EXECUTION COPY
CHASE MANHATTAN BANK USA, N.A.,
as Seller and Servicer
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
as Trustee
on behalf of the Certificateholders
and as Collateral Agent
POOLING AND SERVICING AGREEMENT
Dated as of September 1, 1996
$1,524,147,107.71
Chase Manhattan Auto Grantor Trust 1996-B
6.61% Asset Backed Certificates, Class A
6.76% Asset Backed Certificates, Class B
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions................................................... 1
SECTION 1.2. Usage of Terms................................................ 18
SECTION 1.3. Simple Interest Method; Allocations........................... 18
ARTICLE II
THE TRUST CONVEYANCE OF THE RECEIVABLES
SECTION 2.1. Creation of the Trust......................................... 19
SECTION 2.2. Conveyance of Receivables..................................... 19
ARTICLE III
THE RECEIVABLES
SECTION 3.1. Representations and Warranties of Seller;
Conditions Relating to Receivables........................ 21
SECTION 3.2. Repurchase Upon Breach or Failure of a
Condition................................................. 25
SECTION 3.3. Custody of Receivable Files................................... 26
SECTION 3.4. Duties of Servicer as Custodian............................... 27
SECTION 3.5. Instructions; Authority to Act................................ 28
SECTION 3.6. Custodian's Indemnification................................... 28
SECTION 3.7. Effective Period and Termination.............................. 28
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1. Duties of Servicer............................................ 30
SECTION 4.2. Collection of Receivable Payments;
Refinancing............................................... 30
SECTION 4.3. Realization Upon Receivables.................................. 31
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Section Page
SECTION 4.4. Non-Credit Related Extensions to Obligors..................... 32
SECTION 4.5. Maintenance of Security Interests in
Financed Vehicles......................................... 34
SECTION 4.6. Covenants of Servicer......................................... 34
SECTION 4.7. Purchase of Receivables Upon Breach........................... 35
SECTION 4.8. Servicing Fee................................................. 35
SECTION 4.9. Servicer's Certificate........................................ 36
SECTION 4.10. Annual Statement as to Compliance............................ 36
SECTION 4.11. Annual Audit Report.......................................... 37
SECTION 4.12. Access by Certificateholders to Certain
Documentation and Information Regarding
Receivables.............................................. 38
SECTION 4.13. Reports to Certificateholders and the
Rating Agencies.......................................... 38
SECTION 4.14. Reports to the Securities and Exchange
Commission............................................... 39
ARTICLE V
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
SECTION 5.1. Establishment of the Accounts................................. 40
SECTION 5.2. Collections................................................... 41
SECTION 5.3. Advances...................................................... 42
SECTION 5.4. Additional Deposits........................................... 43
SECTION 5.5. Distributions................................................. 43
SECTION 5.6. Reserve Account; Assignment of Retained
Yield to Collateral Agent................................. 44
SECTION 5.7. Net Deposits.................................................. 47
SECTION 5.8. Statements to Certificateholders.............................. 47
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ARTICLE VI
THE CERTIFICATES
SECTION 6.1. The Certificates.............................................. 49
SECTION 6.2. Execution, Authentication and Delivery of
Certificates.............................................. 49
SECTION 6.3. Registration of Transfer and Exchange of
Certificates.............................................. 50
SECTION 6.4. Mutilated, Destroyed, Lost, or Stolen
Certificates.............................................. 52
SECTION 6.5. Persons Deemed Owners......................................... 52
SECTION 6.6. Access to List of Certificateholders' Names
and Addresses............................................. 52
SECTION 6.7. Maintenance of Office or Agency............................... 53
SECTION 6.8. Book-Entry Certificates....................................... 53
SECTION 6.9. Notices to Clearing Agency.................................... 54
SECTION 6.10. Definitive Certificates....................................... 54
SECTION 6.11. Appointment of Paying Agent................................... 55
SECTION 6.12. Authenticating Agent.......................................... 56
SECTION 6.13. Actions of Certificateholders................................. 58
ARTICLE VII
THE SELLER
SECTION 7.1. Representations of Seller..................................... 59
SECTION 7.2. Liability of Seller; Indemnities.............................. 60
SECTION 7.3. Merger or Consolidation of Seller............................. 61
SECTION 7.4. Limitation on Liability of Seller and
Others.................................................... 61
SECTION 7.5. Seller May Own Certificates................................... 61
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Section Page
ARTICLE VIII
THE SERVICER
SECTION 8.1. Representations of Servicer................................... 62
SECTION 8.2. Liability of Servicer; Indemnities............................ 63
SECTION 8.3. Merger or Consolidation of Servicer........................... 64
SECTION 8.4. Limitation on Liability of Servicer and
Others.................................................... 64
SECTION 8.5. Servicer Not To Resign........................................ 66
SECTION 8.6. Delegation of Duties.......................................... 66
ARTICLE IX
DEFAULT
SECTION 9.1. Events of Servicing Termination............................... 67
SECTION 9.2. Trustee to Act; Appointment of Successor...................... 68
SECTION 9.3. Notification to Certificateholders............................ 69
SECTION 9.4. Waiver of Past Defaults....................................... 69
ARTICLE X
THE TRUSTEE
SECTION 10.1. Duties of Trustee............................................ 71
SECTION 10.2. Trustee's Assignment of Repurchased
Receivables and Trustee's Certificates................... 73
SECTION 10.3. Certain Matters Affecting the Trustee........................ 73
SECTION 10.4. Trustee Not Liable for Certificates or
Receivables.............................................. 74
SECTION 10.5. Trustee May Own Certificates................................. 76
SECTION 10.6. Trustee's Fees and Expenses.................................. 76
SECTION 10.7. Indemnity of Trustee......................................... 76
SECTION 10.8. Eligibility Requirements for Trustee......................... 77
SECTION 10.9. Resignation or Removal of Trustee............................ 77
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SECTION 10.10. Successor Trustee........................................... 78
SECTION 10.11. Merger or Consolidation of Trustee.......................... 78
SECTION 10.12. Appointment of Co-Trustee or Separate
Trustee................................................. 79
SECTION 10.13. Representations and Warranties of
Trustee................................................. 80
SECTION 10.14. Tax Returns................................................. 81
SECTION 10.15. Trustee May Enforce Claims Without
Possession of Certificates.............................. 81
SECTION 10.16. Suits for Enforcement....................................... 82
SECTION 10.17. Maintenance of Office or Agency............................. 82
SECTION 10.18 Norwest Bank Minnesota, National
Association, as Collateral Agent......................... 82
ARTICLE XI
TERMINATION
SECTION 11.1. Termination of the Trust..................................... 83
SECTION 11.2. Optional Purchase of All Receivables......................... 84
ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.1. Amendment.................................................... 85
SECTION 12.2. Protection of Title to Trust................................. 86
SECTION 12.3. Limitation on Rights of Certificateholders................... 88
SECTION 12.4. GOVERNING LAW................................................ 89
SECTION 12.5. Notices...................................................... 89
SECTION 12.6. Severability of Provisions................................... 90
SECTION 12.7. Assignment; References to Chase USA.......................... 90
SECTION 12.8. Certificates Nonassessable and Fully Paid.................... 90
SECTION 12.9. Third-Party Beneficiaries.................................... 91
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Section Page
SECTION 12.10. Counterparts................................................. 91
SECTION 12.11. Tax Matters.................................................. 91
SCHEDULES
Schedule A - List of Receivables
Schedule B - Location of Receivables
EXHIBITS
Exhibit A-1 - Form of Class A Certificate
Exhibit A-2 - Form of Class B Certificate
Exhibit B - Form of Depositary Receipt Agreement
Exhibit C-1 - Trustee's Certificate pursuant to Section
11.2 (assignment to Seller)
Exhibit C-2 - Trustee's Certificate pursuant to Section
11.2 (assignment to Servicer)
Exhibit D - Form of Servicer's Certificate
Exhibit E - Form of Certificateholder Report
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This Pooling and Servicing Agreement, dated as of
September 1, 1996 (as amended, supplemented or otherwise modified and
in effect from time to time, this "Agreement") is made with respect to
the formation of the Chase Manhattan Auto Grantor Trust 1996-B (the
"Trust"), between CHASE MANHATTAN BANK USA, N.A., a national banking
association ("Chase USA" and the "Seller" and the "Servicer" in its
respective capacities as such), and NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, a national banking association, as trustee (in such
capacity, the "Trustee") and as collateral agent with respect to the
Reserve Account and the Retained Yield (in such capacity, the
"Collateral Agent").
W I T N E S S E T H :
In consideration of the premises and of the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. Whenever used in this
Agreement, the following words and phrases, unless the context
otherwise requires, shall have the following meanings:
"Accounts" mean, collectively, the Collection Account
and the Distribution Accounts.
"Account Property" means all amounts and investments
held from time to time in the Reserve Account (whether in the form of
deposit accounts, instruments, certificated securities, book-entry
securities, uncertificated securities or otherwise), and all proceeds
of the foregoing.
"Accrued Interest" on a Receivable, as of any date
of determination, means that amount of interest accrued on the
Principal Balance at the APR but not paid by or on behalf of the
Obligor.
"Advance" as of a Record Date means any payment made
by the Servicer pursuant to Section 5.3.
"Affiliate" means, with respect to any Person, any
other Person directly or indirectly controlling, controlled by, or
under direct or indirect common control with, such Person. For
purposes of this definition, "control" when used with respect to any
Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the
foregoing.
"Aggregate Net Losses" means, with respect to a
Collection Period, the amount equal to (i) the principal balance of
the Receivables that became Defaulted Receivables during such
Collection Period minus (ii) the Liquidation Proceeds allocable to
principal collected during such Collection Period with respect to any
Defaulted Receivables.
"Amount Financed" in respect of a Receivable means
the amount advanced under the Receivable toward the purchase price of
the Financed Vehicle and related costs.
"Assertion" has the meaning specified in Section 4.11.
"Authenticating Agent" has the meaning specified in
Section 6.12 and shall initially be the corporate trust office of The
Chase Manhattan Bank, and its successors and assigns in such capacity.
"Authorized Officer" means any officer of the
Trustee who is authorized to act on behalf of the Trustee and who is
identified as such on the list of authorized officers delivered by the
Trustee to the Seller and the Servicer.
"Available Interest" means, for any Distribution
Date, that portion of Collections on the Receivables received during
the related Collection Period allocated to interest, all Advances made
by the Servicer with respect to such Distribution Date and, to the
extent attributable to interest, the Repurchase Amount received with
respect to each Receivable repurchased by the Seller or purchased by
the Servicer under an obligation that arose during the related
Collection Period.
"Available Principal" means, for any Distribution
Date, that portion of Collections on the Receivables received during
the related Collection Period allocated to the principal balance of
the Receivables, and, to the extent attributable to principal, the
Repurchase Amount received with respect to each Receivable repurchased
by the Seller or purchased by the Seller under an obligation that
arose during the related Collection Period.
"Available Reserve Account Amount" shall mean, for
each Distribution Date, an amount equal to the lesser of (i) the
amount on deposit in the Reserve Account (exclusive of investment
earnings thereon) and (ii) the Specified Reserve Account Balance.
"Average Delinquency Percentage" means, as of any
Distribution Date, the average of the Delinquency Percentages for the
preceding three (3) Collection Periods.
"Average Net Loss Ratio" means, as of any
Distribution Date, the average of the Net Loss Ratios for the
preceding three (3) Collection Periods.
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"Base Rate" means, with respect to each Receivable,
the weighted average interest rate on the Receivable equal to (i) the
Class A Percentage multiplied by the sum of the Class A PassThrough
Rate and the Servicing Fee Rate, plus (ii) the Class B Percentage
multiplied by the sum of the Class B Pass Through Rate and the
Servicing Fee Rate.
"Book-Entry Certificates" means beneficial interests
in the Certificates described in Section 6.8, the ownership and
transfers of which shall be made through book entries by a Clearing
Agency or Foreign Clearing Agency as described in Section 6.8.
"Business Day" means a day, other than a Saturday or
a Sunday, on which the Trustee and banks located in New York, New York
and Minneapolis, Minnesota are open for the purpose of conducting a
commercial banking business.
"CEDEL" means Centrale de Livraison de Valeurs
Mobilieres, S.A.
"Certificate Owner" means, with respect to a
Book-Entry Certificate, the Person who is the owner of such Book-Entry
Certificate, as reflected on the books of the Clearing Agency or
Foreign Clearing Agency, or on the books of a direct or indirect
Clearing Agency Participant.
"Certificate Register" means the register maintained
pursuant to Section 6.3.
"Certificateholders" or "Holders" means,
collectively, the Class A Certificateholders and the Class B
Certificateholders.
"Certificates" means, collectively, the Class A
Certificates and the Class B Certificates.
"Chase Connecticut Loan" means a motor vehicle
retail installment sales contract or purchase money loan serviced by
Chase USA and either originated by The Chase Manhattan Bank of
Connecticut, National Association or originated pursuant to the
agreements with automobile dealers who regularly originated and sold
such contracts and loans to The Chase Manhattan Bank of Connecticut,
National Association.
"Chase Florida Loan" means a motor vehicle retail
installment sales contract or purchase money loan serviced by Chase
USA and either originated by The Chase Manhattan Private Bank of
Florida, National Association or originated pursuant to the agreements
with automobile dealers who regularly originated and sold such
contracts and loans to The Chase Manhattan Private Bank of Florida,
National Association.
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"Chase Lincoln Loan" means a motor vehicle retail
installment sales contract or purchase money loan serviced by Chase
USA and either originated by Chase Lincoln First Bank, National
Association or originated pursuant to the agreements with automobile
dealers who regularly originated and sold such contracts and loans to
Chase Lincoln First Bank, National Association.
"Chase Maryland Loan" means a motor vehicle retail
installment sales contract or purchase money loan serviced by Chase
USA and either originated by The Chase Manhattan Bank of Maryland or
originated pursuant to the agreements with automobile dealers who
regularly originated and sold such contracts and loans to The Chase
Manhattan Bank of Maryland.
"Chase USA Delaware" means Chase Manhattan Bank USA,
N.A., a national banking association having its principal executive
offices located at 802 Delaware Avenue, Wilmington, Delaware 19801 and
shall not mean the Seller or the Servicer unless Chase USA Delaware
succeeds to the interests of Chase USA in connection with the Proposed
Merger or otherwise.
"Class A Certificate" means a certificate executed
on behalf of the Trust and authenticated by the Trustee substantially
in the form of Exhibit A-1 attached hereto.
"Class A Certificate Balance" means, at any date of
determination, the Original Class A Certificate Balance, as reduced by
all amounts allocable to principal on the Class A Certificates
distributed to Class A Certificateholders prior to such date.
"Class A Certificateholder" or "Class A Holder"
means the Person in whose name a Class A Certificate shall be
registered in the Certificate Register, except that, solely for the
purpose of giving any consent, request or waiver pursuant to this
Agreement, the interest evidenced by any Class A Certificate
registered in the name of the Seller, the Servicer, or any Person
actually known to an Authorized Officer of the Trustee to be an
Affiliate of the Seller or the Servicer, shall not be taken into
account in determining whether the requisite percentage necessary to
effect any such consent, request or waiver shall have been obtained.
"Class A Distribution Account" means the account
established and maintained as such pursuant to Section 5.1(a).
"Class A Interest Carryover Shortfall" means, (a)
for the initial Distribution Date, zero, and (b) for any other
Distribution Date, the excess of Class A Monthly Interest for the
preceding Distribution Date and any outstanding Class A Interest
Carryover Shortfall for such preceding Distribution Date over the
amount in respect of interest that is actually deposited in the Class
A Distribution Account on such preceding Distribution Date,
4
plus 30 days of interest on such excess, to the extent permitted by
law, at the Class A Pass-Through Rate.
"Class A Interest Distributable Amount" means, for
any Distribution Date, the sum of Class A Monthly Interest for such
Distribution Date and the Class A Interest Carryover Shortfall for
such Distribution Date.
"Class A Monthly Interest" means, for any
Distribution Date, one-twelfth of the Class A Pass-Through Rate
multiplied by the Class A Certificate Balance as of the preceding
Distribution Date (after giving effect to any payments made on such
preceding Distribution Date) or, in the case of the first Distribution
Date, as of the Closing Date.
"Class A Monthly Principal" means, for any
Distribution Date, the sum of (a) the Class A Percentage of the
Available Principal for such Distribution Date and (b) the Class A
Percentage of Aggregate Net Losses with respect to the related
Collection Period.
"Class A Pass-Through Rate" means 6.61% per annum.
"Class A Percentage" means, a fraction (expressed as
a percentage with eight decimal places), the numerator if which is the
Original Class A Certificate Balance and the denominator of which is
the Original Certificate Balance.
"Class A Pool Factor" means, with respect to any
Distribution Date, the Class A Certificate Balance as of such
Distribution Date (after giving effect to any payments to be made on
such Distribution Date), divided by the Original Class A Certificate
Balance, expressed as a eight-digit decimal.
"Class A Principal Carryover Shortfall" means, for
any Distribution Date, the excess of Class A Monthly Principal for the
preceding Distribution Date and any outstanding Class A Principal
Carryover Shortfall for such preceding Distribution Date over the
amount in respect of principal that is actually deposited in the Class
A Distribution Account on such preceding Distribution Date.
"Class A Principal Distributable Amount" means, for
any Distribution Date, the sum of Class A Monthly Principal for such
Distribution Date and, in the case of any Distribution Date other than
the initial Distribution Date, the Class A Principal Carryover
Shortfall for such Distribution Date. In addition, on the Final
Scheduled Distribution Date, the Class A Principal Distributable
Amount shall include any additional amount required to reduce the
outstanding aggregate principal balance of the Class A Certificates to
zero.
5
"Class B Certificate" means a certificate executed
on behalf of the Trust and authenticated by the Trustee substantially
in the form of Exhibit A-2 hereto.
"Class B Certificate Balance" means, at any time,
the Original Class B Certificate Balance, as reduced by all amounts
allocable to principal on the Class B Certificates distributed to
Class B Certificateholders prior to such time.
"Class B Certificateholder" or "Class B Holder"
means the Person in whose name a Class B Certificate shall be
registered in the Certificate Register, except that, solely for the
purpose of giving any consent, request or waiver pursuant to this
Agreement, the interest evidenced by any Class B Certificate
registered in the name of the Seller, the Servicer, or any Person
actually known to an Authorized Officer of the Trustee to be an
Affiliate of the Seller or the Servicer, shall not be taken into
account in determining whether the requisite percentage necessary to
effect any such consent, request or waiver shall have been obtained.
"Class B Distribution Account" means the account
established and maintained as such pursuant to Section 5.1(a).
"Class B Interest Carryover Shortfall" means, (a)
for the initial Distribution Date, zero, and (b) for any other
Distribution Date, the excess of Class B Monthly Interest for the
preceding Distribution Date and any outstanding Class B Interest
Carryover Shortfall for such preceding Distribution Date over the
amount in respect of interest that is actually deposited in the Class
B Distribution Account on such preceding Distribution Date, plus 30
days of interest on such excess, to the extent permitted by law, at
the Class B Pass-Through Rate.
"Class B Interest Distributable Amount" means, with
respect to any Distribution Date, the sum of Class B Monthly Interest
for such Distribution Date and the Class B Interest Carryover
Shortfall for such Distribution Date.
"Class B Monthly Interest" means, for any
Distribution Date, one-twelfth of the Class B Pass-Through Rate
multiplied by the Class B Certificate Balance as of the preceding
Distribution Date (after giving effect to any payments made on such
preceding Distribution Date) or, in the case of the first Distribution
Date, as of the Closing Date, which amount includes any amounts due
with respect to the Class B Stripped Coupon.
"Class B Monthly Principal" means, with respect to
any Distribution Date, the sum of (a) the Class B Percentage of the
Available Principal for such Distribution Date and (b) the Class B
Percentage of Aggregate Net Losses with respect to the related
Collection Period.
"Class B Pass-Through Rate" means 6.76% per annum.
6
"Class B Percentage" means, a fraction (expressed as
a percentage with eight decimal places), the numerator if which is the
Original Class B Certificate Balance and the denominator of which is
the Original Certificate Balance.
"Class B Pool Factor" means, with respect to any
Distribution Date, the Class B Principal Balance as of such (after
giving effect to any payments to be made on such Distribution Date),
divided by the Original Class B Certificate Balance, expressed as a
eight-digit decimal.
"Class B Principal Carryover Shortfall" means, for
any Distribution Date, the excess of Class B Monthly Principal for the
preceding Distribution Date and any outstanding Class B Principal
Carryover Shortfall for such preceding Distribution Date over the
amount in respect of principal that is actually deposited in the Class
B Distribution Account for such preceding Distribution Date.
"Class B Principal Distributable Amount" means, for
any Distribution Date, the sum of Class B Monthly Principal for such
Distribution Date and, in the case of any Distribution Date other than
the initial Distribution Date, the Class B Principal Carryover
Shortfall for such Distribution Date. In addition, on the Final
Scheduled Distribution Date, the Class B Principal Distributable
Amount will include any additional amount required to reduce the
outstanding aggregate principal balance of the Class B Certificates to
zero.
"Class B Stripped Coupon" means, with respect to
each Receivable, the amount of interest allocable to a Class B
Certificateholder in excess of such Class B Certificateholder's pro
rata percentage interest in the interest payable on the Receivable at
the Base Rate.
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities
Exchange Act of 1934, as amended. The initial Clearing Agency
shall be The Depository Trust Company.
"Clearing Agency Participant" means a broker,
dealer, bank, other financial institution or other person for whom
from time to time a Clearing Agency effects book-entry transfers of
securities deposited with the Clearing Agency (including a Foreign
Clearing Agency).
"Closing Date" means September 18, 1996.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Collateral Agent" means Norwest Bank Minnesota,
National Association, a national banking association, in its capacity
as collateral agent for the benefit of the
7
Certificateholders with respect to the Reserve Account and the
Retained Yield.
"Collection Account" means the account established and
maintained pursuant to Section 5.1(a).
"Collection Period" means each calendar month
beginning September 1, 1996 until the Trust shall terminate pursuant
to Article XII.
"Collections" means all collections in respect of
Receivables.
"Contract Rate" of a Receivable means the annual
rate of interest stated in such Receivable.
"Cutoff Date" means September 1, 1995.
"Dealer" means the dealer which sold a Financed
Vehicle and which originated or assisted in the origination of the
Receivable relating to such Financed Vehicle under a Dealer Agreement.
"Dealer Agreement" means any agreement and, if
applicable, assignment under which the Receivables were originated by
or through a Dealer and sold to the Seller or an Affiliate of the
Seller.
"Defaulted Receivable" means a Receivable (other
than a Repurchased Receivable) as to which the Servicer has determined
based on its usual collection practices and procedures, during any
Collection Period, that eventual payment in full of the Amount
Financed (including accrued interest thereon) is unlikely; provided
that such loss recognition cannot be later than the calendar month in
which more than 10% of the scheduled payment becomes 240 days
delinquent.
"Definitive Certificates" has the meaning specified in
Section 6.8.
"Delinquency Percentage" means, with respect to a
Collection Period, the sum of the outstanding principal balances of
all Receivables which are 60 days or more delinquent (including
Receivables, which are not Defaulted Receivables, relating to Financed
Vehicles that have been repossessed), as of the end of such Collection
Period, determined in accordance with the Servicer's normal practices,
such sum expressed as a percentage of the Pool Balance on the last day
of such Collection Period.
"Delivery" when used with respect to Account
Property means: (a)(i) with respect to "certificated securities"
within the meaning of Section 8-102(1)(a) of the Relevant UCC not held
by the initial Clearing Agency or other "instruments" within the
8
meaning of Section 9-105(1)(i) of the Relevant UCC, physical delivery
thereof to the Collateral Agent endorsed to, or registered in the name
of, the Collateral Agent or endorsed in blank, or, with respect to a
certificated security, possession thereof by a financial intermediary
(as defined in Section 8- 313(4) of the Relevant UCC) and the making
by such financial intermediary of entries on its books and records
identifying such certificated securities as belonging to the
Collateral Agent and the sending by such financial intermediary of a
confirmation of the purchase of such certificated security by the
Collateral Agent, or (ii) with respect to "certificated securities"
within the meaning of Section 8-102(4)(a) of the Relevant UCC held by
the initial Clearing Agency or by a "custodian bank" within the
meaning of Section 8-102(4) of the Relevant UCC (a "Custodian Bank")
or a nominee of either subject to the control of the initial Clearing
Agency, the delivery thereof to the initial Clearing Agency or a
Custodian Bank or a nominee of either subject to the control of the
initial Clearing Agency and in bearer form or endorsed in blank by an
appropriate person or registered on the books of the issuer thereof in
the name of the initial Clearing Agency or its Custodian Bank or a
nominee of either and the identification by book-entry or otherwise on
the records of the financial intermediary, the sending of a
confirmation by the financial intermediary of the purchase by the
Collateral Agent of such securities and the making by such financial
intermediary of entries on its books and records identifying such
certificated securities as belonging to the Collateral Agent (all of
the foregoing, "Physical Property"), and such additional or
alternative procedures as may hereafter become appropriate to effect
the complete transfer of ownership of any such Account Property to the
Collateral Agent, consistent with changes in applicable law or
regulations or the interpretation thereof;
(b) with respect to any securities issued by the
U.S. Treasury, the Federal Home Loan Mortgage Corporation or by the
Federal National Mortgage Association that are maintained in the form
of entries on the records of the Federal Reserve System pursuant to
Federal book-entry regulations, the following procedures: entries on
the records of a member bank of the Federal Reserve System identifying
such Account Property as belonging to a Federal Reserve "depositary"
pursuant to applicable Federal regulations and the sending by such
depositary of written confirmation of the purchase of such Account
Property to the Collateral Agent; the making by such depositary of
entries in its books and records identifying such Account Property as
belonging to, or otherwise subject to a security interest in favor of,
the Collateral Agent; and such additional or alternative procedures as
may hereafter become appropriate to effect transfer of ownership of
any such Account Property to the Collateral Agent consistent with
changes in applicable law or regulations or the interpretation
thereof; and
9
(c) with respect to any item of Account Property
that is an uncertificated security under Article 8 of the Relevant UCC
and that is not governed by clause (b) above, registration on the
books and records of the issuer thereof in the name of the financial
intermediary, the sending of a confirmation by the financial
intermediary of the purchase by the Collateral Agent or its nominee,
agent or custodian of such uncertificated security, the making by such
financial intermediary of entries on its books and records identifying
such uncertificated certificates as belonging to the Collateral Agent
or its nominee, agent or custodian.
"Deposit Date" means the Business Day immediately
preceding each Distribution Date.
"Depository Agreement" means the agreement among the
Seller, the Trustee and the initial Clearing Agency, in the form
attached hereto as Exhibit B, as the same may be amended, supplemented
or otherwise modified and in effect from time to time.
"Determination Date" means the 10th calendar day of
the month (or, if such 10th calendar day is not a Business Day, the
Business Day preceding the 10th calendar day of the month) immediately
succeeding the related Collection Period.
"Distribution Date" means, in the case of the first
Collection Period, October 15, 1996, and in the case of every
Collection Period thereafter, the 15th calendar day of the following
month, or if the 15th calendar day is not a Business Day, the next
following Business Day, commencing with the first Distribution Date.
"Eligible Deposit Account" means either (i) a
segregated identifiable trust account established in the trust
department of a Qualified Trust Institution or (ii) a separately
identifiable deposit account established in the deposit taking
department of a Qualified Institution.
"Euroclear Operator" means Morgan Guaranty Trust
Company of New York, Brussels, Belgium office, in its capacity as
the operator of the Euroclear system.
"Event of Servicing Termination" means an event
specified in Section 9.1.
"FDIC" means the Federal Deposit Insurance Corporation
or any successor thereto.
"FHLMC" means the Federal Home Loan Mortgage
Corporation or any successor thereto.
10
"Final Scheduled Distribution Date" shall be
September 15, 2002, or, if such day is not a Business Day, the next
succeeding Business Day.
"Financed Vehicle" means, with respect to a
Receivable, the new or used automobile or light-duty truck, together
with all accessions thereto, securing an Obligor's indebtedness under
such Receivable.
"Fitch" means Fitch Investors Service L.P. and its
successors and assigns.
"FNMA" means the Federal National Mortgage Association
or any successor thereto.
"Foreign Clearing Agency" means CEDEL and the Euroclear
Operator.
"Late Fees" means any late charges, credit related
extension fees, non-credit related extension fees or other
administrative fees or similar charges allowed by applicable law with
respect to the Receivables.
"Lien" means a security interest, lien, charge,
pledge or encumbrance of any kind other than tax liens, mechanics'
liens or any other liens that attach to a Receivable by operation of
law.
"Liquidation Proceeds" means, with respect to any
Receivable, (i) insurance proceeds, (ii) the monies collected during a
Collection Period from whatever source on a Defaulted Receivable and
(iii) proceeds of a Financed Vehicle sold after repossession, in each
case net of any liquidation expenses and payments required by law to
be remitted to the Obligor.
"Moody's" means Moody's Investors Service, Inc., and
its successors and assigns.
"Net Loss Ratio" means, for any Collection Period,
an amount, expressed as a percentage, equal to (i) the Aggregate Net
Losses for such Collection Period, divided by (ii) the average of the
Pool Balances on each of the Settlement Date related to such
Collection Period and the last day of such Collection Period.
"Obligor" on a Receivable means the purchaser or the
co-purchasers of the Financed Vehicle purchased in part or in whole by
the execution and delivery of such Receivable or any other Person who
owes or may be liable for payments under such Receivable.
"Officer's Certificate" means a certificate signed
by the chairman of the board, the president, the treasurer, the
controller, any executive or senior vice president or any vice
president of the Seller or Servicer, as appropriate.
11
"Opinion of Counsel" means a written opinion of
counsel (who may be counsel to the Seller or the Servicer) reasonably
acceptable in form and substance to the Trustee.
"Optional Purchase Percentage" shall be 5%.
"Original Certificate Balance" means the sum of the
Original Class A Certificate Balance and the Original Class B
Certificate Balance.
"Original Class A Certificate Balance" means
$1,478,422,107.71.
"Original Class B Certificate Balance" means
$45,725,000.00.
"Original Pool Balance" shall be $1,524,147,107.71.
"Outstanding Receivable" means, as of the time of
reference thereto, a Receivable that (i) has not been fully paid, (ii)
has not become a Defaulted Receivable, and (iii) has not become a
Repurchased Receivable.
"Pass-Through Rate" means either the Class A
PassThrough Rate or the Class B Pass-Through Rate, as applicable.
"Paying Agent" has the meaning specified in Section
6.11 and shall initially be the corporate trust office of The Chase
Manhattan Bank.
"Permitted Investments" means, at any time, any one
or more of the following obligations and securities (excluding any
security with the "r" symbol attached to its rating):
(i) obligations of the United States of
America or any agency thereof, provided such obligations are
backed by the full faith and credit of the United States of
America;
(ii) general obligations of or obligations
guaranteed as to the timely payment of interest and principal
by any state of the United States of America or the District
of Columbia then rated "A-l+" or "AAA" by Standard & Poor's,
"F-1+" and "AAA" by Fitch (if rated by Fitch) and "P-1" or
"Aaa" by Moody's;
(iii) commercial paper which is then rated
"P-1" by Moody's, "F-1+" by Fitch (if rated by Fitch) and
"A-l+" by Standard & Poor's;
(iv) certificates of deposit, demand or
time deposits, federal funds or banker's acceptances issued
by any depository institution or trust company (including the
Trustee acting in its commercial banking capacity)
12
incorporated under the laws of the United States or of any
state thereof or incorporated under the laws of a foreign
jurisdiction with a branch or agency located in the United
States of America and subject to supervision and examination
by federal or state banking authorities which short term
unsecured deposit obligations of such depository institution
or trust company are then rated "P-1" by Moody's, "F-1+" by
Fitch (if rated by Fitch) and "A-l+" by Standard & Poor's;
(v) demand or time deposits of, or
certificates of deposit issued by, any bank, trust company,
savings bank or other savings institution and such deposits
or certificates of deposit are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements
issued by any bank, insurance company or other corporation
the short term unsecured debt or deposits of which are rated
"P-1" by Moody's, "F-1+" by Fitch (if rated by Fitch) and
"A-l+" by Standard & Poor's or the long-term unsecured debt
of which are rated "Aaa" by Moody's, "F-1+" by Fitch (if
rated by Fitch) and "AAA" by Standard & Poor's;
(vii) repurchase obligations with respect
to any security described in clauses (i) or (ii) herein or
any other security issued or guaranteed by the FHLMC, FNMA or
any other agency or instrumentality of the United States of
America which is backed by the full faith and credit of the
United States of America, in either case entered into with a
federal agency or a depository institution or trust company
(acting as principal) described in (iv) above;
(viii) investments in money market funds,
which funds (A) are not subject to any sales, load or other
similar charge; and (B) are rated at least "AAAM" or "AAAMG"
by Standard & Poor's, "AAA V-1+" by Fitch (if rated by Fitch)
and "Aaa" by Moody's;
(ix) such other investments where the
short-term unsecured debt or deposits of the obligor on such
investments are rated "A-l+" by Standard & Poor's, "F-1" by
Fitch (if rated by Fitch) and "P-1" by Moody's; and
(x) any other obligation or security
satisfying the Rating Agency Condition;
provided, however, that with respect to the obligations or securities
described in (i) through (x) above which are considered an asset
(i.e., property) of the Trust, such obligations or securities must
mature not later than the Deposit Date next succeeding the date the
trust invested in such obligation or security, except if the
Collection Account is maintained with the Trustee, for investments in
obligations or securities on which the Trustee is to obligor
(including repurchase agreements on which the Trustee in its
commercial
13
capacity is liable as principal) which investments may mature on the
Distribution Date next succeeding the date the Trust invested in such
obligation or security. Permitted Investments include money market
mutual funds (so long as such fund has the ratings specified in clause
(viii) hereof), including, without limitation, the VISTA U.S.
Government Money Market Fund or any other fund for which The Chase
Manhattan Bank, the Trustee or an Affiliate thereof serves as an
investment advisor, administrator, shareholder servicing agent, and/or
custodian or subcustodian, notwithstanding that (i) The Chase
Manhattan Bank, Norwest Bank Minnesota, National Association or an
Affiliate thereof charges and collects fees and expenses from such
funds for services rendered, (ii) The Chase Manhattan Bank, Norwest
Bank Minnesota, National Association or an Affiliate thereof charges
and collects fees and expenses for services rendered pursuant to this
Agreement, and (iii) services performed for such funds and pursuant to
this Agreement may converge at any time. The Trustee specifically
authorizes The Chase Manhattan Bank, Norwest Bank Minnesota, National
Association or an Affiliate thereof to charge and collect all fees and
expenses from such funds for services rendered to such funds (but not
to exceed investment earnings), in addition to any fees and expenses
Chase USA or Norwest Bank Minnesota, National Association, as
applicable, may charge and collect for services rendered pursuant to
this Agreement.
"Person" means a legal person, including any
individual, corporation, estate, partnership, joint venture,
association, joint stock company, trust, unincorporated organization,
or government or any agency or political subdivision thereof, or any
other entity of whatever nature.
"Physical Property" has the meaning assigned to such
terms in the definition of "Delivery" above.
"Pool Balance" as of any date of determination means
the aggregate Principal Balance of the Receivables, calculated as of
the close of business on such date.
"Principal Balance" of a Receivable, as of any date
of determination, means the Amount Financed minus that portion of all
payments received on or prior to such date allocable to principal. The
Principal Balance of a Defaulted Receivable or a Repurchased
Receivable shall be deemed to be zero, in each case, as of such date.
"Proposed Merger" means, as of the Closing Date, the
proposed merger of Chase USA into Chase USA Delaware.
"Qualified Institution" means a depository
institution organized under the laws of the United States of America
or any one of the states thereof or incorporated under the laws of a
foreign jurisdiction with a branch or agency located in the United
States of America or one of the States thereof and subject to
supervision and examination by federal or state banking
14
authorities which at all times has the Required Deposit Rating and, in
the case of any such institution organized under the laws of the
United States of America, whose deposits are insured by the FDIC.
"Qualified Trust Institution" means an institution
organized under the laws of the United States of America or any one of
the states thereof or incorporated under the laws of a foreign
jurisdiction with a branch or agency located in the United States of
America or one of the States thereof and subject to supervision and
examination by federal or state banking authorities which at all times
(i) is authorized under such laws to act as a trustee or in any other
fiduciary capacity, (ii) has not less than one billion dollars in
assets under fiduciary management, and (iii) has a long term deposits
rating of not less than "BBB-" by Standard & Poor's, "BBB-" by Fitch
(if rated by Fitch) and "Baa3" by Moody's.
"Rating Agency" means any of Standard & Poor's, Moody's
or Fitch.
"Rating Agency Condition" means, with respect to any
action, that each Rating Agency shall have notified the Seller, the
Servicer and the Trustee in writing that such action will not result
in reduction or withdrawal of the rating of any outstanding
Certificate with respect to which it is the Rating Agency.
"Receivable" means a retail installment sale
contract or purchase money promissory note and security agreement
executed by an Obligor in respect of a Financed Vehicle, and all
proceeds thereof and payments thereunder (other than interest accrued
and unpaid as of the Cutoff Date), which Receivable shall be
identified on Schedule A to this Agreement.
"Receivable Files" means the documents specified in
Section 3.3.
"Receivables Pool" means the pool of Receivables
included in the Trust.
"Record Date" means, with respect to any
Distribution Date, the Business Day prior to such Distribution Date
unless Definitive Certificates are issued, in which case Record Date
shall mean the last day of the immediately preceding calendar month.
"Relevant UCC" means the Uniform Commercial Code as in
effect in the applicable jurisdiction.
"Repurchase Amount" of a Repurchased Receivable or
any Receivable purchased by the Servicer pursuant to Sections 3.2, 4.7
or 11.2 means the sum, as of the Settlement Date on which such
Receivable becomes such, of the Principal Balance thereof
15
plus the Accrued Interest thereon; of a Defaulted Receivable means the
sum, as of the Settlement Date on which such Receivable is to be
purchased, of the principal balance thereof plus the Accrued Interest
thereon (the accrued interest for the Collection Period in which such
Receivable became a Defaulted Receivable to be calculated at a rate
equal to one-twelfth of the sum of (A) the Weighted Average
Pass-Through Rate and (B) the Servicing Fee Rate).
"Repurchased Receivable" as of any Settlement Date,
means a Receivable repurchased as of such day by the Seller pursuant
to Section 3.2 or purchased as of such day by the Servicer pursuant to
Section 4.7.
"Required Deposit Rating" shall be a short-term
certificate of deposit rating from Moody's of "P-1," from Fitch of
"F-1+" (if rated by Fitch) and from S&P of "A-l+," and a long-term
unsecured debt rating of not less than "AA" by Standard & Poor's, "AA"
by Fitch (if rated by Fitch) and "Aa3" by Moody's.
"Reserve Account" means the Reserve Account
established and maintained as such pursuant to Section 5.6(a).
"Reserve Account Initial Deposit" means $30,482,942.15.
"Retained Yield" means, with respect to each
Receivable, a fixed portion of the interest due on such Receivable
equal to the difference between the Contract Rate of such Receivable
and the Base Rate of such Receivable.
"Securities Act" means the Securities Act of 1933, as
amended.
"Seller" means Chase Manhattan Bank USA, N.A., a
national banking association with its principal executive offices in
Jericho, New York, in its capacity as the seller of the Receivables
under this Agreement, and each successor to Chase Manhattan Bank USA,
N.A. (in the same capacity) pursuant to Section 7.3.
"Servicer" means Chase Manhattan Bank USA, N.A., a
national banking association with its principal executive offices in
Jericho, New York in its capacity as the servicer of the Receivables
under this Agreement, each successor to Chase Manhattan Bank USA, N.A.
(in the same capacity) pursuant to Section 8.3, and each successor
Servicer pursuant to Section 9.2.
"Servicer's Certificate" means a certificate,
substantially in the form of Exhibit D attached hereto, completed and
executed by the Servicer by its chairman of the board, the president,
treasurer, controller or any executive, senior vice president or vice
president pursuant to Section 4.9.
16
"Servicing Fee" with regard to a Collection Period
means the fee payable to the Servicer for services rendered during
such Collection Period, determined pursuant to Section 4.8.
"Servicing Fee Rate" means 1.00% per annum.
"Settlement Date" means, with respect to any
Collection Period, the last day of the Collection Period immediately
preceding such Collection Period, and with respect to any Distribution
Date, the last day of the second Collection Period preceding such
Distribution Date.
"Specified Reserve Account Balance", with respect to
any Distribution Date, means 3.25% of the Pool Balance as of the
related Settlement Date, but in any event will not be less than the
lesser of (i) $11,431,103 and (ii) the sum of (A) such Pool Balance
plus (B) an amount sufficient to pay interest on such Pool Balance
through the Final Scheduled Distribution Date at a rate equal to the
sum of (x) the weighted average of the Class A Pass-Through Rate and
the Class B Pass-Through Rate (based on their respective Certificate
balances) plus (y) the Servicing Fee Rate; provided that the Specified
Reserve Account Balance will be calculated using a percentage of 5.25%
for any Distribution Date on which the Average Net Loss Ratio exceeds
1.25% or the Average Delinquency Percentage exceeds 1.25%. Upon
written notification to the Trustee by the Seller, the Specified
Reserve Account Balance may be reduced to a lesser amount as
determined by the Seller so long as such reduction satisfies the
Rating Agency Condition.
"Standard & Poor's" means Standard & Poor's Ratings
Services, and its successors and assigns.
"Transfer Agent and Certificate Registrar" has the
meaning specified in Section 6.3 and shall initially be the corporate
trust office of The Chase Manhattan Bank.
"Trust" means the Chase Manhattan Auto Grantor Trust
1996-B, the estate of which shall consist of the property transferred
thereto pursuant to this Agreement; funds deposited in the Collection
Account and the Distribution Accounts (other than any funds in respect
of the Retained Yield) and proceeds of the foregoing.
"Trustee" means, initially, Norwest Bank Minnesota,
National Association, its successor in interest pursuant to Section
10.11, and any successor Trustee pursuant to Section 10.10.
"Trustee's Certificate" means a certificate
completed and executed by an Authorized Officer pursuant to Section
10.2 and substantially in the forms attached hereto as Exhibits C-1 or
C-2.
17
"Weighted Average Pass-Through Rate" means the
weighted average of the Class A Pass-Through Rate and the Class B
PassThrough Rate (based on their respective Certificate balances).
SECTION 1.2. Usage of Terms. With respect to all
terms in this Agreement, the singular includes the plural and the
plural the singular; words importing any gender include the other
gender; references to "writing" include printing, typing, lithography,
and other means of reproducing words in a visible form; references to
agreements and other contractual instruments include all subsequent
amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement;
references to Persons include their permitted successors and assigns;
and the term "including" means "including without limitation."
SECTION 1.3. Simple Interest Method; Allocations. All
allocations of payments to principal and interest and determinations
of periodic charges and the like on the Receivables shall be based on
a year with the actual number of days in such year and twelve months
with the actual number of days in each such month. Each payment on a
Receivable shall be applied first to the amount of interest accrued on
such Receivable to the date of receipt, then to reduce the scheduled
principal amount outstanding on the Receivable to the extent of the
remaining scheduled payment and then to any outstanding fees and Late
Fees under the terms of the Receivable. Amounts paid by the Seller or
the Servicer in respect of Repurchased Receivables shall be allocated
first to any Accrued Interest and then to the Principal Balance of the
related Receivable.
18
ARTICLE II
THE TRUST CONVEYANCE OF THE RECEIVABLES
SECTION 2.1. Creation of the Trust. Upon the
execution of this Agreement by the parties hereto, there is hereby
created the Chase Manhattan Auto Grantor Trust 1996-B.
SECTION 2.2. Conveyance of Receivables. In
consideration of the Trustee's delivery to, or upon the order of, the
Seller of authenticated Certificates, in authorized denominations, in
an aggregate amount equal to the Original Pool Balance, the Seller
does hereby sell, transfer, assign, and otherwise convey to the
Trustee on behalf of the Trust, without recourse (subject to the
Seller's obligations herein):
(i) all right, title, and interest of the
Seller in, to and under the Receivables listed in Schedule A
hereto, all proceeds thereof and all amounts and monies paid
thereon on and after the Cutoff Date (including proceeds of
the repurchase of Receivables by the Seller pursuant to
Section 3.2 or the purchase of Receivables by the Servicer
pursuant to Section 4.7 or 11.2), together with the interest
of the Seller in the security interests in the Financed
Vehicles granted by the Obligors pursuant to the Receivables
and in any repossessed Financed Vehicles;
(ii) all right, title and interest of the
Seller in any Liquidation Proceeds and in any proceeds of any
extended warranties, theft and physical damage, credit life
or credit disability policies relating to the Financed
Vehicles or the Obligors;
(iii) all right, title and interest of the
Seller in any proceeds from Dealer repurchase obligations
relating to the Receivables;
(iv) all right, title and interest of the
Seller in the Collection Account; and
(v) all proceeds (as defined in the
Relevant UCC) of the foregoing.
Simultaneously with the sale, transfer, assignment
and conveyance by the Seller pursuant to this Section 2.1, the Trustee
on behalf of the Trust does hereby transfer, assign and otherwise
convey to the Seller all of its right, title and interest in the
Retained Yield.
Notwithstanding anything herein to the contrary, the
property of the Trust shall not include, and the Trust shall not have
any right to, the Retained Yield or the Reserve Account, any funds
actually or deemed to be deposited in such account or any
19
investments therein except to the extent provided in Sections
5.2, 5.5 and 5.6.
In connection with such sale, the Seller agrees to
record and file, at its own expense, financing statements (and
continuation statements with respect to such financing statements when
applicable) with respect to the Receivables for the sale of accounts
and chattel paper meeting the requirements of applicable state law in
such manner and in such jurisdictions as are necessary to perfect the
sale and assignment of the Receivables to the Trust.
It is the intention of the Seller and the Trustee
that the assignment and transfer herein contemplated constitute a sale
of the Receivables, conveying good title thereto free and clear of any
liens and encumbrances, from the Seller to the Trust and the
Receivables not be part of the Seller's estate in the event of an
insolvency. In the event that such conveyance is deemed to be a pledge
to secure a loan, the Seller hereby grants to the Trustee on behalf of
the Trust for the benefit of the Certificateholders a first priority
perfected security interest in all of the Seller's right, title and
interest in, to and under the items of property listed in clauses (i)
through (v) above, and in all proceeds (as defined in the Relevant
UCC) of the foregoing, to secure the loan deemed to be made in
connection with such pledge and, in such event, this Agreement shall
constitute a security agreement under applicable law.
20
ARTICLE III
THE RECEIVABLES
SECTION 3.1. Representations and Warranties of Seller;
Conditions Relating to Receivables.
(a) The Seller makes the following
representations and warranties as to the Receivables on which the
Trustee shall rely in accepting the Receivables in trust and
authenticating the Certificates. Such representations and warranties
shall speak as of the Cutoff Date unless otherwise specified and shall
survive the sale, transfer, and assignment of the Receivables to the
Trustee.
(i) Schedule of Receivables. The
information set forth in Schedule A hereto with respect to
each Receivable is true and correct in all material respects,
and no selection procedures adverse to the Certificateholders
has been utilized in selecting the Receivables from all
receivables owned by the Seller which meet the selection
criteria specified herein.
(ii) No Sale or Transfer. No Receivable
has been sold, transferred, assigned or pledged by the Seller
to any Person other than the Trustee.
(iii) Good Title. Immediately prior to the
transfer and assignment of the Receivables to the Trust
herein contemplated, the Seller has good and marketable title
to each Receivable free and clear of all Liens and rights of
others; and, immediately upon the transfer thereof, the
Trustee, for the benefit of the Certificateholders, has
either (i) good and marketable title to each Receivable, free
and clear of all Liens and rights of others, and the transfer
has been perfected under applicable law or (ii) a first
priority perfected security interest in each Receivable.
(b) Each Receivable satisfies the following
conditions as of the Cutoff Date unless otherwise specified and shall
survive the sale, transfer and assignment of the Receivables to the
Trustee.
(i) Acquisition. Each Receivable has been
acquired directly or indirectly from or made through a
Dealer located in the United States (including the District
of Columbia);
(ii) Security. Each Receivable is secured
by a new or used automobile;
(iii) Maturity of Receivables. Each Re-
ceivable conveyed hereby had a remaining maturity, as of the
21
Cutoff Date, of not less than 6 months nor greater than 66
months, and (i) with respect to Receivables secured by new
Financed Vehicles, an original maturity of at least 12 months
and not more than 84 months and (ii) with respect to
Receivables secured by used Financed Vehicles, an original
maturity of at least 12 months and not more than 60 months;
(iv) Contract Rate. Each Receivable is a
fully-amortizing fixed rate simple interest contract that
provides for level scheduled monthly payments over its
remaining term, and has a Contract Rate of at least 7.75% and
not more than 20.00% and is not secured by any interest in
real estate;
(v) No Repossessions. Each Receivable is
secured by a Financed Vehicle that, as of the Cutoff Date,
has not been repossessed without reinstatement of such
Receivable;
(vi) Obligor Not Subject to Bankruptcy
Proceedings. Each Receivable has been entered into by an
Obligor who has not been identified on the computer files of
the Seller as in bankruptcy proceedings as of the Cutoff
Date;
(vii) No Overdue Payments. Each Receivable
has no payment that is more than 30 days past due as of the
Cutoff Date;
(viii) Advance Payments. Each Receivable
has not been paid more than three months in advance as of the Cutoff Date;
(ix) Remaining Principal Balance. Each
Receivable had a remaining principal balance, as of the
Cutoff Date, of at least $2,000 and not greater than
$75,000;
(x) No Force Placed Insurance. As of the
Cutoff Date, each Receivable is secured by a Financed Vehicle
that was not insured by a force placed insurance policy or
any vendor's single interest and non-filing insurance policy.
(xi) Receivable Files. The Receivable
Files shall be kept at one or more of the locations specified
in Schedule B hereto.
(xii) Characteristics of Receivables. Each
Receivable (a) has been originated in the form of a credit
sales transaction by a Dealer or a purchase money loan
through a Dealer located in one of the States of the United
States (including the District of Columbia) for the retail
financing of a Financed Vehicle, has been fully and properly
22
executed by the parties thereto and, if a retail installment
sales contract, has been purchased by the Seller from such
Dealer or an affiliate of the Seller, and has been validly
assigned by such Dealer or an affiliate of the Seller to the
Seller in accordance with its terms; (b) 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; and (c)
provides for fully amortizing level scheduled monthly
payments (provided that the payment in the last month in the
life of the Receivable may be different from the level
scheduled payment) and for accrual of interest at a fixed
rate according to the simple interest method.
(xiii) Compliance with Laws. Each
Receivable and each sale of the related Financed Vehicle complied at
the time it was originated or made, and complies on and after the
Cutoff Date, in all material respects with all requirements of
applicable federal, state, and local laws, and regulations thereunder,
including usury laws, the Federal Truth-in-Lending Act, the Equal
Credit Opportunity Act, the Fair Credit Reporting Act, the Federal
Trade Commission Act, the Magnuson-Moss Warranty Act, Federal Reserve
Board Regulations B and Z, state adaptations of the National Consumer
Act and of the Uniform Consumer Credit Code, and any other consumer
credit, equal opportunity, and disclosure laws applicable to such
Receivable and sale thereof.
(xiv) Binding Obligation. Each Receivable
constitutes the legal, valid, and binding payment obligation
in writing of the Obligor, enforceable by the holder thereof
in all material respects in accordance with its terms,
subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization, liquidation and other similar
laws and equitable principles relating to or affecting the
enforcement of creditors' rights.
(xv) No Government Obligor. Each
Receivable is not due from the United States of America or
any state or from any agency, department, instrumentality or
political subdivision of the United States of America or any
state or local municipality, and each Receivable is not due
from a business except to the extent that such Receivable has
a personal guaranty.
(xvi) Security Interest in Financed Vehicle.
Immediately prior to the sale and assignment thereof to the
Trustee as herein contemplated, each Receivable was secured
by a validly perfected first priority security interest in
the Financed Vehicle in favor of or for the benefit of the
Seller as secured party (subject to administrative delays and
clerical errors on the part of the applicable governmental
agency and to any statutory or other lien
23
arising by operation of law after the Closing Date which is
prior to such security interest), the Seller's security
interest (or beneficial interest therein) is assignable to
and has been so assigned by the Seller to the Trust, and at
such time as enforcement of such security interest is sought,
each Receivable shall be secured by a validly perfected first
priority security interest in the Financed Vehicle for the
benefit of the Trust (subject to administrative delays and
clerical errors on the part of the applicable governmental
agency and to any statutory or other lien arising by
operation of law after the Closing Date which is prior to
such security interest).
(xvii) Receivables in Force. No Receivable
has been satisfied, subordinated, or rescinded, nor has any
Financed Vehicle been released from the Lien granted by the
related Receivable, in whole or in part.
(xviii) No Waiver. No provision of a
Receivable has been waived in such a manner that such
Receivable fails either to meet all of the representations
and warranties made by the Seller herein with respect thereto
or to meet all of the conditions with respect thereto
pursuant to this Section 3.1(b).
(xix) No Amendments. No Receivable has been
amended except pursuant to either instruments included in the
Receivable Files or instruments to be included in the
Receivables Files pursuant to Sections 4.2 and 4.4 (or
otherwise maintained by the Seller in the ordinary course of
its business), and no such amendment has caused such
Receivable either to fail to meet all of the representations
and warranties made by the Seller herein with respect thereto
or to fail to meet all of the conditions with respect thereto
pursuant to this Section 3.1(b).
(xx) No Defenses. As of the Cutoff Date,
the Seller has no knowledge either of any facts which would
give rise to any right of rescission, setoff, counterclaim,
or defense, or of the same being asserted or threatened, with
respect to any Receivable.
(xxi) No Liens. As of the Cutoff Date, the
Seller has no knowledge of any Liens or claims that have been
filed, including liens for work, labor, materials or unpaid
taxes relating to a Financed Vehicle, that would be liens
prior to, or equal or coordinate with, the lien granted by
the Receivable.
(xxii) No Default. Except for payment
defaults continuing for a period of not more than 30 days as
of the Cutoff Date, the Seller has no knowledge that a
default, breach, violation, or event permitting acceleration
under the terms of any Receivable exists; the Seller has no
24
knowledge that a continuing condition that with notice or
lapse of time would constitute a default, breach, violation,
or event permitting acceleration under the terms of any
Receivable exists; and the Seller has not waived any of the
foregoing.
(xxiii) Insurance. Each Receivable requires
that the Obligor thereunder obtain theft and physical damage
insurance covering the Financed Vehicle.
(xxiv) Lawful Assignment. No Receivable has
been originated in, or is subject to the laws of, any
jurisdiction under which the sale, transfer, and assignment
of such Receivable under this Agreement or pursuant to
transfers of the Certificates is unlawful, void or voidable.
(xxv) All Filings Made. No filings (other
than filings under the Relevant UCC which have been made) or
other actions are necessary in any jurisdiction to give the
Trustee a first perfected security interest in the
Receivables.
(xxvi) One Original. There is no more than
one original executed copy of each Receivable which,
immediately prior to the delivery thereof to the Servicer,
(as custodian for the Trustee) was in the possession of the
Seller.
(xxvii) Excluded Loans. Each Receivable is
(A) not a Chase Connecticut Loan, Chase Florida Loan, Chase
Lincoln Loan, Chase Maryland Loan or a Receivable originated
by or through a Dealer located in the State of Alabama, and
(B) has not been the subject of a previous securitization.
(xxviii) Account Number. Each Receivable
has been assigned an account number that corresponds to the
number assigned to the Dealer from or through whom such
Receivable was acquired.
SECTION 3.2. Repurchase Upon Breach or Failure of a
Condition. The Seller, the Servicer, or the Trustee, as the case may
be, shall inform the other parties promptly, in writing, upon the
discovery by the Seller, the Servicer or an Authorized Officer of the
Trustee of either any breach of the Seller's representations and
warranties set forth in Section 3.1(a) or the failure of any
Receivable to satisfy any of the conditions set forth in Section
3.1(b) which materially and adversely affects the Trust's interest in
any Receivable. Unless the breach or failed condition shall have been
cured by the last day of the Collection Period following the
Collection Period in which such discovery occurred (or, at the
Seller's option, the last day of the Collection Period in which such
discovery occurred), the Seller shall repurchase any Receivable the
Holder's interest in which was materially and adversely affected by
the breach or
25
failed condition, as of such last day. Notwithstanding anything herein
to the contrary, with respect to the breach of a representation and
warranty in Section 3.1(b)(xxviii), the Seller shall repurchase such
Receivable regardless of its effect on the interest of the Holders or
whether notice thereof has been delivered by any of the parties
thereto, and the repurchase of any such Receivable shall take place at
any time as is administratively convenient for the Seller and the
Servicer. In consideration of the repurchase of a Receivable, the
Seller shall remit the Repurchase Amount of such Receivable as of such
last day (less any Liquidation Proceeds deposited, or to be deposited,
by the Servicer in the Collection Account with respect to such
Receivable pursuant to Section 4.3) in the manner specified in Section
5.4. In the event that, as of the Cutoff Date, any Receivable shall
have a Contract Rate which is lower than the sum of the Weighted
Average Pass-Through Rate and the Servicing Fee Rate, the Seller shall
repurchase such Receivable on the terms and in the manner specified
above; provided, however, that notwithstanding anything to the
contrary contained herein, the Seller shall repurchase such Receivable
as of the last day of the Collection Period immediately succeeding the
discovery thereof by the Seller or the Servicer or the receipt by the
Seller of notice thereof from the Trustee. The sole remedy of the
Trust, the Trustee or the Certificateholders with respect either to a
breach of the Seller's representations and warranties set forth in
Section 3.1(a) or to a failure of any of the conditions set forth in
Section 3.1(b) shall be to require the Seller to repurchase
Receivables pursuant to this Section 3.2. The obligation of the Seller
to repurchase under this Section 3.2 shall not be solely dependent
upon the actual knowledge of the Seller of any breached representation
or warranty. The Trustee shall have no duty to conduct any affirmative
investigation as to the occurrence of any condition requiring the
repurchase of any Receivable pursuant to this Section 3.2 or the
eligibility of any Receivable for purposes of this Agreement.
SECTION 3.3. Custody of Receivable Files. To assure
uniform quality in servicing the Receivables and to reduce
administrative costs, the Trustee, upon the execution and delivery of
this Agreement, agrees to have the Servicer act as custodian of the
following documents or instruments (the "Receivable Files") which are
hereby constructively delivered to the Trustee with respect to each
Receivable:
(i) The original executed Receivable;
(ii) The original credit application or, if
no such original exists, a copy thereof; and
(iii) Any and all other documents or records
that the Seller or Servicer, as the case may be, shall keep
on file, in accordance with its customary procedures,
relating to a Receivable, an Obligor, or a Financed Vehicle.
26
The Servicer hereby agrees to act as custodian and
as agent for the Trustee hereunder. The Servicer acknowledges that it
holds the documents and instruments relating to the Receivables for
the benefit of the Trustee and the Certificateholders. The Trustee
shall have no responsibility to monitor the Servicer's performance as
custodian and shall have no liability in connection with the
Servicer's performance of such duties hereunder.
SECTION 3.4. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer, in its
capacity as custodian, shall hold the Receivable Files on behalf of
the Trustee for the use and benefit of all present and future
Certificateholders and maintain such accurate and complete accounts,
records (either original execution documents or copies of such
originally executed documents shall be sufficient), and computer
systems pertaining to the Receivables as shall enable the Trustee to
comply with its obligations pursuant to this Agreement. In performing
its duties as custodian, the Servicer shall act with reasonable care,
using that degree of skill and attention that the Servicer exercises
with respect to the receivable files of comparable new or used
automobile receivables that the Servicer services for itself or
others. The Servicer shall conduct, or cause to be conducted, periodic
audits of the files of all receivables owned or serviced by the
Servicer which shall include the Receivable Files held by it under
this Agreement and the related accounts, records, and computer
systems, in such a manner as shall enable the Trustee to identify all
Receivable Files and such related accounts, records and computer
systems and to verify, if the Trustee so elects, the accuracy of the
Servicer's recordkeeping. The Servicer shall promptly report to the
Trustee any failure on its part to hold the Receivable Files and
maintain its accounts, records, and computer systems as herein
provided, and promptly take appropriate action to remedy any such
failure.
(b) Maintenance of and Access to
Records. The Servicer shall maintain each Receivable File at one of
the locations specified in Schedule B to this Agreement, or at such
other location as shall be specified to the Trustee by 30 days' prior
written notice. The Servicer shall make available to the Trustee or
its duly authorized representatives, attorneys, or auditors the
Receivable Files and the related accounts, records, and computer
systems maintained by the Servicer at such times during normal
operating hours as the Trustee shall reasonably instruct which does
not unreasonably interfere with the Servicer's normal operations or
customer or employee relations.
(c) Release of Documents. Upon
instruction from the Trustee, the Servicer shall release any document
in the Receivable Files to the Trustee, the Trustee's agent, or the
Trustee's designee, as the case may be, at such place or places as the
Trustee may reasonably designate as soon as reasonably
27
practicable to the extent it does not unreasonably interfere with the
Servicer's normal operations or customer or employee relations. The
Servicer shall not be responsible for any loss occasioned by the
failure of the Trustee, its agent or its designee to return any
document or any delay in doing so.
(d) Title to Receivables. The Servicer agrees
that, in respect of any Receivable held by it as custodian hereunder,
(i) the Servicer will not at any time have or in any way attempt to
assert any interest in such Receivable or the related Receivable File,
other than solely for the purpose of collecting or enforcing the
Receivable for the benefit of the Trust and (ii) the related
Receivable File shall at all times be property of the Trust.
SECTION 3.5. Instructions; Authority to Act. The
Servicer shall be deemed to have received proper instructions with
respect to the Receivable Files upon its receipt of written
instructions signed by an Authorized Officer. A certified copy of a
by-law or of a resolution of the Board of Directors of the Trustee
shall constitute conclusive evidence of the authority of any such
Authorized Officer to act and shall be considered in full force and
effect until receipt by the Servicer of written notice to the contrary
given by the Trustee.
SECTION 3.6. Custodian's Indemnification. The
Servicer, as custodian, shall indemnify the Trustee for any and all
liabilities, obligations, losses, damages, payments, costs, or
expenses of any kind whatsoever that may be imposed on, incurred, or
asserted against the Trustee as the result of any act or omission in
any way relating to the maintenance and custody by the Servicer, as
custodian, of the Receivable Files; provided, however, that the
Servicer shall not be liable for any portion of any such amount
resulting from the wilful misfeasance, bad faith, or negligence of the
Trustee.
SECTION 3.7. Effective Period and Termination. The
Servicer's appointment as custodian shall become effective as of the
Cutoff Date and shall continue in full force and effect until
terminated pursuant to this Section 3.7 or until this Agreement
shall be terminated. If the Servicer shall resign as Servicer
under Section 8.5 or if all of the rights and obligations of the
Servicer shall have been terminated under Section 9.1, the
appointment of the Servicer as custodian may be terminated by the
Trustee or by the Holders of Certificates evidencing not less than 25%
of the sum of the Class A Certificate Balance and the Class B
Certificate Balance voting as a single class, in the same manner as
the Trustee or such Holders may terminate the rights and obligations
of the Servicer under Section 9.1. As soon as
practicable after any termination of such appointment, the Servicer
shall, at its expense, deliver the Receivable Files to the Trustee or
the Trustee's agent at such place or places as the Trustee may
reasonably designate. Notwithstanding the termination of the Servicer
as custodian, the Trustee agrees that
28
upon any such termination, the Trustee shall provide, or cause its
agent to provide, access to the Receivables Files to the Servicer for
the purpose of carrying out its duties and responsibilities with
respect to the servicing of the Receivables hereunder.
29
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1. Duties of Servicer. The Servicer shall
manage, service, administer and make collections on the Receivables
(other than Repurchased Receivables) with reasonable care, using that
degree of skill and attention that the Servicer exercises with respect
to comparable new or used automobile receivables that it services for
itself or others. The Servicer's duties shall include collection and
posting of all payments, responding to inquiries by Obligors or by
federal, state, or local governmental authorities with respect to the
Receivables, investigating delinquencies, reporting tax information to
Obligors in accordance with its customary practices, advancing costs
of disposition of defaults, monitoring the Collateral in cases of
Obligor defaults, accounting for collections, furnishing monthly and
annual statements to the Trustee with respect to distributions, and,
if it elects to do so, making Advances pursuant to Section 5.3. The
Servicer shall follow its customary standards, policies, and
procedures in performing its duties as Servicer hereunder; provided
that the Servicer shall be permitted to take or to refrain from taking
any action not specified in this Agreement with respect to servicing
the Receivables if such action or inaction would not contravene any
material term of this Agreement or materially adversely affect the
interests of Certificateholders. Without limiting the generality of
the foregoing, the Servicer shall be authorized and empowered by the
Trustee to execute and deliver, on behalf of itself, the Trust, the
Trustee, the Certificateholders, or any of them, any and all
instruments of satisfaction or cancellation, or of partial or full
release or discharge, and all other comparable instruments, without
recourse to the Trustee, with respect to the Receivables or with
respect to the Financed Vehicles. If the Servicer shall commence a
legal proceeding to enforce a Receivable or a Defaulted Receivable,
the Trustee shall thereupon be deemed to have automatically assigned
such Receivable and the related property conveyed to the Trust
pursuant to Section 2.1 with respect to such Receivable to the
Servicer, solely for the purpose of collection. The Trustee shall
furnish the Servicer with such documents as have been prepared by the
Servicer for execution by the Trustee and as are necessary or
appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
SECTION 4.2. Collection of Receivable Payments;
Refinancing. (a) The Servicer shall make reasonable efforts to collect
all payments called for under the terms and provisions of the
Receivables and of this Agreement as and when the same shall become
due, and shall follow such collection procedures as it follows with
respect to comparable new or used automobile receivables that it
services for itself or others and that are consistent with prudent
industry standards. No extensions of, or other modifications to, the
Receivables shall be made by the
30
Servicer if such modifications would have a material adverse effect on
the interests of Certificateholders. The Servicer shall not change the
amount of (except with respect to a prepayment of a scheduled payment
that does not result in a deferral of any other scheduled payment) or
reschedule the due date of any scheduled payment to a date more than
30 days from the original due date of such scheduled payment, change
the Contract Rate of, or extend any Receivable (except as provided in
Section 4.4) or change any material term of a Receivable, except with
respect to certain unilateral changes as provided by the terms of the
Receivable or of this Agreement or as required by law or court order;
provided, however, that the Servicer may grant extensions of the due
date for a payment on a Receivable that is in default or with respect
to which, absent such extension, default is reasonably foreseeable,
and the Servicer would grant such extension with respect to comparable
new or used automobile receivables that it services for itself, but
such extension would be granted only if (i) the Available Reserve
Account Amount is greater than zero at the time of such extension,
(ii) the extension is for no more than three months, (iii) the total
period of all credit related extensions granted on the Receivable will
not exceed the number of months equal to the number of whole years
comprising the original term of the Receivable and (iv) the maturity
of such Receivable would not be extended beyond the Collection Period
immediately preceding the Final Scheduled Distribution Date and the
rescheduling or extension would not modify the terms of such
Receivable in such a manner as to constitute a cancellation of such
Receivable and the creation of a new receivable for federal income tax
purposes. If, as a result of inadvertently rescheduling or extending
of payments, such rescheduling or extension breaches any of the terms
of the proviso to the preceding sentence, then the Servicer shall be
obligated to purchase such Receivable pursuant to Section 4.7. For the
purpose of such purchases pursuant to Section 4.7, notice shall be
deemed to have been received by the Servicer at such time as shall
make purchase mandatory as of the last day of the Collection Period
during which the discovery of such breach shall have occurred. The
Servicer may, in its discretion, in accordance with its customary
standards, policies and procedures, waive any Late Fees that may be
collected in the ordinary course of servicing a Receivable.
(b) Notwithstanding anything in this Agreement to
the contrary, the Servicer may refinance any Receivable by accepting a
new promissory note from the related Obligor and applying the proceeds
of such refinancing to pay all obligations in full of such Obligor
under such Receivable; provided, however, that the Servicer shall not
refinance a Receivable unless at least one material term of the
Receivable is substantively changed. The receivable created by the
refinancing shall not be property of the Trust.
SECTION 4.3. Realization Upon Receivables. On
behalf of the Trust, the Servicer shall use reasonable efforts,
31
consistent with its customary servicing procedures, to repossess or
otherwise take possession of the Financed Vehicle securing any
Receivable which the Servicer shall have determined to be a Defaulted
Receivable or otherwise. The Servicer shall follow such customary and
usual practices and procedures as it shall deem necessary or advisable
in its servicing of new or used automobile receivables, which may
include reasonable efforts to realize upon any recourse to Dealers,
consigning the Financed Vehicle to a Dealer for resale and selling the
Financed Vehicle at public or private sale. The Servicer shall be
entitled to recover from proceeds all reasonable expenses incurred by
it in the course of converting the Financed Vehicle into cash
proceeds. The Liquidation Proceeds realized in connection with any
such action with respect to a Receivable shall be deposited by the
Servicer in the Collection Account in the manner specified in Section
5.2 and shall be applied to reduce (or to satisfy, as the case may be)
the Repurchase Amount of the Receivable, if such Receivable is to be
repurchased by the Seller pursuant to Section 3.2, or is to be
purchased by the Servicer pursuant to Section 4.7. The foregoing shall
be subject to the provision that, in any case in which the Financed
Vehicle shall have suffered damage, the Servicer shall not expend
funds in connection with the repair or the repossession of such
Financed Vehicle unless it shall determine in its sole discretion that
such repair and/or repossession will increase the Liquidation Proceeds
of the related Receivable by an amount equal to or greater than the
amount of such expenses.
SECTION 4.4. Non-Credit Related Extensions to
Obligors. Prior to the Closing Date, the Servicer shall notify each
Obligor in writing that if such Obligor satisfies certain conditions,
as fully set forth in clauses (i) through (vii) below, as of a date
selected by the Servicer within five (5) months prior to the proposed
extension, such Obligor shall be entitled to a non-credit related
extension of any regularly scheduled payment due under a Receivable
that satisfies clauses (w) through (z) below;
(i) either (A) if the original term to maturity of the
Receivable is less than or equal to 48 months, at least eight
(8), or (B) if the original term to maturity of the
Receivable exceeds 48 months but is not greater than 60
months, at least ten, regular monthly payments shall have
been made on the related Receivable, and the remaining
outstanding Principal Balance of the related Receivable shall
be greater than $500;
(ii) the payment status is current;
(iii) such Obligor shall not within the previous six
months have been delinquent for thirty days or more in making
a payment under the related Receivable;
32
(iv) no information has been furnished to the Servicer
which indicates that, based upon its current underwriting
guidelines and credit standards relating to advancing funds
under comparable retail installment sales contracts and
purchase money loans for new or used automobiles, the Obligor
is not a Person to whom the Servicer would advance funds;
(v) at least four (4) monthly payments are
scheduled to be made by the Obligor prior to final maturity
of the related Receivables;
(vi) the Receivable related to such optional extension
shall not have previously been the subject of more than two
credit-related extensions or the subject of any collection or
bankruptcy-related rewrites; and
(vii) after giving effect to such extension and the
Obligor's projected payments given the Obligor's payment
history, the final payment with respect to such Receivable
would not exceed two (2) times the original scheduled final
payment amount of such Receivable.
In addition, any such extensions selected by an
Obligor shall satisfy the following criteria:
(w) a Receivable shall be extended for
only the calendar month of December;
(x) during the term of a Receivable, it
shall be extended only for the number of months equal to the
number of whole years comprising the initial term of such
Receivable;
(y) no Receivable shall be extended such
that its maturity will be later than the Collection Period
immediately preceding the Final Scheduled Distribution Date;
and
(z) the Obligor (or the related
Receivable) shall have satisfied conditions (i) through (vii)
above.
If, as an inadvertent result of any extension
granted pursuant to this Section 4.4, such extension breaches any of
the terms of the preceding criteria (w) through (z), then the Servicer
shall be obligated to purchase such Receivable pursuant to Section
4.7. For the purpose of such purchases pursuant to Section 4.7, notice
shall be deemed to have been received by the Servicer at such time as
shall make purchase mandatory as of the last day of the Collection
Period during which the discovery of such breach shall have occurred.
33
SECTION 4.5. Maintenance of Security Interests in
Financed Vehicles. The Servicer, in accordance with its customary
servicing procedures, shall take such steps as are necessary to
maintain (i) perfection of the first priority security interest
created in any Financed Vehicle which secures a Receivable and (ii)
perfection of the Trust's first priority security interest in the
Receivables including, without limitation, the filing of financing
statements and continuation statements. On behalf of the Trust, the
Servicer hereby agrees to take such steps as are necessary to
re-perfect such security interest in the event of the relocation of a
Financed Vehicle or for any other reason, in either case, when the
Servicer has knowledge of the need for such re-perfection. In the
event that the assignment of a Receivable to the Trust is insufficient
without a notation on the related Financed Vehicle's certificate of
title, or without fulfilling any additional administrative
requirements under the laws of the state in which the Financed Vehicle
is located, to grant to the Trust a perfected security interest in the
related Financed Vehicle, the Servicer hereby agrees that the Seller's
listing as the secured party on the certificate of title is deemed in
its capacity as agent of the Trust and further agrees to hold such
certificate of title as the Trustee's agent and custodian; provided,
however, that the Servicer shall not, nor shall the Trustee or
Certificateholders have the right to require that the Servicer, make
any such notation on the related Financed Vehicles' certificate of
title or fulfill any such additional administrative requirement of the
laws of the state in which a Financed Vehicle is located.
SECTION 4.6. Covenants of Servicer. The Servicer
hereby makes the following covenants on which the Trustee will rely in
accepting the Receivables in trust and authenticating the
Certificates:
(i) Security Interest to Remain in Force.
The Financed Vehicle securing each Receivable shall not be
released from the security interest granted by the Receivable
in whole or in part except if such Financed Vehicle is
substituted in whole by the manufacturer, dealer or seller as
a result of mechanical defects or a total loss of the
Financed Vehicle because of accident or theft or as otherwise
contemplated herein;
(ii) No Impairment. The Servicer
shall not impair the rights of the Trust in the Receivables; and
(iii) Extensions, Defaulted Receivables.
The Servicer shall not increase the number of payments under
a Receivable, nor increase the Amount Financed under a
Receivable, nor extend or forgive payments on a Receivable,
except as provided in Sections 4.2 and 4.4. In the event that
at the end of the scheduled term of any Receivable, the
outstanding principal amount thereof is such that the final
payment to be made by the related Obligor is larger than the
34
regularly scheduled payment of principal and interest made by
such Obligor, the Servicer may permit such Obligor to pay
such remaining principal amount in more than one payment of
principal and interest; provided, however, that the last such
payment shall be due on or prior to the Collection Period
immediately preceding the Final Scheduled Distribution Date.
SECTION 4.7. Purchase of Receivables Upon Breach.
The Servicer or the Trustee, as the case may be,
shall inform the other party promptly, in writing, upon the discovery
by the Servicer or an Authorized Officer of the Trustee, as the case
may be, of any breach by the Servicer of its covenants under Section
4.6 which materially and adversely affects the interest of the Trust
in any Receivable (for this purpose, any breach of the covenant set
forth in Section 4.6(iii) shall be deemed to materially and adversely
affect the interest of the Trust in a Receivable). Except as otherwise
specified in Sections 4.2 or 4.4, unless the breach shall have been
cured by the last day of the Collection Period following the
Collection Period in which such discovery occurred (or, at the
Servicer's election, the last day of the Collection Period in which
such discovery occurred), the Servicer shall purchase any Receivable
materially and adversely affected by such breach, as of such last day.
In consideration of the purchase of such Receivable, the Servicer
shall remit the Repurchase Amount (less any Liquidation Proceeds
deposited, or to be deposited, by the Servicer in the Collection
Account with respect to such Receivable pursuant to Section 4.3) in
the manner specified in Section 5.4. The sole remedy of the Trust, the
Trustee, or the Certificateholders against the Servicer with respect
to a breach pursuant to Section 4.2 or 4.6 shall be to require the
Servicer to purchase Receivables pursuant to this Section 4.7. The
Trustee shall have no duty to conduct any affirmative investigation as
to the occurrence of any condition requiring the repurchase of any
Receivable pursuant to this Section 4.7 or the eligibility of any
Receivable for purposes of this Agreement.
SECTION 4.8. Servicing Fee. The Servicing Fee for a
Collection Period shall be payable on the related Distribution Date
pursuant to Section 5.5 and shall equal the sum of (i) the product of
one-twelfth of the Servicing Fee Rate and the Pool Balance as of the
related Settlement Date and (ii) Late Fees received from Obligors
during such Collection Period, and, in addition, as part of the
Servicing Fee the Servicer shall be entitled to receive on each
Distribution Date investment earnings on amounts on deposit in the
Accounts or earned on collections pending deposit in the Collection
Account; provided, however, that, beginning with the Collection Period
for which the Trustee is notified in writing that the Servicer has
failed to deposit an Advance with respect to a Receivable (other than
because such Receivable has been designated a Defaulted Receivable)
and continuing until the Final Scheduled Distribution Date, such
35
investment earnings shall not be paid to the Servicer, but shall be
deposited by the Trustee or the Paying Agent on its behalf into the
Reserve Account on each Distribution Date. The Servicer shall be
required to pay from its own account all expenses incurred by it in
connection with its activities hereunder (including fees and
disbursements of the Trustee, the Collateral Agent, Trustee's and
Collateral Agent's counsel, the Paying Agent, the Transfer Agent and
Certificate Registrar and independent accountants and auditors, taxes
imposed on the Servicer, and other costs incurred in connection with
administering and servicing the Receivables) except federal, state and
local income and franchise taxes, if any, of the Trust or any
Certificateholder or any expenses in connection with realizing upon
Receivables under Section 4.3.
SECTION 4.9. Servicer's Certificate. On or before
each Determination Date, the Servicer shall deliver to the Trustee,
the Collateral Agent, the Paying Agent and the Rating Agencies a
Servicer's Certificate substantially in the form of Exhibit D hereto,
for the Collection Period preceding such Determination Date,
containing all information necessary to make the distributions
pursuant to Section 5.5, and all information necessary for the Paying
Agent to send statements to Certificateholders pursuant to Section
5.8. The Servicer shall deliver to the Rating Agencies any
information, to the extent it is available to the Servicer, that the
Rating Agencies reasonably request in order to monitor the Trust. The
Servicer shall also specify each Receivable which the Seller or the
Servicer is required to repurchase or purchase, as the case may be, as
of the last day of the preceding Collection Period or as of the
related Settlement Date, as applicable, each Receivable which the
Servicer shall have determined to be a Defaulted Receivable during the
preceding Collection Period, and each Receivable for which the
Servicer has failed to deposit an Advance pursuant to Section 5.3
other than because such Receivable has been designated a Defaulted
Receivable. Subsequent to the Closing Date, the form of Servicer's
Certificate may be revised or modified to cure any ambiguities or
inconsistencies with this Agreement; provided, however, that no
material information shall be deleted from the form of Servicer's
Certificate. In the event that the form of Servicer's Certificate is
revised or modified in accordance with the preceding sentence, a form
thereof, as so revised or modified, shall be provided to the Trustee
and each Rating Agency.
SECTION 4.10. Annual Statement as to Compliance. (a)
The Servicer shall deliver to a firm of independent certified public
accountants, on or before March 31 of each year commencing March 31,
1997, a certificate signed by the chairman of the board, president,
the treasurer, the controller, any executive or senior vice president
or any vice president of the Servicer, stating that (a) a review of
the activities of the Servicer during the year ended the preceding
December 31 (or shorter period in the case of the first such
certificate) and of its
36
performance under this Agreement has been made under such officer's
supervision and (b) to the best of such officer's knowledge, based on
such review, the Servicer has fulfilled all its obligations in all
material respects under this Agreement throughout such year (or
shorter period in the case of the first such certificate), or, if
there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officer and the nature and
status thereof.
(b) The Servicer shall deliver to the Trustee 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 with the giving of notice or
lapse of time, or both, would become an Event of Servicing Termination
under Section 9.1. The Seller shall deliver to the Trustee, promptly
after having obtained knowledge thereof, but in no event later than
five Business Days thereafter, an Officer's Certificate specifying any
event which with the giving of notice or lapse of time, or both, would
become an Event of Servicing Termination under Section 9.1.
SECTION 4.11. Annual Audit Report. The Servicer
shall cause a firm of independent public accountants (which may
provide other services to the Servicer or the Seller) to prepare a
report (with a copy of the certificate described in Section 4.10(a)
attached) addressed to the Board of Directors of the Servicer, for the
information and use of the Trustee and the Rating Agencies on or
before March 31 of each year, beginning March 31, 1997, to the effect
that, with respect to the twelve months (or shorter period in the case
of the first such report) ended the preceding December 31, such firm
has either (A) examined a written assertion by the Servicer about the
effectiveness of the Servicer's internal control structure over the
processing and reporting of transactions relating to securitized
automobile loans with respect to the criteria set forth by the
Servicer (the "Assertion") and that, on the basis of such examination,
such firm is of the opinion that the Servicer's Assertion is fairly
stated in all material respects except for (i) such exceptions as such
firm believes to be immaterial and (ii) such other exceptions as shall
be set forth in such firm's report, or (B) such firm has performed the
following Procedures:
1. For a sample of daily cash receipts during the preceding
calendar year, perform the following:
a. Trace total cash receipts to deposits on bank
statements.
b. Agree cash receipts for securitized loans to computer
reports.
c. Trace cash receipts for securitized loans to
disbursements to the Trustee.
2. For a sample of monthly cash receipt reports, perform the
following:
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a. Agree total cash receipts per the cash receipt
reports to "Total Payments From Obligors Applied to
Collection Period" per monthly Servicer
Certificates.
b. Agree total principal payments per the cash receipt
report to "Principal Payments" per monthly Servicer
Certificates.
3. For a sample of loans delinquent 30 days or more and for a
sample of loans in repossession status, selected from the
loan delinquency report or a new repossession report, as
applicable, at a point in time, trace loan number to
inclusion in the loan collection system.
The determination of which of the two alternative reports to be
prepared and delivered, and the size of each sample to be tested,
shall be decided in the sole discretion of the Servicer. The report of
the independent certified public accountants shall also indicate that
such accounting firm is independent of the Servicer within the meaning
of the Code of Professional Ethics of the American Institute of
Certified Public Accountants.
SECTION 4.12. Access by Certificateholders to
Certain Documentation and Information Regarding Receivables. The
Servicer shall provide to the Certificateholders access to the
Receivable Files in such cases where the Certificateholder shall be
required by applicable statutes or regulations to have access to such
documentation. Access by the Certificateholders shall be afforded
without charge, but only upon reasonable request and during normal
business hours which does not unreasonably interfere with the
Servicer's normal operations or customer or employee relations.
Nothing in this Section 4.12 shall affect the obligation of the
Servicer to observe any applicable law prohibiting disclosure of
information regarding the Obligors, and the failure of the Servicer to
provide access to information as a result of such obligation shall not
constitute a breach of this Section 4.12.
SECTION 4.13. Reports to Certificateholders and the
Rating Agencies. (a) The Trustee shall provide to any
Certificateholder who so requests in writing (addressed to the
Corporate Trust Office) a copy of any Servicer's Certificate described
in Section 4.9, of the annual statement described in Section 4.10, or
the annual report described in Section 4.11. The Trustee may require
the Certificateholder to pay a reasonable sum to cover the cost of the
Trustee's complying with such request.
(b) The Trustee shall forward to the Rating
Agencies the statement to Certificateholders described in Section 5.8
and any other reports it may receive pursuant to this Agreement (i) to
Standard & Poor's Ratings Services, Asset-Backed Surveillance Group,
25 Broadway, New York, New York 10004, (ii) to Moody's Investors
Service, Inc., ABS Monitoring Dept., 99 Church Street, 4th Floor, New
York, New York 10007 and (iii) to
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Fitch Investors Services, L.P., One State Street Plaza, 32nd Floor,
New York, New York 10004.
SECTION 4.14. Reports to the Securities and Exchange
Commission. The Servicer shall, on behalf of the Trust, cause to be
filed with the Commission any periodic reports required to be filed
under the provisions of the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Securities and Exchange
Commission thereunder.
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ARTICLE V
DISTRIBUTIONS; STATEMENTS TO
CERTIFICATEHOLDERS
SECTION 5.1. Establishment of the Accounts. (a) The
Servicer shall establish:
(i) the Collection Account in the name of the
Trustee bearing a designation clearly indicating
that the funds deposited therein are held for
the benefit of the Certificateholders;
(ii) the Class A Distribution Account in the
name of the Trustee bearing a
designation clearly indicating that the
funds deposited therein are held for the
benefit of the Class A
Certificateholders; and
(iii) the Class B Distribution Account in the
name of the Trustee bearing a
designation clearly indicating that the
funds deposited therein are held for the
benefit of the Class B
Certificateholders.
Each Account shall be an Eligible Deposit Account
established initially at The Chase Manhattan Bank. Each Account may be
maintained with The Chase Manhattan Bank (or an Affiliate thereof) so
long as The Chase Manhattan Bank (or such Affiliate) is a Qualified
Trust Institution or Qualified Institution, as applicable.
(b) The Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Accounts
(excluding the Seller's interest in the Retained Yield) and in all
proceeds thereof (excluding investment earnings) and all such funds
shall be part of the property of the Trust. The Accounts shall be
under the sole dominion and control of the Trustee. Should any
depositary of an Account (including The Chase Manhattan Bank (or an
Affiliate thereof)) cease to be either a Qualified Institution or a
Qualified Trust Institution, as applicable, then the Servicer shall,
with the Seller's assistance as necessary, cause such Account to be
moved to a Qualified Institution or a Qualified Trust Institution,
unless the Rating Agency Condition is satisfied in connection with
such depositary's ceasing to be a Qualified Institution or a Qualified
Trust Institution, as the case may be.
All amounts held in the Collection Account shall be
invested by the bank or trust company then maintaining the account (at
the written direction of the Servicer (or, if investment earnings on
amounts on deposit in the Collection Account are not being paid to the
Servicer, the Seller) in Permitted Investments that mature not later
than the Deposit Date
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next succeeding the date of investment except, if the Collection
Account is maintained with the Trustee, for investments on which the
Trustee is the obligor (including repurchase agreements on which the
Trustee in its commercial capacity is liable as principal), which
investments may mature on such Distribution Date; provided, however,
that once such amounts have been invested by such bank or trust
company, as applicable, in Permitted Investments, such Permitted
Investments must be held or maintained until they mature on or before
the dates described above. Amounts on deposit in the Reserve Account
will be distributed in the manner set forth in Section 5.5.
SECTION 5.2. Collections. The Servicer shall remit
daily within forty-eight hours of receipt to the Collection Account
all payments by or on behalf of the Obligors on the Receivables and
all Liquidation Proceeds (including any Retained Yield), both as
collected during the Collection Period. Chase USA has requested that,
so long as it is acting as the Servicer, the Servicer be permitted to
make remittances of collections on a less frequent basis than that
specified in the immediately preceding sentence. It is understood that
such less frequent remittances may be made only on the specific terms
and conditions set forth below in this Section 5.2 and only for so
long as such terms and conditions are fulfilled. Accordingly,
notwithstanding the provisions of the first sentence of this Section
5.2, the Servicer shall remit such collections to the Collection
Account in Automated Clearinghouse Corporation next-day funds or
immediately available funds no later than 11:00 a.m., New York City
time, on the Deposit Date but only for so long as (i) any of (a) the
short-term certificate of deposit or debt ratings of the Servicer are
at least "P-1" by Moody's, "F-1" by Fitch (if rated by Fitch) and
"A-1" by Standard & Poor's, or (b) (1) the Servicer is an Affiliate of
(directly or indirectly) The Chase Manhattan Bank, and (2) if the
Servicer's short-term certificates of deposit or debt are assigned a
rating by a Rating Agency, such rating is not below "P-1" by Moody's,
"F-1" by Fitch or "A-l" by Standard & Poor's, and (3) the short-term
certificate of deposit or debt ratings of The Chase Manhattan Bank are
at least "P-1" by Moody's, "F-1" by Fitch (if rated by Fitch) and
"A-l" by Standard & Poor's or (c) the Rating Agency Condition is
satisfied as a result of Collections being remitted on a monthly,
rather than daily, basis and (ii) the Servicer shall be Chase USA or
The Chase Manhattan Bank. Upon remittance by the Servicer of
Collections to the Collection Account pursuant to the preceding
sentence, the Paying Agent shall provide written notice to the Trustee
no later than 11 a.m., New York City time, on each Deposit Date
setting forth the amounts remitted by the Servicer on such date and,
if the Paying Agent fails to provide the Trustee with such written
notice by 12 noon, New York City time, on such Deposit Date, then the
Trustee shall assume that no deposits were made to the Collection
Account pursuant to this Section 5.2 and shall withdraw any amount
required from the Reserve Account for deposit into the Collection
Account pursuant to Section 5.6. For purposes of this Section 5.2 the
phrase
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"payments made on behalf of the Obligors" shall mean payments made by
Persons other than the Seller or the Servicer. Investment earnings on
amounts on deposit in the Collection Account will be paid to the
Servicer or deposited into the Reserve Account in accordance with
Section 4.8.
SECTION 5.3. Advances. (a) As of the Business Day
preceding the related Distribution Date, the Servicer may, in its sole
discretion, make a payment with respect to each Receivable (other than
a Defaulted Receivable) equal to the excess, if any, of (x) the
product of the Principal Balance of such Receivable as of the related
Settlement Date and one-twelfth of the Contract Rate for such
Receivable, over (y) the interest actually received by the Servicer
with respect to such Receivable from the Obligor or from payments of
the Repurchase Amount during or with respect to such Collection
Period. The Servicer shall deposit all such Advances into the
Collection Account in Automated Clearinghouse Corporation next-day
funds or immediately available funds no later than 11 a.m., New York
City time, on the Deposit Date. The Servicer may elect not to make any
Advance with respect to a Receivable to the extent that the Servicer,
in its sole discretion, shall determine that such Advance is not
recoverable from subsequent payments on such Receivable or from funds
in the Reserve Account. To the extent that the amount set forth in
clause (y) above with respect to a Receivable during or with respect
to a Collection Period plus any amounts withdrawn from the Reserve
Account during or with respect to such Collection Period and allocable
to interest with respect to such Receivable is greater than the amount
set forth in clause (x) above with respect thereto, such amount shall
be distributed to the Servicer on the related Distribution Date
pursuant to Section 5.5(a); provided, however, that, notwithstanding
anything else herein, until a Receivable becomes a Defaulted
Receivable, the Servicer shall be reimbursed for any Advance made with
respect to a Receivable only from accrued interest paid from the
Obligor under such Receivable.
(b) On each Deposit Date, the Trustee shall demand a
withdrawal from the Reserve Account in an amount, not to exceed the
Available Reserve Account Amount for such Distribution Date, equal to
the amount of all outstanding Advances with respect to all Receivables
that become Defaulted Receivables during the immediately preceding
Collection Period (to the extent not recovered from Liquidation
Proceeds) and shall deposit such amount into the Collection Account in
Automated Clearinghouse Corporation next-day funds or immediately
available funds no later than 11 a.m., New York City time, on such
Deposit Date. Such amounts shall be distributed to the Servicer on the
related Distribution Date pursuant to Section 5.5(a).
(c) On each Deposit Date, the Paying Agent shall
provide written notice to the Trustee setting forth the amount, if
any, of Advances deposited by the Servicer in the Collection Account
no later than 11 a.m., New York City time, on such
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Deposit Date and, if the Paying Agent fails to provide the Trustee
with such written notice by 12 noon, New York City time, on such
Deposit Date, then the Trustee shall assume that no Advances were
deposited to the Collection Account pursuant to this Section 5.3.
SECTION 5.4. Additional Deposits. The Servicer, or
the Seller, as the case may be, shall deposit into the Collection
Account the aggregate Repurchase Amount pursuant to Sections 3.2, 4.7
and 11.2, as applicable. All remittances shall be made to the
Collection Account, in Automated Clearinghouse Corporation next-day
funds or immediately available funds, no later than 11 a.m., New York
City time, on the Deposit Date.
SECTION 5.5. Distributions. Not later than 12 noon,
New York City time, on each Distribution Date, the Trustee, or the
Paying Agent on behalf of the Trustee, shall cause to be made the
following distributions, to the extent funds are available in the
Collection Account (including amounts withdrawn from the Reserve
Account and deposited therein), in the following order of priority and
in the amounts set forth in the Servicer's Certificate for such
Distribution Date:
(a) to the Servicer, by wire transfer of
immediately available funds, in reimbursement of Advances from amounts
on deposit in the Collection Account allocable to interest under the
Receivables or from withdrawals from the Reserve Account (including an
amount equal to the accrued interest on Defaulted Receivables and
Repurchased Receivables to the extent available in the Collection
Account), the amount payable to the Servicer pursuant to Section 5.3;
(b) to the extent of the sum of Available
Interest (after reimbursement of Advances pursuant to Section 5.5(a))
and any Available Reserve Account Amount remaining after any
withdrawal from the Reserve Account in respect of Advances pursuant to
Section 5.3(b) on the related Deposit Date (and, in the case of
shortfalls occurring under clause (ii) below in the Class A Interest
Distributable Amount, the Class B Percentage of Available Principal to
the extent of such shortfalls), in the following priority:
(i) to the Servicer, any unpaid Servicing Fee for
the related Collection Period and all unpaid Servicing
Fees from prior Collection Periods;
(ii) to the Class A Distribution Account, the
Class A Interest Distributable Amount for such
Distribution Date; and
(iii) to the Class B Distribution Account, the
Class B Interest Distributable Amount for such
Distribution Date.
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(c) to the extent of the portion of
Available Principal, Available Interest (after reimbursement of
Advances pursuant to Section 5.5(a)) and any Available Reserve Account
Amount (after any withdrawal pursuant to Section 5.3(b) on the related
Deposit Date) remaining after the application of clause (b) above, in
the following priority:
(i) to the Class A Distribution Account, the
Class A Principal Distributable Amount for such
Distribution Date;
(ii) to the Class B Distribution Account, the
Class B Principal Distributable Amount for such
Distribution Date; and
(iii) to the Collateral Agent for deposit in the
Reserve Account, any remaining amounts.
(d) On each Distribution Date, the Trustee
or the Paying Agent, as the case may be, will distribute all amounts
on deposit in the Class A Distribution Account to the Class A
Certificateholders as of the Record Date and all amounts on deposit in
the Class B Distribution Account to the Class B Certificateholders as
of the Record Date. Amounts distributed from the Distribution Accounts
shall be paid to the related Certificateholders of record, as of the
related Record Date, by check mailed by the Paying Agent (or, if
directed by the Seller in the case of the certificates registered in
the name of the Clearing Agency, by wire transfer of immediately
available funds). To the extent that the Paying Agent wires funds to a
Clearing Agency from the Collection Account, the Paying Agent will
request the Seller, the Qualified Institution or the Qualified Trust
Institution then maintaining the Collection Account to make such wire
distribution and the Seller, the Qualified Institution or the
Qualified Trust Institution then maintaining the Collection Account
shall promptly deliver to the Paying Agent a confirmation of such wire
distribution. The Paying Agent shall have no liability in connection
with any failure by the Seller, the Qualified Institution or the
Qualified Trust Institution to make such distribution.
SECTION 5.6. Reserve Account; Assignment of
Retained Yield to Collateral Agent. (a) The Seller shall establish
the Reserve Account at Norwest Bank Minnesota, National Association,
in the name of Norwest Bank Minnesota, National Association, as
Collateral Agent on behalf of the Certificateholders. The Reserve
Account shall be an Eligible Deposit Account. The Reserve Account
shall not be property of the Trust.
(b) On the Closing Date, the Seller shall
deposit the Reserve Account Initial Deposit into the Reserve Account.
The Seller hereby grants to the Collateral Agent for the benefit of
the Certificateholders all of its right, title and interest in and to
the Retained Yield and the Reserve Account and any and all
44
property credited thereto from time to time, including, but not
limited to, Permitted Investments, to secure the payment of all
amounts due and owing to the Certificateholders hereunder. By
acceptance of their Certificates, Certificateholders shall be deemed
to have appointed Norwest Bank Minnesota, National Association, as
Collateral Agent with respect to the Reserve Account and the Retained
Yield. Norwest Bank Minnesota, National Association hereby accepts
such appointment as Collateral Agent with respect to the Reserve
Account and the Retained Yield.
(c) The Reserve Account shall be under the sole
dominion and control of the Collateral Agent, and the Collateral Agent
shall have signature authority with respect thereto. Should any sole
depositary of the Reserve Account cease to be either a Qualified
Institution or a Qualified Trust Institution, the Seller shall cause
the Reserve Account to be moved to a Qualified Institution or a
Qualified Trust Institution, as applicable, unless the Seller provides
the Trustee with a letter from the Rating Agencies to the effect that
the Rating Agency Conditions will be satisfied in connection with such
depositary's ceasing to be a Qualified Institution or a Qualified
Trust Institution, as the case may be.
All amounts held in the Reserve Account shall be
invested by the bank or trust company then maintaining the account (at
the written direction of the Seller in Permitted Investments that
mature not later than the Deposit Date next succeeding the date of
investment except, if the Reserve Account is maintained with the
Trustee, for investments on which the Trustee is the obligor
(including repurchase agreements on which the Trustee in its
commercial capacity is liable as principal), which investments may
mature on such Distribution Date; provided, however, that amounts on
deposit in the Reserve Account may be invested in Permitted
Investments that mature later than the next succeeding Deposit Date if
the Rating Agency Condition is satisfied.
(d) With respect to the Account Property in
respect of the Reserve Account:
(i) any Account Property that constitutes
Physical Property shall be delivered to the
Collateral Agent in accordance with paragraph (a) of
the definition of "Delivery" and shall be held by
the Collateral Agent, pending maturity or
disposition;
(ii) any Account Property that is a
book-entry security held through the Federal Reserve
System pursuant to Federal book-entry regulations
shall be delivered in accordance with paragraph (b)
of the definition of "Delivery" and shall be
maintained by the Collateral Agent, pending maturity
or disposition; and
45
(iii) any Account Property that is an
"uncertificated security" under Article VIII of the
Relevant UCC and that is not governed by clause (ii)
above shall be delivered to the Collateral Agent in
accordance with paragraph (c) of the definition of
"Delivery" and shall be maintained by the Collateral
Agent, pending maturity or disposition.
The Collateral Agent shall, at the expense of the Servicer, take such
action as is required in writing by the Trustee to maintain the
security interest of the Collateral Agent in any Account Property as a
perfected security interest under the Relevant UCC; provided, however,
that the Collateral Agent shall not be required to prepare or file any
financing statements or continuation statements and that the
Collateral Agent and Trustee may rely upon the written instructions of
the Servicer as to the method by which the security interest of the
Collateral Agent may be perfected. Upon written request from the
Trustee or Collateral Agent, the Servicer shall provide such
instructions and an opinion of counsel with respect to the method of
perfecting such security interest; provided, however, that the
Servicer shall not be obligated to deliver to the Collateral Agent or
the Trustee an opinion of counsel with respect to the method of
perfecting a security interest in any Permitted Investment the method
of perfecting a security interest in which was described in that
certain legal opinion of Dorsey & Whitney LLP, special local counsel
to the Collateral Agent, dated September 18, 1996, unless there has
been change in law or the interpretation thereof from the date of such
opinion with respect to the method of perfecting a security interest
in such Permitted Investment.
(e) On each Distribution Date, the Collateral Agent
shall withdraw from the Reserve Account and pay to the Seller any
investment income with respect to amounts on deposit in the Reserve
Account and, subject to Sections 8.4 and 10.7, an amount equal to the
excess, if any, of the amount on deposit in the Reserve Account (after
giving effect to all deposits therein or withdrawals therefrom on such
Distribution Date) over the Specified Reserve Account Balance with
respect to such Distribution Date. Upon any distribution to the Seller
of amounts from the Reserve Account, neither the Holders nor the
Collateral Agent will have any rights in, or claims, to, such amounts.
Amounts properly distributed to the Seller from the Reserve Account
shall not be available under any circumstances to the Trustee, the
Collateral Agent, and the Seller shall in no event thereafter be
required to refund any such distributed amounts.
(f) On each Deposit Date, the Trustee shall demand a
withdrawal from the Reserve Account, in an amount not to exceed the
Available Reserve Account Amount (after withdrawals from the Reserve
Account on the related Deposit Date pursuant to Section 5.3(b)), equal
to the sum of the excess, if any, of the sum of
46
the Class A Interest Distributable Amount, Class A Principal
Distributable Amount, Class B Interest Distributable Amount and Class
B Principal Distributable Amount, in each case for the Distribution
Date, and the Servicing Fee payable to the Servicer on such
Distribution Date, over the sum of the Available Interest (after
reimbursement of Advances pursuant to Section 5.5(a)) and Available
Principal, in each case for such Distribution Date. The Trustee shall
(x) first, pay the amount set forth in clause (ii) above to the
Servicer in reimbursement of such Advances and (y) then, deposit the
amount set forth in clause (i) above, in the Collection Account for
application pursuant to Section 5.5.
SECTION 5.7. Net Deposits. Chase USA (in its
capacity as Seller and/or Servicer) may make the remittances pursuant
to Section 5.2 and Section 5.4 above, net of amounts to be retained by
it or distributed to it (also in any such capacity) pursuant to
Section 4.8 (if applicable) and Section 5.5, if (a) it shall be the
Servicer and (b) it is entitled, pursuant to Section 5.2, to make
deposits on a monthly basis, rather than a daily basis. Nonetheless,
the Servicer shall account for all of the above described amounts as
if such amounts were deposited and distributed separately.
SECTION 5.8. Statements to Certificateholders. On
each Distribution Date, the Servicer shall prepare and furnish to the
Trustee and the Paying Agent, and the Paying Agent shall include with
the distribution to each Certificateholder a statement substantially
in the form of Exhibit E, based on information in the certificate
furnished pursuant to Section 4.9, setting forth for the Collection
Period the following information (which in the case of items (i), (ii)
and (iii) shall be expressed in the aggregate and as a dollar amount
per $1,000 of the original principal balance of a Certificate):
(i) the amount of the distribution
allocable to principal on the Class A Certificates and the
Class B Certificates;
(ii) the amount of the distribution
allocable to interest on the Class A Certificates and the
Class B Certificates (specifying specifically the amount of
any Class B Stripped Coupon included therein);
(iii) the amount of the Servicing Fee
paid to the Servicer pursuant to Section 5.5(c);
(iv) the Class A Certificate Balance, the
Class A Pool Factor, the Class B Certificate Balance and the
Class B Pool Factor as of such Distribution Date, in each
case after giving effect to payments allocated to principal
reported pursuant to clause (i);
(v) the Pool Balance as of the last day
of the related Collection Period;
47
(vi) the amount of the Aggregate Net
Losses, if any, for such Collection Period.
(vii) the Class A Interest Carryover
Shortfall, the Class B Interest Carryover Shortfall, the
Class A Principal Carryover Shortfall and the Class B
Principal Carryover Shortfall, if any, for such Distribution
Date;
(viii) the balance of the Reserve Account
on such Distribution Date, after giving effect to changes
therein on such Distribution Date and the amounts deposited
into and withdrawn from the Reserve Account on such
Distribution Date;
(ix) the Specified Reserve Account
Balance as of such Distribution Date;
(x) the aggregate Repurchase Amount of
Receivables repurchased by the Seller or purchased by the
Servicer during such Collection Period; and
(xi) the aggregate unreimbursed Advances
as of such Distribution Date and the change in such amount
from the previous Distribution Date and the amount of
Advances reimbursed on such Distribution Date from
collections and Liquidation Proceeds and from withdrawals
from the Reserve Account.
Within a reasonable period of time after the end of
each calendar year, but not later than the latest date permitted by
law, the Servicer shall prepare and furnish to the Trustee and the
Paying Agent, and the Paying Agent shall furnish, to each Person who
at any time during such calendar year shall have been a
Certificateholder for the purposes of such Certificateholder's
preparation of federal income tax returns, a statement setting forth
the sum of the amounts determined in clauses (i) through (iii) for
such calendar year.
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ARTICLE VI
THE CERTIFICATES
SECTION 6.1. The Certificates. Unless otherwise
specified in this Agreement, the Certificates of each class shall be
issued in denominations of $1,000 and integral multiples thereof;
provided, however, that one Class A Certificate and one Class B
Certificate may be issued in a denomination that represents a residual
portion of the Original Class A Certificate Balance and the Original
Class B Certificate Balance, respectively. Upon initial issuance on
the Closing Date, the Class A Certificates and the Class B
Certificates shall be in the form of Exhibit A-1 and Exhibit A-2,
respectively, which are incorporated by reference, and shall be issued
as provided in Section 6.8 in an aggregate amount equal to the
Original Class A Certificate Balance and the Original Class B
Certificate Balance, respectively. The Certificates shall be executed
on behalf of the Trust by manual or facsimile signature of an
Authorized Officer or other authorized signatory of the Trustee.
Certificates bearing the manual or facsimile signatures of individuals
who were, at the time when such signatures shall have been affixed,
authorized to sign on behalf of the Trust, shall be valid and binding
obligations of the Trust, notwithstanding that such individuals shall
have ceased to be so authorized prior to the execution, authentication
and delivery of such Certificates or did not hold such offices or
positions at the date of such Certificates. No Certificate shall
entitle the Holder to any benefit under this Agreement, or shall be
valid for any purpose, unless there shall appear on such Certificate
an authentication substantially in the form set forth in Exhibit A-1
or A-2 hereto as applicable, executed by the Trustee by manual or
facsimile signature; such authentication shall constitute conclusive
evidence that such Certificate has been duly authenticated and
delivered hereunder. All Certificates shall be dated the date of their
authentication. A transferee of a Certificate shall become a
Certificateholder, and shall be entitled to the rights and subject to
the obligations of a Certificateholder hereunder, upon due presentment
of such Certificate in such transferee's name pursuant to Section 6.5.
SECTION 6.2. Execution, Authentication and Delivery
of Certificates. The Trustee shall deliver to, or upon the order of,
the Seller, in exchange for the Receivables, the other assets of the
Trust and the pledge of the Reserve Account and amounts on deposit
therein and the Retained Yield, simultaneously with the sale,
assignment and transfer to the Trustee of the Receivables, the
constructive delivery to the Trustee of the Receivable Files and the
delivery to the Trustee of the other components of the Trust,
Certificates duly executed by the Trustee, on behalf of the Trust, and
authenticated by the Trustee in authorized denominations equaling in
the aggregate the Original Pool Balance, and evidencing the entire
ownership of the Trust.
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SECTION 6.3. Registration of Transfer and Exchange of
Certificates.
(a) The Trustee shall cause to be
kept at the office or agency to be maintained by a transfer agent and
certificate registrar (the "Transfer Agent and Certificate
Registrar"), in accordance with the provisions of Section 6.7, a
register (the "Certificate Register") in which, subject to such
reasonable regulations as it may prescribe, the Transfer Agent and
Certificate Registrar shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein
provided. The Chase Manhattan Bank is hereby initially appointed
Transfer Agent and Certificate Registrar for the purpose of
registering Certificates and transfers and exchanges of Certificates
as herein provided. In the event that, subsequent to the date of
issuance of the Certificates, The Chase Manhattan Bank notifies the
Trustee that it is unable to act as Transfer Agent and Certificate
Registrar, the Trustee shall act, or the Trustee shall, with the
consent of the Seller, appoint another bank or trust company, having
an office or agency located in The City of New York and which agrees
to act in accordance with the provisions of this Agreement applicable
to it, to act, as successor Transfer Agent and Certificate Registrar
under this Agreement.
The Trustee may revoke such appointment and remove
The Chase Manhattan Bank as Transfer Agent and Certificate Registrar
if the Trustee determines in its sole discretion that The Chase
Manhattan Bank failed to perform its obligations under this Agreement
in any material respect. The Chase Manhattan Bank shall be permitted
to resign as Transfer Agent and Certificate Registrar upon 30 days'
written notice to the Trustee, the Seller and the Servicer; provided,
however, that such resignation shall not be effective and The Chase
Manhattan Bank shall continue to perform its duties as Transfer Agent
and Certificate Registrar until the Trustee has appointed a successor
Transfer Agent and Certificate Registrar with the consent of the
Seller.
Upon surrender for registration of transfer of any
Certificate at the office or agency of the Transfer Agent and
Certificate Registrar maintained pursuant to Section 6.7, the Trustee
shall execute, authenticate and (if the Transfer Agent and Certificate
Registrar is different than the Trustee, then the Transfer Agent and
Certificate Registrar shall) deliver (or shall cause The Chase
Manhattan Bank as its authenticating agent to authenticate and
deliver), in the name of the designated transferee or transferees, one
or more new Class A Certificates or Class B Certificates, as the case
may be, in authorized denominations of a like aggregate amount dated
the date of authentication by the Trustee or any authenticating agent.
At the option of a Certificateholder, Certificates may be exchanged
for other Certificates of authorized denominations of a like aggregate
amount upon surrender of the Certificates to be
50
exchanged at the office or agency maintained pursuant to Section
6.7.
Whenever any Certificate is surrendered for
exchange, the Trustee shall execute, authenticate and (if the Transfer
Agent and Certificate Registrar is different than the Trustee, then
the Transfer Agent and Certificate Registrar shall) deliver the
Certificates which the Certificateholder making the exchange is
entitled to receive. Every Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Trustee and the
Transfer Agent and Certificate Registrar duly executed by the Holder,
which signature on such assignment must be guaranteed by a member of
the New York Stock Exchange or a commercial bank or trust company.
Each Certificate surrendered for registration of
transfer or exchange shall be cancelled by the Transfer Agent and
Certificate Registrar and disposed of by the Trustee or Transfer Agent
and Certificate Registrar in accordance with its customary practice.
No service charge shall be made for any registration
of transfer or exchange of Certificates, but the Transfer Agent and
Certificate Registrar may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with
any transfer or exchange of Certificates.
An institution succeeding to the corporate agency
business of the Transfer Agent and Certificate Registrar shall
continue to be the Transfer Agent and Certificate Registrar without
the execution or filing of any paper or any further act on the part of
the Trustee or such Transfer Agent and Certificate Registrar.
The Class B Certificates may not be acquired by or
for the account of (i) an employee benefit plan (as defined in Section
3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA")) which is subject to the provisions of Title I of
ERISA, (ii) a plan (as defined in Section 4975(e)(1) of the Code other
than a governmental or church plan described in Section 4975(g)(2) or
(3) of the Code), or (iii) any entity whose underlying assets include
"plan assets" by reason of any such plan's investment in the entity
(excluding any investment company that is registered under the
Investment Company Act of 1940, as amended) (each, a "Benefit Plan").
By accepting and holding a Class B Certificate, the Holder thereof
shall be deemed to have represented and warranted that it is not a
Benefit Plan, and that no assets of a Benefit Plan were used to
acquire such Class B Certificate. The foregoing restrictions shall not
apply to acquisitions of Class B Certificates with assets of the
general account of an insurance company, to the extent permitted under
Section 401(c) of ERISA.
51
SECTION 6.4. Mutilated, Destroyed, Lost, or Stolen
Certificates. If (a) any mutilated Class A Certificate or Class B
Certificate shall be surrendered to the Transfer Agent and Certificate
Registrar, or if the Transfer Agent and Certificate Registrar shall
receive evidence to its satisfaction of the destruction, loss, or
theft of any Class A Certificate or Class B Certificate and (b) there
shall be delivered to the Trustee and the Transfer Agent and
Certificate Registrar such security or indemnity as may be required to
save each of them harmless then, in the absence of notice to the
Trustee that such Class A Certificate or Class B Certificate shall
have been acquired by a bona fide purchaser, the Trustee on behalf of
the Trust shall execute, authenticate and (if the Transfer Agent and
Certificate Registrar is different from the Trustee, the Transfer
Agent and Certificate Registrar shall) deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Class A
Certificate or Class B Certificate, a new Class A Certificate or Class
B Certificate, as the case may be, of like tenor and denomination but
bearing a number not contemporaneously outstanding. In connection with
the issuance of any new Certificate under this Section 6.4, the
Trustee or the Transfer Agent and Certificate Registrar, as the case
may be, may require the payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection
therewith. Any duplicate Certificate issued pursuant to this Section
6.4 shall constitute conclusive evidence of ownership in the Trust, as
if originally issued, whether or not a lost, stolen, or destroyed
Certificate shall be found at any time.
SECTION 6.5. Persons Deemed Owners. Prior to due
presentation of a Certificate for registration of transfer, the
Trustee, the Paying Agent, the Transfer Agent and Certificate
Registrar or any agent of any of them may treat the Person in whose
name any Certificate shall be registered as the owner of such
Certificate for the purpose of receiving distributions pursuant to
Section 5.5(d) and for all other purposes whatsoever, and none of the
Trustee, the Paying Agent, the Transfer Agent and Certificate
Registrar or any agent of any of them shall be bound by any notice to
the contrary.
SECTION 6.6. Access to List of Certificateholders'
Names and Addresses. The Transfer Agent and Certificate Registrar
shall furnish or cause to be furnished to the Servicer or the Paying
Agent (or to the Trustee if the Trustee is not the Transfer Agent and
Certificate Registrar), within 15 days after receipt by the Transfer
Agent and Certificate Registrar of a request therefor from the
Servicer, the Trustee or the Paying Agent in writing, in such form as
the Servicer, the Trustee or the Paying Agent may reasonably require,
a list of the names and addresses of the Certificateholders as of the
most recent Record Date. If, at such time, if any, as Definitive
Certificates have been issued, three or more Certificateholders, or
one or more Holders of Certificates aggregating not less than 25% of
the sum of the Class A Certificate Balance and the Class B Certificate
52
Balance as a single class apply in writing to the Transfer Agent and
Certificate Registrar (or the Trustee if the Trustee is acting as the
Transfer Agent and Certificate Registrar), and such application states
that the applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement
or under the Certificates, and such application is accompanied by a
copy of the communication that such applicants propose to transmit,
then the Transfer Agent and Certificate Registrar shall, within five
(5) Business Days after the receipt of such application, afford such
applicants access during normal business hours to the current list of
Certificateholders. Each Certificateholder, by receiving and holding a
Certificate, shall be deemed to have agreed to hold neither the
Servicer, the Trustee, the Transfer Agent and Certificate Registrar
nor any of their respective agents accountable by reason of the
disclosure of its name and address, regardless of the source from
which such information was derived.
SECTION 6.7. Maintenance of Office or Agency. The
Transfer Agent and Certificate Registrar shall maintain in The City of
New York an office or offices or agency or agencies where Certificates
may be surrendered for registration of transfer or exchange. The
Transfer Agent and Certificate Registrar initially designates its
corporate trust office located at 450 West 33rd Street, New York, New
York 10001-2697 as its office for such purposes. The Transfer Agent
and Certificate Registrar shall give prompt written notice to the
Trustee, the Servicer and to Certificateholders of any change in the
location of such office or agency.
SECTION 6.8. Book-Entry Certificates. Upon original
issuance, the Class A Certificates and the Class B Certificates, other
than the Class A Certificate representing the residual amount of the
Original Class A Certificate Balance, shall be issued in the form of
typewritten Certificates representing the Book-Entry Certificates, to
be delivered to The Depository Trust Company, the initial Clearing
Agency, by or on behalf of the Seller. The Certificates shall
initially be registered on the Certificate Register in the name of
Cede & Co., the nominee of the initial Clearing Agency, and no
Certificate Owner will receive a definitive certificate representing
such Certificate Owner's interest in the Class A Certificates or the
Class B Certificates, as the case may be, except as provided in
Section 6.10. Unless and until definitive, fully registered
Certificates ("Definitive Certificates") have been issued to Class A
Certificateholders or Class B Certificateholders pursuant to Section
6.10:
(i) the provisions of this Section 6.8
shall be in full force and effect;
(ii) the Seller, the Servicer, the Paying
Agent, the Transfer Agent and Certificate Registrar and the
Trustee may deal with the Clearing Agency, and the Clearing
53
Agency Participants for all purposes of this Agreement
(including the making of distributions on the Certificates
and the taking of actions by the Certificateholders) as the
authorized representatives of the Certificate Owners;
(iii) to the extent that the
provisions of this Section 6.8 conflict with any other
provisions of this Agreement, the provisions of this Section
6.8 shall control;
(iv) the rights of Certificate Owners
shall be exercised only through the Clearing Agency (or to
the extent Certificate Owners are not Clearing Agency
Participants through the Clearing Agency Participants through
which such Certificate Owners own Book-Entry Certificates),
and shall be limited to those established by law and
agreements between such Certificate Owners and the Clearing
Agency and/or the Clearing Agency Participants and all
references in this Agreement to actions by Certificateholders
shall refer to actions taken by the Clearing Agency upon
instructions from the Clearing Agency Participants, and all
references in this Agreement to distributions, notices,
reports and statements to Certificateholders shall refer to
distributions, notices, reports and statements to the
Clearing Agency, as registered holder of the Certificates, as
the case may be, for distribution to Certificate Owners in
accordance with the procedures of the Clearing Agency; and
(v) pursuant to the Depository Agree-
ment, and unless Definitive Certificates are issued pursuant
to Section 6.10, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants
and receive and transmit distributions of principal and
interest on the Certificates to the Clearing Agency
Participants, for distribution by such Clearing Agency
Participants to the Certificate Owners or their nominees.
SECTION 6.9. Notices to Clearing Agency. Whenever
notice or other communication to the Certificateholders is required
under this Agreement, unless and until Definitive Certificates shall
have been issued to Certificate Owners pursuant to Section 6.10, the
Trustee and the Paying Agent shall give all such notices and
communications specified herein to be given by it to
Certificateholders to the Clearing Agency.
SECTION 6.10. Definitive Certificates. If (i) the
Servicer advises the Trustee in writing that the Clearing Agency is no
longer willing or able to properly discharge its responsibilities
under the Depository Agreement, and the Servicer is unable to locate a
qualified successor, (ii) the Servicer, at its option, elects to
terminate the book-entry system through the Clearing Agency or (iii)
after the occurrence of an Event of Servicing Termination, Class A
Certificate Owners representing in the aggregate not less than a
majority of the Class A Certificate
54
Balance or Class B Certificate Owners representing in the aggregate
not less than a majority of the Class B Certificate Balance, as the
case may be, advise the Trustee and the Clearing Agency through the
Clearing Agency Participants in writing, and if the Clearing Agency
shall so notify the Trustee, that the continuation of a book-entry
system through the Clearing Agency is no longer in the related
Certificate Owners' best interests, the Trustee shall notify the
Clearing Agency of the occurrence of any event described above, which
shall be responsible to notify the Certificate Owners with respect to
Class A Certificates or both, as the case may be, of the occurrence of
any such event and of the availability of Definitive Certificates to
Certificate Owners with respect to Class A Certificates or Class B
Certificates or both, as the case may be, requesting the same. Upon
surrender to the Transfer Agent and Certificate Registrar by the
Clearing Agency of the Class A Certificates or the Class B
Certificates or both, as the case may be, registered in the name of
such Clearing Agency, or its nominee, accompanied by re-registration
instructions from the Clearing Agency for registration of the
Definitive Certificates, the Trustee shall execute, authenticate and
(if the Transfer Agent and Certificate Registrar is different than the
Trustee, then the Transfer Agent and Certificate Registrar shall)
deliver Definitive Certificates in accordance with the instructions of
the Clearing Agency. The Servicer shall arrange for, and will bear all
costs of, the printing and issuance of such Definitive Certificates.
None of the Seller, the Servicer, the Transfer Agent and Certificate
Registrar or the Trustee shall be liable for any delay in delivery of
such instructions and may conclusively rely on, and shall be protected
in relying upon such instruction. Upon the issuance of Definitive
Certificates, all references herein to obligations imposed upon or to
be performed by the Clearing Agency shall be deemed to be imposed upon
and performed by the Transfer Agent and Certificate Registrar, to the
extent applicable with respect to such Definitive Certificates and the
Trustee, the Paying Agent and the Transfer Agent and Certificate
Registrar shall recognize the Holders of the Definitive Certificates
as Certificateholders hereunder.
SECTION 6.11. Appointment of Paying Agent.
(a) The Paying Agent shall have the
revocable power to withdraw funds from the Accounts and make
distributions to the Certificateholders, the Servicer and the
Collateral Agent pursuant to Section 5.5. The Trustee may revoke such
power and remove the Paying Agent, if the Trustee determines in its
sole discretion that the Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect or for other
good cause. The Paying Agent shall initially be The Chase Manhattan
Bank. The Chase Manhattan Bank shall be permitted to resign as Paying
Agent upon 30 days' written notice to the Servicer and the Trustee. In
the event that The Chase Manhattan Bank shall no longer be the Paying
Agent, the Trustee shall appoint a successor to act as Paying Agent
(which shall be a bank
55
or trust company and may be the Trustee) with the consent of the
Seller, which consent shall not be unreasonably withheld. If at any
time the Trustee shall be acting as the Paying Agent, the provisions
of Sections 10.1, 10.3 and 10.4 shall apply to the Trustee in its role
as Paying Agent.
(b) The Trustee shall cause the
Paying Agent (other than itself and The Chase Manhattan Bank) to
execute and deliver to the Trustee an instrument in which such Paying
Agent shall agree with the Trustee that such Paying Agent will hold
all sums, if any, held by it for payment to the Certificateholders in
trust for the benefit of the Certificateholders entitled thereto until
such sums shall be paid to such Certificateholders and shall agree,
and if the Trustee is the Paying Agent it hereby agrees, that it shall
comply with all requirements of the Code regarding the withholding by
the Trustee of payments in respect of federal income taxes due from
Certificate Owners.
(c) The Chase Manhattan Bank in its
capacity as initial Paying Agent hereunder agrees that it (i) will
hold all sums held by it hereunder for payment to the
Certificateholders in trust for the benefit of the Certificateholders
entitled thereto until such sums shall be paid to such
Certificateholders and (ii) shall comply with all requirements of the
Code regarding the withholding by the Trustee of payments in respect
of federal income taxes due from Certificate Owners.
(d) An institution succeeding to the
corporate agency business of the Paying Agent shall continue to be the
Paying Agent without the execution or filing of any paper or any
further act on the part of the Trustee or such Paying Agent.
SECTION 6.12. Authenticating Agent.
(a) The Trustee may appoint one or
more authenticating agents with respect to the Certificates which
shall be authorized to act on behalf of the Trustee in authenticating
the Certificates in connection with the issuance, delivery,
registration of transfer, exchange or repayment of the Certificates.
The Trustee hereby appoints The Chase Manhattan Bank as Authenticating
Agent for the authentication of Certificates upon any registration of
transfer or exchange of such Certificates. Whenever reference is made
in this Agreement to the authentication of Certificates by the Trustee
or the Trustee's certificate of authentication, such reference shall
be deemed to include authentication on behalf of the Trustee by an
authenticating agent and a certificate of authentication executed on
behalf of the Trustee by an authenticating agent. Each authenticating
agent (other than The Chase Manhattan Bank) shall be acceptable to the
Seller.
(b) Any institution succeeding to the
corporate agency business of an authenticating agent shall continue to
be an authenticating agent without the execution or filing of any
56
paper or any further act on the part of the Trustee or such
authenticating agent.
(c) An authenticating agent may at
any time resign by giving written notice of resignation to the Trustee
and the Seller. The Trustee may at any time terminate the agency of an
authenticating agent by giving notice of termination to such
authenticating agent and to the Seller. Upon receiving such a notice
of resignation or upon such a termination, or in case at any time an
authenticating agent shall cease to be acceptable to the Trustee or
the Seller, the Trustee promptly may appoint a successor
authenticating agent with the consent of the Seller. Any successor
authenticating agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
authenticating agent. No successor authenticating agent shall be
appointed unless acceptable to the Seller.
(d) The Servicer shall pay the
Authenticating Agent from time to time reasonable compensation for its
services under this Section 6.12.
(e) The provisions of Sections 10.1,
10.3 and 10.4 shall be applicable to any authenticating agent.
(f) Pursuant to an appointment made
under this Section 6.12, the Certificates may have endorsed thereon,
in lieu of the Trustee's certificate of authentication, an alternate
certificate of authentication in substantially the following form:
This is one of the certificates referred to in the
within mentioned Agreement.
-----------------------,
as Trustee
By:
----------------------
Authorized Officer
or
-------------------------
as Authenticating Agent
for the Trustee,
-------------------------
Authorized Officer
57
SECTION 6.13. Actions of Certificateholders.
(a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this
Agreement to be given or taken by Certificateholders may be embodied
in and evidenced by one or more instruments of substantially similar
tenor signed by such Certificateholders in person or by an agent duly
appointed in writing; and except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, when required, to the
Seller or the Servicer. Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and conclusive in favor of the Trustee, the
Seller and the Servicer, if made in the manner provided in this
Section 6.13.
(b) The fact and date of the execution
by any Certificateholder of any such instrument or writing may be
proved in any reasonable manner which the Trustee deems sufficient.
(c) Any request, demand, authorization,
direction, notice, consent, waiver or other act by a Certificateholder
shall bind every Holder of every 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
Trustee, the Seller or the Servicer in reliance thereon, whether or
not notation of such action is made upon such Certificate.
(d) The Trustee may require such
additional proof of any matter referred to in this Section 6.13 as it
shall deem necessary.
58
ARTICLE VII
THE SELLER
SECTION 7.1. Representations of Seller. The Seller
makes the following representations on which the Trustee shall rely in
accepting the Receivables in trust and authenticating the
Certificates. The representations shall speak as of the execution and
delivery of this Agreement, and shall survive the sale of the
Receivables to the Trustee.
(i) Organization and Good
Standing. The Seller has been duly organized and is validly
existing as a national banking association in good standing
under the laws of the United States of America, 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
and own the Receivables.
(ii) Power and Authority. The
Seller has the power and authority to execute and deliver
this Agreement and to carry out its terms, the Seller has
full power and authority to sell and assign the property to
be sold and assigned to the Trustee as part of the Trust and
has duly authorized such sale and assignment to this Trustee
by all necessary corporate action; and the execution,
delivery, and performance of this Agreement has been duly
authorized by the Seller by all necessary corporate action.
(iii) Valid Sale; Binding
Obligations. This Agreement effects a valid sale, transfer,
and assignment of the Receivables, enforceable against
creditors of and purchasers from the Seller; and constitutes
a legal, valid, and binding obligation of the Seller
enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization, or other similar laws affecting the
enforcement of creditors' rights in general and by general
principles of equity, regardless of whether such
enforceability is considered in a proceeding in equity or at
law.
(iv) No Violation. The
consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof do not
conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or
lapse of time) a default under, the articles of association
or bylaws of the Seller, or conflict with or breach any of
the material terms or provisions of, or constitute (with or
without notice or lapse of time) a default under, any
indenture, agreement, or other instrument to which the Seller
is a party or by which it is bound; nor result in the
creation or imposition of any Lien
59
upon any of its properties pursuant to the terms of any such
indenture, agreement, or other instrument; nor violate any
law or, to the best of the Seller's knowledge, any order,
rule, or regulation applicable to the Seller of any court or
of any federal or state regulatory body, administrative
agency, or other governmental instrumentality having
jurisdiction over the Seller or its properties.
(v) No Proceedings. There are no
proceedings or investigations pending, or, to the Seller's
best knowledge, threatened, before any court, regulatory
body, administrative agency, or other governmental
instrumentality having jurisdiction over the Seller or its
properties: (a) asserting the invalidity of this Agreement or
the Certificates, (b) seeking to prevent the issuance of the
Certificates or the consummation of any of the transactions
contemplated by this Agreement, (c) seeking any determination
or ruling that might materially and adversely affect the
performance by the Seller of its obligations under, or the
validity or enforceability of, this Agreement or the
Certificates, or (d) relating to the Seller and which might
adversely affect the federal income tax attributes of the
Certificates.
SECTION 7.2. Liability of Seller; Indemnities. The
Seller shall be liable in accordance herewith only to the extent of
the obligations specifically undertaken by the Seller in such capacity
under this Agreement and shall have no other obligations or
liabilities hereunder.
The Seller shall indemnify, defend and hold harmless
the Trustee and the Trust from and against any taxes that may at any
time be asserted against the Trust with respect to, and as of the date
of, the sale of the Receivables to the Trust or the issuance and
original sale of the Certificates, including any sales, gross
receipts, general corporation, tangible or intangible personal
property, privilege, or license taxes (but not including any taxes
asserted with respect to ownership of the Receivables or federal or
other income taxes, including franchise taxes measured by net income),
arising out of the transactions contemplated by this Agreement, and
costs and expenses in defending against the same.
The Seller shall indemnify, defend, and hold
harmless the Trustee or the Trust from and against any loss, liability
or expense incurred by reason of (i) the Seller's wilful misfeasance,
bad faith, or negligence in the performance of its duties hereunder,
or by reason of reckless disregard of the obligations and duties
hereunder and (ii) the Seller's violation of federal or state
securities laws in connection with the registration of the sale of the
Certificates.
Indemnification under this Section 7.2 shall include
reasonable fees and expenses of counsel and expenses of
60
litigation. If the Seller shall have made any indemnity payments to
the Trust pursuant to this Section 7.2 and the Trust thereafter shall
collect any of such amounts from others, the Trust shall repay such
amounts to the Seller, without interest.
SECTION 7.3. Merger or Consolidation of Seller. Any
corporation or other entity (i) into which the Seller may be merged or
consolidated, (ii) which may result from any merger, conversion, or
consolidation to which the Seller shall be a party, or (iii) which may
succeed to all or substantially all of the business of the Seller,
which corporation or other entity shall be bound to perform every
obligation of the Seller under this Agreement, shall be the successor
to the Seller hereunder without the execution or filing of any
document or any further act by any of the parties to this Agreement.
The Seller shall give prompt written notice of any merger or
consolidation to the Trustee, the Servicer and the Rating Agencies.
SECTION 7.4. Limitation on Liability of Seller and
Others. The Seller and any director, officer, employee or agent of the
Seller may rely in good faith on the advice of counsel or on any
document of any kind, prima facie properly executed and submitted by
any Person respecting any matters arising hereunder. The Seller shall
not be under any obligation under this Agreement to appear in,
prosecute, or defend any legal action that shall be unrelated to its
obligations under this Agreement, and that in its opinion may involve
it in any expense or liability.
SECTION 7.5. Seller May Own Certificates. The Seller
and any of its Affiliates may in its individual or any other capacity
become the owner or pledgee of Certificates with the same rights as it
would have if it were not the Seller or an Affiliate thereof, except
as otherwise provided in the definition of "Class A Certificateholder"
and "Class B Certificateholder" specified in Section 1.1. Certificates
so owned by or pledged to the Seller or any Affiliates shall have an
equal and proportionate benefit under the provisions of this
Agreement, without preference, priority, or distinction as among all
of the Certificates.
61
ARTICLE VIII
THE SERVICER
SECTION 8.1. Representations of Servicer. The
Servicer makes the following representations on which the Trustee
shall rely in accepting the Receivables in trust and authenticating
the Certificates. The representations shall speak as of the execution
and delivery of this Agreement, and shall survive the sale of the
Receivables to the Trustee.
(i) Organization and Good
Standing. The Servicer has been duly organized and is
validly existing as a national banking association or
corporation and is in good standing under the laws of the
United States of America or the jurisdiction of its
incorporation, 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, sell, and service the Receivables and
to hold the Receivable Files as custodian on behalf of the
Trustee.
(ii) Power and Authority. The
Servicer has the power and authority to execute and deliver
this Agreement and to carry out its terms; and the execution,
delivery, and performance of this Agreement has been duly
authorized by the Servicer by all necessary corporate action.
(iii) Binding Obligations. This
Agreement constitutes a legal, valid, and binding obligation
of the Servicer enforceable in accordance with its terms
subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization, liquidation or other similar laws
and equitable principles relating to or affecting the
enforcement of creditors' rights, whether considered in a
proceeding at law or in equity.
(iv) No Violation. The
consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof do not
conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or
lapse of time) a default under, the articles of association
or bylaws of the Servicer, or conflict with or breach any of
the material terms or provisions of, or constitute (with or
without notice or lapse of time) a default under, any
indenture, agreement, or other instrument to which the
Servicer is a party or by which it is bound; nor result in
the creation or imposition of any lien upon any of its
properties pursuant to the terms of any such indenture,
agreement, or other instrument; nor violate any law or, to
the best of the Servicer's knowledge, any order, rule, or
regulation applicable to the Servicer of
62
any court or of any federal or state regulatory body,
administrative agency, or other governmental instrumentality
having jurisdiction over the Servicer or its properties.
(v) No Proceedings. There are no
proceedings or investigations pending, or to the Servicer's
best knowledge, threatened, before any court, regulatory
body, administrative agency, or other governmental
instrumentality having jurisdiction over the Servicer or its
properties: (a) asserting the invalidity of this Agreement or
the Certificates, (b) seeking to prevent the issuance of the
Certificates or the consummation of any of the transactions
contemplated by this Agreement, (c) seeking any determination
or ruling that might materially and adversely affect the
performance by the Servicer of its obligations under, or the
validity or enforceability of, this Agreement or the
Certificates, or (d) relating to the Servicer and which might
adversely affect the federal income tax attributes of the
Certificates.
(vi) Fidelity Bond. The Servicer
maintains a fidelity bond in such form and amount as is
customary for banks acting as custodian of funds and
documents in respect of retail automotive installment sales
contracts.
SECTION 8.2. Liability of Servicer; Indemnities. The
Servicer shall be liable in accordance herewith only to the extent of
the obligations specifically undertaken by the Servicer under this
Agreement and shall have no other obligations or liabilities
hereunder.
(i) The Servicer shall defend, indemnify,
and hold harmless the Trustee, the Trust and the
Certificateholders from and against any and all costs,
expenses, losses, damages, claims, and liabilities, arising
out of or resulting from the use, ownership, or operation by
the Servicer or any Affiliate thereof of a Financed Vehicle.
(ii) The Servicer shall indemnify, defend,
and hold harmless the Trustee and the Trust from and against
any taxes that may at any time be asserted against the Trust
with respect to the transactions contemplated in this
Agreement, including, without limitation, any sales, gross
receipts, general corporation, tangible or intangible
personal property, privilege, or license taxes (but not
including any taxes asserted with respect to, and as of the
date of, the sale of the Receivables to the Trust or the
issuance and original sale of the Certificates, or asserted
with respect to ownership of the Receivables or federal or
other income taxes, including franchise taxes measured by net
income) arising out of distributions on the Certificates and
costs and expenses in defending against the same.
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(iii) The Servicer shall
indemnify, defend, and hold harmless the Trustee and the
Trust and the Certificateholders from and against any and all
costs, expenses, losses, claims, damages, and liabilities to
the extent that such cost, expense, loss, claim, damage, or
liability arose out of, or was imposed upon the Trustee and
the Trust or the Certificateholders through the wilful
misfeasance, gross negligence, or bad faith of the Servicer
in the performance of its duties under this Agreement or by
reason of reckless disregard of its obligations and duties
under this Agreement.
Indemnification under this Section 8.2 shall include
reasonable fees and expenses of counsel and expenses of litigation. If
the Servicer shall have made any indemnity payments pursuant to this
Section 8.2 and the recipient thereafter collects any of such amounts
from others, the recipient shall promptly repay such amounts to the
Servicer, without interest. The indemnification obligations of the
Servicer set forth in this Section 8.2 shall survive the termination
of such Servicer with respect to any act or failure to act which
occurs prior to such Servicer's termination.
SECTION 8.3. Merger or Consolidation of Servicer. Any
corporation or other entity (i) into which the Servicer may be merged
or consolidated, (ii) which may result from any merger, conversion, or
consolidation to which the Servicer shall be a party, or (iii) which
may succeed to all or substantially all of the business of the
Servicer, which corporation or other entity shall be bound to perform
every obligation of the Servicer hereunder, shall be the successor to
the Servicer under this Agreement without the execution or filing of
any document or any further act on the part of any of the parties to
this Agreement. The Servicer shall promptly inform the Trustee, the
Seller and the Rating Agencies in writing of any such merger or
consolidation.
SECTION 8.4. Limitation on Liability of Servicer and
Others.
(a) Neither the Servicer nor any of the
directors, officers, or employees or agents of the Servicer shall be
under any liability to the Trust, the Trustee, or the
Certificateholders, except as provided under this Agreement, for any
action taken or for refraining from the taking of any action pursuant
to this Agreement; provided, however, that this provision shall not
protect the Servicer or any such person against any liability that
would otherwise be imposed by reason of wilful misfeasance, gross
negligence, or bad faith in the performance of duties or by reason of
reckless disregard of obligations and duties under this Agreement. The
Servicer and any director, officer, or employee or agent of the
Servicer may rely in good faith on the advice of counsel or on any
document of
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any kind prima facie properly executed and submitted by any Person
respecting any matters arising under this Agreement.
(b) The Servicer, and any director,
officer, employee or agent of the Servicer, shall be
indemnified by the Trust and held harmless against any loss,
liability, or expense (including reasonable attorneys' fees
and expenses) incurred in connection with any legal action
relating to the performance of the Servicer's duties under
this Agreement, other than (i) any loss or liability
otherwise reimbursable pursuant to this Agreement; (ii) any
loss, liability, or expense incurred solely by reason of the
Servicer's wilful misfeasance, negligence, or bad faith in
the performance of its duties hereunder or by reason of
reckless disregard of its obligations and duties under this
Agreement or the Trust Agreement; and (iii) any loss,
liability, or expense for which the Trust is to be
indemnified by the Servicer under this Agreement. Any amounts
due the Servicer pursuant to this Section 8.4 shall be
payable on a Distribution Date from amounts distributable to
the Seller from the Reserve Account pursuant to Section
5.6(e) (other than investment income) after all payments
required to be made on such date to the Certificateholders
and the Servicer, and amounts, if any, distributable
therefrom to the Trustee pursuant to Section 10.7, have been
paid and any amounts required to be retained on deposit in
the Reserve Account pursuant to Section 5.6(e) to maintain
the amount on deposit therein (exclusive of investment income
and earnings on amounts on deposit therein) in an amount
equal to the Specified Reserve Account Balance on such date
shall have been made.
(c) Except as provided in this
Agreement, the Servicer shall not be under any obligation to
appear in, prosecute, or defend any legal action that shall
not be incidental to its obligations under this Agreement,
and that in its opinion may involve it in any expense or
liability; provided, however, that the Servicer may undertake
any reasonable action that it may deem necessary or desirable
in respect of this Agreement and the rights and duties of the
parties to this Agreement and the interests of the
Certificateholders under this Agreement. In such event, the
legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs, and liabilities
of the Trust, and the Servicer shall be entitled to be
reimbursed therefor. Any amounts due the Servicer pursuant to
this Section 8.4 shall be payable on a Distribution Date from
amounts distributable to the Seller from the Reserve Account
pursuant to Section 5.6(e) (other than investment income)
after all payments required to be made on such date to the
Certificateholders and the Servicer, and amounts, if any,
distributable therefrom to the Trustee pursuant to Section
10.7, have been paid and any amounts required to be retained
on deposit in the Reserve Account pursuant to Section 5.6(e)
to maintain the amount on deposit therein (exclusive of
investment income and earnings on amounts on deposit therein)
in an amount equal to the
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Specified Reserve Account Balance on such date shall have been made.
The Person to be indemnified shall provide the
Trustee with a certificate and accompanying Opinion of Counsel
requesting indemnification and setting forth the basis for such
request.
SECTION 8.5. Servicer Not To Resign. Except as
permitted by Section 8.3, the Servicer shall not resign from its
obligations and duties under this Agreement except (i) upon
determination that the performance of its duties shall no longer be
permissible under applicable law or (ii) in the event of the
appointment of a successor Servicer, upon satisfaction of the Rating
Agency Condition. Notice of any such determination set forth in clause
(i) above permitting the resignation of Chase USA shall be
communicated to the Trustee and the Rating Agencies at the earliest
practicable time (and, if such communication is not in writing, shall
be confirmed in writing at the earliest practicable time) and any such
determination permitting the resignation of the Servicer shall be
evidenced by an Opinion of Counsel to such effect delivered to the
Trustee concurrently with such notice. No such resignation shall
become effective until the Trustee (which shall not be obligated to
act as successor Servicer if the Servicer has resigned for a reason
other than that the performance of its duties are no longer
permissible under applicable law) or a successor Servicer shall have
assumed the responsibilities and obligations of the Servicer hereunder
in accordance with Section 9.2.
SECTION 8.6. Delegation of Duties. So long as Chase
USA (or any successor thereto in accordance with Section 8.3) or the
Trustee acts as Servicer, the Servicer shall have the right, in the
ordinary course of its business, to delegate any of its duties under
this Agreement to any Person. Any compensation payable to such Person
shall be paid by the Servicer from its own funds and none of the
Trust, the Trustee (if not the Servicer), the Collateral Agent or the
Certificateholders shall have any liability to such Person with
respect thereto. Notwithstanding any delegation of duties by the
Servicer pursuant to this Section 8.6, the Servicer shall not be
relieved of its liability and responsibility with respect to such
duties, and any such delegation shall not constitute a resignation
within the meaning of Section 8.5 hereof. Any agreement that may be
entered into by the Servicer and a Person that provides for any
delegation of the Servicer's duties hereunder shall be deemed to be
between the Servicer and such Person alone, and the Trustee and
Certificateholders shall not be deemed parties thereto and shall have
no claims, rights, obligations, duties or liabilities with respect
thereto.
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ARTICLE IX
DEFAULT
SECTION 9.1. Events of Servicing Termination. Any
one of the following events which shall occur and be continuing shall
constitute an event of servicing termination hereunder (each, an
"Event of Servicing Termination"):
(i) Any failure by the Servicer to deliver
to the Trustee the Servicer's Certificate for the related
Collection Period, or any failure by the Servicer to deliver
to the Trustee, for distribution to Certificateholders, any
proceeds or payment required to be so delivered under the
terms of the Certificates and this Agreement (or, in the case
of a payment or deposit to be made not later than the Deposit
Date, the failure to make such payment or deposit on such
Deposit Date), which failure continues unremedied for a
period of five Business Days after (A) discovery by an
officer of the Servicer or (B) written notice (1) to the
Servicer by the Trustee or (2) to the Trustee and the
Servicer by the Holders of Certificates evidencing not less
than 25% of the sum of the Class A Certificate Balance and
the Class B Certificate Balance voting together as a single
class;
(ii) Failure on the part of the Servicer,
duly to observe or to perform in any material respect any
other covenants or agreements of the Servicer set forth in
the Certificates or in this Agreement, which failure shall
(a) materially and adversely affect the rights of the Trust
or the Certificateholders (which determination shall be made
without regard to the Available Reserve Account Amount and
(b) continues 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 (1) to the
Servicer by the Trustee or (2) to the Trustee and the
Servicer by the Holders of Certificates evidencing not less
than 25% of the sum of the Class A Certificate and the Class
B Certificate Balance voting together as a single class;
(iii) The entry of a decree or order by a
court or agency or supervisory authority having jurisdiction
in the premises for the appointment of a conservator,
receiver, or liquidator for the Servicer in any insolvency,
readjustment of debt, marshalling of assets and liabilities,
or similar proceedings, or for the winding up or liquidation
of its affairs, and the continuance of any such decree or
order unstayed and in effect for a period of 60 consecutive
days; or
(iv) The consent by the Servicer to the
appointment of a conservator or receiver or liquidator in any
insolvency, readjustment of debt, marshalling of assets and
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liabilities, or similar proceedings of or relating to the
Servicer or of or relating to substantially all of its
property; or the Servicer shall admit in writing its
inability to pay its debts generally as they become due, file
a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of
its creditors, or voluntarily suspend payment of its
obligations.
Upon the occurrence of an Event of Servicing Termination described
above, and in each and every case and for so long as such Event of
Servicing Termination shall not have been remedied, either the
Trustee, or the Holders of Certificates evidencing not less than a
majority of the sum of the Class A Certificate Balance and the Class B
Certificate Balance voting together as a single class, by notice given
in writing to the Servicer (and to the Trustee if given by the
Certificateholders) may terminate all of the rights and obligations of
the Servicer under this Agreement. On or after the receipt by the
Servicer of such written notice, all authority and power of the
Servicer under this Agreement, whether with respect to the
Certificates or the Receivables or otherwise, shall pass to and be
vested in the Trustee pursuant to this Section 9.1; and, without
limitation, the Trustee shall be hereby authorized and empowered to
execute and deliver, on behalf of the predecessor Servicer, as
attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things
necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement of the
Receivable Files, or otherwise. The predecessor Servicer shall
cooperate with the successor Servicer and the Trustee in effecting the
termination of the responsibilities and rights of the predecessor
Servicer under this Agreement, including the transfer to the successor
Servicer for administration by it of all cash amounts that shall at
the time be held by the predecessor Servicer for deposit, shall have
been deposited by the Servicer in the Collection Account, or shall
thereafter be received with respect to a Receivable. All reasonable
costs and expenses (including attorneys' fees and disbursements)
incurred in connection with transferring the Receivable Files to the
successor Servicer and amending this Agreement to reflect such
succession as Servicer pursuant to this Section 9.1 shall be paid by
the predecessor Servicer upon presentation of reasonable documentation
of such costs and expenses. The Trustee shall give written notice of
any termination of the Servicer to the Certificateholders and the
Rating Agencies.
SECTION 9.2. Trustee to Act; Appointment of
Successor. Upon the Servicer's receipt of notice of termination
pursuant to Section 9.1 or resignation pursuant to Section 8.5, the
Trustee shall be the successor in all respects to the Servicer in its
capacity as Servicer under this Agreement, and shall be subject to all
the responsibilities, duties and liabilities arising thereafter
relating thereto placed on the Servicer by the terms
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and provisions of this Agreement. As compensation therefor, the
Trustee shall be entitled to such compensation (whether payable out of
the Collection Account or otherwise) as the Servicer would have been
entitled to under this Agreement if no such notice of termination or
resignation had been given. Notwithstanding the above, the Trustee
may, if it shall be unwilling so to act, or shall, if it shall be
legally unable so to act, appoint, or petition a court of competent
jurisdiction to appoint, any established financial institution (x)
having a net worth of not less than $100,000,000 as of the last day of
the most recent fiscal quarter for such institution and (y) whose
regular business shall include the servicing of automobile
receivables, as successor Servicer under this Agreement; provided,
that the appointment of any such successor Servicer is required to
satisfy the Rating Agency Condition. In connection with such
appointment, the Trustee may make such arrangements for the
compensation of such successor Servicer out of payments on Receivables
as it and such successor Servicer shall agree; provided, however, that
no such compensation shall be in excess of that permitted the Servicer
under this Agreement. The Trustee and such successor Servicer shall
take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession. Unless the Trustee shall
be prohibited by law from so acting, the Trustee shall not be relieved
of its duties as successor Servicer under this Section 9.2 until the
newly appointed successor Servicer shall have assumed the
responsibilities and obligations of the Servicer under this Agreement.
SECTION 9.3. Notification to Certificateholders. Upon
delivery of written notice by the Trustee to the Servicer or receipt
by the Trustee of written notice of an Event of Servicing Termination
from Holders of Class A Certificates and Class B Certificates
evidencing not less than 25% of the sum of the Class A Certificate
Balance and the Class B Certificate Balance voting together as a
single class or upon any Servicer termination, or appointment of a
successor Servicer pursuant to this Article IX,
the Trustee shall give prompt written notice thereof to
Certificateholders at their respective addresses of record, to the
Seller and to the Rating Agencies.
SECTION 9.4. Waiver of Past Defaults. The Holders of
Certificates evidencing not less than a majority of the sum of the
Class A Certificate Balance and the Class B Certificate Balance voting
together as a single class, may, on behalf of all Holders of
Certificates, waive any default by the Servicer in the performance of
its obligations hereunder and its consequences, except a default in
the failure to make any required deposits to or payments from the
Collection Account in accordance with this Agreement. Upon any such
waiver of a past default, such default shall cease to exist, and any
Event of Servicing Termination arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver
shall extend to any subsequent or other default or impair any right
consequent thereon except to the extent expressly so waived. The
Servicer
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shall give prompt written notice of any waiver to the Rating
Agencies.
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ARTICLE X
THE TRUSTEE
SECTION 10.1. Duties of Trustee. The Trustee, both
prior to and after the occurrence of an Event of Servicing
Termination, shall undertake to perform such duties and only such
duties as are specifically set forth in this Agreement. If an Event of
Servicing Termination known to the Trustee shall have occurred and
shall not have been cured, the Trustee shall exercise such of the
rights and powers vested in it by this Agreement, and shall use the
same degree of care and skill in their exercise, as a prudent man
would exercise or use under the circumstances in the conduct of his
own affairs; provided, however, that if the Trustee shall assume the
duties of the Servicer pursuant to Sections 8.5 and 9.2, the Trustee
in performing such duties shall use the degree of skill and attention
customarily exercised by a servicer with respect to automobile
receivables that it services for itself.
The Trustee, upon receipt of any resolutions,
certificates, statements, opinions, reports, documents, orders, or
other instruments furnished to the Trustee that shall be specifically
required to be furnished pursuant to any provision of this Agreement,
shall examine them to determine whether they conform to the
requirements of this Agreement; provided, however, that the Trustee
shall not be responsible for the accuracy or content of any such
resolution, certificate, statement, opinion, report, document, order
or other instrument furnished by the Servicer to the Trustee pursuant
to this Agreement.
No provision of this Agreement shall be construed to
relieve the Trustee from liability for its own negligent action, its
own negligent failure to act, or its own bad faith or wilful
misfeasance; provided, however, that:
(i) Prior to the occurrence of an
Event of Servicing Termination, and after the curing of all
such Events of Servicing Termination that may have occurred,
the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Agreement, the
Trustee shall not be liable except for the performance of
such duties and obligations as shall be specifically set
forth in this Agreement, no implied covenants or obligations
shall be read into this Agreement against the Trustee, the
permissible right of the Trustee to do things enumerated in
this Agreement shall not be construed as a duty and, in the
absence of bad faith on the part of the Trustee, or manifest
error, the Trustee may conclusively rely upon any
certificates or opinions furnished to the Trustee and
conforming to the requirements of this Agreement as to the
truth of the statements made and the correctness of the
opinions expressed therein;
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(ii) The Trustee shall not be personally
liable for an error of judgment made in good faith by an
Authorized Officer of the Trustee, unless it shall be proved
that the Trustee shall have been negligent in ascertaining
the pertinent facts; and
(iii) The Trustee shall not be
personally liable with respect to any action taken, suffered,
or omitted to be taken in good faith in accordance with this
Agreement or at the direction of the Holders of Certificates
evidencing not less than 25% of the sum of the Class A Certificate
Balance and the Class B Certificate Balance voting together
as a single class, relating to the time, method, and place of
conducting any proceeding or any remedy available to the
Trustee, or exercising any trust or power conferred upon the
Trustee, under this Agreement.
The Trustee shall not be required to expend or risk
its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder, or in the exercise of any
of its rights or powers, if there shall be reasonable ground for
believing that the repayment of such funds or adequate indemnity
against such risk or liability shall not be reasonably assured to it,
and none of the provisions contained in this Agreement shall in any
event require the Trustee to perform, or be responsible for the manner
of performance of, any of the obligations of the Servicer (including
its obligations as custodian) under this Agreement except during such
time, if any, as the Trustee shall be the successor to, and be vested
with the rights, duties, powers and privileges of, the Servicer in
accordance with the terms of this Agreement.
The Trustee shall not be charged with knowledge of
an Event of Servicing Termination until such time as an Authorized
Officer shall have actual knowledge or have received written notice
thereof.
Except for actions expressly authorized by this
Agreement or, based upon an Opinion of Counsel, in the best interests
of Certificateholders, the Trustee shall take no action reasonably
likely to impair the security interests created or existing under any
Receivable or to impair the value of any Receivable.
All information obtained by the Trustee regarding
the Obligors and the Receivables, whether upon the exercise of its
rights under this Agreement or otherwise, shall be maintained by the
Trustee in confidence and shall not be disclosed to any other Person,
other than its counsel, unless such disclosure is pursuant to the
terms of this Agreement or required by any applicable law or
regulation.
In the event that the Paying Agent or the Transfer
Agent and Certificate Registrar shall fail to perform any
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obligation, duty or agreement in the manner or on the day required to
be performed by the Paying Agent or the Transfer Agent and Certificate
Registrar, as the case may be, under this Agreement, the Trustee shall
be obligated promptly upon an Authorized Officer obtaining knowledge
thereof to perform such obligation, duty or agreement in the manner so
required to the extent the information necessary to such performance
is reasonably available to the Trustee after the Trustee has made a
reasonable effort to obtain such information. The Trustee shall not be
liable for the acts or omissions of any Paying Agent, any
Authenticating Agent or the Transfer Agent and Certificate Registrar
appointed hereunder with due care by the Trustee hereunder.
SECTION 10.2. Trustee's Assignment of Repurchased
Receivables and Trustee's Certificate. With respect to all Receivables
repurchased by the Seller pursuant to Section 3.2 or purchased by the
Servicer pursuant to Section 4.7 or 11.2, the Trustee shall (i)
assign, without recourse, representation, or warranty, to the Seller
or the Servicer, as the case may be, all the Trust's right, title, and
interest in and to such Receivable and the other property conveyed to
the Trust pursuant to Section 2.1 with respect to such Receivable, and
all security and documents relating thereto, such assignment being an
assignment outright and not for security and (ii) as soon as
practicable after each date as of which a Receivable shall be assigned
to the Seller or the Servicer, as the case may be, execute a Trustee's
Certificate, including the date of execution of such Trustee's
Certificate and the date of the related Agreement, and accompanied by
a copy of the Servicer's Certificate specified for the related
Collection Period. If, in any enforcement suit or legal proceeding, it
shall be held that the Servicer may not enforce a Receivable on the
ground that it shall not be a real party in interest or a holder
entitled to enforce the Receivable, the Trustee shall, at the
Servicer's expense, take such steps as the Trustee or the Servicer
deems necessary to enforce the Receivable, including bringing suit in
the Trustee's name or the names of the Trust or the
Certificateholders.
SECTION 10.3. Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 10.1:
(i) The Trustee may request, and
may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate of auditors or any
other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond, or other
paper or document (including the annual auditor's report and
the letter of independent certified public accountants
described in Section 4.11, the Servicer's Certificate
described in Section 4.9, and the annual compliance statement
described in Section 4.10) believed by it to be genuine and
to have been signed or presented by the proper party or
parties.
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(ii) The Trustee may consult with counsel
and any written advice or Opinion of Counsel shall be full
and complete authorization and protection in respect of any
action taken or suffered or omitted by it under this
Agreement in good faith and in accordance with such written
advice or Opinion of Counsel. A copy of such written advice
or Opinion of Counsel shall be provided to the Seller, the
Servicer and the Rating Agencies.
(iii) The Trustee shall be under no
obligation to exercise any of the rights or powers vested in
it by this Agreement, or to institute, conduct or defend any
litigation under this Agreement or in relation to this
Agreement, at the request, order or direction of any of the
Certificateholders pursuant to the provisions of this
Agreement, unless such Certificateholders shall have offered
to the Trustee reasonable security or indemnity against the
costs, expenses, and liabilities that may be incurred therein
or thereby; provided, however, that the Trustee shall have
the right to decline to follow any such request, order or
direction if the Trustee, in accordance with an Opinion of
Counsel, determines that the action or proceeding may not
lawfully be taken or if the Trustee in good faith determines
that the action or proceeding so directed would involve it in
personal liability or be unjustly prejudicial to the
non-assenting Certificateholders; provided, further, that
nothing contained in this Agreement shall relieve the Trustee
of the obligations, upon the occurrence of an Event of
Servicing Termination (that shall not have been cured), to
exercise such of the rights and powers vested in it by this
Agreement, and to use the same degree of care and skill in
their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
(iv) The Trustee shall not be personally
liable for any action taken, suffered or omitted by it in
good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this
Agreement.
(v) The Trustee may execute any of the
trusts or powers hereunder or perform any duties under this
Agreement either directly or by or through agents or
attorneys or a custodian, which agents or attorneys shall
have any or all of the rights, powers, duties and obligations
of the Trustee conferred on them by such appointment.
SECTION 10.4. Trustee Not Liable for Certificates or
Receivables. The recitals contained in this Agreement and in the
Certificates shall be taken as the statements of the Seller or the
Servicer, as the case may be, and the Trustee assumes no
responsibility for the correctness thereof. The Trustee shall make no
representations as to the validity or sufficiency of this
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Agreement or of the Certificates (other than execution by the Trustee
on behalf of the Trust of, or the authentication on, the
Certificates), or of any Receivable or related document. The Trustee
shall have no obligation to perform any of the duties of the Seller or
Servicer unless explicitly set forth in this Agreement. The Trustee
shall at no time have any responsibility or liability for or with
respect to the legality, validity, and enforceability of any security
interest in any Financed Vehicle or any Receivable, or the perfection
and priority of such a security interest or the maintenance of any
such perfection and priority; the filing of any financing or
continuation statement in any public office; the preparation or filing
of any report or statement with The Securities and Exchange
Commission; the efficacy of the Trust or its ability to generate the
payments to be distributed to Certificateholders under this Agreement;
the existence, condition, location, and ownership of any Financed
Vehicle; the existence and enforceability of any theft and physical
damage insurance or credit life or credit disability insurance; the
existence and contents of any Receivable or any computer or other
record thereof; the validity of the assignment of any Receivable to
the Trust or of any intervening assignment; the completeness of any
Receivable; any claim or default asserted against a Receivable; the
performance or enforcement of any Receivable; the compliance by the
Seller with any warranty or representation made under this Agreement
or in any related document and the accuracy of any such warranty or
representation (except after the Trustee's receipt of notice or other
discovery of any noncompliance therewith or any breach thereof or as
otherwise provided herein); the satisfaction of any conditions
relating to the Receivables; any investment of monies by the Servicer
or any loss resulting therefrom (it being understood that the Trustee
shall remain responsible for any Trust property that it may hold); the
acts or omissions of the Seller, the Servicer (including in its
capacity as custodian hereunder), or any Obligor; an action of the
Servicer taken in the name of the Trustee; or any action by the
Trustee taken at the instruction of the Servicer; provided, however,
that the foregoing shall not relieve the Trustee of its obligation to
perform its duties under this Agreement. Except with respect to a
claim based on the failure of the Trustee to perform its duties under
this Agreement or based on the Trustee's wilful misconduct,
negligence, or bad faith, or based on the Trustee's breach of a
representation and warranty specified in Section 10.13, no recourse
shall be had for any claim or defense based on any provision of this
Agreement, the Certificates, or any Receivable or assignment thereof
against the Trustee in its individual capacity. The Trustee shall not
have any personal obligation, liability, or duty whatsoever to any
Certificateholder or any other Person with respect to any such claim
or defense, and any such claim or defense shall be asserted solely
against the Trust or any indemnitor who shall furnish indemnity as
provided in this Agreement. The Trustee shall not be accountable for
the use or application by the Seller of any of the Certificates or of
the proceeds of such
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Certificates, or for the use or application of any funds paid to the
Servicer in respect of the Receivables.
SECTION 10.5. Trustee May Own Certificates. The
Trustee in its individual or any other capacity may become the owner
or pledgee of Certificates and may deal with the Seller and the
Servicer in banking transactions with the same rights as it would have
if it were not Trustee.
SECTION 10.6. Trustee's Fees and Expenses. The
Servicer shall covenant and agree to pay to the Trustee, and the
Trustee shall be entitled to, reasonable compensation (which shall not
be limited by any provision of law in regard to the compensation of a
trustee of an express trust) for all services rendered by it in the
execution of the trusts created by this Agreement and in the exercise
and performance of any of the powers and duties under this Agreement
of the Trustee, and the Servicer shall pay or reimburse the Trustee
upon its request for all reasonable expenses, disbursements, and
advances (including the reasonable compensation and the expenses and
disbursements of its counsel and of all persons not regularly in its
employ) incurred or made by the Trustee under this Agreement
(including expenses, disbursements, and advances incurred in defense
of any action brought against it in connection with this Agreement)
except any such expense, disbursement, or advance as may arise from
its negligence, wilful misfeasance, or bad faith or that is the
responsibility of Certificateholders under this Agreement. The
Servicer's obligation to pay such compensation and expenses shall
survive the termination of such Servicer to the extent that such
obligation is a result of services rendered prior to such Servicer's
termination. Additionally, the Servicer, pursuant to Section 10.7,
shall indemnify the Trustee with respect to certain matters, and
Certificateholders, pursuant to Section 12.3, shall upon the
circumstances therein set forth, indemnify the Trustee under certain
circumstances. The provisions of this Section 10.6 shall survive the
termination of this Agreement and the resignation or removal of the
Trustee.
SECTION 10.7. Indemnity of Trustee. The Trustee and
it agents and employees shall be indemnified by the Servicer and held
harmless against any loss, liability, or expense (including reasonable
attorneys' fees and expenses and expenses of litigation) arising out
of or incurred in connection with the acceptance or performance of the
trusts and duties contained in this Agreement to the extent that (i)
such loss, liability, or expense shall not have been incurred by
reason of the Trustee's wilful misfeasance, bad faith, or negligence,
and (ii) such loss, liability, or expense shall not have been incurred
by reason of the Trustee's breach of its representations and
warranties pursuant to Section 10.13; provided, however, that the
obligations of the Servicer in this Section 10.7 shall survive such
Servicer's termination with respect to the performance of such
Servicer prior to such Servicer's termination; provided, further, that
if the Servicer fails to indemnify the Trustee and
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its agents and employees pursuant to this Section 10.7, then such
indemnity shall be provided from amounts distributable to the Seller
from the Reserve Account pursuant to Section 5.6(e) (other than
investment income), after all payments required to be made on such
date to the Servicer and the Certificateholders shall have been made
and any amounts required to be retained therein to maintain the amount
on deposit in the Reserve Account (exclusive of investment income and
earnings on amounts on deposit therein) in an amount equal to the
Specified Reserve Account Balance on such date shall have been
retained. The provisions of this Section 10.7 shall survive the
termination of this Agreement and the resignation or removal of the
Trustee.
SECTION 10.8. Eligibility Requirements for Trustee.
The Trustee under this Agreement shall at all times be a state banking
corporation or national banking association organized and doing
business under the laws of such state or the United States of America;
authorized under such laws to exercise corporate trust powers; and
having a combined capital and surplus of at least $100,000,000 as of
the last day of the most recent fiscal quarter for such institution
and subject to supervision or examination by federal or state
authorities. If such corporation or national banking association shall
publish reports of condition at least annually, pursuant to law or to
the requirements of the aforesaid supervising or examining authority,
then for the purpose of this Section 10.8, the combined capital and
surplus of such corporation shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so
published. The long-term unsecured debt of the Trustee shall at all
times be rated not lower than "BBB-" by Standard & Poor's and Fitch
(if rated by Fitch) and Baa3 by Moody's or such other ratings as are
acceptable to the Rating Agencies. In case at any time the Trustee
shall cease to be eligible in accordance with the provisions of this
Section 10.8, the Trustee shall resign immediately in the manner and
with the effect specified in Section 10.9.
SECTION 10.9. Resignation or Removal of Trustee. The
Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Servicer. Upon
receiving such notice of resignation, the Servicer shall promptly
appoint a successor Trustee by written instrument, in duplicate, one
copy of which instrument shall be delivered to the resigning Trustee
and one copy to the successor Trustee. If no successor Trustee shall
have been so appointed and have accepted appointment within 30 days
after the giving of such notice of resignation, the resigning Trustee
may petition any court of competent jurisdiction for the appointment
of a successor Trustee. The Servicer shall provide notice to the
Rating Agencies of any resignation of the Trustee.
If at any time the Trustee shall cease to be
eligible in accordance with the provisions of Section 10.8 and shall
fail to resign after written request therefor by the Servicer, or if
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at any time the Trustee shall be legally unable to act, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation, or liquidation, then the
Servicer may remove the Trustee. If it shall remove the Trustee under
the authority of the immediately preceding sentence, the Servicer
shall promptly appoint a successor Trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor Trustee.
Any resignation or removal of the Trustee and
appointment of a successor Trustee pursuant to any of the provisions
of this Section 10.9 shall not become effective until acceptance of
appointment by the successor Trustee pursuant to Section 10.10.
SECTION 10.10. Successor Trustee. Any successor
Trustee appointed pursuant to Section 10.9 shall execute, acknowledge,
and deliver to the Servicer and to its predecessor Trustee an
instrument accepting such appointment under this Agreement, and
thereupon the resignation or removal of the predecessor Trustee shall
become effective and such successor Trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights,
powers, duties, and obligations of its predecessor under this
Agreement, with like effect as if originally named as Trustee. The
predecessor Trustee shall deliver to the successor Trustee all
documents and statements held by it under this Agreement and the
Servicer and the predecessor Trustee shall execute and deliver such
instruments and do such other things as may reasonably be required for
fully and certainly vesting and confirming in the successor Trustee
all such rights, powers, duties, and obligations.
No successor Trustee shall accept appointment as
provided in this Section 10.10 unless at the time of such acceptance
such successor Trustee shall be eligible pursuant to Section 10.8.
Upon acceptance of appointment by a successor
Trustee pursuant to this Section 10.10, the Servicer shall mail notice
of the successor of such Trustee under this Agreement to all
Certificateholders at their respective addresses of record, to the
Rating Agencies. If the Servicer shall fail to mail such notice within
10 days after acceptance of appointment by successor Trustee, the
successor Trustee shall cause such notice to be mailed at the expense
of the Servicer.
SECTION 10.11. Merger or Consolidation of Trustee.
Any corporation or other entity (i) into which the Trustee may be
merged or consolidated, (ii) which may result from any merger,
conversion, or consolidation to which the Trustee shall be a
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party, or (iii) which may succeed to all or substantially all of the
corporate trust business of the Trustee, which corporation or other
entity executes an agreement of assumption to perform every obligation
of the Trustee under this Agreement, shall be the successor of the
Trustee hereunder, provided such corporation or other entity shall be
eligible pursuant to Section 10.8, without the execution or filing of
any instrument or any further act on the part of any of the parties
hereto. The Trustee shall provide prompt written notice of any merger
or consolidation to the Seller, the Servicer and the Rating Agencies.
SECTION 10.12. Appointment of Co-Trustee or Separate
Trustee. Notwithstanding any other provisions of this Agreement, at
any time, for the purpose of meeting any legal requirements of any
jurisdiction in which any part of the Trust or any Financed Vehicle
may at the time be located, the Servicer and the Trustee acting
jointly shall have the power and shall execute and deliver all
instruments to appoint one or more Persons approved by the Trustee to
act as co-trustee, jointly with the Trustee, or separate trustee or
separate trustees, of all or any part of the Trust, and to vest in
such Person, in such capacity and for the benefit of the
Certificateholders, such title to the Trust, or any part thereof, and,
subject to the other provisions of this Section 10.12, such powers,
duties, obligations, rights, and trusts as the Servicer and the
Trustee may consider necessary or desirable. The Servicer will pay all
reasonable fees and expenses of any co-trustee or separate trustee or
separate trustees. The appointment of any separate trustee or
co-trustee shall not absolve the Trustee of its obligations under this
Agreement. If the Servicer shall not have joined in such appointment
within 15 days after the receipt by it of a request so to do, or in
the case an Event of Servicing Termination shall have occurred and be
continuing, the Trustee alone shall have the power to make such
appointment. No co-trustee or separate trustee or separate trustees
under this Agreement shall be required to meet the terms of
eligibility as a successor trustee pursuant to Section 10.8, and no
notice to Certificateholders of the appointment of any co-trustee or
separate trustee or separate trustees shall be required pursuant to
Section 10.10.
Each separate trustee and co-trustee shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) All rights, powers, duties, and
obligations conferred or imposed upon the Trustee shall be
conferred upon and exercised or performed by the Trustee and
such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not
authorized to act separately without the Trustee joining in
such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be
performed (whether as Trustee under this Agreement or as
successor to the Servicer under this Agreement), the Trustee
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shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties, and
obligations (including the holding of title to the Trust or
any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such separate trustee or
co-trustee, but solely at the direction of the Trustee.
(ii) No trustee under this Agreement shall
be personally liable by reason of any act or omission of any
other trustee under this Agreement.
(iii) The Servicer and the Trustee acting
jointly may at any time accept the resignation of or remove
any separate trustee or co-trustee, except that, following
the occurrence of an Event of Servicing Termination which has
not been cured, the Trustee acting alone may accept the
resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the
Trustee shall be deemed to have been given to each of the then
separate trustees and co-trustees, as effectively as if given to each
of them. Every instrument appointing any separate trustee or
co-trustee shall refer to this Agreement and the conditions of this
Article XI. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or
properties specified in its instrument of appointment, either jointly
with the Trustee or separately, as may be provided therein, subject to
all the provisions of this Agreement, specifically including every
provision of this Agreement relating to the conduct of, affecting the
liability of, or affording protection to, the Trustee. Each such
instrument shall be filed with the Trustee and a copy thereof given to
the Servicer.
Any separate trustee or co-trustee may at any time
appoint the Trustee, its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act
under or in respect of this Agreement on its behalf and in its name.
If any separate trustee or co-trustee shall die, become incapable of
acting, resign or be removed, all of its estates, properties, rights,
remedies and trusts shall vest in and be exercised by the Trustee, to
the extent permitted by law, without the appointment of a new or
successor Trustee.
SECTION 10.13. Representations and Warranties of
Trustee. The Trustee makes the following representations and
warranties on which the Seller, the Servicer and the
Certificateholders may rely:
(i) Organization and Good Standing. The
Trustee is a banking association duly organized, validly
existing, and in good standing under the laws of the United
States of America.
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(ii) Power and Authority. The Trustee has
full power, authority and legal right to execute, deliver,
and perform this Agreement, and has taken all necessary
action to authorize the execution, delivery, and performance
by it of this Agreement.
(iii) No Violation. The execution, delivery
and performance by the Trustee of this Agreement (a) does not
violate any provision of any law governing the trust powers
of the Trustee or, to the best of the Trustee's knowledge,
any order, writ, judgment, or decree of any court,
arbitrator, or governmental authority applicable to the
Trustee or any of its assets, (b) does not violate any
provision of the articles of association or bylaws of the
Trustee and (c) does not conflict with, result in any breach
of any of the terms or provisions of, or constitute (with or
without notice or lapse of time) a default under, any
indenture, agreement or other instrument to which the Trustee
is a party or by which it is bound to the extent such
conflict, breach or default would impair the Trustee's
obligation or ability to perform under this Agreement.
(iv) No Governmental Authorization Required.
The execution, delivery and performance by the Trustee of
this Agreement does not require the authorization, consent,
or approval of, the giving of notice to, the filing or
registration with, or the taking of any other action in
respect of, any governmental authority or agency regulating
the corporate trust activities of the Trustee.
(v) Due Authorization, Execution and
Delivery. This Agreement has been duly authorized, executed
and delivered by the Trustee and shall constitute the legal,
valid, and binding agreement of the Trustee, enforceable in
accordance with its terms.
SECTION 10.14. Tax Returns. The Servicer shall
prepare or shall cause to be prepared any tax returns required to be
filed by the Trust and furnish to Certificateholders any information
required by the Code or the regulations thereunder and shall remit
such returns to the Trustee for signature at least five days before
such returns are due to be filed. The Trustee, upon request, will
furnish the Servicer with all such information known to the Trustee as
may be reasonably required in connection with the preparation of all
tax returns of the Trust, and shall, upon request, execute such
returns.
SECTION 10.15. Trustee May Enforce Claims Without
Possession of Certificates. All rights of action and claims
under this Agreement or the Certificates may be prosecuted and
enforced by the Trustee without the possession of any of the
Certificates or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee. Any
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recovery of judgment shall, after provision for the payment of the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, be for the ratable benefit of the
Certificateholders in respect of which such judgment has been
recovered.
SECTION 10.16. Suits for Enforcement. In case an
Event of Servicing Termination or other default by the Servicer or the
Seller hereunder shall occur and be continuing, the Trustee, in its
discretion, may proceed to protect and enforce its rights and the
rights of the Certificateholders under this Agreement by a suit,
action or proceeding in equity or at law or otherwise whether for the
specific performance of any covenant or agreement contained in this
Agreement or in aid of the execution of any power granted in this
Agreement or the enforcement of any other legal, equitable or other
remedy, as the Trustee, being advised by counsel, shall deem most
effectual to protect and enforce any of the rights of the Trustee or
the Certificateholders.
SECTION 10.17. Maintenance of Office or Agency. The
Trustee shall maintain at its expense in The City of New York an
office or offices or agency or agencies where notices and demands to
or upon the Trustee in respect of the Certificates and this Agreement
may be served. The Trustee initially designates Norwest Trust Company,
New York as its office for such purposes. The Trustee will give prompt
written notice to the Servicer, the Paying Agent, the Transfer Agent
and Certificate Registrar and to Certificateholders of any change in
the location of such office or agency.
SECTION 10.18 Norwest Bank Minnesota, National
Association, as Collateral Agent. Notwithstanding anything in this
Agreement to the contrary, references in this Article X to the Trustee
shall also refer to Norwest Bank Minnesota, National Association, in
its capacity as Collateral Agent hereunder.
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ARTICLE XI
TERMINATION
SECTION 11.1. Termination of the Trust. The Trust,
and the respective obligations and responsibilities of the Seller, the
Servicer and the Trustee shall terminate with respect to the
Certificateholders upon the first to occur of (i) the Distribution
Date next succeeding the Collection Period which is six months after
the maturity or other liquidation of the last Receivable and the
disposition of any amounts received upon liquidation of any property
remaining in the Trust and (ii) the payment to Certificateholders of
all amounts required to be paid to them pursuant to this Agreement;
provided, however, that in no event shall the Trust created by this
Agreement continue beyond the expiration of 21 years from the death of
the last survivor of the descendants of Joseph P. Kennedy, the late
ambassador to the Court of St. James's, living on the date of this
Agreement. The Servicer shall promptly (but in any event not later
than the first day of the month of the specified Distribution Date)
notify the Trustee, the Paying Agent, the Transfer Agent and
Certificate Registrar and the Rating Agencies in writing of any
prospective termination pursuant to this Section 11.1.
Notice of any termination, specifying the
Distribution Date upon which the Certificateholders may surrender
their Certificates to the Transfer Agent and Certificate Registrar for
payment of the final distribution and cancellation, shall be given
promptly by the Trustee by letter to Certificateholders mailed not
earlier than the 15th day and not later than the 25th day of the
Collection Period related to the specified Distribution Date stating
that the Record Date otherwise applicable to such Distribution Date is
not applicable, payments being made only upon presentation and
surrender of the Certificates at the office of the Transfer Agent and
Certificate Registrar therein specified. The Trustee shall give such
notice to the Transfer Agent and Certificate Registrar, the Paying
Agent and the Rating Agencies at the time such notice is given to
Certificateholders. Upon presentation and surrender of the
Certificates, the Paying Agent shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date
pursuant to Section 5.5. Upon notification by the Seller, any funds in
the Collection Account after the payment of all amounts owing to the
Certificateholders shall be paid to the Seller.
In the event that all of the Certificateholders
shall not surrender their Certificates for cancellation within six
months after the date specified in the above-mentioned written notice,
the Trustee shall give a second written notice to the remaining
Certificateholders upon receipt of the appropriate records from the
Transfer Agent and Certificate Registrar to surrender their
Certificates for cancellation and receive the final distribution with
respect thereto. If within one year
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after the second notice all the Certificates shall not have been
surrendered for cancellation, the Trustee may take appropriate steps,
or may appoint an agent to take appropriate steps, to contact the
remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds and
other assets that shall remain subject to this Agreement. Any funds
remaining in the Trust after exhaustion of such remedies shall be
distributed by the Trustee or the Trustee shall cause to be
distributed to the United Way or a similar charitable organization
located or operating in the New York metropolitan area, as specified
by the Servicer; provided, however, that such funds shall be
distributed by the Trustee or the Trustee shall cause to be
distributed no later than three years after the final Distribution
Date specified in the notice referred to in the preceding paragraph.
All Certificates surrendered for payment of the
final distribution with respect to such Certificates and cancellation
shall be cancelled by the Transfer Agent and Certificate Registrar and
shall be disposed of in a manner satisfactory to the Trustee and the
Seller.
SECTION 11.2. Optional Purchase of All Receivables.
As of the last day of any Collection Period on which the Pool Factor
(expressed as a percentage) shall be equal to or less than the
Optional Purchase Percentage, the Servicer shall have the option to
purchase the corpus of the Trust. To exercise such option, the
Servicer shall notify the Trustee, the Paying Agent, the Transfer
Agent and Certificate Registrar in writing, no later than the 20th day
of such Collection Period, shall pay the aggregate Repurchase Amount
for the Receivables (including Defaulted Receivables) as of such last
day and shall succeed to all interests in, to and under the Trust
property. The payment shall be made in the manner specified in Section
5.4, and shall be distributed pursuant to Section 5.5. The Trustee
shall not permit the purchase of the corpus of the Trust pursuant to
this Section unless any of (i) the Servicer's long-term unsecured debt
is rated at the time of such purchase at least "BBB-" by Standard &
Poor's and Fitch (if rated by Fitch) and "Baa3" by Moody's or (ii) (A)
The Chase Manhattan Bank's long-term unsecured debt is rated at the
time of such purchase at least "BBB-" by Standard & Poor's and Fitch
(if rated by Fitch) and "Baa3" by Moody's, (B) the Servicer is an
Affiliate of (directly or indirectly) The Chase Manhattan Bank, and
(C) if the Servicer's long-term unsecured debt is assigned a rating by
a Rating Agency, such rating is not below "BBB-" by Standard & Poor's
or Fitch (if rated by Fitch) and "Baa3" by Moody's or (iii) the
Servicer provides to the Trustee an Opinion of Counsel in form
reasonably satisfactory to the Trustee and in form and substance
satisfactory to the Rating Agencies to the effect that such purchase
will not constitute a fraudulent transfer under applicable state and
federal law.
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ARTICLE XII
MISCELLANEOUS PROVISIONS
SECTION 12.1. Amendment. This Agreement may be
amended by the Seller, the Servicer and the Trustee, with prior notice
to the Rating Agencies but without prior notice to or the consent of
any of the Certificateholders, (i) to cure any ambiguity, to correct
or supplement any provisions in this Agreement or the Certificates
which may be inconsistent with any other provisions herein or therein,
to evidence a succession to the Servicer or the Seller pursuant to
this Agreement or to add any other provisions with respect to matters
or questions arising under this Agreement that shall not be
inconsistent with the provisions of this Agreement; provided, however,
that such action shall not, as evidenced by an Officer's Certificate
and/or an Opinion of Counsel delivered to the Trustee, adversely and
materially affect the interests of the Trust or any of the
Certificateholders and provided, further, that the Servicer shall
deliver written notice of such changes to each Rating Agency prior to
the execution of any such amendment, or (ii) to effect a transfer or
assignment in compliance with Section 12.7(a). Notwithstanding the
foregoing, no amendment modifying the provisions of Section 5.5 or
Article VI shall become effective without satisfaction of the Rating
Agency Condition.
This Agreement may also be amended from time to time
by the Seller, the Servicer and the Trustee, with the consent of the
Holders of Certificates evidencing not less than a majority of the sum
of the Class A Certificate Balance and the Class B Certificate Balance
voting together as a single 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 Certificateholders (including effecting a transfer or
assignment in compliance with Section 12.7(a) of this Agreement);
provided, however, that no such amendment, except with the consent of
the Holders of all Certificates then outstanding, shall (a) increase
or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments of Receivables, or distributions
that shall be required to be made on any Certificate, (b) reduce the
aforesaid percentage of the sum of the Class A Certificate Balance and
the Class B Certificate Balance, the holders of which are required to
consent to any such amendment, (c) materially and adversely affect the
interests of either the Class A Certificateholders or the Class B
Certificateholders without the consent of the holders of Class A
Certificates or Class B Certificates, as the case may be, evidencing
not less than a majority of the Class A Certificate Balance or the
Class B Certificate Balance, as the case may be, or (d) adversely
affect the rating of the Class A Certificates or the Class B
Certificates by any Rating Agency.
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Promptly after the execution of any amendment or
consent referred to in this Section 12.1, the Trustee shall furnish a
copy of such amendment or consent to each Certificateholder and to the
Rating Agencies.
It shall not be necessary for the consent of
Certificateholders pursuant to this Section 12.1 to approve the
particular form of any proposed amendment or consent, but it shall be
sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization
of the execution thereof by Certificateholders shall be subject to
such reasonable requirements as the Trustee may prescribe.
Prior to the execution of any amendment to this
Agreement, the Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement. The Trustee shall not be
obligated to enter into any such amendment which affects the Trustee's
own rights, duties or immunities under this Agreement.
Prior to the execution of any amendment to this
Agreement, other than an amendment permitted pursuant to clause (i) of
the first paragraph of this Section 12.1, such amendment is required
to satisfy the Rating Agency Condition.
SECTION 12.2. Protection of Title to Trust.
(a) The Seller shall execute and file such fi-
nancing statements and cause to be executed and filed such
continuation statements, all in such manner and in such places as may
be required by law fully to preserve, maintain, and protect the
interests of the Trustee and the Collateral Agent under this Agreement
in the Receivables and in the proceeds thereof. The Seller shall
deliver (or cause to be delivered) to the Trustee or the Collateral
Agent, as applicable, file-stamped copies of, or filing receipts for,
any document filed as provided above, as soon as available following
such filing.
(b) Neither the Seller nor the Servicer shall
change its name, identity, or corporate structure in any manner that
would, could, or might make any financing statement or continuation
statement filed by the Seller on behalf of the Trustee or the
Collateral Agent in accordance with paragraph (a) above seriously
misleading within the meaning of ss. 9-402(7) (or any comparable
section) of the Relevant UCC, unless it shall have given the Trustee
or the Collateral Agent, as applicable, at least 30 days prior written
notice thereof.
(c) The Seller and the Servicer shall give the
Trustee and the Collateral Agent at least 60 days prior written notice
of any relocation of its principal executive office if, as a result of
such relocation, the applicable provisions of the
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Relevant UCC would require the filing of any amendment of any
previously filed financing or continuation statement or of any new
financing statement. The Servicer shall at all times maintain each
office from which it shall service Receivables, and its principal
executive office, within the United States of America.
(d) The Servicer shall maintain accounts and
records as to each Receivable accurately and in sufficient detail to
permit (i) the reader thereof to know at any time the status of such
Receivable, including payments and recoveries made and payments owing
(and the nature of each) and (ii) reconciliation between payments or
recoveries on (or with respect to) each Receivable and the amounts
from time to time deposited in the Collection Account in respect of
such Receivable.
(e) The Servicer shall maintain its computer
systems so that, from and after the time of sale under this Agreement of
the Receivables to the Trustee, the Servicer's master computer records
(including archives) that shall refer to a Receivable indicate
clearly, by numerical code or otherwise, that such Receivable is owned
by the Trust. Indication of the Trust's ownership of a Receivable
shall be deleted from or modified on the Servicer's computer systems
when, and only when, the Receivable shall have been paid in full,
repurchased or assigned pursuant hereto.
(f) If at any time the Seller or the Servicer
shall propose to sell, grant a security interest in, or otherwise
transfer any interest in a new or used automobile to any prospective
purchaser, creditor, or other transferee, the Seller or the Servicer,
as the case may be, shall give to such prospective purchaser,
creditor, or other transferee computer tapes, records, or print-outs
(including any restored from archives) that, if they shall refer in
any manner whatsoever to any Receivable, shall indicate clearly that
such Receivable has been sold and is owned by the Trust.
(g) The Servicer shall permit the Trustee and
its agents upon reasonable notice at any time during normal business hours
which does not unreasonably interfere with the Servicer's normal
operations or customer or employee relations to inspect, audit, and
make copies of and abstracts from the Servicer's records regarding the
Receivables.
(h) Upon request, the Servicer shall furnish to
the Trustee, within five Business Days, a list of all Receivables by
contract number and name of Obligor then held as part of the Trust,
together with a reconciliation of such list to the Schedule of
Receivables attached as Schedule A to this Agreement and to each of
the Servicer Certificates indicating removal of Receivables from the
Trust.
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(i) The Servicer shall deliver to the Trustee and
the Collateral Agent:
(1) upon the execution and delivery of this
Agreement, an Opinion of Counsel either (a) stating that, in the
opinion of such counsel, all financing statements and continuation
statements have been executed and filed that are necessary fully to
preserve and protect the interest of the Trust in the Receivables and
of the Collateral Agent in the Reserve Account, and reciting the
details of such filings or referring to prior Opinions of Counsel in
which such details are given, or (b) stating that, in the opinion of
such counsel, no such action shall be necessary to preserve and
protect such interest; and
(2) on or before March 31 of each year, commencing
with March 31, 1997, an Opinion of Counsel, dated as of such date,
either (a) stating that, in the opinion of such counsel, all financing
statements and continuation statements have been executed and filed
that are necessary fully to preserve and protect the interest of the
Trustee in the Receivables, and reciting the details of such filings
or referring to prior opinions of Counsel in which such details are
given, or (b) stating that, in the opinion of such counsel, no such
action shall be necessary to preserve and protect such interest.
Notwithstanding the provisions of Section 12.5, such Opinion of
Counsel may be sent by regular non-certified mail, and such mailed
opinion shall be deemed delivered when so mailed.
(j) The Servicer shall, to the extent required by
applicable law, cause the Certificates to be registered with the
Securities and Exchange Commission pursuant to Section 12(b) or
Section 12(g) of the Securities Exchange Act of 1934 within the time
periods specified in such sections.
(k) For the purpose of facilitating the
execution of this Agreement and for other purposes, this Agreement may be
executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and all of which
counterparts shall constitute but one and the same instrument.
SECTION 12.3. Limitation on Rights of
Certificateholders. The death or incapacity of any Certificateholder
shall not operate to terminate this Agreement or the Trust, nor
entitle the Certificateholder's legal representatives or heirs to
claim an accounting or to take any action or commence any proceeding
in any court for a partition or winding up of the Trust, nor otherwise
affect the rights, obligations, and liabilities of the parties to this
Agreement or any of them.
No Certificateholder shall have any right to vote
(except as provided in Section 9.1, Section 9.4, Section 12.1 and this
Section 12.3) or in any manner otherwise control the
88
operation and management of the Trust, or the obligations of the
parties to this Agreement, nor shall anything set forth in this
Agreement or contained in the terms of the Certificates, be construed
so as to constitute the Holders as partners or members of an
association; nor shall any Certificateholder be under any liability to
any third person by reason of any action taken pursuant to any
provision of this Agreement.
No Certificateholder shall have any right by virtue
or by availing itself of any provisions of this Agreement to institute
any suit, action, or proceeding in equity or at law upon or under or
with respect to this Agreement, unless such Holder previously shall
have given to the Trustee a written notice of default and of the
continuance thereof, as hereinbefore provided, and unless also the
Holders of Certificates evidencing not less than 25% of the sum of the
Class A Certificate Balance and the Class B Certificate Balance voting
together as a single class, shall have made written request upon the
Trustee to institute such action, suit, or proceeding in its own name
as Trustee under this Agreement and shall have offered to the Trustee
such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and the
Trustee, for 30 days after its receipt of such notice, request, and
offer of indemnity, shall have either neglected or refused to
institute any such action, suit or proceeding; no one or more Holders
of Certificates shall have any right in any manner whatever by virtue
or by availing itself or themselves of any provisions of this
Agreement to affect, disturb, or prejudice the rights of the Holders
of any other of the Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce
any right, under this Agreement, except in the manner provided in this
Agreement and for the equal, ratable, and common benefit of all
Certificateholders. For the protection and enforcement of the
provisions of this Section 12.3, each Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law
or in equity.
SECTION 12.4. GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS, REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 12.5. Notices. All demands, notices, and
communications under this Agreement shall be in writing, personally
delivered or mailed by certified mail, return receipt requested, and
shall be deemed to have been duly given upon receipt (a) in the case
of the Seller, c/o Chase Automotive Finance Corporation, 900 Stewart
Avenue, Garden City, New York 11530, Attention: Financial Controller,
or at such other address as shall be designated by the Seller in a
written notice to the Trustee, (b) in the case of the Servicer, c/o
Chase Automotive Finance Corporation, 900 Stewart Avenue, Garden City,
New York
89
11530, Attention: Financial Controller, or at such other address as
shall be designated by the Servicer in a written notice to the
Trustee, (c) in the case of the Trustee, at Sixth Street and Marquette
Avenue, Minneapolis, Minnesota 55479-0070, Attention: Corporate Trust
Office and (d) in the case of the Collateral Agent, at Sixth Street
and Marquette Avenue, Minneapolis, Minnesota 55479-0070, Attention:
Corporate Trust Office. Any notice required or permitted to be mailed
to a Certificateholder shall be given by first class mail, postage
prepaid, at the address of record of such Holder. Any notice to a
Certificateholder so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have been duly given,
whether or not the Certificateholder shall receive such notice.
Notices to Obligors pursuant to Section 4.4 herein may be given by
first class mail or by third-class mail, postage prepaid, at the
address of record of such Obligor and shall be deemed received when
mailed by the Servicer.
SECTION 12.6. Severability of Provisions. If any one
or more of the covenants, agreements, provisions, or terms of this
Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions, or terms shall be deemed severable
from the remaining covenants, agreements, provisions, or terms of this
Agreement and shall in no way affect the validity or enforceability of
the other provisions of this Agreement or of the Certificates or the
rights of the Holders thereof.
SECTION 12.7. Assignment; References to Chase USA.
(a) Notwithstanding anything to the contrary contained herein, except
as provided in Sections 6.2, 6.12, 7.3, and 8.3, neither the Seller
nor the Servicer may assign all, or a portion of, its rights,
obligations and duties under this Agreement (except as contemplated in
connection with the Proposed Merger and except for the assignment by
the Seller of a portion of its rights and obligations hereunder to The
Chase Manhattan Bank) unless such transfer or assignment satisfies the
Rating Agency Condition. Any transfer or assignment with respect to
the Servicer of all of its rights, obligations and duties will not
become effective until a successor Servicer has assumed the Servicer's
rights, duties and obligations under this Agreement.
(b) References in this Agreement to Chase USA as
Seller and/or Servicer hereunder shall refer to a national banking
association having its principal executive offices located at 200
Jericho Quadrangle, Jericho, New York 11753 and shall be deemed to
include any successor or assign of Chase USA in connection with the
Proposed Merger.
SECTION 12.8. Certificates Nonassessable and Fully
Paid. The interests represented by the Certificates shall be
nonassessable for any losses or expenses of the Trust or for any
reason whatsoever, and, upon authentication thereof by the
90
Trustee pursuant to Section 6.2, each Certificate shall be deemed
fully paid.
SECTION 12.9. Third-Party Beneficiaries. This
Agreement will inure to the benefit of and be binding upon the parties
hereto, the Certificateholders and the Certificate Owners and their
respective successors and permitted assigns. Except as otherwise
provided in this Agreement, no other person will have any right or
obligation hereunder.
SECTION 12.10. Counterparts. This Agreement may be
executed in one or more counterparts and by the different parties
hereto on separate counterparts, each of which, when so executed,
shall be deemed to be an original; such counterparts, together, shall
constitute one and the same agreement.
SECTION 12.11. Tax Matters. It is intended that the
Trust shall be a grantor trust for federal income tax purposes. All
provisions hereof shall be construed so as to effectuate such intent.
In addition, the Seller and the Certificateholders (by accepting a
beneficial interest in a Certificate) agree to treat the Certificates
as representing undivided beneficial ownership interests in the
Receivables (other than the Retained Yield). Moreover, if the Class B
Pass-Through Rate exceeds the Class A Pass-Through Rate, the Seller
and the Certificateholders (by accepting a beneficial interest in a
Certificate) agree to (i) treat the Certificates as representing
undivided beneficial ownership interests in the Receivables (other
than the Retained Yield), and (ii) treat the Class A
Certificateholders as having sold, and the Class B Certificateholders
as having purchased, the Class B Stripped Coupon.
91
IN WITNESS WHEREOF, the parties have caused this
Pooling and Servicing Agreement to be duly executed by their
respective officers as of the day and year first above written.
CHASE MANHATTAN BANK USA, N.A,
as Seller and Servicer
By
---------------------------
Name:
Title:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Trustee
By
----------------------------
Name:
Title:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Collateral Agent
By
----------------------------
Name:
Title:
92
SCHEDULE A
[LIST OF RECEIVABLES]
Delivered to the Trustee on
the Closing Date.
93
SCHEDULE B
Location of Receivable Files
Chase Manhattan Bank USA, N.A.
20 Clinton Avenue South
5th Floor
SENECA Building
Rochester, New York 14604
Iron Mountain
Route 9-W South
P.O. Box 477
Pt. Ewen, NY 12466
Chase Automotive Finance Corporation
900 Stewart Avenue
Garden City, NY 11530
94
EXHIBIT A-1
[FORM OF CLASS A CERTIFICATE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, TO ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR OBLIGATION
OF CHASE MANHATTAN BANK USA, N.A. OR ANY AFFILIATE THEREOF. THIS
CERTIFICATE AND THE RECEIVABLES ARE NOT DEPOSITS AND ARE NOT
INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
CHASE MANHATTAN AUTO GRANTOR TRUST 1996-B
6.61% ASSET BACKED CERTIFICATE, CLASS A
evidencing a fractional undivided interest in the Trust, as
defined below, the property of which includes a pool of
simple interest retail installment sales contracts and
purchase money loans, secured by new and used automobiles
financed thereby and sold to the Trustee, as defined below,
on behalf of the Trust by Chase Manhattan Bank USA, N.A.
NUMBER CUSIP
A-1
$---------
THIS CERTIFIES THAT __________ is the registered
owner of a nonassessable, fully paid, fractional undivided interest,
in the amount set forth above, in the Chase Manhattan Auto Grantor
Trust 1996-B (the "Trust") formed by Chase Manhattan Bank USA, N.A.
(the "Seller"). The Trust was created pursuant to a Pooling and
Servicing Agreement dated as of September 1, 1996 (as amended,
supplemented or otherwise modified and in effect from time to time,
the "Agreement") between the Seller, acting as Seller and Servicer,
and Norwest Bank Minnesota, National Association, as trustee the
"Trustee" and as collateral agent, a summary of certain of the
pertinent provisions of which is set forth on the reverse hereof. This
Certificate is one of the duly
A-1-1
authorized Certificates designated as "6.61% Asset Backed
Certificates, Class A" (herein called "Class A Certificates" and
together with the "Class B Certificates", issued concurrently herewith
the "Certificates"). This Certificate is issued under and is subject
to the terms, provisions, and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound. The property of the
Trust includes a pool of simple interest retail installment sales
contracts and purchase money loans (the "Receivables") for the
purchase of new and used automobiles financed thereby, all monies due
thereunder on or after the Cutoff Date (other than the Retained
Yield), security interests in the vehicles securing the Receivables
(the "Financed Vehicles"), such amounts as from time to time may be
held in the Collection Account and the Distribution Accounts
established and maintained by the Servicer in the name of the Trustee,
the rights to proceeds as a result of the Seller's exercise of its
recourse rights against Dealers with respect to the Receivables, and
assignment of the rights of the Seller to receive proceeds from any
Liquidation Proceeds and from any extended warranties, theft and
physical damage, credit life and credit disability insurance policies
relating to the Financed Vehicles or the Obligors, as the case may be,
the rights with respect to any Financed Vehicle that has been
repossessed by the Servicer, on behalf of the Trustee, and the right
to receive payments under certain circumstances from the Reserve
Account and the Retained Yield and all proceeds of the foregoing.
Subject to the terms and conditions of the Agreement
(including the availability of funds for distributions) and until the
obligations created by the Agreement shall have terminated in
accordance therewith, there will be distributed on the 15th day of
each month or, if such 15th day is not a Business Day, the next
succeeding Business Day (the "Distribution Date"), commencing on
October 15, 1996, to the Person in whose name this Certificate is
registered at the close of business on the related Record Date, such
Certificateholder's fractional undivided interest in the amounts
distributable to Class A Certificateholders on such Distribution Date.
Distributions on this Class A Certificate will be
made by the Paying Agent by check mailed to the Class A
Certificateholder of record in the Certificate Register without the
presentation or surrender of this Class A Certificate or the making of
any notation hereon, except that if directed by the Seller in the case
of Class A Certificates registered in the name of a Clearing Agency or
Foreign Clearing Agency, as applicable, distributions will be made in
the form of immediately available funds. Except as otherwise provided
in the Agreement and notwithstanding the above, the final distribution
on this Class A Certificate will be made after due notice by the
Trustee of the pendency of such distribution and only upon
presentation and surrender of this Class A Certificate at the office
or agency maintained for that
A-1-2
purpose by the Transfer Agent and Certificate Registrar in The
City of New York.
Reference is hereby made to the further provisions
of this Class A Certificate set forth on the reverse hereof, which
further provisions shall for all purposes have the same effect as if
set forth at this place.
All capitalized terms used herein not otherwise
defined shall have the meaning assigned thereto in the Agreement.
Unless the authentication hereon shall have been
executed by an authorized officer of the Trustee or an authenticating
agent acting on behalf of the Trustee, by manual signature, this Class
A Certificate shall not entitle the holder hereof to any benefit under
the Agreement or be valid for any purpose.
A-1-3
IN WITNESS WHEREOF, the Trustee, on behalf of the
Trust, and not in its individual capacity, has caused this Certificate
to be duly executed.
CHASE MANHATTAN AUTO
GRANTOR TRUST 1996-B
By: NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By:
---------------------------
Authorized Officer
This is one of the Certificates referred to
in the within-mentioned Agreement.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual
capacity but solely as Trustee
By:
---------------------------
Authorized Officer
or
-------------------------------
as Authenticating Agent
for the Trustee
By:
---------------------------
Authorized Officer
A-1-4
CHASE MANHATTAN AUTO GRANTOR TRUST 1996-B
6.61% AUTOMOBILE ASSET BACKED CERTIFICATES, CLASS A
The Agreement permits, with certain exceptions
therein provided, the amendment thereof and the modification of the
rights of the Certificateholders under the Agreement at any time by
the Seller, the Servicer and the Trustee with the consent of the
Holders of Certificates evidencing not less than a majority of the sum
of the Class A Certificate Balance and the Class B Certificate Balance
voting as a single class. Any such consent by the Holder of this Class
A Certificate shall be conclusive and binding on such Holder and on
all future Holders of this Class A Certificate and of any Class A
Certificate issued upon registration of transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent is
made upon this Class A Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances and with certain
exceptions provided therein, without prior notice to or the consent of
the Holders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Class A
Certificate is registerable in the Certificate Register upon surrender
of this Class A Certificate for registration of transfer at the office
or agency maintained by the Transfer Agent and Certificate Registrar,
in The City of New York, accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Transfer Agent
and Certificate Registrar duly executed by the Holder hereof, which
signature to such assignment has been guaranteed by a member of the
New York Stock Exchange or a commercial bank or trust company, and
thereupon one or more new Class A Certificates of authorized
denominations evidencing the same aggregate interest in the Trust will
be issued to the designated transferee.
The Class A Certificates are issuable only as
registered Certificates without coupons in denominations of $1,000 and
integral multiples thereof (except for a single Class A Certificate in
a smaller minimum denomination representing any residual portion of
the
A-1-5
Original Class A Certificate Balance). As provided in the Agreement
and subject to certain limitations therein set forth, Class A
Certificates are exchangeable for new Class A Certificates of
authorized denominations evidencing the same aggregate denomination,
as requested by the Holder surrendering the same. No service charge
will be made for any such registration of transfer or exchange, but
the Transfer Agent and Certificate Agent may require payment of a sum
sufficient to cover any tax or governmental charges payable in
connection therewith.
In the event that the Holder of this Class A
Certificate does not surrender this Class A Certificate for
cancellation within six months after the date specified in the notice
regarding the pendency of the final distribution described on the face
hereof, the Trustee shall give a second notice with respect thereto.
If within one year after such second notice this Class A Certificate
shall not have been surrendered for cancellation, the Trustee may take
appropriate steps to contact the Holder hereof. As provided in the
Agreement, any funds remaining in the Trust after exhaustion of such
steps shall be distributed to a charitable organization, such
distribution to occur not later than three years from the date of the
final Distribution Date.
The Trustee, the Paying Agent and the Transfer Agent
and Certificate Registrar may treat the Person in whose name this
Class A Certificate is registered as the owner hereof for all
purposes, and none of the Trustee, the Paying Agent or the Transfer
Agent and Certificate Registrar shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the
Agreement and the Trust created thereby with respect to the
Certificateholders shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant
to the Agreement on the Distribution Date next succeeding the month
which is six months after the maturity or liquidation of the last
Receivable and the disposition of all property held as part of the
Trust. The Servicer may, at its option, purchase the corpus of the
Trust at a price specified in the Agreement, and such purchase of the
Receivables and other property of the Trust will effect early
retirement
A-1-6
of the Certificates; however, such right of purchase is exercisable
only as of the last day of a Settlement Period immediately preceding
any Distribution Date as of which the Pool Balance is equal to or less
than 5% of the Original Pool Balance.
A-1-7
EXHIBIT A-2
[FORM OF CLASS B CERTIFICATE]
THIS CLASS B CERTIFICATE IS SUBORDINATED IN RIGHT OF
PAYMENT TO THE CLASS A CERTIFICATES AS DESCRIBED IN THE
AGREEMENT (AS DESCRIBED HEREIN).
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, TO ISSUER OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH
AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE CLASS B CERTIFICATES MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF
(I) AN EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"))
WHICH IS SUBJECT TO THE PROVISIONS OF TITLE I OF ERISA, (II) A PLAN
(AS DEFINED IN SECTION 4975(E)(1) OF THE CODE OTHER THAN A
GOVERNMENTAL OR CHURCH PLAN DESCRIBED IN SECTION 4975(G)(2) OR (3) OF
THE CODE), OR (III) ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN
ASSETS" BY REASON OF ANY SUCH PLAN'S INVESTMENT IN THE ENTITY
(EXCLUDING ANY INVESTMENT COMPANY THAT IS REGISTERED UNDER THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED) (EACH, A "BENEFIT PLAN").
BY ACCEPTING AND HOLDING A CLASS B CERTIFICATE, THE HOLDER THEREOF
SHALL BE DEEMED TO HAVE REPRESENTED AND WARRANTED THAT IT IS NOT A
BENEFIT PLAN, AND THAT NO ASSETS OF A BENEFIT PLAN WERE USED TO
ACQUIRE SUCH CLASS B CERTIFICATE. THE FOREGOING RESTRICTIONS SHALL NOT
APPLY TO ACQUISITIONS OF CLASS B CERTIFICATES WITH ASSETS OF THE
GENERAL ACCOUNT OF AN INSURANCE COMPANY, TO THE EXTENT PERMITTED UNDER
SECTION 401(C) OF ERISA.
THIS CERTIFICATE DOES NOT REPRESENT AN INTEREST IN OR
OBLIGATION OF CHASE MANHATTAN BANK USA, N.A. OR ANY
A-2-1
AFFILIATE THEREOF. THIS CERTIFICATE AND THE RECEIVABLES
ARE NOT DEPOSITS AND ARE NOT INSURED OR GUARANTEED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.
CHASE MANHATTAN AUTO GRANTOR TRUST 1996-B
6.76% ASSET BACKED CERTIFICATE, CLASS B
evidencing a fractional undivided interest in the Trust, as
defined below, the property of which includes a pool of
simple interest retail installment sales contracts and
purchase money loans, secured by new and used automobiles
financed thereby and sold to the Trustee, as defined below,
on behalf of the Trust by Chase Manhattan Bank USA, N.A.
NUMBER CUSIP
B-1
$---------
THIS CERTIFIES THAT __________ is the registered
owner of a nonassessable, fully paid, fractional undivided interest,
in the amount set forth above, in the Chase Manhattan Auto Grantor
Trust 1996-B (the "Trust") formed by Chase Manhattan Bank USA, N.A.
(the "Seller"). The Trust was created pursuant to a Pooling and
Servicing Agreement dated as of September 1, 1996 (as amended,
supplemented or otherwise modified and in effect from time to time,
the "Agreement") between the Seller, acting as Seller and Servicer,
and Norwest Bank Minnesota, National Association, as trustee (the
"Trustee") and as collateral agent, a summary of certain of the
pertinent provisions of which is set forth on the reverse hereof. This
Certificate is one of the duly authorized Certificates designated as
"6.76% Asset Backed Certificates, Class B" (herein called the Class B
Certificates, and, together with the Class A Certificates issued
concurrently herewith, the "Certificates"). This Certificate is issued
under and is subject to the terms, provisions, and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue
of the acceptance
A-2-2
hereof assents and by which such Holder is bound. The property of the
Trust includes a pool of simple interest retail installment sales
contracts and purchase money loans (the "Receivables") for the
purchase of new and used automobiles financed thereby, all monies due
thereunder on or after the Cutoff Date (other than the Retained
Yield), security interests in the vehicles securing the Receivables
(the "Financed Vehicles"), such amounts as from time to time may be
held in the Collection Account and the Distribution Accounts
established and maintained by the Servicer in the name of the Trustee,
the rights to proceeds as a result of the Seller's exercise of its
recourse rights against Dealers with respect to the Receivables, and
assignment of the rights of the Seller to receive proceeds from any
Liquidation Proceeds and from any extended warranties, theft and
physical damage, credit life and credit disability insurance policies
relating to the Financed Vehicles or the Obligors, as the case may be,
the rights with respect to any Financed Vehicle that has been
repossessed by the Servicer, on behalf of the Trustee, and the right
to receive payments under certain circumstances from the Reserve
Account and the Retained Yield and all proceeds of the foregoing.
Subject to the terms and conditions of the Agreement
(including the availability of funds for distribution) and until the
obligations created by the Agreement shall have terminated in
accordance therewith, there will be distributed on the 15th day of
each month or, if such 15th day is not a Business Day, the next
succeeding Business Day (the "Distribution Date"), commencing on
October 15, 1996, to the Person in whose name this Certificate is
registered at the close of business on the related Record Date, such
Certificateholder's fractional undivided interest in the amounts
distributable to the Class B Certificateholders on such Distribution
Date.
Pursuant to the Agreement distributions of interest
and principal on the Class B Certificates will be subordinated in
priority of payment to interest and principal due on the Class A
Certificates in the event of defaults and delinquencies on the
Receivables. The Class B Certificateholders will not receive any
distributions of interest with respect to a Collection Period until
the
A-2-3
full amount of interest on the Class A Certificates relating to such
Collection Period has been deposited in the Class A Distribution
Account, and the Class B Certificateholders will not receive any
distributions of principal with respect to such Collection Period
until the full amount of interest on and principal of the Class A
Certificates relating to such Collection Period has been deposited in
the Class A Distribution Account as set forth in the Agreement.
Distributions on this Class B Certificate will be
made by the Paying Agent by check mailed to the Class B
Certificateholder of record in the Class B Certificate Register
without the presentation or surrender of this Class B Certificate or
the making of any notation hereon, except that if directed by the
Seller in the case of Class B Certificates registered in the name of a
Clearing Agency or Foreign Clearing Agency, as applicable,
distributions will be made in the form of immediately available funds.
Except as otherwise provided in the Agreement and notwithstanding the
above, the final distribution on this Class B Certificate will be made
after due notice by the Trustee of the pendency of such distribution
and only upon presentation and surrender of this Class B Certificate
at the office or agency maintained for that purpose by the Transfer
Agent and Certificate Registrar in The City of New York.
Reference is hereby made to the further provisions
of this Class B Certificate set forth on the reverse hereof, which
further provisions shall for all purposes have the same effect as if
set forth at this place.
All capitalized terms used herein not otherwise
defined shall have the meaning assigned thereto in the Agreement.
Unless the authentication hereon shall have been
executed by an authorized officer of the Trustee or an authenticating
agent acting on behalf of the Trustee, by manual signature, this Class
B Certificate shall not entitle the holder hereof to any benefit under
the Agreement or be valid for any purpose.
A-2-4
IN WITNESS WHEREOF, the Trustee, on behalf of the
Trust, and not in its individual capacity, has caused this Certificate
to be duly executed.
CHASE MANHATTAN AUTO
GRANTOR TRUST 1996-B
By: NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By:
-------------------------
Authorized Officer
This is one of the Certificates referred to
in the within-mentioned Agreement.
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION
not in its individual capacity
but solely as Trustee
By:
----------------------------
Authorized Officer
or
------------------------------
as Authenticating Agent
for the Trustee
By:
----------------------------
Authorized Officer
A-2-5
CHASE MANHATTAN AUTO GRANTOR TRUST 1996-B
6.76% AUTOMOBILE ASSET BACKED CERTIFICATES, CLASS B
The Agreement permits, with certain exceptions
therein provided, the amendment thereof and the modification of the
rights of the Certificateholders under the Agreement at any time by
the Seller, the Servicer and the Trustee with the consent of the
Holders of Certificates evidencing not less than a majority of the sum
of the Class A Certificate Balance and the Class B Certificate Balance
voting as a single class. Any such consent by the Holder of this Class
B Certificate shall be conclusive and binding on such Holder and on
all future Holders of this Class B Certificate and of any Class B
Certificate issued upon registration of transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent is
made upon this Class B Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances and with certain
exceptions provided therein, without prior notice to or the consent of
the Holders of any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Class B
Certificate is registerable in the Certificate Register upon surrender
of this Class B Certificate for registration of transfer at the office
or agency maintained by the Transfer Agent and Certificate Registrar,
in The City of New York, accompanied by a written instrument of
transfer in form satisfactory to the Trustee and the Transfer Agent
and Certificate Registrar duly executed by the Holder hereof, which
signature to such assignment has been guaranteed by a member of the
New York Stock Exchange or a commercial bank or trust company, and
thereupon one or more new Class B Certificates of authorized
denominations evidencing the same aggregate interest in the Trust will
be issued to the designated transferee.
The Class B Certificates are issuable only as
registered Class B Certificates without coupons in denominations of
$1,000 and integral multiples thereof. As provided in the Agreement
and subject to certain limitations therein set forth, Class B
Certificates are
A-2-6
exchangeable for new Class B Certificates of authorized denominations
evidencing the same aggregate denomination, as requested by the Holder
surrendering the same. No service charge will be made for any such
registration of transfer or exchange, but the Transfer Agent and
Certificate Agent may require payment of a sum sufficient to cover any
tax or governmental charges payable in connection therewith.
In the event that the Holder of this Class B
Certificate does not surrender this Certificate for cancellation
within six months after the date specified in the notice regarding the
pendency of the final distribution described on the face hereof, the
Trustee shall give a second notice with respect thereto. If within one
year after such second notice this Class B Certificate shall not have
been surrendered for cancellation, the Trustee may take appropriate
steps to contact the Holder hereof. As provided in the Agreement, any
funds remaining in the Trust after exhaustion of such steps shall be
distributed to a charitable organization, such distribution to occur
not later than three years from the date of the final Distribution
Date.
The Trustee, the Paying Agent and the Transfer Agent
and Certificate Registrar may treat the Person in whose name this
Class B Certificate is registered as the owner hereof for all
purposes, and none of the Trustee, the Paying Agent or the Transfer
Agent and Certificate Registrar shall be affected by any notice to the
contrary.
The obligations and responsibilities created by the
Agreement and the Trust created thereby with respect to the
Certificateholders shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant
to the Agreement on the Distribution Date next succeeding the month
which is six months after the maturity or liquidation of the last
Receivable and the disposition of all property held as part of the
Trust. The Servicer may, at its option, purchase the corpus of the
Trust at a price specified in the Agreement, and such purchase of the
Receivables and other property of the Trust will effect early
retirement of the Certificates; however, such right of purchase is
exercisable only as of the last day of a Settlement Period
A-2-7
immediately preceding any Distribution Date as of which the Pool
Balance is equal to or less than 5% of the Original Pool Balance.
A-2-8
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby
sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
- --------------------------------------------------------------------
(Please print or typewrite name and address, including
postal zip code, of assignee)
- --------------------------------------------------------------------
the within Certificate, and all rights thereunder, hereby
irrevocably constituting and appointing
Attorney
- ----------------------------------------------------------
to transfer said Certificate on the books of the Transfer Agent and
Certificate Registrar, with full power of substitution in the
premises.
Dated:
*
-------------------------------
Signature Guaranteed:
*
-------------------------------
* NOTICE: The signature to this assignment must correspond with the
name as it appears upon the face of the within Certificate in every
particular, without alteration, enlargement or any change whatever.
Such signature must be guaranteed by a member of the New York Stock
Exchange or a commercial bank or trust company.
A-2-9
EXHIBIT B
[FORM OF DEPOSITORY RECEIPT AGREEMENT]
B-1
EXHIBIT C-1
Trustee's Certificate
pursuant to Section 11.2
of the Pooling and Servicing
Agreement
Norwest Bank Minnesota, National Association, as trustee
(the "Trustee") and as collateral agent of the Chase Manhattan Auto
Grantor Trust 1996-B created pursuant to the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement"), dated as of
September 1, 1996, between Chase Manhattan Bank USA, N.A., as Seller
(the "Seller") and Servicer, and the Trustee does hereby sell,
transfer, assign, and otherwise convey to the Seller, without
recourse, representation, or warranty, all of the Trustee's right,
title, and interest in and to all of the Receivables (as defined in
the Pooling and Servicing Agreement) identified in the attached
Servicer's Certificate as "Repurchased Receivables," which are to be
repurchased by the Seller pursuant to Section 3.2 of the Pooling and
Servicing Agreement and all security and documents relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this
____ day of ______, 19__.
-------------------------------
Authorized Signatory
C-1
EXHIBIT C-2
Trustee's Certificate
pursuant to Section 11.2
of the Pooling and Servicing
Agreement
Norwest Bank Minnesota, National Association, as
trustee (the "Trustee") and as collateral agent of the Chase Manhattan
Auto Grantor Trust 1996-B created pursuant to the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), dated as
of September 1, 1996, between Chase Manhattan Bank USA, N.A., as
Seller and Servicer (the "Servicer"), and the Trustee, does hereby
sell, transfer, assign, and otherwise convey to the Servicer, without
recourse, representation, or warranty, all of the Trustee's right,
title, and interest in and to all of the Receivables (as defined in
the Pooling and Servicing Agreement) identified in the attached
Servicer's Certificate as "Repurchased Receivables," which are to be
purchased by the Servicer pursuant to Section 4.7 or 12.2 of the
Pooling and Servicing Agreement, and all security and documents
relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this
____ day of ______, 19__.
-----------------------------
Authorized Signatory
C-2
EXHIBIT D
Form of Servicer's Certificate
Creation Date Wed Oct. 9, 1996 09:17 PM Page 1
Chase Manhattan Auto Grantor Trust 1996-B
6.61% Automobile Loan Pass-Through Certificates, Class A
6.76% Automobile Loan Pass-Through Certificates, Class B
MONTHLY SERVICER CERTIFICATE REPORT
Collection Period 1 Beginning Date 09/01/1996
Collection Period 1 End Date 09/30/1996
Determination Date 10/10/1996
Distribution Date 10/15/1996
I. Available Amount in the Certificate Account
A. Credits
1. Payments from Obligors Applied to Collection Period
a. Principal Payments $ 0.00
b. Recovery of Advance $ 0.00
c. Other Interest Payments $ 0.00
d. Total (Lines a thru c) $ 0.00
2. Repurchase Amount from Repurchased Receivables
a. Principal Payments $ 0.00
b. Recovery of Advance $ 0.00
c. Other Interest Payments $ 0.00
d. Total (Lines a thru c) $ 0.00
3. Reversal from Defaulted Contracts $ 0.00
4. Recovery of Defaulted Receivables $ 0.00
a. Principal $ 0.00
b. Interest $ 0.00
c. Total (Lines a thru b) $ 0.00
5. Investment Earnings on Certificate Account $ 0.00
6. Net Adjustments $ 0.00
7. Advance by Servicer $ 0.00
8. Overpayment From Obligors $ 0.00
9. Total Credits $ 0.00
B. Debits
1. Overpayments From Obligors $ 0.00
2. Recovery Amount Before Cutoff Date to Seller
a. Principal $ 0.00
b. Interest $ 0.00
c. Total (Lines a thru b) $ 0.00
3. Reversal from Defaulted Contracts $ 0.00
4. Reimbursement of Advance
a. From Payments of Non-Defaulted
Receivables $ 0.00
b. From Recovery of Defaulted Receivables $ 0.00
c. Total (Lines a thru b) $ 0.00
5. Net Investment Earnings on Certificate Account $ 0.00
6. Total Debits (Lines 1 thru 5) $ 0.00
C. Total Available Amount (Lines A - B) $ 0.00
Creation Date Wed Oct 9, 1996 09:17 PM Page 2
Chase Manhattan Auto Grantor Trust 1996-B
6.61% Automobile Loan Pass-Through Certificates, Class A
6.76% Automobile Loan Pass-Through Certificates, Class B
MONTHLY SERVICER CERTIFICATE REPORT
Collection Period 1 Beginning Date 09/01/1996
Collection Period 1 End Date 09/30/1996
Determination Date 10/10/1996
Distribution Date 10/15/1996
II. Defaulted Receivables Information for Collection Period
A. Principal $ 0.00
B. Advanced Interest $ 0.00
C. Interest Not Advanced $ 0.00
D. Total (Lines A thru C) $ 0.00
III. Pool Balance Reduction Allocation for Collection Period
A. Pool Balance Reduction
1. Available Principal
a. From Repurchased Receivables $ 0.00
b. Principal Payment $ 0.00
c. Total (Lines a thru b) $ 0.00
2. From Defaulted Receivables $ 0.00
3. Total (Lines 1 thru 2) $ 0.00
B. Allocation
1. Percentage Allocation
a. Class A %
b. Class B %
2. Monthly Principal Allocation
a. Class A $ 0.00
b. Class B $ 0.00
IV. Scheduled Monthly Disbursements
A. Pool Servicing Fee To Servicer
1. Monthly Servicing Fee $ 0.00
2. Overdue Monthly Servicing Fee $ 0.00
3. Total (Lines 1 thru 2) $ 0.00
B. Class A Interest Distributable Amount $ 0.00
1. Class A Monthly Interest $ 0.00
2. Class A Interest Carryover Shortfall $ 0.00
3. Total (Lines 1 thru 2) $ 0.00
Creation Date Wed Oct. 9, 1996 09:17 PM Page 3
Chase Manhattan Auto Grantor Trust 1996-B
6.61% Automobile Loan Pass-Through Certificates, Class A
6.76% Automobile Loan Pass-Through Certificates, Class B
MONTHLY SERVICER CERTIFICATE REPORT
Collection Period 1 Beginning Date 09/01/1996
Collection Period 1 End Date 09/30/1996
Determination Date 10/10/1996
Distribution Date 10/15/1996
C. Class B Interest Distributable Amount $ 0.00
1. Class B Monthly Interest $ 0.00
2. Class B Interest Carryover Shortfall $ 0.00
3. Total (Lines 1 thru 2) $ 0.00
D. Class A Principal Distributable Amount $ 0.00
1. Class A Monthly Principal $ 0.00
2. Class A Principal Carryover Shortfall $ 0.00
3. Total (Lines 1 thru 2) $ 0.00
E. Class B Principal Distributable Amount $ 0.00
1. Class A Monthly Principal $ 0.00
2. Class A Principal Carryover Shortfall $ 0.00
3. Total (Lines 1 thru 2) $ 0.00
F. Total (Lines A thru E) $ 0.00
V. Payment Deficiency Amount
A. Scheduled Monthly Disbursements $ 0.00
B. Available Distribution Amount $ 0.00
C. Payment Deficiency Amount
(Max: (Lines A - B) and $0.00) $ 0.00
VI. Reserve Account Withdrawal
A. Available Reserve Amount for the Collection Period $ 0.00
B. Unreimbursed Advance on Defaulted Receivables $ 0.00
C. Payment Deficiency Amount $ 0.00
D. Reserve Account Withdrawal
(Min: Lines A and (B + C)) $ 0.00
VII. Disbursements from Certificate Account Including Reserve Account
Withdrawal
A. Available Certificate Distribution Amount
1. Available Distribution Amount from
Certificate Account $ 0.00
2. Amount from Reserve Account Withdrawal
a. Reserve Account Withdrawal $ 0.00
b. Reimbursed Advance on Defaulted
Receivables $ 0.00
c. Available amount in Reserve Account
(Lines a - b) $ 0.00
3. Available Amount (Lines 1 + 2) $ 0.00
B. Monthly Servicing Fee and Overdue Servicing Fee $ 0.00
C. Class A Interest Distributable Amount $ 0.00
Creation Date Wed Oct. 9, 1996 09:17 PM Page 4
Chase Manhattan Auto Grantor Trust 1996-B
6.61% Automobile Loan Pass-Through Certificates, Class A
6.76% Automobile Loan Pass-Through Certificates, Class B
MONTHLY SERVICER CERTIFICATE REPORT
Collection Period 1 Beginning Date 09/01/1996
Collection Period 1 End Date 09/30/1996
Determination Date 10/10/1996
Distribution Date 10/15/1996
D. Class B Interest Distributable Amount $ 0.00
E. Class A Principal Distributable Amount $ 0.00
F. Class B Principal Distributable Amount $ 0.00
G. Deposit to Reserve Account $ 0.00
VIII. Average Certificate Principal Balance For the Collection Period
A. Beginning Balance $ 0.00
B. Ending Balance $ 0.00
C. Average Balance (Lines (A + B) / 2) $ 0.00
IX. Delinquency and Defaults Information
A. Automobiles Delinquency Information
DELINQUENCY UNITS DELINQUENCY AMOUNT PRINCIPAL
- ----------- ----- ------------------ ---------
30 - 59 Day 0 $ 0.00 $ 0.00
60 - 89 Day 0 $ 0.00 $ 0.00
90 - 119 Day 0 $ 0.00 $ 0.00
120 - 149 Day 0 $ 0.00 $ 0.00
150 - 179 Day 0 $ 0.00 $ 0.00
180 - 209 Day 0 $ 0.00 $ 0.00
210 - 239 Day 0 $ 0.00 $ 0.00
240 + Day 0 $ 0.00 $ 0.00
- ------------- ----- ------ ------
TOTAL : 0 $ 0.00 $ 0.00
B. Principal Amount of Loans in Defaulted Receivables $ 0.00
C. Delinquency Percentage
1. Outstanding Principal Balance for
Delinquency >= 60 Days $ 0.00
2. Portfolio Principal Ending Balance
for the Collection Period $ 0.00
3. Delinquency Percentage (Lines 1 / 2) 0.000000000000%
X. Portfolio Average Delinquency Rate
A. Delinquency Rate for Period 1 0.000000000000%
B. Average Delinquency Rate (Line A) 0.000000000000%
Creation Date Wed Oct. 9, 1996 09:17 PM Page 5
Chase Manhattan Auto Grantor Trust 1996-B
6.61% Automobile Loan Pass-Through Certificates, Class A
6.76% Automobile Loan Pass-Through Certificates, Class B
MONTHLY SERVICER CERTIFICATE REPORT
Collection Period 1 Beginning Date 09/01/1996
Collection Period 1 End Date 09/30/1996
Determination Date 10/10/1996
Distribution Date 10/15/1996
XI. Portfolio Average Charge Off Rate
A. Portfolio Charge Off Rate for Period 1
1. Principal Recoveries of Defaulted Receivables $ 0.00
2. Principal on Defaulted Receivables $ 0.00
3. Average Pool Balance for Collection Period $ 0.00
4. Charge Off Rate (12 * (Lines (2 - 1) / 3)) 0.000000000000%
B. Average Charge Off Rate (Line A) 0.000000000000%
XII. Specified Reserve Account Balance for Next Collection Period
A. Reserve Account Floor Amount
1. Maximum Amount $ 11,431,103.00
2. Possible Floor Amount
a. Principal Balance at the Beginning of Next Collection
Period
a1. Class A $ 0.00
a2. Class B $ 0.00
a3. Total (Lines al + a2) $ 0.00
b. Cumulative Monthly Interest through Final Distribution
Date
b1. Weighted Average Pass Through Rate %
b2. Scheduled Remaining Term After This
Period 00
b3. Cumulative Interest Amount
(Lines a * b1 / 12 * b2) $ 0.00
c. Cumulative Monthly Servicing Fee through Final Distribution
Date
c1. Loan Servicing Fee Rate 1.00%
c2. Scheduled Remaining Term After This
Period 00
c3. Cumulative Servicing Fee
(Lines a * cl / 12 * c2) $ 0.00
d. Total (Lines a thru c) $ 0.00
3. Reserve Account Floor Amount
(Min: Lines 1 and 2) $ 0.00
B. Possible Reserve Account Amount
1. Reserve Account Percentage Trigger
a. Average Three Period Delinquency
Percentage 0.000000000000%
b. Delinquency Percentage Trigger 1.250000000000%
c. Average Three Period Charge Off Rate 0.000000000000%
d. Charge Off Rate Trigger 1.250000000000%
e. Maximum Reserve Account Percentage
Specified 5.250000000000%
f. Minimum Reserve Account Percentage
Specified 3.250000000000%
Creation Date Wed Oct 9, 1996 09:17 PM Page 6
Chase Manhattan Auto Grantor Trust 1996-B
6.61% Automobile Loan Pass-Through Certificates, Class A
6.76% Automobile Loan Pass-Through Certificates, Class B
MONTHLY SERVICER CERTIFICATE REPORT
Collection Period 1 Beginning Date 09/01/1996
Collection Period 1 End Date 09/30/1996
Determination Date 10/10/1996
Distribution Date 10/15/1996
g. Reserve Account Percentage Applied
(Lines: If a > b or c > d, then e,
else f) 0.000000000000%
2. Pool Principal Balance $ 0.00
3. Possible Amount (Lines 1 * 2) $ 0.00
C. Specified Reserve Account Amount
(Max: Lines A and B) $ 0.00
XIII. Available Reserve Account Amount for Next Distribution Date
A. Reserve Account Balance After Deposit
1. Available Reserve Account After Disbursement
from Previous Distribution Date $ 0.00
2. Reserve Account Withdrawal $ 0.00
3. Investment Earnings From Certificate Account $ 0.00
4. Deposit to Reserve Account After Disbursement $ 0.00
5. Amount After Deposit (Linea 1 - 2 + 3 + 4) $ 0.00
B. Specified Reserve Account Balance $ 0.00
C. Available Reserve Account Amount
(Min: Lines A and B) $ 0.00
XIV. Reimbursed Advance
A. From Payments in Certificate Account $ 0.00
B. From Reserve Account $ 0.00
C. Total (Lines A thru B) $ 0.00
XV. Excess Amount To seller
A. Reserve Account Balance after Deposit $ 0.00
B. Available Reserve Account Amount $ 0.00
C. Excess Amount to seller (Lines A - B) $ 0.00
I Certify That the Information in This Report Is Correct
Chase Manhattan Bank USA, N.A.
By :
D-1
EXHIBIT E
Form of Certificateholder Report
MONTHLY CERTIFICATEHOLDER's REPORT
Collection Period 1 Beginning Date 09/01/1996
Collection Period 1 End Date 09/30/1996
Determination Date 10/10/1996
Distribution Date 10/15/1996
I. Monthly Principal and Principal Carryover Shortfall to
Certificateholders (Per $1000 of Original Principal Amount)
A. Class A $
B. Class B $
II. Monthly Interest and Unpaid Interest to Certificateholders
(Per $1000 of Original Principal Amount)
A. Class A $
B. Class B $
III. Servicing Fee Summary
A. Loan Servicing Fee Disbursement $
B. Late Fees $
C. Net Investment Earnings on Certificate Account $
D. Total Servicing Fee
(per $1000 of Original Principal Amount) $
IV. Pool Factor Information
A. Certificate Principal Balance
1. Class A $
2. Class B $
B. Initial Certificate Balance
1. Class A $
2. Class B $
C. Pool Factor (Lines A / B)
1. Class A
2. Class B
V. Pool Balance at the end of the Collection Period $
VI. Realized Losses for Collection Period $
Creation Date Wed Oct. 9, 1996 09:17 PM Page 2
CMB96B
From: Chase Manhattan Bank USA, N.A.
To: Norwest Bank Minnesota, N.A.
MONTHLY CERTIFICATEHOLDER'S REPORT
Collection Period 1 Beginning Date 09/01/1996
Collection Period 1 End Date 09/30/1996
Determination Date 10/10/1996
Distribution Date 10/15/1996
VII. Carryover Shortfall Information
A. Principal Carryover Shortfall
1. Class A $
2. Class B $
B. Interest Carryover Shortfall
1. Class A $
2. Class B $
VIII. Reserve Account Balance After Disbursement $
IX. Specified Reserve Account Balance for Next
Distribution Date $
X. Aggregate Repurchase Amount for Collection Period $
XI. Outstanding Advance Summary
A. From Prior Period $
B. From Current Period $
C. Change in Amount Between Periods (Lines B - A) $