mailing Address. Following the end of the Pre-Funding
Period, no more than ____%, ____%, ____%, and ____% of the Receivables as of
their respective Cutoff Dates will have an obligor mailing address in
_________________, ______________, _____________________ and
__________________ respectively.
A-6
EXHIBIT B
FORM OF DISTRIBUTION STATEMENT
Wachovia Auto Owner Trust 200__-__
Priority Principal Distributable Amount $__________
Secondary Principal Distributable Amount $__________
Regular Principal Distributable Amount $__________
Interest Distributable Amount $__________
Class A-1 Notes: $ per $1,000 original principal amount
Class A-2 Notes: $ per $1,000 original principal amount
Class A-3 Notes: $ per $1,000 original principal amount
Class A-4 Notes: $ per $1,000 original principal amount
Class A-5 Notes: $ per $1,000 original principal amount
Class B Notes: $ per $1,000 original principal amount
Available Collections $__________
Available Funds $__________
Pool Balance as of the close of business on the last day of the Collection Period $__________
(per $1,000 original principal amount)
Note Pool Factor $__________
Class A-1 Notes: $__________
Class A-2 Notes: $__________
Class A-3 Notes: $__________
Class A-4 Notes: $__________
Class A-5 Notes: $__________
Class B Notes: $__________
Note Balance $__________
Class A-1 Notes: $__________
Class A-2 Notes: $__________
Class A-3 Notes: $__________
Class A-4 Notes: $__________
Class A-5 Notes: $__________
Class B Notes: $__________
Reserve Fund Amount $__________
change from immediately preceding Distribution Date $__________
Reserve Fund Draw Amount $__________
Total Servicing Fee $__________
Total Trustee Fees $__________
Required Payment Amount $__________
Aggregate Amount of Defaulted Receivables $__________
B-1
Aggregate Purchase Amount of Purchased Receivables $__________
Purchase Amount $__________
Net Losses on the Receivables $__________
Overcollateralization Target Amount plus Pre-Funding Account Amount $----------
Amount by which the Pool Balance Exceeds the Note Balance $----------
Aggregate Principal Balance of Receivables $__________
30 to 59 days past due (No. of Receivables ____) $__________
60 to 89 days past due (No. of Receivables ____) $__________
90 or more days past due (No. of Receivables ____) $__________
Cumulative Net Loss Percentage __________%
Sequential Payment Trigger ___________
Yield Supplement Account Draw Amount $__________
Excess Collections $__________
Amount withdrawn from Pre-Funding Account
to purchase subsequent Receivables $__________
Pre-Funding Account Amount $__________
Negative Carry Account Draw Amount $__________
For the Distribution Date following the end of the
Collection Period in which the Pre-Funding Period ends only
The Pre-Funding Account Amount that is being remitted to the
Noteholders as an additional payment of principal on the Notes $__________
The Negative Carry Account Amount being remitted
to the Collection Account $__________
B-2
EXHIBIT C
FORM OF SERVICER'S CERTIFICATE
Wachovia Auto Owner Trust 200__-__
Collection Period ____________________
Determination Date ____________________
Distribution Date ____________________
1.Pool Balance as of the close of business on the last day of the Collection Period $__________
(per $1,000 original principal amount)
2. Note Balance
a. Class A-1 Notes $
b. Class A-2 Notes $
c. Class A-3 Notes $
d. Class A-4 Notes $
e. Class A-5 Notes $
f. Class B Notes $
3. Pool Factors
a. Class A-1 Notes
b. Class A-2 Notes
c. Class A-3 Notes
d. Class A-4 Notes
e. Class A-5 Notes
f. Class B Notes
4. Available Funds $__________
5. Available Collections $__________
6. Total Servicing Fee $__________
a. Monthly Servicing Fee $__________
b. Amount Unpaid from prior months $__________
7. Total Trustee Fees $__________
a. Monthly Trustee Fees $__________
b. Amount Unpaid from prior months $__________
8. Priority Principal Distributable Amount $__________
9. Secondary Principal Distributable Amount $__________
10. Regular Principal Distributable Amount $__________
11. Interest Distributable Amount (per $1,000 original principal amount) $__________
a. Class A-1 Notes (per $1,000 original principal amount) $__________
b. Class A-2 Notes (per $1,000 original principal amount) $__________
c. Class A-3 Notes (per $1,000 original principal amount) $__________
d. Class A-4 Notes (per $1,000 original principal amount) $__________
e. Class A-5 Notes (per $1,000 original principal amount) $__________
f. Class B Notes (per $1,000 original principal amount) $__________
12. Required Payment Amount $__________
C-1
13. Reserve Fund Amount $__________
Change from immediately preceding Distribution Date $__________
14. Reserve Fund Draw Amount $__________
15. The lesser of: (a or b)
a. The amount, if any, by which the Required Payment Amount for the
Distribution Date exceeds Available Funds (excluding the
Reserve Fund Draw Amount) for such Distribution Date $__________
b. The Reserve Fund Amount for such Distribution Date (before
giving effect to any deposits to or withdrawals from the Reserve
Fun on the related Distribution Date) $__________
16. The amount by which the Required Payment Amount exceeds the sum of
Available Collections plus the Reserve Fund Draw Amount: $__________
17. Reserve Fund Amount $__________
18. Negative Carry Account Draw Amount $__________
19. The amount by which the Required Reserve Fund
Amount exceeds the Reserve Fund Amount $----------
20. Yield Supplement Account Draw Amount $__________
21. Aggregate Amount of Defaulted Receivables $__________
Account No. ___ $__________
22. Aggregate Purchase Amount of Purchased Receivables $__________
Account No. ___ $__________
23. Trustee Fees and Expenses $__________
24. Purchase Amount $__________
25. Net Losses on the Receivables $__________
26. Aggregate Principal Balance of Receivables $__________
a. 30 to 59 days past due (No. of Receivables ____) $__________
b. 60 to 89 days past due (No. of Receivables ____) $__________
c. 90 or more days past due (No. of Receivables ____) $__________
27. Cumulative Losses $__________
28. Sequential Payment Trigger $__________
29. Excess Collections $__________
Instructions to the Indenture Trustee
-------------------------------------
From the Collection Account:
1. To the Master Servicer $__________
2. To the Trustees $__________
3. To the Note Payment Account $__________
4. To the Reserve Fund $__________
C-2
▇.▇▇ the Certificate Payment Account $__________
From the Note Payment Account:
1. To the Class A-1 Noteholders $__________
2. To the Class A-2 Noteholders $__________
3. To the Class A-3 Noteholders $__________
4. To the Class A-4 Noteholders $__________
5. To the Class A-5 Noteholders
6. To the Class B Noteholders $__________
From the Certificate Payment Account:
1. To the Certificateholders $__________
From the Reserve Fund:
1. To the Collection Account $__________
2. To the Certificateholders $__________
For the Distribution Date following the Collection Period in which the
Pre-Funding Period ends only:
1. From the Pre-Funding Account to the Note Payment Account $__________
2. From the Negative Carry Account to the Collection Account $__________
C-3
EXHIBIT D
FORM OF SECOND-TIER SUBSEQUENT ASSIGNMENT
For value received, in accordance with the Sale and Servicing
Agreement, dated as of _________________ ___, 200__ (the "Sale and Servicing
Agreement"), among Wachovia Auto Owner Trust 200__-__ (the "Issuer"), Pooled
Auto Securities Shelf LLC (the "Depositor"), and Wachovia Bank, National
Association, the Depositor hereby irrevocably sells, transfers, assigns and
otherwise conveys to the Issuer, without recourse (subject to the obligations
of the Depositor herein and in the Sale and Servicing Agreement), all right,
title and interest of the Depositor, whether now owned or existing or
hereafter acquired or arising, in, to and under the following:
(i) the Subsequent Receivables listed on Schedule A to the
related Second-Tier Subsequent Assignment and all amounts due and
collected on or in respect of the Subsequent Receivables (including
proceeds of the repurchase of Subsequent Receivables by the Seller
pursuant to Section 2.04 of the Sale and Servicing Agreement or the
purchase of Subsequent Receivables by the Master Servicer pursuant to
Section 3.08 or 8.01 of the Sale and Servicing Agreement) after the
related Subsequent Cutoff Date;
(ii) the security interest in the Financed Vehicles granted
by the Obligors pursuant to the Subsequent Receivables and any other
interest of the Depositor in such Financed Vehicles;
(iii) all proceeds from claims on or refunds of premiums of
any physical damage or theft insurance policies and extended
warranties covering such Financed Vehicles and any proceeds of or
refunds of premiums of any credit life or credit disability insurance
policies relating to the Subsequent Receivables, the related Financed
Vehicles or the related Obligors;
(iv) the Receivable Files that relate to the Subsequent
Receivables;
(v) any proceeds of Dealer Recourse;
(vi) the right to realize upon any property (including the
right to receive future Net Liquidation Proceeds and Recoveries) that
shall have secured a Subsequent Receivable and have been repossessed
by or on behalf of the Depositor;
(vii) all of the Depositor's rights under the related
First-Tier Subsequent Assignment; and
(viii) all present and future claims, demands, causes of
action and choses in action in respect of any or all of the
foregoing, and all payments on or under and all proceeds of every
kind and nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion thereof, voluntary or
involuntary, into cash or other liquid property, all accounts,
accounts receivable, general intangibles, chattel paper, documents,
money, investment property, deposit accounts, letters of credit,
letter of credit
D-1
rights, insurance proceeds, condemnation awards, notes, drafts,
acceptances, rights to payment of any and every kind and other forms
of obligations and receivables, instruments and other property which
at any time constitute all or part of or are included in the proceeds
of any of the foregoing.
The Subsequent Cutoff Date for each Subsequent Receivable is
___________, 200_.
The Depositor hereby represents that as of the Subsequent Cutoff
Date, the aggregate Principal Balance of the Subsequent Receivables was
$___________.
In the event that the foregoing sale, transfer, assignment and
conveyance is deemed to be a pledge, the Depositor hereby grants to the Issuer
a first priority security interest in all of the Depositor's right to and
interest in the Subsequent Receivables and other property described in clauses
(i) through (viii) above to secure a loan deemed to have been made by the
Issuer to the Depositor in an amount equal to the sum of the initial principal
amount of the Notes plus accrued interest thereon.
THIS SECOND-TIER SUBSEQUENT ASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS OF THE
DEPOSITOR UNDER THIS SECOND-TIER SUBSEQUENT ASSIGNMENT SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
This Second-Tier Subsequent Assignment is made pursuant to and upon
the representations, warranties and agreements on the part of the Depositor
contained in the Sale and Servicing Agreement and is to be governed by the
Sale and Servicing Agreement.
Capitalized terms used herein that are not otherwise defined shall
have the meanings ascribed thereto in the Sale and Servicing Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Second-Tier
Subsequent Assignment to be duly executed as of _________ __, 200_.
POOLED AUTO SECURITIES SHELF LLC
By:
------------------------------------
Name:
Title:
D-2
SCHEDULE A
to
EXHIBIT D
SCHEDULE OF SUBSEQUENT RECEIVABLES
Schedule A to Exhibit D
ANNEX A
to
EXHIBIT D
OFFICER'S CERTIFICATE
___________, a __________ of Pooled Auto Securities Shelf LLC (the
"Depositor"), does hereby certify, pursuant to Section 2.01(d)(xv) of the Sale
and Servicing Agreement, dated as of _________ 1, 200__ (the "Sale and
Servicing Agreement"), among Wachovia Auto Owner Trust 200__-__ (the
"Issuer"), the Depositor and Wachovia Bank, National Association, that all of
the conditions to the transfer to the Issuer of the Subsequent Receivables
listed on Schedule A to the Second-Tier Subsequent Assignment delivered
herewith and the other property and rights related to such Subsequent
Receivable, as described in Section 2.01(d) of the Sale and Servicing
Agreement, have been satisfied on or prior to the related Subsequent Transfer
Date.
Capitalized terms used herein that are not otherwise defined shall
have the meanings ascribed thereto in the Sale and Servicing Agreement.
IN WITNESS WHEREOF, the undersigned have caused this certificate to
be duly executed this _____ day of ______________ __, 200_.
___________________________________
Name:
Title:
Annex A to Exhibit D
