EXECUTION COPY
EXHIBIT 99.1
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TRUST SALE AND SERVICING AGREEMENT
AMONG
GENERAL MOTORS ACCEPTANCE CORPORATION
SERVICER
CAPITAL AUTO RECEIVABLES, INC.
SELLER
AND
CAPITAL AUTO RECEIVABLES ASSET TRUST 2005-1
ISSUER
DATED AS OF JUNE 2, 2005
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TABLE OF CONTENTS
PAGE
ARTICLE I CERTAIN DEFINITIONS............................................................................... 1
Section 1.01 Definitions............................................................................ 1
ARTICLE II CONVEYANCE OF RECEIVABLES; ISSUANCE OF SECURITIES................................................ 1
Section 2.01 Conveyance of Receivables.............................................................. 1
Section 2.02 Custody of Receivable Files............................................................ 3
Section 2.03 Acceptance by Issuer................................................................... 3
Section 2.04 Representations and Warranties as to the Receivables................................... 3
Section 2.05 Repurchase of Receivables Upon Breach of Warranty...................................... 3
Section 2.06 Realization Upon Liquidating Receivables............................................... 4
ARTICLE III THE SELLER...................................................................................... 4
Section 3.01 Representations of Seller.............................................................. 4
Section 3.02 Liability of Seller.................................................................... 6
Section 3.03 Merger or Consolidation of, or Assumption of the Obligations of Seller; Amendment of
Certificate of Incorporation............................................................................. 6
Section 3.04 Limitation on Liability of Seller and Others........................................... 7
Section 3.05 Seller May Own Notes or Certificates................................................... 7
ARTICLE IV SERVICER'S COVENANTS; DISTRIBUTIONS; RESERVE ACCOUNT; STATEMENTS TO NOTEHOLDERS AND
CERTIFICATEHOLDERS.......................................................................................... 7
Section 4.01 Annual Statement as to Compliance; Notice of Servicer Default.......................... 7
Section 4.02 Annual Independent Accountants' Report................................................. 8
Section 4.03 Access to Certain Documentation and Information Regarding the Receivables.............. 9
Section 4.04 Amendments to Schedule of Receivables.................................................. 9
Section 4.05 Assignment of Administrative Receivables and Warranty Receivables...................... 9
Section 4.06 Distributions.......................................................................... 10
Section 4.07 Reserve Account........................................................................ 13
Section 4.08 Net Deposits........................................................................... 14
Section 4.09 Statements to Securityholders.......................................................... 14
ARTICLE V CERTIFICATEHOLDER AND NOTEHOLDER STATEMENTS AND ACCOUNTS; COLLECTIONS, DEPOSITS AND INVESTMENTS;
ADVANCES.................................................................................................... 15
Section 5.01 Establishment of Accounts.............................................................. 15
Section 5.02 Collections............................................................................ 19
Section 5.03 Investment Earnings and Supplemental Servicing Fees.................................... 20
Section 5.04 Monthly Advances....................................................................... 20
Section 5.05 Additional Deposits.................................................................... 21
ARTICLE VI LIABILITIES OF SERVICER AND OTHERS............................................................... 21
Section 6.01 Liability of Servicer; Indemnities..................................................... 21
Section 6.02 Merger or Consolidation of, or Assumption of the Obligations of the Servicer........... 22
Section 6.03 Limitation on Liability of Servicer and Others......................................... 23
Section 6.04 Delegation of Duties................................................................... 24
Section 6.05 Servicer Not to Resign................................................................. 24
ARTICLE VII DEFAULT......................................................................................... 24
Section 7.01 Servicer Defaults...................................................................... 24
Section 7.02 Consequences of a Servicer Default..................................................... 25
Section 7.03 Indenture Trustee to Act; Appointment of Successor..................................... 26
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Section 7.04 Notification to Noteholders and Certificateholders..................................... 26
Section 7.05 Waiver of Past Defaults............................................................... 26
Section 7.06 Repayment of Advances.................................................................. 27
ARTICLE VIII TERMINATION.................................................................................... 27
Section 8.01 Optional Purchase of All Receivables; Insolvency of Seller; Termination of Trust....... 27
ARTICLE IX MISCELLANEOUS PROVISIONS......................................................................... 30
Section 9.01 Amendment.............................................................................. 30
Section 9.02 Protection of Title to Trust........................................................... 31
Section 9.03 Notices................................................................................ 33
Section 9.04 GOVERNING LAW.......................................................................... 33
Section 9.05 Severability of Provisions............................................................. 33
Section 9.06 Assignment............................................................................. 33
Section 9.07 Third-Party Beneficiaries.............................................................. 33
Section 9.08 Separate Counterparts.................................................................. 34
Section 9.09 Headings and Cross-References.......................................................... 34
Section 9.10 Assignment to Indenture Trustee........................................................ 34
Section 9.11 No Petition Covenants.................................................................. 34
Section 9.12 Limitation of Liability of Indenture Trustee and Owner Trustee......................... 34
Section 9.13 Tax Treatment.......................................................................... 35
Section 9.14 Furnishing Documents................................................................... 35
EXHIBIT A Schedule of Receivables
EXHIBIT B Form of Second Step Receivables Assignment
EXHIBIT C Additional Representations and Warranties
APPENDIX A Definitions and Rules of Construction
APPENDIX B Notices Addresses and Procedures
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THIS TRUST SALE AND SERVICING AGREEMENT is made as of June 2, 2005 by and
among General Motors Acceptance Corporation, a Delaware corporation and in its
capacity as Servicer under the Pooling and Servicing Agreement described below
(the "Servicer"), Capital Auto Receivables, Inc., a Delaware corporation (the
"Seller"), and Capital Auto Receivables Asset Trust 2005-1, a Delaware statutory
trust (the "Issuer").
WHEREAS, on the Closing Date GMAC has sold the Receivables to the Seller;
WHEREAS, GMAC, as Servicer, has agreed to service the Receivables pursuant
to the Pooling and Servicing Agreement;
WHEREAS, the Seller desires to sell the Receivables to the Issuer on the
Closing Date in exchange for the Notes and Certificates pursuant to the terms of
this Agreement;
WHEREAS, the Servicer desires to perform the servicing obligations set
forth herein for and in consideration of the fees and other benefits set forth
in this Agreement and in the Pooling and Servicing Agreement; and
WHEREAS, Seller and the Issuer wish to set forth the terms pursuant to
which the Receivables are to be sold by the Seller to the Issuer and serviced by
the Servicer.
NOW, THEREFORE, in consideration of the foregoing, the other good and
valuable consideration and the mutual terms and covenants contained herein, the
parties hereto agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
Section 1.01 Definitions. Certain capitalized terms used in the above
recitals and in this Agreement are defined in and shall have the respective
meanings assigned to them in Part I of Appendix A to this Agreement. All
references herein to "the Agreement" or "this Agreement" are to this Trust Sale
and Servicing Agreement as it may be amended, supplemented or modified from time
to time, the exhibits hereto and the capitalized terms used herein which are
defined in such Appendix A, and all references herein to Articles, Sections and
subsections are to Articles, Sections or subsections of this Agreement unless
otherwise specified. The rules of construction set forth in Part II of such
Appendix A shall be applicable to this Agreement.
ARTICLE II
CONVEYANCE OF RECEIVABLES; ISSUANCE OF SECURITIES
Section 2.01 Conveyance of Receivables.
(a) Receivables. In consideration of the Issuer's delivery of the
Notes and the Certificates to, or upon the order of, the Seller, the Seller does
hereby enter into this Agreement and the related Second Step Receivables
Assignment in the form attached as Exhibit B to this Agreement (the "Second Step
Receivables Assignment") and agrees to fulfill all of its obligations hereunder
and thereunder and to sell, transfer, assign and otherwise convey to the Issuer,
without recourse:
(i) all right, title and interest of the Seller in, to and
under the Receivables listed on the Schedule of Receivables and (a) in the case
of Receivables that are Scheduled Interest Receivables, all monies due
thereunder on and after the Cutoff Date and (b) in the case of Receivables that
are Simple Interest Receivables, all monies received thereon on and after the
Cutoff Date, in each case exclusive of any amounts allocable to the premium for
physical damage insurance force-placed by the Servicer covering any related
Financed Vehicle;
(ii) the interest of the Seller in the security interests in
the Financed Vehicles granted by Obligors pursuant to the Receivables and, to
the extent permitted by law, any accessions thereto;
(iii) the interest of the Seller in any proceeds from claims
on any physical damage, credit life, credit disability or other insurance
policies covering related Financed Vehicles or Obligors;
(iv) the interest of the Seller in any proceeds from recourse
against Dealers on the Receivables;
(v) all right, title and interest of the Seller in, to and
under the Pooling and Servicing Agreement, the First Step Receivables Assignment
and the Custodian Agreement, including the right of the Seller to cause GMAC to
repurchase Receivables under certain circumstances; and
(vi) all present and future claims, demands, causes and choses
in action in respect of any or all of the foregoing described above and all
payments on or under and all proceeds of every kind and nature whatsoever in
respect of any or all of the foregoing, including all proceeds of the conversion
of any or all of the foregoing, voluntary or involuntary, into cash or other
liquid property, all cash proceeds, accounts, accounts receivable, notes,
drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, investment property, payment intangibles, general intangibles,
condemnation awards, rights to payment of any and every kind and other forms of
obligations and receivables, instruments and other property which ay any time
constitute all or part or are included in the proceeds of any of the foregoing.
(b) It is the intention of the Seller and the Issuer that the
transfers and assignments contemplated by this Agreement and the related Second
Step Receivables Assignment shall constitute sales of the Receivables from the
Seller to the Issuer for the purpose of applicable bankruptcy, insolvency,
reorganization and other similar laws, so that the beneficial interest in and
title to the Receivables shall not be part of the Seller's estate in the event
of the filing of a bankruptcy petition by or against the Seller under any
bankruptcy law.
(c) The foregoing sales do not constitute and are not intended to
result in any assumption by the Issuer of any obligation of the Seller to the
Obligors, Dealers, insurers or any other Person in connection with the
Receivables, any Dealer Agreements, any insurance policies or any agreement or
instrument relating to any of them.
(d) Within two (2) Business Days after the Closing Date, GMAC shall
cause to be deposited into the Collection Account the collections on the
Receivables described in Section 5.07 of the Pooling and Servicing Agreement;
provided, however, that so long as the
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Monthly Remittance Conditions are satisfied, such collections need not be
deposited until the Distribution Date immediately following the Closing Date.
Section 2.02 Custody of Receivable Files. In connection with the sale,
transfer and assignment of the Receivables to the Issuer pursuant to this
Agreement and the related Second Step Receivables Assignment, GMAC, as Custodian
under the Custodian Agreement, agrees to act as Custodian thereunder for the
benefit of the Issuer. The Issuer hereby accepts and agrees to the terms and
provisions of the Custodian Agreement and designates GMAC as custodian with
respect to the Receivables Files.
Section 2.03 Acceptance by Issuer. The Issuer does hereby accept all
consideration conveyed by the Seller pursuant to Section 2.01(a), and declares
that the Issuer shall hold such consideration upon the trust set forth in the
Trust Agreement for the benefit of Certificateholders, subject to the terms and
conditions of the Indenture, this Agreement and the related Second Step
Receivables Assignment and the rights of the Noteholders with respect thereto.
The Issuer hereby agrees to and accepts the appointment and authorization of
GMAC as Servicer under Section 3.01 of the Pooling and Servicing Agreement. The
parties agree that this Agreement, the Second Step Receivables Assignment, the
Indenture, the Trust Agreement, the Notes and the Certificates constitute the
Further Transfer and Servicing Agreements for purposes of the Pooling and
Servicing Agreement and that the rights, duties and obligations of GMAC as
Servicer under the Pooling and Servicing Agreement are subject to the provisions
of Sections 6.02, 6.04, 6.05, 9.01 and Article VII hereof.
Section 2.04 Representations and Warranties as to the Receivables.
Pursuant to Section 2.01(a)(v), the Seller assigns to the Issuer all of its
right, title and interest in, to and under the Pooling and Servicing Agreement.
Such assigned right, title and interest includes the benefit of representations
and warranties of GMAC made to the Seller pursuant to Section 4.01 of the
Pooling and Servicing Agreement. The Seller hereby represents and warrants to
the Issuer that the Seller has taken no action which would cause such
representations and warranties of GMAC to be false in any material respect as of
the Closing Date. The Seller further acknowledges that the Issuer and its
permitted assignees rely on the representations and warranties of the Seller
under this Agreement and of GMAC under the Pooling and Servicing Agreement in
accepting the Receivables in trust and executing and delivering the Notes and
the Certificates. The foregoing representation and warranty speaks as of the
Closing Date, but shall survive the sale, transfer and assignment of the
Receivables to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture.
Section 2.05 Repurchase of Receivables Upon Breach of Warranty. Upon
discovery by the Seller, the Servicer, the Owner Trustee or the Indenture
Trustee of a breach of any of the representations and warranties in Section 4.01
of the Pooling and Servicing Agreement or in Section 2.04 or Section 3.01 of
this Agreement that materially and adversely affects the interests of the
Noteholders or the Certificateholders in any Receivable, the party discovering
such breach shall give prompt written notice thereof to the others. As of the
last day of the second Monthly Period following its discovery or its receipt of
notice of breach (or, at the Seller's election, the last day of the first
Monthly Period following such discovery), unless such breach shall have been
cured in all material respects, in the event of a breach of the representations
and warranties made by the Seller in Section 2.04 or Section 3.01, the Seller
shall repurchase, or in the event of
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a breach of a representation and warranty under Section 4.01 of the Pooling and
Servicing Agreement, the Seller and the Servicer shall use reasonable efforts to
enforce the obligation of GMAC under Section 5.04 of the Pooling and Servicing
Agreement to repurchase such Receivable from the Issuer on the related
Distribution Date. The repurchase price to be paid by the breaching party (the
"Warranty Purchaser") shall be an amount equal to the Warranty Payment
calculated as of the last day of the related Monthly Period. Upon repurchase and
payment of such Warranty Payment, the Warranty Purchaser shall be entitled to
receive the Released Warranty Amount, if any. It is understood and agreed that
the obligation of the Warranty Purchaser to repurchase any Receivable as to
which a breach has occurred and is continuing, and the obligation of the Seller
and the Servicer to enforce GMAC's obligation to repurchase such Receivables
pursuant to the Pooling and Servicing Agreement shall, if such obligations are
fulfilled, constitute the sole remedy against the Seller, the Servicer or GMAC
for such breach available to the Issuer, the Financial Parties, the Owner
Trustee or the Indenture Trustee. The Servicer also acknowledges its obligations
to repurchase Administrative Receivables from the Issuer pursuant to Section
3.08 of the Pooling and Servicing Agreement.
Section 2.06 Realization Upon Liquidating Receivables. The Servicer shall
use all reasonable efforts, consistent with its customary servicing procedures,
to repossess or take other similar action with respect to any Financed Vehicle
that it has reasonably determined should be repossessed or otherwise converted
following a default under the Receivable secured by the Financed Vehicle. The
Servicer is authorized to follow such practices, policies and procedures as it
customarily follows with respect to comparable automotive receivables that it
services for itself or others, which practices, policies and procedures may
include reasonable efforts to realize upon any recourse to Dealers, selling the
related Financed Vehicle at public or private sale and the taking of other
actions by the Servicer in order to realize upon such a Receivable. The Servicer
is hereby authorized to exercise its discretion consistent with its customary
servicing procedures and the terms of the Basic Documents, in servicing
Liquidating Receivables so as to maximize the net collection of those
Liquidating Receivables. The Servicer shall not be liable for any such exercise
of its discretion made in good faith and in accordance with such servicing
procedures. The foregoing is subject to the provision that, in any case in which
the Financed Vehicle shall have suffered damage, the Servicer shall not expend
funds in connection with any repair or towards the repossession of such Financed
Vehicle unless it shall determine in its discretion and in accordance with such
servicing procedures that such repair and/or repossession shall increase the
proceeds of liquidation of the related Receivable by an amount greater than the
amount of such expenses. The Servicer shall be entitled to receive Liquidation
Expenses with respect to each Liquidating Receivable at such time as the
Receivable becomes a Liquidating Receivable
ARTICLE III
THE SELLER
Section 3.01 Representations of Seller. The Seller makes the following
representations on which the Issuer is relying in acquiring the Receivables and
issuing the Notes and the Certificates. The following representations in clause
(a) speak as of the Closing Date. The representations in clause (b) speak as of
the Closing Date, with respect to the Receivables, and shall survive the sale,
transfer and assignment of the Receivables to the Issuer.
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(a) Representations and Warranties as to the Seller.
(i) Organization and Good Standing. The Seller has been duly
organized and is validly existing as a corporation in good standing under the
laws of the State of Delaware, with power and authority to own its properties
and to conduct its business as such properties are presently owned and such
business is presently conducted, and had at all relevant times, and now has,
power, authority and legal right to acquire and own the Receivables;
(ii) Due Qualification. The Seller is duly qualified to do
business as a foreign corporation in good standing, and has obtained all
necessary licenses and approvals in all jurisdictions in which the ownership or
lease of property or the conduct of its business requires such qualification;
(iii) Power and Authority. The Seller has the power and
authority to execute and deliver the Basic Documents to which it is a party and
to carry out their terms, the Seller has full power and authority to sell and
assign the property to be sold and assigned to and deposited with the Issuer as
part of the Trust and has duly authorized such sale and assignment to the Issuer
by all necessary corporate action; and the execution, delivery and performance
of the Basic Documents to which it is a party have been duly authorized by the
Seller by all necessary corporate action;
(iv) Valid Sale; Binding Obligations. This Agreement and the
Second Step Receivables Assignment, when duly executed and delivered, shall
constitute a valid sale, transfer and assignment of the Receivables, enforceable
against creditors of and purchasers from the Seller; and the Basic Documents to
which the Seller is a party, when duly executed and delivered, shall constitute
legal, valid and binding obligations of the Seller enforceable in accordance
with their 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;
(v) No Violation; Consents. The consummation of the
transactions contemplated by the Basic Documents to which the Seller is a party
and the fulfillment of the terms of the Basic Documents to which the Seller is a
party shall not conflict with, result in any breach of any of the terms and
provisions of or constitute (with or without notice or lapse of time) a default
under, the certificate of incorporation or by-laws of the Seller, or any
indenture, agreement or other instrument to which the Seller is a party or by
which it is bound, or result in the creation or imposition of any Lien upon any
of its properties pursuant to the terms of any such indenture, agreement or
other instrument, other than this Agreement and the Second Step Receivables
Assignment, or 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 any of its properties;
and
(vi) No Proceedings. To the Seller's knowledge, there are no
proceedings or investigations pending, or threatened, before any court,
regulatory body, administrative agency or other tribunal or governmental
instrumentality having jurisdiction over
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the Seller or its properties (i) asserting the invalidity of any Basic Document,
(ii) seeking to prevent the issuance of the Notes or the Certificates or the
consummation of any of the transactions contemplated by any Basic Document,
(iii) seeking any determination or ruling that might materially and adversely
affect the performance by the Seller of its obligations under, or the validity
or enforceability of, any Basic Document, or (iv) seeking to adversely affect
the federal income tax attributes of the Notes or the Certificates.
(b) Representations and Warranties as to the Receivables.
(i) Good Title. No Receivable has been sold, transferred,
assigned or pledged by the Seller to any Person other than the Issuer;
immediately prior to the conveyance of the Receivables pursuant to this
Agreement and the Second Step Receivables Assignment, the Seller had good and
marketable title thereto, free of any Lien; and, upon execution and delivery of
this Agreement and the Second Step Receivables Assignment by the Seller, the
Issuer shall have all of the right, title and interest of the Seller in, to and
under the Receivables, the unpaid indebtedness evidenced thereby and the
collateral security therefor, free of any Lien.
(ii) All Filings Made. All filings (including, without
limitation, UCC filings) necessary in any jurisdiction to give the Issuer a
first priority perfected ownership interest in the Receivables shall have been
made.
(iii) Additional Representations and Warranties. The
representations and warranties regarding creation, perfection and priority of
security interests in the Receivables, which are attached to this Agreement as
Exhibit C, are true and correct to the extent they are applicable.
Section 3.02 Liability of Seller. The Seller shall be liable in accordance
with this Agreement and the Second Step Receivables Assignment only to the
extent of the obligations in this Agreement and the Second Step Receivables
Assignment specifically undertaken by the Seller.
Section 3.03 Merger or Consolidation of, or Assumption of the Obligations
of Seller; Amendment of Certificate of Incorporation.
(a) Any corporation or other entity (i) into which the Seller may be
merged or consolidated, (ii) resulting from any merger or consolidation to which
the Seller shall be a party, (iii) succeeding to the business of the Seller, or
(iv) more than 50% of the voting stock (or, if not a corporation, other voting
interests) of which is owned directly or indirectly by General Motors, which
corporation in any of the foregoing cases executes an agreement of assumption to
perform every obligation of the Seller under this Agreement and the other Basic
Documents to which it is a party, shall be the successor to the Seller under
this Agreement without the execution or filing of any document or any further
act on the part of any of the parties to this Agreement. The Seller shall
provide ten (10) days prior notice of any merger, consolidation or succession
pursuant to this Section 3.03 to the Rating Agencies.
(b) The Seller hereby agrees that during the term of this Agreement
it shall not (i) take any action prohibited by Article Fourth of its certificate
of incorporation, (ii) without the prior written consent of the Indenture
Trustee and the Owner Trustee and without giving
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prior written notice to the Rating Agencies, amend Article Third or Fourth of
its certificate of incorporation or (iii) incur any indebtedness, or assume or
guaranty indebtedness of any other entity, other than pursuant to the Revolving
Note and the Intercompany Advance Agreement (without giving effect to any
amendment to such Note or Agreement after the date hereof, unless the Rating
Agency Condition was satisfied in connection therewith), if such action would
result in a downgrading of the then current rating of any class of the Notes.
Section 3.04 Limitation on Liability of Seller and Others. The Seller and
any director or officer or employee or agent of the Seller may rely in good
faith on the advice of counsel or on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
under this Agreement and the Second Step Receivables Assignment. The Seller and
any director or officer or employee or agent of the Seller shall be reimbursed
by the Indenture Trustee or Owner Trustee, as applicable, for any contractual
damages, liability or expense incurred by reason of such trustee's willful
misfeasance, bad faith or negligence (except errors in judgment) in the
performance of its duties under this Agreement, the Second Step Receivables
Assignment, the Indenture or the Trust Agreement, or by reason of reckless
disregard of its obligations and duties under this Agreement, the Second Step
Receivables Assignment, the Indenture or the Trust Agreement. In no event,
however, shall the Indenture Trustee or the Owner Trustee be liable to the
Seller for any damages in the nature of special, indirect or consequential
damages, however styled, including lost profits. The Seller shall not be under
any obligation to appear in, prosecute or defend any legal action that is not
incidental to its obligations as Seller of the Receivables under this Agreement
and the Second Step Receivables Assignment and that in its opinion may involve
it in any expense or liability.
Section 3.05 Seller May Own Notes or Certificates. Each of the Seller and
any Person controlling, controlled by or under common control with the Seller
may in its individual or any other capacity become the owner or pledgee of Notes
or Certificates with the same rights as it would have if it were not the Seller
or an affiliate thereof, except as otherwise specifically provided herein.
Except as otherwise provided herein, Notes or Certificates so owned by or
pledged to the Seller or such controlling or commonly controlled Person shall
have an equal and proportionate benefit under the provisions of this Agreement,
without preference, priority or distinction as among all of such Notes or
Certificates, respectively.
ARTICLE IV
SERVICER'S COVENANTS; DISTRIBUTIONS; RESERVE ACCOUNT;
STATEMENTS TO NOTEHOLDERS AND CERTIFICATEHOLDERS
Section 4.01 Annual Statement as to Compliance; Notice of Servicer
Default.
(a) The Servicer shall deliver to the Indenture Trustee and the
Owner Trustee, on or before March 15 of each year, beginning March 15, 2006, an
officer's certificate signed by the President or any Vice President of the
Servicer, dated as of December 31 of the immediately preceding year, in each
instance stating that (i) a review of the activities of the Servicer during the
preceding 12-month period (or, with respect to the first such certificate, such
period as shall have elapsed from the Closing Date to the date of such
certificate) and of its performance under this Agreement and under the Pooling
and Servicing Agreement has been made under such officer's supervision and (ii)
to such officer's knowledge, based on such review, the Servicer has
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fulfilled all its obligations under such agreements throughout such period, or,
if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officer and the nature and status
thereof. A copy of such certificate, once delivered, may be obtained by any
Noteholder or Certificateholder by a request in writing to the Issuer addressed
to the Corporate Trust Office of the Indenture Trustee or the Owner Trustee, as
applicable.
(b) The Servicer shall deliver to the Indenture Trustee, the Owner
Trustee and to the Rating Agencies, promptly after having obtained knowledge
thereof, but in no event later than five (5) Business Days thereafter, written
notice in an officer's certificate of any event which with the giving of notice
or lapse of time, or both, would become a Servicer Default under Section 7.01.
The Seller shall deliver to the Indenture Trustee, the Owner Trustee, the
Servicer and the Rating Agencies, promptly after having obtained knowledge
thereof, but in no event later than five (5) Business Days thereafter, written
notice in an officer's certificate of any event which with the giving of notice
or lapse of time, or both, would become a Servicer Default under clause (b) of
Section 7.01.
(c) The Administrator shall prepare, and cause the Servicer to
execute and deliver all certificates or other documents required to be delivered
by the Issuer pursuant to the Sarbanes-Oxley Act of 2002 or the rules and
regulations promulgated pursuant thereto.
Section 4.02 Annual Independent Accountants' Report.
(a) The Servicer shall cause a firm of independent accountants, who
may also render other services to the Servicer or the Seller, to deliver to the
Issuer and the Board of Directors of the Servicer, on or before March 15 of each
year, beginning March 15, 2006, with respect to the twelve months ended on the
immediately preceding December 31 (or, with respect to the first such report,
such period as shall have elapsed from the Closing Date to the date of such
certificate), a report (the "Accountants' Report") delivered to the Board of
Directors of the Servicer and to the Indenture Trustee and the Owner Trustee, to
the effect that such firm has examined the Servicer's assertion that the
Servicer has complied with its Minimum Servicing Standards and that such
examination: (i) was conducted in accordance with the Attestation Protocol and
(ii) included examining, on a test basis, evidence regarding the Servicer's
compliance with its Minimum Servicing Standards. The Accountant's Report shall
include an opinion that the Servicer's assertion with respect to compliance with
its Minimum Servicing Standards is fairly stated in all material respects or
shall report the exceptions that do not permit such opinion. In the event that
such firm requires the Issuer or the Owner Trustee to agree to the examination
performed by such firm, the Servicer shall direct the Owner Trustee in writing
to so agree; it being understood and agreed that the Owner Trustee will deliver
such letter of agreement in conclusive reliance upon the direction of the
Servicer and the Owner Trustee makes no independent inquiry or investigation as
to, and shall have no obligation or liability in respect of, the sufficiency,
validity or correctness of such examination. The Accountants' Report required by
this Section 4.02(a) may be replaced at the election of the Servicer by any
similar report or certification using standards other than Minimum Servicing
Standards or the Attestation Protocol that are now or in the future in use by
servicers of retail instalment sale contracts or direct purchase money loans or
that otherwise comply with any rule, regulation, "no action" letter or similar
guidance promulgated by the Securities and Exchange Commission.
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(b) A copy of the Accountants' Report received pursuant to Section
4.02(a) shall be delivered by the Servicer to the Indenture Trustee and the
Owner Trustee on or before March 15 of each year beginning March 15, 2006.
(c) A copy of the Accountants' Report may be obtained by any
Noteholder or Certificateholder by a request in writing to the Issuer addressed
to the Corporate Trust Office of the Indenture Trustee or the Owner Trustee.
Section 4.03 Access to Certain Documentation and Information Regarding the
Receivables. The Servicer shall provide to the Indenture Trustee and the Owner
Trustee reasonable access to the documentation regarding the Receivables. The
Servicer shall provide such access to any Noteholder or Certificateholder only
in such cases where a Noteholder or a Certificateholder is required by
applicable statutes or regulations to review such documentation. In each case,
such access shall be afforded without charge but only upon reasonable request
and during normal business hours at offices of the Servicer designated by the
Servicer. Nothing in this Section 4.03 shall derogate from the obligation of the
Servicer to observe any applicable law prohibiting disclosure of information
regarding Obligors, and the failure of the Servicer to provide access as
provided in this Section 4.03 as a result of such obligation shall not
constitute a breach of this Section 4.03.
Section 4.04 Amendments to Schedule of Receivables. If the Servicer,
during a Monthly Period, assigns to a Receivable an account number that differs
from the account number previously identifying such Receivable on the Schedule
of Receivables, the Servicer shall deliver to the Seller, the Indenture Trustee
and the Owner Trustee on or before the Distribution Date related to such Monthly
Period an amendment to the Schedule of Receivables to report the newly assigned
account number. Each such amendment shall list all new account numbers assigned
to the Receivables during such Monthly Period and shall show by cross reference
the prior account numbers identifying such Receivables on the Schedule of
Receivables.
Section 4.05 Assignment of Administrative Receivables and Warranty
Receivables. Upon receipt of the Administrative Purchase Payment or the Warranty
Payment with respect to an Administrative Receivable or a Warranty Receivable,
respectively, each of the Indenture Trustee and the Owner Trustee shall assign,
without recourse, representation or warranty, to the Servicer or the Warranty
Purchaser, as applicable, all of such Person's right, title and interest in, to
and under such Administrative Receivable or Warranty Receivable, all monies due
thereon, the security interests in the related Financed Vehicle, proceeds from
any Insurance Policies, proceeds from recourse against a Dealer on such
Receivable and the interests of such Person or the Trust, as applicable, in
rebates of premiums and other amounts relating to the Insurance Policies and any
document relating thereto, such assignment being an assignment outright and not
for security; and the Servicer or the Warranty Purchaser, as applicable, shall
thereupon own such Receivable, and all such security and documents, free of any
further obligations to the Indenture Trustee, the Owner Trustee, the Noteholders
or the Certificateholders with respect thereto. If in any Proceeding it is held
that the Servicer may not enforce a Receivable on the ground that it is not a
real party in interest or a holder entitled to enforce the Receivable, the
Indenture Trustee or the Owner Trustee, as applicable, shall, at the Servicer's
expense, take such steps as the Servicer deems necessary to enforce the
Receivable,
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including bringing suit in the name of such Person or the names of the
Noteholders or the Certificateholders.
Section 4.06 Distributions.
(a) On or before each Determination Date, the Servicer shall
calculate the Total Available Amount, the Available Interest, the Available
Principal, if any, the Basic Servicing Fee, the Additional Servicing Fee, the
Aggregate Noteholders' Interest Distributable Amount (including the Aggregate
Class A Interest Distributable Amount, the Aggregate Class B Interest
Distributable Amount, the Aggregate Class C Interest Distributable Amount, and
the Aggregate Class D Interest Distributable Amount), the Noteholders' Regular
Principal Distributable Amount, the Aggregate Noteholders' Principal
Distributable Amount, the Specified Reserve Account Balance, the net amount, if
any, payable by the Trust under any Interest Rate Swaps, the amount, if any, of
any payments due in respect of an Early Termination Date payable by the Trust
under any Interest Rate Swaps, and all other amounts required to determine the
amounts, if any, to be deposited in or paid from each of the Collection Account,
the Note Distribution Account, the Reserve Account, the Payment Ahead Servicing
Account, if applicable, on or before the related Distribution Date (or, in the
case of payments due under any Interest Rate Swaps, if any, on the Business Day
preceding the Distribution Date).
(b) Based in each case, on the information contained in the
Servicer's Accounting delivered on the related Determination Date pursuant to
Section 3.10 of the Pooling and Servicing Agreement:
(i) On or before each Distribution Date, the Indenture Trustee
shall cause collections made during the related Monthly Period which constitute
Payments Ahead to be transferred from the Collection Account to the Servicer, or
to the Payment Ahead Servicing Account, if required pursuant to Section 5.01(e).
(ii) On or before each Distribution Date (or, with respect to
funds necessary to make payments due, if any, under any Interest Rate Swaps for
the related Monthly Period, on the Business Day preceding the Distribution
Date), the Indenture Trustee shall transfer from the Payment Ahead Servicing
Account (or, if the Servicer is not required to make deposits to the Payment
Ahead Servicing Account on a daily basis pursuant to Section 5.01(e), the
Servicer shall deposit) to the Collection Account the aggregate Applied Payments
Ahead and, as applicable, Applied Payments Ahead necessary to make payments
under any Interest Rate Swaps pursuant to Section 4.06(d)(ii) and (e)(ii).
(iii) On or before each Distribution Date, the Indenture
Trustee shall transfer from the Collection Account to the Servicer, in
immediately available funds, reimbursement of Outstanding Monthly Advances
pursuant to Section 5.04, payment of Excess Simple Interest Collections, if any,
pursuant to Section 3.11(b) of the Pooling and Servicing Agreement, and payments
of Liquidation Expenses (and any unpaid Liquidation Expenses from prior periods)
with respect to Receivables which became Liquidating Receivables during the
related Monthly Period pursuant to Section 3.04 of the Pooling and Servicing
Agreement.
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(iv) On or before each Distribution Date (or, with respect to
funds necessary to make payments due, if any, under any Interest Rate Swaps for
the related payment period thereunder, the amount, if any, of any payments due
in respect of any Early Termination Date payable by the Trust under any Interest
Rate Swaps, the Indenture Trustee shall withdraw from the Reserve Account and
deposit in the Collection Account the amount of cash or other immediately
available funds on deposit therein.
(c) Except as otherwise provided in Section 4.06(d), on each
Distribution Date (or in the case of payments to the Swap Counterparty pursuant
to clause (ii) below, if any, on the Business Day preceding the Distribution
Date) the Indenture Trustee (based on the information contained in the
Servicer's Accounting delivered on the related Determination Date pursuant to
Section 3.10 of the Pooling and Servicing Agreement) shall make the following
distributions from the Collection Account (after the withdrawals, deposits and
transfers specified in Section 4.06(c) have been made) in the following order of
priority:
(i) first, to the Servicer, to the extent of the Total
Available Amount, the Basic Servicing Fee;
(ii) second, to the Swap Counterparty, to the extent of the
Total Available Amount (as such amount has been reduced by the distributions
described in clause (i) above), the net amount, if any, due under all Interest
Rate Swaps (exclusive of payments due in respect of an Early Termination Date of
any Interest Rate Swaps);
(iii) third, to the extent of the Total Available Amount (as
such amount has been reduced by the distributions described in clauses (i) and
(ii) above) (a) to the Note Distribution Account for the payment of interest on
the Class A Notes, the Aggregate Class A Interest Distributable Amount, and (b)
to the Swap Counterparty, the amount of any payments due to the Swap
Counterparty in connection with an Early Termination Date of any Interest Rate
Swaps related to the Class A-1 Notes, the Class A-2a Notes, the Class A-3 Notes
and the Class A-5 Notes, allocated between the Note Distribution Account and the
Swap Counterparty in proportion to the amount of the Aggregate Class A Interest
Distributable Amount and the amount owing to the Swap Counterparty in connection
with such Early Termination Date;
(iv) fourth, to the extent of the Total Available Amount (as
such amount has been reduced by the distributions described in clauses (i)
through (iii) above), to the Note Distribution Account for the payment of
principal on the Notes in the priority specified in the Indenture, the First
Priority Principal Distributable Amount;
(v) fifth, to the extent of the Total Available Amount (as
such amount has been reduced by the distributions described in clauses (i)
through (iv) above), (a) to the Note Distribution Account for the payment of
interest on the Class B Notes, the Aggregate Class B Interest Distributable
Amount and (b) to the Swap Counterparty, the amount of any payments due to the
Swap Counterparty in connection with an Early Termination Date of any Interest
Rate Swaps related to the Class B Notes, allocated between the Note Distribution
Account and the Swap Counterparty in proportion to the amount of the Aggregate
Class B Interest Distributable Amount and the amount owing to the Swap
Counterparty in connection with such Early Termination Date;
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(vi) sixth, to the extent of the Total Available Amount (as
such amount has been reduced by the distributions described in clauses (i)
through (v) above), to the Note Distribution Account for the payment of
principal on the Notes in the priority specified in the Indenture, the Second
Priority Principal Distributable Amount;
(vii) seventh, to the extent of the Total Available Amount (as
such amount has been reduced by the distributions described in clauses (i)
through (vi) above), to the Note Distribution Account for the payment of
interest on the Class C Notes, the Aggregate Class C Interest Distributable
Amount;
(viii) eighth, to the extent of the Total Available Amount (as
such amount has been reduced by the distributions described in clauses (i)
through (vii) above), to the Note Distribution Account for the payment of
principal on the Notes in the priority specified in the Indenture, the Third
Priority Principal Distributable Amount;
(ix) ninth, to the extent of the Total Available Amount (as
such amount has been reduced by the distributions described in clauses (i)
through (viii) above), to the Note Distribution Account for the payment of
interest on the Class D Notes, the Aggregate Class D Interest Distributable
Amount;
(x) tenth, to the extent of the Total Available Amount (as
such amount has been reduced by the distributions described in clauses (i)
through (ix) above), to the Note Distribution Account for the payment of
principal on the Notes in the priority specified in the Indenture, the Fourth
Priority Principal Distributable Amount;
(xi) eleventh, to the Reserve Account, to the extent of the
Total Available Amount (as such amount has been reduced by the distributions
described in clauses (i) through (x) above), the amount required to bring the
amount on deposit therein up to the Specified Reserve Account Balance;
(xii) twelfth, to the Note Distribution Account for payment to
the Noteholders, to the extent of the Total Available Amount (as such amount has
been reduced by the distributions described in clauses (i) through (xi) above),
an amount equal to the Noteholders' Regular Principal Distributable Amount;
(xiii) thirteenth, to the Servicer, to the extent of the Total
Available Amount (as such amount has been reduced by the distributions described
in clauses (i) through (xii) above), the Additional Servicing Fee; and
(xiv) fourteenth, to the Certificateholders (if the
Certificate Distribution Account has been established pursuant to Section 5.1 of
the Trust Agreement, then to such Certificate Distribution Account for
distribution to the Certificateholders), any portion of the Total Available
Amount remaining after the distributions described in clauses (i) through (xiii)
above.
(d) Notwithstanding the foregoing, at any time that the Notes have
not been paid in full and the principal balance of the Notes has been declared
immediately due and payable following the occurrence of an Event of Default
under Sections 5.1(a), 5.1(b), 5.1(c),
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5.1(e), or 5.1(f) of the Indenture, then until such time as the Notes have been
paid in full and the Indenture has been discharged or the foregoing Events of
Default have been cured or waived as provided in Section 5.2(b) of the
Indenture, the order in which payments to Noteholders shall be made or on
amounts deposited into the Note Distribution Account shall be as specified in
Section 2.7(c) of the Indenture.
Section 4.07 Reserve Account.
(a) There shall be established in the name of and maintained with
the Indenture Trustee for the benefit of the Noteholders an Eligible Deposit
Account known as the Capital Auto Receivables Asset Trust 2005-1 Reserve Account
(the "Reserve Account") to include the money and other property deposited and
held therein pursuant to this Section 4.07(a), Section 4.07(e) and Section
4.06(c). On the Closing Date, the Seller shall deposit the Reserve Account
Initial Deposit in immediately available funds into the Reserve Account. The
Reserve Account shall constitute property of the Trust.
(b) If the amount on deposit in the Reserve Account on any
Distribution Date (after giving effect to all deposits therein or withdrawals
therefrom on such Distribution Date) exceeds the Specified Reserve Account
Balance for such Distribution Date, the Servicer shall instruct the Indenture
Trustee to distribute an amount equal to any such excess to the
Certificateholder; it being understood that no such distribution from the
Reserve Account shall be made to the Certificateholder unless the amount so on
deposit in the Reserve Account exceeds such Specified Reserve Account Balance.
(c) [Intentionally Omitted].
(d) Each of the Seller and Servicer agree to take or cause to be
taken such further actions, to execute, deliver and file or cause to be
authorized and executed, as applicable, delivered and filed such further
documents and instruments (including, without limitation, any UCC financing
statements or this Agreement) as may be determined to be necessary, in an
Opinion of Counsel to the Seller delivered to the Indenture Trustee, in order to
perfect the interests created by this Section 4.07 and otherwise fully to
effectuate the purposes, terms and conditions of this Section 4.07. The Seller
shall:
(i) promptly authorize and execute, as applicable, deliver and
file any financing statements, amendments, continuation statements, assignments,
certificates and other documents with respect to such interests and perform all
such other acts as may be necessary in order to perfect or to maintain the
perfection of the Indenture Trustee's security interest; and
(ii) make the necessary filings of financing statements or
amendments thereto within thirty (30) days after the occurrence of any of the
following: (A) any change in their respective corporate names or any trade
names, (B) any change in the location of their respective chief executive
offices or principal places of business or any change in their respective
jurisdictions of organization, (C) any merger or consolidation or other change
in their respective identities or corporate structures and (D) any other change
or occurrence that would make any financing statement or amendment thereto
seriously misleading within the meaning of the UCC; and shall promptly notify
the Indenture Trustee of any such filings.
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(e) If the Servicer pursuant to Section 5.04 determines on any
Determination Date that it is required to make a Monthly Advance and does not do
so from its own funds, the Servicer shall instruct the Indenture Trustee to
withdraw funds from the Reserve Account and deposit them in the Collection
Account to cover any shortfall. Such payment shall be deemed to have been made
by the Servicer pursuant to Section 5.04 for purposes of making distributions
pursuant to this Agreement, but shall not otherwise satisfy the Servicer's
obligation to deliver the amount of the Monthly Advances, and the Servicer shall
within two (2) Business Days replace any funds in the Reserve Account so used.
The Servicer shall not be entitled to reimbursement for any such deemed Monthly
Advances unless and until the Servicer shall have replaced such funds in the
Reserve Account.
Section 4.08 Net Deposits. At any time that (i) GMAC shall be the
Servicer, (ii) the Servicer shall be permitted by Section 5.02 to remit
collections on a basis other than a daily basis, and (iii) the Servicer shall be
permitted by Section 5.01(e) to remit Payments Ahead on a basis other than on a
daily basis, the Servicer, the Seller, the Indenture Trustee and the Owner
Trustee may make any remittances pursuant to this Article IV net of amounts to
be distributed by the applicable recipient to such remitting party. Nonetheless,
each such party shall account for all of the above described remittances and
distributions as if the amounts were deposited and/or transferred separately.
Section 4.09 Statements to Securityholders.
(a) On each Distribution Date, the Owner Trustee shall (except as
otherwise provided in the Trust Agreement) deliver to each Certificateholder,
and the Indenture Trustee shall include with each distribution to each
Noteholder, a statement (which statement shall also be provided to the Rating
Agencies) prepared by the Servicer based on information in the Servicer's
Accounting furnished pursuant to Section 3.10 of the Pooling and Servicing
Agreement. Each such statement to be delivered to Certificateholders and
Noteholders, respectively, shall set forth the following information concerning
the Certificates or the Notes, as appropriate, with respect to such Distribution
Date or the preceding Monthly Period:
(i) the amount of such distribution allocable to principal of
each class of the Notes;
(ii) the amount of the distribution, if any, allocable to
interest on or with respect to each class of securities;
(iii) the net amount, if any, of any payments due under all
Interest Rate Swaps (specifying, if applicable, any amounts owing as a result of
an Early Termination Date under the Notes);
(iv) the Aggregate Receivables Principal Balance as of the
close of business on the last day of such Monthly Period, the Aggregate
Receivables Principal Balance as of the close of business on the last day of the
second monthly period preceding such Distribution Date (or, for the first
Distribution Date, the Initial Aggregate Receivables Principal Balance) and the
Principal Distributable Amount for such Distribution Date;
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(v) the Note Principal Balance for each class of Notes and the
Aggregate Note Principal Balance, and the Note Pool Factor for each class of
Notes, each as of such Distribution Date after giving effect to all payments
described under clause (i) above;
(vi) the amount of the Class A Notes Interest Carryover
Shortfall, the Class B Notes Interest Carryover Shortfall, the Class C Notes
Interest Carryover Shortfall, and the Class D Notes Interest Carryover
Shortfall, if any, and the change in each of such amounts from the preceding
Distribution Date;
(vii) the aggregate amount in the Payment Ahead Servicing
Account or on deposit with the Servicer as Payments Ahead and the change in such
amount from the previous Distribution Date;
(viii) the amount of Outstanding Monthly Advances on such
Distribution Date;
(ix) the amount of the Basic Servicing Fee and the Additional
Servicing Fee paid to the Servicer with respect to the related Monthly Period;
(x) the amount, if any, distributed to Noteholders from
amounts on deposit in the Reserve Account;
(xi) the balance of the Reserve Account on such Distribution
Date (after giving effect to changes therein on such Distribution Date); and
(xii) LIBOR for such Distribution Date and the interest rate
on each class of Floating Rate Notes.
Each amount set forth pursuant to clauses (i), (ii), (iv), (vii), and (viii)
above shall be expressed as a dollar amount per $1,000 of initial principal
amount of the Notes.
(b) Within the prescribed period of time for tax reporting purposes
after the end of each calendar year during the term of this Agreement, the
Indenture Trustee and the Owner Trustee shall mail, to each Person who at any
time during such calendar year shall have been a holder of Notes or
Certificates, respectively, and received any payments thereon, a statement
containing such information as may be required by the Code and applicable
Treasury Regulations to enable such securityholder to prepare its federal income
tax returns.
ARTICLE V
CERTIFICATEHOLDER AND NOTEHOLDER STATEMENTS AND ACCOUNTS;
COLLECTIONS, DEPOSITS AND INVESTMENTS; ADVANCES
Section 5.01 Establishment of Accounts.
(a) (i) The Servicer, for the benefit of the Financial Parties,
shall establish and maintain in the name of the Indenture Trustee an Eligible
Deposit Account known as the Capital Auto Receivables Asset Trust 2005-1
Collection Account (the "Collection
15
Account"), bearing an additional designation clearly indicating that the funds
deposited therein are held for the benefit of the Financial Parties.
(ii) The Servicer, for the benefit of the Noteholders, shall
establish and maintain in the name of the Indenture Trustee an Eligible Deposit
Account known as the Capital Auto Receivables Asset Trust 2005-1 Note
Distribution Account (the "Note Distribution Account"), bearing an additional
designation clearly indicating that the funds deposited therein are held for the
benefit of the Noteholders.
(iii) [Intentionally Omitted].
(iv) The Servicer, for the benefit of the Obligors, shall
establish and maintain in the name of the Indenture Trustee an account known as
the Capital Auto Receivables Asset Trust 2005-1 Payment Ahead Servicing Account
(the "Payment Ahead Servicing Account"). The Payment Ahead Servicing Account
shall not be property of the Issuer.
(b) (i) Each of the Designated Accounts and the Payment Ahead
Servicing Account shall be initially established with the Indenture Trustee. At
any time after the Closing Date, the Servicer, upon thirty (30) days written
notice to the Indenture Trustee or other Account Holder, shall have the right to
instruct an Account Holder to transfer any or all of the Designated Accounts or
the Payment Ahead Servicing Account to another Eligible Institution designated
by the Servicer in such notice. No Designated Account nor the Payment Ahead
Servicing Account shall be maintained with an Account Holder if the short-term
debt obligations of such Account Holder cease to have the Required Deposit
Rating (except that any Designated Account, but not the Payment Ahead Servicing
Account, may be maintained with an Account Holder even if the short-term debt
obligations of such Account Holder do not have the Required Deposit Rating, if
such Account Holder maintains such Designated Account in its corporate trust
department). Should the short-term unsecured debt obligations of an Account
Holder no longer have the Required Deposit Rating, then the Servicer shall,
within ten (10) Business Days (or such longer period, not to exceed thirty (30)
calendar days, as to which each Rating Agency shall consent), with the Indenture
Trustee's assistance as necessary, cause each affected Designated Account or
Payment Ahead Servicing Account (A) to be moved to an Account Holder that is an
Eligible Institution or (B) with respect to the Designated Accounts only, to be
moved to the corporate trust department of the Account Holder. All amounts held
in Designated Accounts and the Payment Ahead Servicing Account (including
amounts, if any, which the Servicer is required to remit daily to the Collection
Account pursuant to Section 5.02) shall, to the extent permitted by applicable
laws, rules and regulations, be invested, at the written direction of the
Servicer, by such Account Holder in Eligible Investments. Such written direction
shall constitute certification by the Servicer that any such investment is
authorized by this Section 5.01. Funds deposited in the Reserve Account shall be
invested in Eligible Investments which mature (i) prior to the next Distribution
Date or (ii) at such later date as shall be otherwise permitted by the Rating
Agencies. Investments in Eligible Investments shall be made in the name of the
Indenture Trustee or its nominee, and such investments shall not be sold or
disposed of prior to their maturity; provided, however, that Notes held in the
Reserve Account may be sold or disposed of prior to their maturity so long as
(x) the Servicer directs the Indenture Trustee to make such sale or disposition,
(y) the Indenture Trustee gives reasonable prior notice of such disposition to
the Administrator and (z) such Notes are sold at a price equal to or greater
than the
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unpaid principal balance thereof if, following such sale, the amount on deposit
in the Reserve Account would be less than the Specified Reserve Account Balance.
Investment Earnings on funds deposited in the Designated Accounts and the
Payment Ahead Servicing Account shall be payable to the Servicer. Each Account
Holder holding a Designated Account as provided in this Section 5.01(b)(i),
shall be a "Securities Intermediary." If a Securities Intermediary shall be a
Person other than the Indenture Trustee, the Servicer shall obtain the express
agreement of such Person to the obligations of the Securities Intermediary set
forth in this Section 5.01 and an Opinion of Counsel that such Person can
perform such obligations.
(ii) With respect to the Designated Account Property, the Account
Holder agrees, by its acceptance hereof, that:
(A) Any Designated Account Property that is held in
deposit accounts shall be held solely in Eligible Deposit Accounts. The
Designated Accounts are accounts to which Financial Assets will be credited.
(B) All securities or other property underlying any
Financial Assets credited to the Designated Accounts shall be registered in the
name of the Securities Intermediary, indorsed to the Securities Intermediary or
in blank or credited to another securities account maintained in the name of the
Securities Intermediary and in no case will any Financial Asset credited to any
of the Designated Accounts be registered in the name of the Issuer, the Servicer
or the Seller, payable to the order of the Issuer, the Servicer or the Seller or
specially indorsed to the Issuer, the Servicer or the Seller except to the
extent the foregoing have been specially indorsed to the Securities Intermediary
or in blank.
(C) All property delivered to the Securities
Intermediary pursuant to this Agreement will be credited upon receipt of such
property to the appropriate Designated Account.
(D) Each item of property (whether investments,
investment property, Financial Asset, security, instrument or cash) credited to
a Designated Account shall be treated as a "financial asset" within the meaning
of Section 8-102(a)(9) of the New York UCC.
(E) If at any time the Securities Intermediary shall
receive any order from the Indenture Trustee directing transfer or redemption of
any Financial Asset relating to the Designated Accounts, the Securities
Intermediary shall comply with such order without further consent by the Trust,
the Servicer, the Seller or any other Person.
(F) The Designated Accounts shall be governed by the
laws of the State of New York, regardless of any provision in any other
agreement. For purposes of the UCC, New York shall be deemed to be the
Securities Intermediary's jurisdiction and the Designated Accounts (as well as
the Security Entitlements related thereto) shall be governed by the laws of the
State of New York.
(G) The Securities Intermediary has not entered into,
and until the termination of this Agreement will not enter into, any agreement
with any other Person relating to the Designated Accounts and/or any Financial
Assets or other property
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credited thereto pursuant to which it has agreed to comply with entitlement
orders (as defined in Section 8-102(a)(8) of the New York UCC) of such other
Person and the Securities Intermediary has not entered into, and until the
termination of this Agreement will not enter into, any agreement with the
Issuer, the Seller, the Servicer, the Account Holder or the Indenture Trustee
purporting to limit or condition the obligation of the Securities Intermediary
to comply with entitlement orders as set forth in Section 5.01(b)(ii)(E) hereof.
(H) Except for the claims and interest of the Indenture
Trustee in the Designated Accounts, the Securities Intermediary has no actual
knowledge of claims to, or interests in, the Designated Accounts or in any
Financial Asset credited thereto. If any other Person asserts any Lien,
encumbrance or adverse claim (including any writ, garnishment, judgment, warrant
of attachment, execution or similar process) against the Designated Accounts or
in any Financial Asset carried therein, the Securities Intermediary will
promptly notify the Indenture Trustee, the Servicer and the Issuer thereof.
(I) The Securities Intermediary will promptly send
copies of all statements, confirmations and other correspondence concerning the
Designated Accounts and/or any Designated Account Property simultaneously to
each of the Servicer and the Indenture Trustee, at the addresses set forth in
Appendix B to this Agreement.
(J) The Account Holder shall maintain each item of
Designated Account Property in the particular Designated Account to which such
item originated and shall not commingle items from different Designated
Accounts.
(iii) The Servicer shall have the power, revocable by the
Indenture Trustee (or by the Owner Trustee with the consent of the Indenture
Trustee) to instruct the Indenture Trustee to make withdrawals and payments from
the Designated Accounts for the purpose of permitting the Servicer or the Owner
Trustee to carry out its respective duties hereunder or permitting the Indenture
Trustee to carry out its duties under the Indenture.
(iv) The Indenture Trustee shall possess all right, title and
interest in and to all funds on deposit from time to time in the Designated
Accounts and in all proceeds thereof (except Investment Earnings). Except as
otherwise provided herein or in the Indenture, the Designated Accounts shall be
under the exclusive dominion and control of the Indenture Trustee for the
benefit of the Securityholders and the Indenture Trustee shall have sole
signature power and authority with respect thereto.
(v) The Servicer shall not direct the Account Holder to make
any investment of any funds or to sell any investment held in any of the
Designated Accounts unless the security interest granted and perfected in such
account shall continue to be perfected in such investment or the proceeds of
such sale, in either case without any further action by any Person, and, in
connection with any direction to the Account Holder to make any such investment
or sale, if requested by the Indenture Trustee, the Servicer shall deliver to
the Indenture Trustee an Opinion of Counsel, acceptable to the Indenture
Trustee, to such effect.
(c) [Intentionally Omitted].
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(d) The Indenture Trustee, the Owner Trustee, the Securities
Intermediary, the Account Holder and each other Eligible Deposit Institution
with whom a Designated Account is maintained waives any right of set-off,
counterclaim, security interest or bankers' lien to which it might otherwise be
entitled.
(e) At any time that each Monthly Remittance Condition is satisfied,
then (x) Payments Ahead need not be remitted to and deposited in the Payment
Ahead Servicing Account but instead may be remitted to and held by the Servicer
and (y) the Servicer shall not be required to segregate or otherwise hold
separate any Payments Ahead, but the Servicer shall be required to remit Applied
Payments Ahead to the Collection Account in accordance with Section 4.06(c)(ii).
The Servicer shall promptly notify the Indenture Trustee if any Monthly
Remittance Condition ceases to be satisfied such that the Payments Ahead will
not be remitted in accordance with the prior sentence. Commencing with the first
day of the first Monthly Period that begins at least two (2) Business Days after
the day on which any Monthly Remittance Condition ceases to be satisfied, the
Servicer shall deposit in the Payment Ahead Servicing Account the amount of any
Payments Ahead then held by it, and thereafter, for so long as a Monthly
Remittance Condition continues to be unsatisfied, the Servicer shall deposit any
additional Payments Ahead in the Payments Ahead Servicing Account within two (2)
Business Days after receipt thereof. Notwithstanding the foregoing, if a Monthly
Remittance Condition is unsatisfied the Servicer may utilize, with respect to
the Payments Ahead, an alternative remittance schedule (which may include a
remittance schedule utilized by the Servicer at a time when the Monthly
Remittance Conditions were satisfied), if the Servicer provides to the Indenture
Trustee written confirmation from the Rating Agencies that such alternative
remittance schedule will not result in the downgrading or withdrawal by the
Rating Agencies of the ratings then assigned to either the Notes or the
Certificates. Neither the Indenture Trustee nor the Owner Trustee shall be
deemed to have knowledge of any Servicer Default unless such trustee has
received notice of such event or circumstance from the other trustee, the Seller
or the Servicer in an officer's certificate or from Certificateholders whose
Certificates evidence not less than 25% of the Voting Interests as of the close
of the preceding Distribution Date or from Noteholders whose Notes evidence not
less than 25% of the Outstanding Amount of the Notes as of the close of the
preceding Distribution Date or unless a Responsible Officer in the Corporate
Trust Office of the Indenture Trustee with knowledge hereof and familiarity
herewith has actual knowledge of such event or circumstance.
Section 5.02 Collections. If a Monthly Remittance Condition is not
satisfied, commencing with the first day of the first Monthly Period that begins
at least two (2) Business Days after the day on which any Monthly Remittance
Condition ceases to be satisfied, the Servicer shall remit to the Collection
Account all payments by or on behalf of the Obligors (including Payments Ahead
in accordance with Section 5.01(e)) on the Receivables and all Liquidation
Proceeds within two (2) Business Days after receipt thereof. Notwithstanding the
foregoing, if a Monthly Remittance Condition is unsatisfied, the Servicer may
utilize an alternative remittance schedule (which may include a remittance
schedule utilized by the Servicer at a time when the Monthly Remittance
Conditions were satisfied), if the Servicer provides to the Indenture Trustee
written confirmation from the Rating Agencies that such alternative remittance
schedule will not result in the downgrading or withdrawal by the Rating Agencies
of the ratings then assigned to the Notes or the Certificates. At all times when
all Monthly Remittance Conditions are satisfied, the Servicer (i) shall not be
required to segregate
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or otherwise hold separate any Payments Ahead remitted to the Servicer and (ii)
shall remit collections received during a Monthly Period to the Collection
Account in immediately available funds on or before the related Distribution
Date (or in the case of amounts payable to the Swap Counterparty pursuant to
Section 4.06(c)(ii), if any, on or before the Business Day preceding the
Distribution Date).
Section 5.03 Investment Earnings and Supplemental Servicing Fees. The
Servicer shall be entitled to receive all Investment Earnings (with the
exception of Investment Earnings on funds in the Accumulation Account) and
Supplemental Servicing Fees when and as paid without any obligation to the Owner
Trustee, the Indenture Trustee or the Seller in respect thereof. The Servicer
will have no obligation to deposit any such amount in any account established
hereunder. To the extent that any such amount shall be held in any account held
by the Indenture Trustee or the Owner Trustee, or otherwise established
hereunder, such amount will be withdrawn therefrom and paid to the Servicer upon
presentation of a certificate signed by a Responsible Officer of the Servicer
setting forth, in reasonable detail, the amount of such Investment Earnings or
Supplemental Servicing Fees.
Section 5.04 Monthly Advances.
(a) Subject to the following sentence, as of the last day of each
Monthly Period, with respect to each Scheduled Interest Receivable (other than
an Administrative Receivable or a Warranty Receivable), if there is a shortfall
in the Scheduled Payment remaining after application of the Deferred Prepayment
pursuant to the last sentence of Section 3.11(a) of the Pooling and Servicing
Agreement, the Servicer shall advance an amount equal to such shortfall (such
amount, a "Scheduled Interest Advance"). The Servicer shall be obligated to make
a Scheduled Interest Advance in respect of a Scheduled Interest Receivable only
to the extent that the Servicer, in its sole discretion, shall determine that
such advance shall be recoverable from subsequent collections or recoveries on
any Receivable. The Servicer shall be reimbursed for Outstanding Scheduled
Interest Advances with respect to a Receivable from the following sources with
respect to such Receivable, in each case as set forth in the Pooling and
Servicing Agreement: (i) subsequent payments by or on behalf of the Obligor,
(ii) collections of Liquidation Proceeds, and (iii) the Warranty Payment. At
such time as the Servicer shall determine that any Outstanding Scheduled
Interest Advances with respect to any Scheduled Interest Receivable shall not be
recoverable from payments with respect to such Receivable, the Servicer shall be
reimbursed from any collections made on other Receivables held by the Issuer.
(b) As of the last day of each Monthly Period, the Servicer shall
advance an amount equal to the excess, if any, of (i) the amount of interest
that would be due during such Monthly Period on all Simple Interest Receivables
held by the Issuer (assuming that the payment on each such Receivable was
received on its respective due date) over (ii) all payments received during such
Monthly Period on all Simple Interest Receivables held by the Issuer to the
extent allocable to interest (such excess, a "Simple Interest Advance"). In
addition, Liquidation Proceeds with respect to a Simple Interest Receivable
allocable to accrued and unpaid interest thereon (but not including interest for
the then current Monthly Period) shall be paid to the Servicer but only to the
extent of any Outstanding Simple Interest Advances. The Servicer shall not make
any advance with respect to principal of any Simple Interest Receivable. Excess
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Simple Interest Collections shall be paid to the Servicer as provided in Section
3.11(b) of the Pooling and Servicing Agreement.
Section 5.05 Additional Deposits. The Servicer shall deposit in the
Collection Account the aggregate Monthly Advances pursuant to Sections 5.04(a)
and (b) and the aggregate amounts to be paid to the Issuer pursuant to Section
3.03 of the Pooling and Servicing Agreement. The Servicer and the Seller shall
deposit in the Collection Account the aggregate Administrative Purchase Payments
and Warranty Payments with respect to Administrative Receivables and Warranty
Receivables, respectively. All such deposits with respect to a Monthly Period
shall be made in immediately available funds on or before the Distribution Date
related to such Monthly Period (or, to the extent such funds are necessary to
make payments due, if any, under any Interest Rate Swaps for the related Monthly
Period, on or before the Business Day preceding the Distribution Date)..
ARTICLE VI
LIABILITIES OF SERVICER AND OTHERS
Section 6.01 Liability of Servicer; Indemnities.
(a) The Servicer shall be liable in accordance with this Agreement
and the Second Step Receivables Assignment only to the extent of the obligations
in this Agreement and the Pooling and Servicing Agreement specifically
undertaken by the Servicer. Such obligations shall include the following:
(i) The Servicer shall defend, indemnify and hold harmless the
Indenture Trustee, the Owner Trustee, the Issuer, the Noteholders 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 any Financed
Vehicle;
(ii) The Servicer shall indemnify, defend and hold harmless
the Indenture Trustee, the Owner Trustee and the Issuer from and against any
taxes that may at any time be asserted against any such Person with respect to
the transactions contemplated in this Agreement, including, without limitation,
any sales, gross receipts, general corporation, tangible personal property,
privilege or license taxes (but not including any taxes asserted with respect
to, and as of the date of, the sale of the Receivables to the Issuer or the
issuance and original sale of the Notes and the Certificates, or asserted with
respect to ownership of the Receivables, or federal or other income taxes
arising out of distributions on the Notes or the Certificates, or any fees or
other compensation payable to any such Person) and costs and expenses in
defending against the same;
(iii) The Servicer shall indemnify, defend and hold harmless
the Indenture Trustee, the Owner Trustee, the Issuer, the Noteholders 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 Indenture Trustee,
the Owner Trustee, the Issuer, the Noteholders or the Certificateholders through
the negligence, willful misfeasance or bad faith of the Servicer in the
performance of its
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duties under this Agreement, the Pooling and Servicing Agreement, the Indenture
or the Trust Agreement or any other Basic Document or by reason of reckless
disregard of its obligations and duties under this Agreement, the Pooling and
Servicing Agreement, the Indenture, the Trust Agreement or any other Basic
Document; and
(iv) The Servicer shall indemnify, defend and hold harmless
the Indenture Trustee and the Owner Trustee, and their respective agents and
servants, from and against all costs, expenses, losses, claims, damages and
liabilities arising out of or incurred in connection with (x) in the case of the
Owner Trustee, the Indenture Trustee's performance of its duties under the
Indenture or any other Basic Document, (y) in the case of the Indenture Trustee,
the Owner Trustee's performance of its duties under the Trust Agreement or (z)
the acceptance, administration or performance by, or action or inaction of, the
Indenture Trustee or the Owner Trustee, as applicable, of the trusts and duties
contained in this Agreement, the Basic Documents, the Indenture (in the case of
the Indenture Trustee), including the administration of the Trust Estate, and
the Trust Agreement (in case of the Owner Trustee), including the administration
of the Owner Trust Estate, except in each case to the extent that such cost,
expense, loss, claim, damage or liability: (A) is due to the willful
misfeasance, bad faith or negligence (except for errors in judgment) of the
Person indemnified, (B) to the extent otherwise payable to the Indenture
Trustee, arises from the Indenture Trustee's breach of any of its
representations or warranties in Section 6.13 of the Indenture, (C) to the
extent otherwise payable to the Owner Trustee, arises from the Owner Trustee's
breach of any of its representations or warranties set forth in Section 6.6 of
the Trust Agreement, or (D) shall arise out of or be incurred in connection with
the performance by the Indenture Trustee of the duties of successor Servicer
hereunder.
(b) Indemnification under this Section 6.01 shall include, without
limitation, reasonable fees and expenses of external counsel and expenses of
litigation. If the Servicer has made any indemnity payments pursuant to this
Section 6.01 and the recipient thereafter collects any of such amounts from
others, the recipient shall promptly repay such amounts collected to the
Servicer, without interest.
Section 6.02 Merger or Consolidation of, or Assumption of the Obligations
of the Servicer. Any corporation or other entity (a) into which the Servicer may
be merged or consolidated, (b) resulting from any merger, conversion or
consolidation to which the Servicer shall be a party, (c) succeeding to the
business of the Servicer, or (d) more than 50% of the voting stock (or, if not a
corporation, other voting interests) of which is owned directly or indirectly by
General Motors and which is otherwise servicing the Seller's receivables, which
corporation in any of the foregoing cases executes an agreement of assumption to
perform every obligation of the Servicer under this Agreement and the Pooling
and Servicing Agreement, shall be the successor to the Servicer under this
Agreement and the Pooling and Servicing Agreement without the execution or
filing of any paper or any further act on the part of any of the parties to this
Agreement, anything in this Agreement or in the Pooling and Servicing Agreement
to the contrary notwithstanding. The Servicer shall provide notice of any
merger, consolidation or succession pursuant to this Section 6.02 to the Rating
Agencies.
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Section 6.03 Limitation on Liability of Servicer and Others.
(a) Neither the Servicer nor any of the directors or officers or
employees or agents of the Servicer shall be under any liability to the Issuer,
the Noteholders or the Certificateholders, except as specifically provided in
this Agreement and in the Pooling and Servicing Agreement, for any action taken
or for refraining from the taking of any action pursuant to this Agreement, the
Pooling and Servicing Agreement, the Indenture or the Trust Agreement or for
errors in judgment; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability that would otherwise be
imposed by reason of willful misfeasance, bad faith or negligence (except errors
in judgment) in the performance of duties or by reason of reckless disregard of
obligations and duties under this Agreement, the Pooling and Servicing
Agreement, the Indenture, the Trust Agreement or any other Basic Document. 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 any kind prima
facie properly executed and submitted by any Person respecting any matters
arising under this Agreement or the Pooling and Servicing Agreement.
(b) The Servicer and any director or officer or employee or agent of
the Servicer shall be reimbursed by the Indenture Trustee or the Owner Trustee,
as applicable, for any contractual damages, liability or expense (including any
obligation of the Servicer to the Indenture Trustee or the Owner Trustee, as
applicable, pursuant to Section 6.01(a)(iv)(x) or (y)) incurred by reason of
such trustee's willful misfeasance, bad faith or negligence (except errors in
judgment) in the performance of such trustee's duties under this Agreement, the
Indenture or the Trust Agreement or by reason of reckless disregard of its
obligations and duties under this Agreement. In no event, however, shall the
Indenture Trustee or the Owner Trustee be liable to the Servicer for any damages
in the nature of special, indirect or consequential damages, however styled,
including lost profits.
(c) Except as provided in this Agreement or in the Pooling and
Servicing Agreement, the Servicer shall not be under any obligation to appear
in, prosecute or defend any legal action that is not incidental to its duties to
service the Receivables in accordance with this Agreement and the Pooling and
Servicing 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 or
the Pooling and Servicing Agreement and the rights and duties of the parties to
this Agreement or the Pooling and Servicing Agreement and the interests of the
Noteholders and the Certificateholders under this Agreement and the Pooling and
Servicing Agreement, the interests of the Noteholders under the Indenture and
the interests of the Certificateholders under the Trust Agreement. In such
event, the legal expenses and costs for 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.
(d) The Applicable Trustee shall distribute out of the Collection
Account on a Distribution Date any amounts permitted for reimbursement pursuant
to Section 6.03(c) not therefor reimbursed; provided, however, that the
Applicable Trustee shall not distribute such amounts if the amount on deposit in
the Reserve Account (after giving effect to all deposits and withdrawals
pursuant to Sections 4.06(b) and (c) and Section 4.07(e), on such Distribution
Date)
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is greater than zero but less than the Specified Reserve Account Balance for
such Distribution Date.
Section 6.04 Delegation of Duties. So long as GMAC acts as Servicer, the
Servicer may, at any time without notice or consent, delegate any duties under
this Agreement or under the Pooling and Servicing Agreement to any corporation
or other Person more than 50% of the voting stock (or, if not a corporation,
other voting interests) of which is owned, directly or indirectly, by General
Motors. The Servicer may at any time perform specific duties as Servicer through
sub-contractors who are in the business of servicing automotive receivables;
provided, however, that no such delegation or sub-contracting shall relieve the
Servicer of its responsibility with respect to such duties.
Section 6.05 Servicer Not to Resign. Subject to the provisions of Section
7.02, the Servicer shall not resign from the obligations and duties imposed on
it by this Agreement and the Pooling and Servicing Agreement as Servicer except
upon determination that the performance of its duties under this Agreement or
under the Pooling and Servicing Agreement, as the case may be, is no longer
permissible under applicable law. Any such determination permitting the
resignation of the Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Indenture Trustee and the Owner Trustee. No such
resignation shall become effective until the Indenture Trustee or a successor
Servicer shall have assumed the responsibilities and obligations of the Servicer
in accordance with Section 7.02.
ARTICLE VII
DEFAULT
Section 7.01 Servicer Defaults. Each of the following shall constitute a
"Servicer Default":
(a) any failure by the Servicer to deliver to the Indenture Trustee
for deposit in any of the Designated Accounts any required payment or to direct
the Indenture Trustee to make any required distributions therefrom, which
failure continues unremedied for a period of five (5) Business Days after
written notice is received by the Servicer from the Indenture Trustee or the
Owner Trustee or after discovery of such failure by an officer of the Servicer;
(b) failure on the part of the Seller or the Servicer to duly
observe or perform in any material respect any other covenants or agreements of
the Seller or the Servicer set forth in this Agreement, the Pooling and
Servicing Agreement, the Indenture or the Trust Agreement which failure (i)
materially and adversely affects the rights of Noteholders or
Certificateholders, and (ii) continues unremedied for a period of ninety (90)
days after the date on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Seller or the Servicer, as
applicable, by the Indenture Trustee or the Owner Trustee, or to the Seller or
the Servicer, as applicable, and to the Indenture Trustee or the Owner Trustee
by Noteholders whose Notes evidence not less than 25% of the Outstanding Amount
of the Controlling Class as of the close of the preceding Distribution Date or
by Certificateholders whose Certificates evidence not less than 25% of the
Voting Interests as of the close of the preceding Distribution Date;
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(c) the entry of a decree or order by a court or agency or
supervisory authority having jurisdiction in the premises for the appointment of
a conservator, receiver or liquidator for the Seller or the Servicer, in any
insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings, or for the winding up or liquidation of their respective
affairs, and the continuance of any such decree or order unstayed and in effect
for a period of ninety (90) consecutive days; or
(d) the consent by the Seller or the Servicer to the appointment of
a conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities, or similar proceedings of or relating to
the Seller or the Servicer or of or relating to substantially all of their
respective property; or the Seller 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.
Notwithstanding the foregoing, there shall be no Servicer Default
where a Servicer Default would otherwise exist under clause (a) above for a
period of ten (10) Business Days or under clause (b) for a period of sixty (60)
days if the delay or failure giving rise to the Servicer Default was caused by
an act of God or other similar occurrence. Upon the occurrence of any of these
events, the Servicer shall not be relieved from using its best efforts to
perform its obligations in a timely manner in accordance with the terms of the
Pooling and Servicing Agreement and this Agreement, and the Servicer shall
provide the Indenture Trustee, the Owner Trustee, the Seller and the
Securityholders prompt notice of the failure or delay by it, together with a
description of its efforts to so perform its obligations.
Section 7.02 Consequences of a Servicer Default. If a Servicer Default
shall occur and be continuing, either the Indenture Trustee or the Noteholders
whose Notes evidence not less than a majority of the Outstanding Amount of the
Controlling Class as of the close of the preceding Distribution Date (or, if the
Notes have been paid in full and the Indenture has been discharged in accordance
with its terms, by the Owner Trustee or Certificateholders whose Certificates
evidence not less than a majority of the Voting Interests as of the close of the
preceding Distribution Date) by notice then given in writing to the Servicer and
the Owner Trustee (and to the Indenture Trustee if given by the Noteholders or
the Certificateholders) may terminate all of the rights and obligations of the
Servicer under this Agreement and the Pooling and Servicing Agreement. On or
after the receipt by the Servicer of such written notice, all authority and
power of the Servicer under this Agreement and the Pooling and Servicing
Agreement, whether with respect to the Notes, the Certificates or the
Receivables or otherwise, shall pass to and be vested in the Indenture Trustee
pursuant to and under this Section 7.02. The Indenture Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, whether to complete the transfer and
endorsement of the Receivables and related documents, or otherwise. The Servicer
agrees to cooperate with the Indenture Trustee and the Owner Trustee in
effecting the termination of the responsibilities and rights of the Servicer
under this Agreement and the Pooling and Servicing Agreement, including, without
limitation, the transfer to the Indenture Trustee or the Owner Trustee for
administration by it of all cash amounts that shall at the time be held by the
Servicer for deposit, or that shall have been
25
deposited by the Servicer in the Collection Account, the Note Distribution
Account or the Payment Ahead Servicing Account or thereafter received with
respect to the Receivables and all Payments Ahead that shall at that time be
held by the Servicer. In addition to any other amounts that are then payable to
the Servicer under this Agreement, the Servicer shall be entitled to receive
from the successor Servicer reimbursements for any Outstanding Monthly Advances
made during the period prior to the notice pursuant to this Section 7.02 which
terminates the obligation and rights of the Servicer under this Agreement.
Section 7.03 Indenture Trustee to Act; Appointment of Successor. On and
after the time the Servicer receives a notice of termination pursuant to Section
7.02, the Indenture Trustee shall be the successor in all respects to the
Servicer in its capacity as servicer under this Agreement and the Pooling and
Servicing Agreement and the transactions set forth or provided for in this
Agreement and the Pooling and Servicing Agreement, and shall be subject to all
the responsibilities, restrictions, duties and liabilities relating thereto
placed on the Servicer by the terms and provisions of this Agreement and the
Pooling and Servicing Agreement. As compensation therefor, the Indenture 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 had been given including the Basic
Servicing Fee, the Additional Servicing Fee, Investment Earnings and
Supplemental Servicing Fees. Notwithstanding the above, the Indenture Trustee
may, if it shall be unwilling so to act, or shall, if it is legally unable so to
act, appoint, or petition a court of competent jurisdiction to appoint, a
successor (i) having a net worth of not less than $100,000,000, (ii) a long-term
unsecured debt rating from Moody's Investors Service, Inc. of at least Baa3
(unless such requirement is expressly waived by Moody's Investors Service, Inc.)
and (iii) whose regular business includes the servicing of automotive
receivables, as the successor to the Servicer under this Agreement and the
Pooling and Servicing Agreement in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer under this Agreement and
the Pooling and Servicing Agreement. In connection with such appointment and
assumption, the Indenture Trustee may make such arrangements for the
compensation of such successor out of payments on Receivables as it and such
successor shall agree; provided, however, that no such compensation shall be in
excess of that permitted the Servicer under this Agreement and the Pooling and
Servicing Agreement. The Indenture Trustee and such successor shall take such
action, consistent with this Agreement and the Pooling and Servicing Agreement,
as shall be necessary to effectuate any such succession.
Section 7.04 Notification to Noteholders and Certificateholders. Upon any
termination of, or appointment of a successor to, the Servicer pursuant to this
Article VII, the Indenture Trustee shall give prompt written notice thereof to
the Noteholders and the Rating Agencies and the Owner Trustee shall give prompt
written notice thereof to the Certificateholders.
Section 7.05 Waiver of Past Defaults. Noteholders whose Notes evidence not
less than a majority of the Outstanding Amount of the Controlling Class as of
the close of the preceding Distribution Date (or, if all of the Notes have been
paid in full and the Indenture has been discharged in accordance with its terms,
Certificateholders whose Certificates evidence not less than a majority of the
Voting Interests as of the close of the preceding Distribution Date) may, on
behalf of all Noteholders and Certificateholders, waive any default by the
Servicer in the performance of its obligations hereunder and its consequences,
except a default in making any
26
required deposits to or payments from any of the accounts in accordance with
this Agreement. Upon any such waiver of a past default, such default shall cease
to exist, and any Servicer Default arising therefrom shall be deemed to have
been remedied for every purpose of this Agreement and the Pooling and Servicing
Agreement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereon.
Section 7.06 Repayment of Advances. If the identity of the Servicer shall
change, the predecessor Servicer shall be entitled to receive, to the extent of
available funds, reimbursement for Outstanding Monthly Advances pursuant to
Section 5.04 in the manner specified in Section 4.06 with respect to all Monthly
Advances made by such predecessor Servicer.
ARTICLE VIII
TERMINATION
Section 8.01 Optional Purchase of All Receivables; Insolvency of Seller;
Termination of Trust.
(a) (i) The Servicer (or the Holder of all of the Certificates, that
is not the depositor, the Seller or any Affiliate thereof) shall have the option
to purchase the assets of the Trust (other than the Designated Accounts) as of
any date (the "Optional Purchase Date") which is the last day of any Monthly
Period as of which the Aggregate Receivables Principal Balance is the Optional
Purchase Percentage or less of the Initial Aggregate Receivables Principal
Balance. To exercise such option, the Servicer or the party exercising such
option, shall (A) furnish to the Issuer and the Indenture Trustee notice of its
intention to exercise such option and of the Optional Purchase Date (such notice
to be furnished not later than twenty-five (25) days prior to the Distribution
Date related to such Optional Purchase Date) and (B) deposit in the Collection
Account when required pursuant to (ii) below an amount equal to the greater of
(a) the remaining unpaid Principal Balance of the Notes, plus accrued and unpaid
interest, and any amounts payable to the Swap Counterparty under any Interest
Rate Swaps and any accrued and unpaid Basic Servicing Fee payments and (b) the
lesser of (i) the unpaid Aggregate Receivables Balance plus accrued and unpaid
interest and (ii) the fair market value of the Receivables. Such fair market
value shall be determined by an appraiser mutually satisfactory to the Seller,
the Servicer, the Owner Trustee and the Indenture Trustee.
(ii) The party exercising such option shall make such deposit
set forth in (i)(B) above in immediately available funds on the Distribution
Date related to the Optional Purchase Date, except that if any Monthly
Remittance Condition is not satisfied on the Optional Purchase Date, such
deposit shall instead be made on the Optional Purchase Date. Upon the making of
such deposit, the party exercising such option shall succeed to all interests in
and to the Trust (other than the Designated Accounts and the rights of the Trust
under the Interest Rate Swaps).
(b) Upon any sale or other disposition of the assets of the Trust
pursuant to Article V of the Indenture (an "Event of Default Sale"), the
Servicer shall instruct the Applicable Trustee to deposit into the Collection
Account from the proceeds of such disposition the amount specified in clause
SECOND of Section 5.4(b) of the Indenture (the "Event of Default Proceeds"). On
the Distribution Date on which the Event of Default Proceeds are deposited in
27
the Collection Account (or, if such proceeds are not so deposited on a
Distribution Date, on the Distribution Date immediately following such deposit),
the Servicer shall instruct the Applicable Trustee to make the following
deposits (after the application on such Distribution Date of the Available
Principal and the Available Interest and funds on deposit in the Reserve Account
pursuant to Sections 4.06 and 4.07) from the Event of Default Proceeds and any
funds remaining on deposit in the Reserve Account (including the proceeds of any
sale of investments therein as described in the following sentence) in the
following priority:
(i) first, to the Swap Counterparty, the net amount, if any,
then due to the Swap Counterparty under any Interest Rate Swaps (exclusive of
payments due to the Swap Counterparty in respect of an Early Termination Date
under any Interest Rate Swaps);
(ii) second, to (a) the Note Distribution Account, for payment
of interest pro rata on the Class A Notes, the Aggregate Class A Interest
Distributable Amount and (b) to the Swap Counterparty in respect of any payments
due to the Swap Counterparty in connection with any Early Termination Date of
any Interest Rate Swaps related to the Class A-1 Notes the Class A-2a Notes, the
Class A-3 Notes and the Class A-5 Notes, allocated between the Note Distribution
Account and the Swap Counterparty in proportion to the amounts owing in respect
of the Aggregate Class A Interest Distributable Amount and the amounts owing to
the Swap Counterparty in connection with such Early Termination Date;
(iii) third, to the Note Distribution Account, an amount equal
to the Note Principal Balance of the Class A Notes (after giving effect to the
reduction in the Note Principal Balance to result from the deposits made in the
Note Distribution Account on such Distribution Date and on each prior
Distribution Date) for payment of principal pro rata on the Class A Notes;
(iv) fourth, to (a) the Note Distribution Account, an amount
equal to the Aggregate Class B Interest Distributable Amount for payment of
interest on the Class B Notes, and (b) to the Swap Counterparty in respect of
any payments due to the Swap Counterparty in connection with any Early
Termination Date of any Interest Rate Swaps related to the Class B Notes,
allocated between the Note Distribution Account and the Swap Counterparty in
proportion to the amounts owing in respect of the Aggregate Class B Interest
Distributable Amount and the amounts owing to the Swap Counterparty in
connection with such Early Termination Date;
(v) fifth, to the Note Distribution Account, an amount equal
to the Note Principal Balance of the Class B Notes (after giving effect to the
reduction in the Note Principal Balance to result from the deposits made in the
Note Distribution Account on such Distribution Date and on each prior
Distribution Date) for payment of principal on the Class B Notes;
(vi) sixth, to the Note Distribution Account, an amount equal
to the Aggregate Class C Interest Distributable Amount for payment of interest
on the Class C Notes;
(vii) seventh, to the Note Distribution Account, an amount
equal to the Note
28
Principal Balance of the Class C Notes (after giving effect to the reduction in
the Note Principal Balance to result from the deposits made in the Note
Distribution Account on such Distribution Date and on each prior Distribution
Date) for payment of principal on the Class C Notes;
(viii) eighth, to the Note Distribution Account, an amount
equal to the Aggregate Class D Interest Distributable Amount for payment of
interest on the Class D Notes; and
(ix) ninth, to the Note Distribution Account, an amount equal
to the Note Principal Balance of the Class D Notes (after giving effect to the
reduction in the Note Principal Balance to result from the deposits made in the
Note Distribution Account on such Distribution Date and on each prior
Distribution Date) for payment of principal on the Class D Notes.
Subject to Section 5.01(b), any investments on deposit in the Reserve Account
which shall not mature on or before such Distribution Date shall be sold by the
Indenture Trustee at such time as shall result in the Indenture Trustee
receiving the proceeds from such sale not later than such Distribution Date and
applied as set forth above. Any Event of Default Proceeds remaining after all
the deposits and other payments described above have been paid in full shall be
paid to the Seller.
(c) Notice of any termination of the Trust shall be given by the
Servicer to the Owner Trustee and the Indenture Trustee as soon as practicable
after the Servicer has received notice thereof.
(d) Following the satisfaction and discharge of the Indenture with
respect to the Notes, and the payment in full of the principal and interest on
the Notes, the Certificateholders shall succeed to the rights of the Noteholders
hereunder and the Owner Trustee shall succeed to the rights of, and assume the
obligations (other than those under Section 7.03 which shall remain obligations
of the Indenture Trustee) of, the Indenture Trustee pursuant to this Agreement
(subject to the continuing obligations of the Indenture Trustee set forth in
Section 4.4 of the Indenture).
(e) After indefeasible payment in full to the Indenture Trustee, the
Owner Trustee, the Swap Counterparty, the Noteholders, the Certificateholders
and the Servicer of all amounts required to be paid under this Agreement, the
Indenture, any Interest Rate Swaps and the Trust Agreement (including as
contemplated by this Section 8.01), (i) any amounts on deposit in the Reserve
Account, the Payment Ahead Servicing Account and the Collection Account (after
all other distributions required to be made from such accounts have been made
and provision for the payment of all liabilities of the Trust as required by
Section 3808 of the Statutory Trust Statute) shall be paid to the Seller and
(ii) any other assets remaining in the Trust shall be distributed to the Seller.
29
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01 Amendment.
(a) This Agreement may be amended by the Seller, the Servicer and
the Owner Trustee with the consent of the Indenture Trustee, but without the
consent of any of the Financial Parties, (i) to cure any ambiguity, (ii) to
correct or supplement any provision in this Agreement that may be defective or
inconsistent with any other provision in this Agreement or any other Basic
Documents, (iii) to add or supplement any credit enhancement for the benefit of
the Noteholders of any class or the Certificateholders ( provided that if any
such addition shall affect any class of Noteholders or Certificateholders
differently than any other class of Noteholders or Certificateholders, then such
addition shall not, as evidenced by an Opinion of Counsel, adversely affect in
any material respect the interests of any class of Noteholders or the
Certificateholders), (iv) add to the covenants, restrictions or obligations of
the Seller, the Servicer, the Owner Trustee or the Indenture Trustee or (v) add,
change or eliminate any other provision of this Agreement in any manner that
shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of the Financial Parties.
(b) This Agreement may also be amended from time to time by the
Seller, the Servicer and the Owner Trustee with the consent of the Indenture
Trustee, the consent of Noteholders whose Notes evidence not less than a
majority of the Outstanding Amount of the Controlling Class as of the close of
the preceding Distribution Date, the consent of Certificateholders whose
Certificates evidence not less than a majority of the Voting Interests as of the
close of the preceding Distribution Date, (which consent, whether given pursuant
to this Section 9.01 or pursuant to any other provision of this Agreement, shall
be conclusive and binding on such Person and on all future holders of such Note
or Certificate and of any Note or Certificate issued upon the transfer thereof
or in exchange thereof or in lieu thereof whether or not notation of such
consent is made upon the Note or Certificate) for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement, or of modifying in any manner the rights of the Noteholders or
the Certificateholders; provided, however, that no such amendment shall (i)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Receivables or distributions that shall be
required to be made on any Note or Certificate, the Interest Rate for any class
of Notes or the Specified Reserve Account Balance, (ii) adversely affect the
rating of any Securities by any of the Rating Agencies without the consent of
two-thirds of the holders of each affected Security, the Outstanding Amount of
the affected class of Notes or the Voting Interests of the Certificates, as
appropriate, as of the close of the preceding Distribution Date or (iii) reduce
the aforesaid percentage required to consent to any such amendment, without the
consent of the holders of all Notes and Certificates then outstanding.
(c) Prior to the execution of any such amendment or consent, the
Indenture Trustee shall furnish written notification of the substance of such
amendment or consent to the Rating Agencies.
30
(d) Promptly after the execution of any such amendment or consent,
the Owner Trustee shall furnish written notification of the substance of such
amendment or consent to each Financial Party.
(e) It shall not be necessary for the consent of Noteholders or
Certificateholders pursuant to Section 9.01(b) to approve the particular form of
any proposed amendment or consent, but it shall be sufficient if such consent
shall approve the substance thereof. The manner of obtaining such consents (and
any other consents of Noteholders or Certificateholders provided for in this
Agreement) and of evidencing the authorization of the execution thereof by
Noteholders and Certificateholders shall be subject to such reasonable
requirements as the Indenture Trustee or the Owner Trustee may prescribe,
including the establishment of record dates pursuant to paragraph number 2 of
the Note Depository Agreement.
(f) Prior to the execution of any amendment to this Agreement, the
Indenture Trustee and the Owner Trustee shall be entitled to receive and
conclusively rely upon an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Agreement and the Opinion of
Counsel referred to in Section 9.02(j). The Indenture Trustee and the Owner
Trustee may, but shall not be obligated to, enter into any such amendment which
affects such trustee's own rights, duties or immunities under this Agreement or
otherwise.
(g) Each of GMAC and the Seller agrees that such Person shall not
amend or agree to any amendment of the Pooling and Servicing Agreement unless
such amendment would be permissible under the terms of this Section 9.01 as if
this Section 9.01 were contained in the Pooling and Servicing Agreement.
Section 9.02 Protection of Title to Trust.
(a) The Seller or the Servicer or both shall authorize and/or
execute, as applicable, and file such financing statements and cause to be
authorized and/or executed, as applicable, and filed such continuation and other
statements, all in such manner and in such places as may be required by law
fully to preserve, maintain and protect the interest of the Noteholders, the
Certificateholders, the Indenture Trustee and the Owner Trustee under this
Agreement and the Second Step Receivables Assignment in the Receivables and in
the proceeds thereof. The Seller or the Servicer or both shall deliver (or cause
to be delivered) to the Indenture Trustee and the Owner Trustee file-stamped
copies of, or filing receipts for, any document filed as provided above, as soon
as available following such filing.
(b) Neither the Seller nor the Servicer shall change its state of
organization or its name, identity or corporate structure in any manner that
would, could or might make any financing statement or continuation statement
filed in accordance with paragraph (a) above seriously misleading within the
meaning of the UCC, unless it shall have given the Indenture Trustee and the
Owner Trustee at least sixty (60) days prior written notice thereof.
(c) Each of the Seller and the Servicer shall give the Indenture
Trustee and the Owner Trustee at least sixty (60) days prior written notice of
any relocation of its principal executive office or change of its jurisdiction
of incorporation if, as a result of such relocation or
31
change of jurisdiction, the applicable provisions of the UCC would require the
filing of any amendment of any previously filed financing or continuation
statement or of any new financing statement. The Servicer shall at all times
maintain each office from which it services 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, Note Distribution Account, and Payment Ahead Servicing Account and any
Payments Ahead held by the Servicer in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that, from
and after the time of sale under this Agreement and the Second Step Receivables
Assignment of the Receivables, the Servicer's master computer records (including
any back-up archives) that refer to any Receivable indicate clearly that the
Receivable is owned by the Issuer. Indication of the Issuer's ownership of a
Receivable shall be deleted from or modified on the Servicer's computer systems
when, and only when, the Receivable has been paid in full or repurchased by the
Seller or purchased by the Servicer in accordance with the terms of the Basic
Documents.
(f) In the event that GMAC shall change the jurisdiction in which it
is incorporated or otherwise enter into any transaction which would result in a
"new debtor" (as defined in the UCC) succeeding to the obligations of GMAC
hereunder, GMAC shall comply fully with the obligations of Section 9.02(a).
(g) If at any time the Seller or the Servicer proposes to sell,
grant a security interest in, or otherwise transfer any interest in automotive
receivables to any prospective purchaser, lender or other transferee, the
Servicer and the Seller shall give to such prospective purchaser, lender or
other transferee computer tapes, records or print-outs (including any restored
from back-up archives) that, if they refer in any manner whatsoever to any
Receivable, indicate clearly that such Receivable has been sold and is owned by
the Issuer unless such Receivable has been paid in full or repurchased by the
Seller or purchased by the Servicer.
(h) The Servicer shall permit the Indenture Trustee and the Owner
Trustee and their respective agents at any time to inspect, audit and make
copies of and abstracts from the Servicer's records regarding any Receivables
then or previously included in the Owner Trust Estate.
(i) The Servicer shall furnish to the Indenture Trustee and the
Owner Trustee at any time upon request a list of all Receivables then held as
part of the Trust, together with a reconciliation of such list to the Schedule
of Receivables and to each of the Servicer's Accountings furnished before such
request indicating removal of Receivables from the Trust. Upon request, the
Servicer shall furnish a copy of any such list to the Seller. The Indenture
Trustee, the Owner Trustee and the Seller shall hold any such list and the
Schedule of Receivables for examination by interested parties during normal
business hours at their respective offices located at the addresses specified in
Section 9.03.
32
(j) The Servicer shall deliver to the Indenture Trustee and the
Owner Trustee promptly after the execution and delivery of this Agreement and of
each amendment thereto, an Opinion of Counsel either (a) stating that, in the
opinion of such counsel, all financing statements and continuation statements
have been authorized and filed as necessary to fully preserve and protect the
interest of the Indenture Trustee and the Owner 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 is necessary to preserve and protect such interest.
(k) To the extent required by law, the Seller shall cause the Notes
and 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.
Section 9.03 Notices. All demands, notices and communications upon or to
the Seller, the Servicer, the Indenture Trustee, the Owner Trustee or the Rating
Agencies under this Agreement shall be delivered as specified in Appendix B
hereto.
Section 9.04 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OR OF ANY OTHER
JURISDICTION OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES UNDER THIS AGREEMENT
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 9.05 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 9.06 Assignment. Notwithstanding anything to the contrary
contained in this Agreement, this Agreement may not be assigned by the Seller
without the prior written consent of Noteholders whose Notes evidence not less
than 66% of the Outstanding Amount of the Notes as of the close of the preceding
Distribution Date and of Certificateholders whose Certificates evidence not less
than 66% of the Voting Interests as of the close of the preceding Distribution
Date. The Seller shall provide notice of any such assignment to the Rating
Agencies.
Section 9.07 Third-Party Beneficiaries. This Agreement and the Second Step
Receivables Assignment shall inure to the benefit of and be binding upon the
parties hereto and, to the extent expressly provided herein, the Noteholders,
the Certificateholders, the Indenture Trustee, the Owner Trustee, the Swap
Counterparty and their respective successors and permitted assigns. The Swap
Counterparty shall be a third-party beneficiary to this Agreement only to the
extent that it has any rights specified herein or rights with respect to this
Trust Sale and Servicing Agreement specified under the Swap Counterparty Rights
Agreement. Except as otherwise
33
provided in Section 6.01, the Swap Counterparty Rights Agreement, or in this
Article IX, no other person shall have any right or obligation hereunder.
Section 9.08 Separate Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
Section 9.09 Headings and Cross-References. The various headings in this
Agreement are included for convenience only and shall not affect the meaning or
interpretation of any provision of this Agreement.
Section 9.10 Assignment to Indenture Trustee. The Seller hereby
acknowledges and consents to any mortgage, pledge, assignment and grant of a
security interest by the Issuer pursuant to the Indenture for the benefit of the
Noteholders and (only to the extent expressly provided in the Indenture) the
Certificateholders of all right, title and interest of the Issuer in, to and
under the Receivables and/or the assignment of any or all of the Issuer's rights
and obligations hereunder to the Indenture Trustee.
Section 9.11 No Petition Covenants. Notwithstanding any prior termination
of this Agreement, the Servicer and the Seller shall not, prior to the date
which is one year and one day after the final distribution with respect to the
Notes to the Note Distribution Account, acquiesce, petition or otherwise invoke
or cause the Issuer to invoke the process of any court or government authority
for the purpose of commencing or sustaining a case against the Issuer under any
federal or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Issuer or any substantial part of its property, or ordering the winding
up or liquidation of the affairs of the Issuer.
Section 9.12 Limitation of Liability of Indenture Trustee and Owner
Trustee.
(a) Notwithstanding anything contained herein to the contrary, this
Agreement has been acknowledged and accepted by JPMorgan Chase Bank, N.A., not
in its individual capacity but solely as Indenture Trustee and in no event shall
JPMorgan Chase Bank, N.A. have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer hereunder
or in any of the certificates, notices or agreements delivered pursuant hereto,
as to all of which recourse shall be had solely to the assets of the Issuer. For
all purposes of this Agreement, in the performance of its duties or obligations
hereunder or in the performance of any duties or obligations of the Issuer
hereunder, the Indenture Trustee shall be subject to, and entitled to the
benefits of, the terms and provisions of Article VI of the Indenture.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been executed by Deutsche Bank Trust Company Delaware not in its
individual capacity but solely in its capacity as Owner Trustee of the Issuer
and in no event shall Deutsche Bank Trust Company Delaware in its individual
capacity or, except as expressly provided in the Trust Agreement, as Owner
Trustee of the Issuer have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets of the Issuer. For all purposes
of this Agreement, in the performance of
34
its duties or obligations hereunder or in the performance of any duties or
obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Article VI of the Trust
Agreement.
Section 9.13 Tax Treatment. The Servicer covenants that for all tax
purposes the Servicer shall regard and treat the Notes and the Certificates in a
manner consistent with the agreements (i) among the Seller, the Owner Trustee
and the Certificateholders in Section 2.11 of the Trust Agreement and (ii) among
the Seller, the Indenture Trustee and the Noteholders in Section 2.14 of the
Indenture.
Section 9.14 Furnishing Documents. The Indenture Trustee shall furnish to
Noteholders, promptly upon receipt of a written request therefor, copies of the
Pooling and Servicing Agreement, the Administration Agreement, the Custodian
Agreement, the Trust Agreement, the Indenture and this Agreement.
* * * * *
35
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers as of the day and year first above
written.
CAPITAL AUTO RECEIVABLES
ASSET TRUST 2005-1
By: DEUTSCHE BANK TRUST COMPANY
DELAWARE, not in its individual capacity
but solely as Owner Trustee on behalf of
the Trust,
By: /s/ Eva Aryeetey
----------------------------
Name: Eva Aryeetey
Title: Attorney-In-Fact
CAPITAL AUTO RECEIVABLES, INC.,
Seller
By: /s/ Nancy L. Bugg
--------------------------
Name: Nancy L. Bugg
Title: Vice President
GENERAL MOTORS ACCEPTANCE CORPORATION
By: /s/ Carl J. Vannatter
----------------------------
Name: Carl J. Vannatter
Title: Director - Global Securitization
Acknowledged and Accepted:
JPMORGAN CHASE BANK, N.A., not in its individual
capacity but solely as Indenture Trustee,
By: /s/ Daniel C. Brown, Jr.
-----------------------------
Name: Daniel C. Brown, Jr.
Title: Vice President
Signature Page to Trust Sale and Servicing Agreement
EXHIBIT A
SCHEDULE OF RECEIVABLES
The Schedule of Receivables is
on file at the offices of:
1. The Indenture Trustee
2. The Owner Trustee
3. General Motors Acceptance Corporation
4. Capital Auto Receivables, Inc.
EXHIBIT B
SECOND STEP RECEIVABLES ASSIGNMENT
PURSUANT TO TRUST SALE AND SERVICING AGREEMENT
For value received in accordance with and subject to the Trust Sale and
Servicing Agreement, dated as of June 2, 2005 (the "Trust Sale and Servicing
Agreement"), by and among General Motors Acceptance Corporation, a Delaware
corporation and in its capacity as Servicer under the Pooling and Servicing
Agreement described below (the "Servicer"), Capital Auto Receivables, Inc., a
Delaware corporation (the "Seller"), and Capital Auto Receivables Asset Trust
2005-1, a Delaware statutory trust (the "Issuer"), the Seller hereby irrevocably
sells, transfers, assigns and otherwise conveys to the Trust, without recourse
(subject to the obligations herein), all right, title and interest of the
Seller, whether now owned or hereafter acquired, in, to and under the following:
(i) all right, title and interest of the Seller in, to and under the
Receivables listed on the Schedule of Receivables, attached as Exhibit A hereto,
and (a) in the case of Receivables that are Scheduled Interest Receivables, all
monies due thereunder on and after the Cutoff Date and (b) in the case of
Receivables that are Simple Interest Receivables, all monies received thereon on
and after the Cutoff Date, in each case exclusive of any amounts allocable to
the premium for physical damage insurance force-placed by the Servicer covering
any related Financed Vehicle;
(ii) the interest of the Seller in the security interests in the
Financed Vehicles granted by Obligors pursuant to the Receivables and, to the
extent permitted by law, any accessions thereto;
(iii) the interest of the Seller in any proceeds from claims on any
physical damage, credit life, credit disability or other insurance policies
covering Financed Vehicles or Obligors;
(iv) the interest of the Seller in any proceeds from recourse
against Dealers on Receivables;
(v) all right, title and interest of the Seller in, to and under the
Pooling and Servicing Agreement, the First Step Receivables Assignment, and the
Custodian Agreement, including the right of the Seller to cause GMAC to
repurchase Receivables under certain circumstances; and
(vi) all present and future claims, demands, causes and choses in
action in respect of any or all of the foregoing described above and all
payments on or under and all proceeds of every kind and nature whatsoever in
respect of any or all of the foregoing, including all proceeds of the conversion
of any or all of the foregoing, voluntary or involuntary, into cash or other
liquid property, all cash proceeds, accounts, accounts receivable, notes,
drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, investment property, payment intangibles, general intangibles,
condemnation awards, rights to payment of any and
every kind and other forms of obligations and receivables, instruments and other
property which ay any time constitute all or part or are included in the
proceeds of any of the foregoing.
The Seller hereby represents that as of the Cutoff Date, the
Aggregate Receivables Principal Balance was $3,070,081,224.17 and acknowledges
that in consideration of such Receivables, the Trust has paid to the Seller an
amount equal to $3,070,081,224.17
THIS SECOND STEP RECEIVABLES ASSIGNMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF OR OF ANY OTHER JURISDICTION OTHER
THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES UNDER THIS AGREEMENT SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
This Second Step Receivables Assignment is made pursuant to and upon the
representations, warranties and agreements on the part of the Seller contained
in the Trust Sale and Servicing Agreement (including the Officer's Certificate
of the Seller accompanying this Second Step Receivables Assignment) and is to be
governed in all respects by the Trust Sale and Servicing Agreement. Capitalized
terms used but not otherwise defined herein shall have the meanings assigned to
them in the Trust Sale and Servicing Agreement.
* * * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers as of the day and year first above
written.
CAPITAL AUTO RECEIVABLES, INC.,
as Seller
By: ___________________________________
Name: Nancy L. Bugg
Title: Vice President
EXHIBIT C
Additional Representations and Warranties
1. This Agreement and the Indenture create a valid and continuing security
interest (as defined in the applicable UCC) in the Purchased Property in
favor of the Issuer and the Indenture Trustee, as applicable, which
security interest is prior to all other Liens, and is enforceable as such
as against creditors of and purchasers from CARI and the Issuer,
respectively.
2. All steps necessary to perfect CARI's security interest against each
Obligor in the property securing the Purchased Property have been taken.
3. Prior to the sale of the Purchased Property to the Issuer under this
Agreement, the Receivables constitute "tangible chattel paper" within the
meaning of the applicable UCC.
4. CARI owns and has good and marketable title to the Purchased Property free
and clear of any Lien, claim or encumbrance of any Person.
5. CARI has caused or will have caused, within ten (10) days, the filing of
all appropriate financing statements in the proper filing office in the
appropriate jurisdictions under applicable law in order to perfect the
security interest in the Purchased Property granted to the Issuer
hereunder and the Indenture Trustee under the Indenture.
6. Other than the security interest granted to CARI pursuant to the Basic
Documents, the Issuer under the Trust Sale and Servicing Agreement and the
Indenture Trustee under the Indenture, none of GMAC, CARI or the Issuer
has pledged, assigned, sold, granted a security interest in, or otherwise
conveyed any of the Purchased Property. None of GMAC, CARI or the Issuer
has authorized the filing of, nor is CARI aware of, any financing
statements against GMAC, CARI or the Issuer that include a description of
collateral covering the Purchased Property other than the financing
statements relating to the security interests granted to CARI, the Issuer
and the Indenture Trustee under the Basic Documents or any financing
statement that has been terminated. CARI is not aware of any judgment or
tax lien filings against GMAC, CARI or the Issuer.
7. GMAC, as Servicer, has in its possession all original copies of the
Receivables Files and other documents that constitute or evidence the
Receivables and the Purchased Property. The Receivables Files and other
documents that constitute or evidence the Purchased Property do not have
any marks or notations indicating that they have been pledged, assigned or
otherwise conveyed to any Person other than CARI.