EXHIBIT 4.4
POOLING AND SERVICING AGREEMENT
among
NISSAN AUTO RECEIVABLES CORPORATION II,
Seller,
NISSAN MOTOR ACCEPTANCE CORPORATION,
Servicer and in its individual capacity,
and
________________________________,
Trustee
Dated as of ______________
ARTICLE I
INTRODUCTION
Section 1.01. Definitions.....................................................1
Section 1.02. Usage of Terms.................................................19
Section 1.03. Cutoff Date and Record Date....................................19
Section 1.04. Section References.............................................19
ARTICLE II
THE TRUST
Section 2.01. Creation of Trust..............................................19
Section 2.02. Conveyance of Receivables......................................19
Section 2.03. Acceptance by Trustee..........................................20
Section 2.04. Characterization...............................................20
ARTICLE III
THE RECEIVABLES
Section 3.01. Representations and Warranties of Seller with Respect to
the Receivables................................................21
Section 3.02. Repurchase Upon Breach.........................................24
Section 3.03. Custody of Receivable Files....................................25
Section 3.04. Duties of Servicer as Custodian................................25
Section 3.05. Instructions; Authority to Act.................................26
Section 3.06. Custodian's Indemnification....................................26
Section 3.07. Effective Period and Termination...............................26
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
Section 4.01. Duties of Servicer.............................................26
Section 4.02. Collection of Receivable Payments..............................28
Section 4.03. Realization Upon Receivables...................................28
Section 4.04. Maintenance of Security Interests in Financed Vehicles.........28
Section 4.05. Covenants of Servicer..........................................29
Section 4.06. Purchase of Receivables Upon Breach............................29
Section 4.07. Total Servicing Fee............................................29
Section 4.08. Servicer's Certificate.........................................30
Section 4.09. Annual Statement as to Compliance; Notice of Default...........30
Section 4.10. Annual Independent Certified Public Accountant's Report........31
Section 4.11. Access to Certain Documentation and Information Regarding
Receivables....................................................31
Section 4.12. Appointment of Subservicer.....................................31
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Section 4.13. Servicer Expenses..............................................32
ARTICLE V
DISTRIBUTIONS; SUBORDINATION SPREAD ACCOUNTS;
STATEMENTS TO CERTIFICATEHOLDERS
Section 5.01. Accounts.......................................................32
Section 5.02. Collections....................................................32
Section 5.03. Application of Collections.....................................33
Section 5.04. Advances.......................................................34
Section 5.05. Additional Deposits............................................35
Section 5.06. Distributions..................................................35
Section 5.07. Net Deposits...................................................38
Section 5.08. Statements to Certificateholders...............................38
Section 5.09. No Petition....................................................40
ARTICLE VI
ADDITIONAL AGREEMENTS
Section 6.01. Yield Supplement Account.......................................40
Section 6.02. Custody and Pledge Agreement...................................42
Section 6.03. Limitations on the Trust.......................................42
ARTICLE VII
THE CERTIFICATES
Section 7.01. The Certificates...............................................42
Section 7.02. Authentication of Certificates.................................42
Section 7.03. Registration of Transfer and Exchange of Certificates..........43
Section 7.04. Mutilated, Destroyed, Lost, or Stolen Certificates.............45
Section 7.05. Persons Deemed Owners..........................................45
Section 7.06. Access to List of Certificateholders' Names and Addresses......45
Section 7.07. Maintenance of Office or Agency................................46
Section 7.08. Book-Entry Certificates........................................46
Section 7.09. Notices to Clearing Agency.....................................47
Section 7.10. Definitive Certificates........................................47
ARTICLE VIII
THE SELLER
Section 8.01. Representations of Seller......................................47
Section 8.02. Liability of Seller; Indemnities...............................48
Section 8.03. Merger or Consolidation of, or Assumption of the
Obligations of, Seller.........................................49
Section 8.04. Limitation on Liability of Seller and Others...................50
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Section 8.05. Seller May Own Certificates....................................50
Section 8.06. Additional Covenants...........................................51
ARTICLE IX
THE SERVICER
Section 9.01. Representations of Servicer....................................53
Section 9.02. Indemnities of Servicer........................................54
Section 9.03. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer.......................................55
Section 9.04. Limitation on Liability of Servicer and Others.................56
Section 9.05. Delegation of Duties...........................................56
Section 9.06. NMAC Not to Resign as Servicer.................................56
ARTICLE X
DEFAULT
Section 10.01. Events of Default..............................................57
Section 10.02. Appointment of Successor.......................................58
Section 10.03. Repayment of Advances..........................................59
Section 10.04. Notification to Certificateholders.............................59
Section 10.05. Waiver of Past Defaults........................................59
ARTICLE XI
THE TRUSTEE
Section 11.01. Duties of Trustee..............................................60
Section 11.02. Trustee's Certificate..........................................62
Section 11.03. Trustee's Assignment of Administrative Receivables and
Warranty Receivables...........................................62
Section 11.04. Certain Matters Affecting the Trustee..........................62
Section 11.05. Trustee Not Liable for Certificates or Receivables.............63
Section 11.06. Trustee May Own Certificates...................................64
Section 11.07. Trustee's Fees and Expenses....................................64
Section 11.08. Indemnity of Trustee...........................................65
Section 11.09. Eligibility Requirements for Trustee...........................65
Section 11.10. Resignation or Removal of Trustee..............................65
Section 11.11. Successor Trustee..............................................66
Section 11.12. Merger or Consolidation of Trustee.............................66
Section 11.13. Appointment of Co-Trustee or Separate Trustee..................66
Section 11.14. Representations and Warranties of Trustee......................68
Section 11.15. Tax Returns....................................................68
Section 11.16. Trustee May Enforce Claims Without Possession of
Certificates...................................................68
Section 11.17. Suits for Enforcement..........................................68
Section 11.18. Rights of Certificateholders to Direct Trustee.................69
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Section 11.19. Appointment of Custodian.......................................69
ARTICLE XII
TERMINATION; RELEASE OF RECEIVABLES
Section 12.01. Termination of the Trust.......................................69
Section 12.02. Optional Purchase of All Receivables...........................70
Section 12.03. Release of Receivables.........................................71
ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 13.01. Amendment......................................................71
Section 13.02. Protection of Title to Trust...................................73
Section 13.03. Limitation on Rights of Certificateholders.....................74
Section 13.04. GOVERNING LAW..................................................75
Section 13.05. Notices........................................................75
Section 13.06. Severability of Provisions.....................................76
Section 13.07. Assignment.....................................................76
Section 13.08. Certificates Nonassessable and Fully Paid......................76
Section 13.09. Further Assurances.............................................76
Section 13.10. No Waiver; Cumulative Remedies.................................76
Section 13.11. Third-Party Beneficiaries......................................77
Section 13.12. Actions by Certificateholders..................................77
Section 13.13. Qualification as Grantor Trust; Separate Assets................77
Section 13.14. Counterparts...................................................77
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EXHIBITS
Exhibit A Form of Class A Certificate
Exhibit B Form of Class B Certificate
Exhibit C Form of Class C Certificate
Exhibit D Form of Depository Agreement
Exhibit E Form of Form of Custody and Pledge Agreement
Exhibit F-1 Form of Trustee's Certificate to Seller
Exhibit F-2 Form of Trustee's Certificate to Servicer
Exhibit G Form of Yield Supplement Agreement
Exhibit H-1 Form of Representation Letter for the Class A Certificates
Exhibit H-2 Form of Representation Letter for the Class [B] [C] Certificates
SCHEDULES
Schedule A List of Receivables
Schedule B Location of Receivables
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This Pooling and Servicing Agreement, dated as of
_______________, is made with respect to the formation of the Nissan Auto
Receivables ____-_____ Grantor Trust, among NISSAN AUTO RECEIVABLES CORPORATION
II, a Delaware corporation, as Seller, NISSAN MOTOR ACCEPTANCE CORPORATION, a
California corporation, in its individual capacity (in such capacity, "NMAC")
and a Servicer (in such capacity, the "Servicer").
WITNESSETH THAT: In consideration of the premises and of the
mutual agreements herein contained, the parties hereto agree as follows:
ARTICLE I
INTRODUCTION
SECTION 1.01. DEFINITIONS. Except as otherwise provided in this
Agreement, whenever used herein, the following words and phrases, unless the
context otherwise requires, shall have the following respective meanings:
"Administrative Purchase Payment" for any Administrative
Receivable as of the last day of any Collection Period, means the sum of the
Principal Balance thereof as of the beginning of such Collection Period plus
interest accrued thereon through the due date for the Obligor's payment in such
Collection Period at the related APR, after giving effect to the receipt of
monies collected (from whatever source other than Advances) on such
Administrative Receivable, if any, during such Collection Period.
"Administrative Receivable" means a Receivable purchased as of
the close of business on the last day of a Collection Period by the Servicer
pursuant to Section 4.06 or Section 12.02.
"Advance" means the amount, as of the last day of a Collection
Period, that the Servicer is required to advance on the respective Receivable
pursuant to Section 5.04(a).
"Affiliate" means, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control," when used with
respect to any specified Person, means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the term "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agreement" means this Pooling and Servicing Agreement.
"AICPA" shall have the meaning assigned to such term in
Section 4.10.
"Amount Financed" with respect to any Receivable, means the
amount advanced under the Receivable toward the purchase price of the Financed
Vehicle and any related costs, including but not limited to accessories,
insurance premiums, service and warranty contracts and other items customarily
financed as part of retail automobile and light-duty truck installment sale
contracts.
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"Annual Percentage Rate" or "APR" of a Receivable means the
annual rate of finance charges stated in such Receivable.
"Annual USAP Report" shall have the meaning assigned to such
term in Section 4.10.
"Available Interest" means, for any Distribution Date, the sum
of the following amounts received during the related Collection Period: (a) that
portion of all collections on Receivables allocable to interest, (b) without
duplication of amounts described in clause (a), Net Liquidation Proceeds to the
extent allocable to interest due on a Liquidated Receivable in accordance with
the Servicer's customary servicing procedures, (c) all Advances made by the
Servicer pursuant to Section 5.04, (d) without duplication of any amounts
described above in clauses (a) and (b), the Administrative Purchase Payment of
each Receivable that became an Administrative Receivable during the related
Collection Period to the extent attributable to interest thereon, (e) without
duplication of any amounts described above in clauses (a) and (b), the Warranty
Purchase Payment of each Receivable that became a Warranty Receivable during the
related Collection Period to the extent attributable to interest thereon, and
(f) the Yield Supplement Deposit plus the sum of (i) reinvestment income on the
Yield Supplement Account and (ii) the amount, if any, deposited into the
Collection Account pursuant to Section 6.01; provided, however, that in
calculating Available Interest, amounts to be paid to the Servicer as
reimbursement for Advances pursuant to Section 5.06(a)(ii) on such Distribution
Date shall be excluded.
"Available Principal" means, for any Distribution Date, the
sum of the following amounts received during the related Collection Period: (a)
that portion of all collections on Receivables allocable to principal, (b)
without duplication of amounts described in clause (a), Net Liquidation Proceeds
attributable to principal due on a Liquidated Receivable in accordance with the
Servicer's customary servicing procedures, (c) without duplication of any
amounts described above in clauses (a) and (b), the Administrative Purchase
Payment of each Receivable that became an Administrative Receivable during the
related Collection Period to the extent attributable to principal, and (d)
without duplication of any amounts described above in clauses (a) and (b), the
Warranty Purchase Payment of each Receivable that became a Warranty Receivable
during the related Collection Period to the extent attributable to principal.
"Bankruptcy Code" means the United States Bankruptcy Code,
Title 11 United States Code.
"Base Servicing Fee" means the fee payable to the Servicer on
each Distribution Date for services rendered during the related Collection
Period, which shall be equal to one-twelfth of the Servicing Rate multiplied by
the Pool Balance as of the close of business on the last day of the immediately
preceding Collection Period or, with respect to the first Distribution Date, the
Original Pool Balance.
"Basic Documents" means the Purchase Agreement, this
Agreement, the Depository Agreement, the Custody and Pledge Agreement, the Yield
Supplement Agreement and the other documents and certificates delivered in
connection herewith and therewith.
2
"Book-Entry Certificates" means a beneficial interest in the
Class A Certificates or Class B Certificates, ownership and transfers of which
shall be made through book entries by a Clearing Agency as described in Section
7.08.
"Business Day" means any day other than a Saturday, a Sunday
or a day on which banking institutions or trust companies in New York, New York,
[or] Los Angeles, California [Minneapolis, Minnesota,] [or Wilmington, Delaware]
shall be authorized or obligated by law, regulation, executive order or
governmental decree to remain closed.
"Certificate" means a Class A Certificate, a Class B
Certificate or a Class C Certificate.
"Certificates" means the Class A Certificates, the Class B
Certificates and the Class C Certificates.
"Certificate Account" means the account designated as such,
established and maintained pursuant to Section 5.01.
"Certificateholder" or "Holder" means the Person in whose name
a Certificate shall be registered in the Certificate Register, except that,
solely for the purposes of giving any consent, waiver, request, or demand
pursuant to this Agreement, the interest evidenced by any Class A Certificate or
Class B Certificate registered in the name of the Seller, the Servicer, or any
Person actually known to a Trustee Officer to be an Affiliate of the Seller or
the Servicer, shall not be taken into account in determining whether the
requisite percentage necessary to effect any such consent, waiver, request, or
demand shall have been obtained.
"Certificate Owner" shall mean, with respect to a Book-Entry
Certificate, the Person who is the owner of such Book-Entry Certificate, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly or as an indirect
participant, in accordance with the rules of such Clearing Agency) and shall
mean, with respect to a Definitive Certificate, the Certificateholder.
"Certificate Register" and "Certificate Registrar" mean the
register maintained and the registrar appointed pursuant to Section 7.03.
"Class A Certificate" means any one of the Certificates
executed by the Trust and authenticated by the Trustee, in substantially the
form set forth in Exhibit A hereto.
"Class A Certificate Balance" shall equal, initially, the
Original Class A Certificate Balance and, thereafter, shall equal the Original
Class A Certificate Balance, reduced by all amounts previously distributed to
the Class A Certificateholders and allocable to principal; provided, however,
that on any Distribution Date on or after the Distribution Date on which the
Class B Certificate Balance and the Class C Certificate Balance are reduced to
zero, the Class A Certificate Balance on any Distribution Date will equal the
Pool Balance as of the last day of the related Collection Period after all
required distributions, deposits and withdrawals have been made.
3
"Class A Certificate Factor" means, as of any Distribution
Date, a seven-digit decimal figure equal to the Class A Certificate Balance as
of the close of business on such Distribution Date divided by the Original Class
A Certificate Balance.
"Class A Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class A Principal Distributable Amount and the
Class A Interest Distributable Amount.
"Class A Interest Carryover Shortfall" means, as of the close
of business on any Distribution Date, the excess, if any, of the Class A
Interest Distributable Amount for such Distribution Date plus any outstanding
unpaid interest owed to holders of Class A Certificates from the preceding
Distribution Date, plus interest on such outstanding unpaid interest amount, to
the extent permitted by law, at the Class A Pass-Through Rate from such
preceding Distribution Date to but not including such current Distribution Date,
over the amount of interest that the holders of the Class A Certificates
actually received on such current Distribution Date.
"Class A Interest Distributable Amount" means, with respect to
any Distribution Date, the sum of (i) thirty (30) days of interest or, in the
case of the initial Distribution Date, the number of days in the related
Collection Period, at the Class A Pass-Through Rate on the Class A Certificate
Balance as of the close of business on the last day of the related Collection
Period, calculated on the basis of a 360-day year consisting of twelve 30-day
months, and (ii) the Class A Interest Carryover Shortfall, if any, for the
preceding Distribution Date.
"Class A Pass-Through Rate" means [___]% per annum.
"Class A Percentage" means [___]%.
"Class A Pool Factor" means, as of the last day of a
Collection Period, a seven-digit decimal figure equal to the Class A Certificate
Balance as of the close of business on such day divided by the Original Pool
Balance.
"Class A Principal Carryover Shortfall" means, as of the close
of business on any Distribution Date, the excess, if any, of the Class A
Principal Distributable Amount plus any outstanding unpaid principal owed to
holders of Class A Certificates from preceding Distribution Dates over the
amount of principal that the holders of the Class A Certificates actually
received on such current Distribution Date.
"Class A Principal Distributable Amount" means, with respect
to any Distribution Date, the Class A Percentage of the sum of: (a) the
principal portion of all payments on Receivables, including prepayments of
principal, received during the related Collection Period, (b) the aggregate
outstanding principal balance as of the beginning of the related Collection
Period of all Receivables that became Administrative Receivables or Warranty
Receivables under obligations that arose during the related Collection Period
(without duplication of amounts referred to in clause (a) above), and (c) the
aggregate outstanding principal balance as of the beginning of the related
Collection Period of all Receivables that became Defaulted Receivables during
the related Collection Period (without duplication of amounts referred to in
clauses (a) or (b) above).
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"Class B Certificate" means any one of the Certificates
executed by the Trust and authenticated by the Trustee, in substantially the
form set forth in Exhibit B hereto.
"Class B Certificate Balance" shall equal, initially, the
Original Class B Certificate Balance and, thereafter, shall equal the Original
Class B Certificate Balance, reduced by all amounts previously distributed to
the Class B Certificateholders and allocable to principal; provided, however,
that on any Distribution Date on or after the Distribution Date on which the
Class C Certificate Balance is reduced to zero, the Class B Certificate Balance
on any Distribution Date will equal the excess of the Pool Balance as of the
last day of the related Collection Period over the Class A Certificate Balance
as of such Distribution Date after all required distributions, deposits and
withdrawals have been made.
"Class B Certificate Factor" means, as of any Distribution
Date, a seven-digit decimal figure equal to the Class B Certificate Balance as
of the close of business on such Distribution Date divided by the Original Class
B Certificate Balance.
"Class B Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class B Principal Distributable Amount and the
Class B Interest Distributable Amount.
"Class B Interest Carryover Shortfall" means, as of the close
of business on any Distribution Date, the excess, if any, of the Class B
Interest Distributable Amount for such Distribution Date plus any outstanding
unpaid interest owed to holders of Class B Certificates from the preceding
Distribution Date plus interest on such outstanding unpaid interest amount, to
the extent permitted by law, at the Class B Pass-Through Rate from such
preceding Distribution Date to but not including such Distribution Date, over
the amount of interest that the holders of the Class B Certificates actually
received on such current Distribution Date.
"Class B Interest Distributable Amount" means, with respect to
any Distribution Date, the sum of (a) thirty (30) days of interest or, in the
case of the initial Distribution Date, the number of days in the related
Collection Period, at the Class B Pass-Through Rate on the Class B Certificate
Balance as of the close of business on the last day of the related Collection
Period, calculated on the basis of a 360-day year consisting of twelve 30-day
months, and (b) the Class B Interest Carryover Shortfall, if any, for the
preceding Distribution Date.
"Class B Pass-Through Rate" means [___]% per annum.
"Class B Percentage" means [___]%.
"Class B Pool Factor" means, as of the last day of a
Collection Period, a seven-digit decimal figure equal to the Class B Certificate
Balance as of the close of business on such day divided by the Original Pool
Balance.
"Class B Principal Carryover Shortfall" means, as of the close
of any Distribution Date, the excess, if any, of the Class B Principal
Distributable Amount plus any outstanding unpaid principal owed to holders of
Class B Certificates from the preceding Distribution Date over the amount of
principal that the holders of the Class B Certificates actually received on such
current Distribution Date.
5
"Class B Principal Distributable Amount" means, with respect
to any Distribution Date, the Class B Percentage of the sum of: (a) the
principal portion of all payments on Receivables, including prepayments of
principal, received during the related Collection Period, (b) the aggregate
outstanding principal balance as of the beginning of the related Collection
Period of all Receivables that became Administrative Receivables or Warranty
Receivables under an obligation that arose during the related Collection Period
(without duplication of amounts included in clause (a) above), and (c) the
aggregate outstanding principal balance as of the beginning of the related
Collection Period of all Receivables that become Defaulted Receivables during
the related Collection Period (without duplication of amounts included in
clauses (a) or (b) above).
"Class C Certificate" means any one of the Certificates
executed by the Trust and authenticated by the Trustee, in substantially the
form set forth in Exhibit C hereto.
"Class C Certificate Balance" shall equal, initially, the
Original Class C Certificate Balance and, thereafter, shall equal the amount by
which the Pool Balance as of the last day of the related Collection Period
exceeds the sum of the Class A Certificate Balance and the Class B Certificate
Balance as of such Distribution Date after all required distributions, deposits
and withdrawals have been made.
"Class C Distributable Amount" means, with respect to any
Distribution Date, the sum of the Class C Principal Distributable Amount and the
Class C Interest Distributable Amount.
"Class C Interest Carryover Shortfall" means, as of the close
of business on any Distribution Date, the excess, if any, of the Class C
Interest Distributable Amount for such Distribution Date plus any outstanding
unpaid interest owed to holders of Class C Certificates from the preceding
Distribution Date plus interest on such outstanding unpaid interest amount, to
the extent permitted by law, at the Class C Pass-Through Rate from such
preceding Distribution Date to but not including such Distribution Date, over
the amount of interest that the holders of the Class C Certificates actually
received on such current Distribution Date.
"Class C Interest Distributable Amount" means, with respect to
any Distribution Date, the sum of (a) thirty (30) days of interest or, in the
case of the initial Distribution Date, the number of days in the related
Collection Period, at the Class C Pass-Through Rate on the Class C Certificate
Balance as of the close of business on the last day of the related Collection
Period, calculated on the basis of a 360-day year consisting of twelve 30-day
months, and (b) the Class C Interest Carryover Shortfall, if any, for the
preceding Distribution Date.
"Class C Pass-Through Rate" means [___]% per annum.
"Class C Percentage" means [___]%.
"Class C Principal Carryover Shortfall" means, as of the close
of any Distribution Date, the excess, if any, of the Class C Principal
Distributable Amount plus any outstanding unpaid principal owed to holders of
Class C Certificates from the preceding Distribution Date over the amount of
principal that the holders of the Class C Certificates actually received on such
current Distribution Date.
6
"Class C Principal Distributable Amount" means, with respect
to any Distribution Date, the Class C Percentage of the sum of: (a) the
principal portion of all payments on Receivables, including prepayments of
principal, received during the related Collection Period, (b) the aggregate
outstanding principal balance as of the beginning of the related Collection
Period of all Receivables that became Administrative Receivables or Warranty
Receivables under an obligation that arose during the related Collection Period
(without duplication of amounts included in clause (a) above), and (c) the
aggregate outstanding principal balance as of the beginning of the related
Collection Period of all Receivables that become Defaulted Receivables during
the related Collection Period (without duplication of amounts included in
clauses (a) or (b) above).
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
"Collection Account" means the account designated as such,
established and maintained pursuant to Section 5.01.
"Collection Period" means, with respect to any Distribution
Date, the preceding calendar month. Any amount stated "as of the close of
business of the last day of a Collection Period" shall give effect to the
following calculations as determined as of the end of the day on such last day:
(a) all applications of collections, (b) all Advances and reductions of
Outstanding Advances and (c) all distributions.
"Controlling Class of Certificates" means, with respect to the
Certificates, (a) first, until the Class A Certificate Balance has been reduced
to zero, the Class A Certificates, (b) second, until the Class B Certificate has
been reduced to zero, the Class B Certificates, and (c) thereafter, the Class C
Certificates.
"Corporate Trust Office" means the office of the Trustee,
which at the date hereof is located at
[________________________________________________________].
"Custodian" means the party named as such in the Custody and
Pledge Agreement.
"Custody and Pledge Agreement" means the agreement, dated as
of the date of this Agreement, between [________________________], substantially
in the form attached hereto as Exhibit E.
"Cutoff Date" means ___________________.
"Damages" shall have the meaning assigned to such term in
Section 9.02.
7
"Dealer" means the dealer who sold a Financed Vehicle and who
originated and assigned the related Receivable to NMAC under an existing
agreement between such dealer and NMAC.
"Dealer Recourse" means, with respect to a Receivable, all
recourse rights against the Dealer which originated the Receivable, and any
successor Dealer.
"Defaulted Receivable" means (a) a Receivable (other than an
Administrative Receivable or a Warranty Receivable as to which a Warranty
Purchase Payment or an Administrative Purchase Payment has been made), which, by
its terms, is delinquent for 120 days or more, or (b) with respect to
Receivables that are delinquent for less than 120 days, the Servicer has (i)
determined, in accordance with its customary servicing procedures, that eventual
payment in full is unlikely, (ii) repossessed the Financed Vehicle, or (iii)
received notification that the related obligor is subject to proceedings under
Chapter 13 of the Bankruptcy Code.
"Definitive Certificates" shall have the meaning specified in
Section 7.08.
"Delivery" when used with respect to Subordination Spread
Account Property means:
(a) with respect to bankers' acceptances, commercial paper,
negotiable certificates of deposit and other obligations that
constitute "instruments" within the meaning of Section 9-105(1)(i) of
the UCC and are susceptible of physical delivery, transfer thereof to
the Custodian by physical delivery to the Custodian indorsed to, or
registered in the name of, the Custodian or indorsed in blank, and,
with respect to a certificated security (as defined in Section 8-102 of
the UCC), transfer thereof (i) by delivery of such certificated
security to the Custodian or by delivery of such certificated security
to a securities intermediary (as defined in Section 8-102(a)(14) of the
UCC) indorsed to, or registered in the name of, the Custodian or
indorsed in blank (as defined in Section 8-304 of the UCC) and the
making by such securities intermediary of entries on its books and
records identifying such certificated securities as belonging to the
Custodian and the sending by such securities intermediary of a
confirmation of the purchase of such certificated security by the
Custodian, or (ii) by delivery thereof to a "clearing corporation" (as
defined in section 8-102(a)(5) of the UCC) and the making by such
clearing corporation of appropriate entries on its books reducing the
appropriate securities account of the transferor and increasing the
appropriate securities account of a securities intermediary by the
amount of such certificated security, the identification by the
clearing corporation of the certificated securities for the sole and
exclusive account of the securities intermediary, the maintenance of
such certificated securities by such clearing corporation or its
nominee subject to the clearing corporation's exclusive control, the
sending of a confirmation by the securities intermediary of the
purchase by the Custodian of such securities and the making by such
securities intermediary of entries on its books and records identifying
such certificated securities as belonging to the Custodian (all of the
foregoing, "Physical Property"), and, in any event, any such Physical
Property in registered form shall be in the name of the Custodian or
its nominee; and such additional or alternative procedures as may
hereafter become appropriate to effect the complete transfer of
ownership of any such Subordination Spread Account
8
Property to the Custodian, consistent with changes in applicable law or
regulations or the interpretation thereof;
(b) with respect to any security issued by the U.S.
Treasury, the Federal Home Loan Mortgage Corporation or by the Federal
National Mortgage Association that is a book-entry security held
through the Federal Reserve System pursuant to Federal book-entry
regulations, the following procedures, all in accordance with
applicable law, including applicable federal regulations and Articles 8
and 9 of the UCC: book-entry registration of such Subordination Spread
Account Property to an appropriate book-entry account maintained with a
Federal Reserve Bank by a securities intermediary which is also a
"depositary" pursuant to applicable federal regulations and issuance by
such securities intermediary of a deposit advice or other written
confirmation of such book-entry registration to the Custodian of the
purchase by the Custodian of such book-entry securities; the making by
such securities intermediary of entries in its books and records
identifying such book-entry security held through the Federal Reserve
System pursuant to Federal book-entry regulations as belonging to the
Custodian and indicating that such securities intermediary holds such
Subordination Spread Account Property solely as agent for the
Custodian; and such additional or alternative procedures as may
hereafter become appropriate to effect complete transfer of ownership
of any such Subordination Spread Account Property to the Custodian,
consistent with changes in applicable law or regulations or the
interpretation thereof; and
(c) with respect to any item of Subordination Spread
Account Property that is an uncertificated security under Article 8 of
the UCC and that is not governed by clause (b) above, registration on
the books and records of the issuer thereof in the name of the
securities intermediary, the sending of a confirmation by the
securities intermediary of the purchase by the Custodian of such
uncertificated security and the making by such securities intermediary
of entries on its books and records identifying such uncertificated
certificates as belonging to the Custodian.
"Depository Agreement" means the agreement dated as of the
date of this Agreement, among the Seller, the Custodian and the initial Clearing
Agency, substantially in the form attached hereto as Exhibit D.
"Determination Date" means the [tenth] calendar day of each
calendar month, or if such [tenth] day is not a Business Day, the next
succeeding Business Day.
"Distribution Date" means, for each Collection Period, the
15th day of the following month, or if the 15th day is not a Business Day, the
next succeeding Business Day, commencing with [__________________].
"Eligible Deposit Account" means an account maintained (a)
with the Trustee so long as the Trustee's short-term unsecured debt obligations
have a rating of "P-1" by Moody's and a rating of "A-1+" by Standard & Poor's,
and for any account in which deposits in excess of 30 days are to be made, so
long as the Trustee's long-term unsecured debt obligations have a rating of at
least "AA-" by Standard & Poor's (such short-term and long-term (if applicable)
ratings being, the "Required Deposit Rating"), or (b) in a segregated trust
account in the trust
9
department of the Trustee. Notwithstanding anything to the contrary, as of the
Closing Date, the Trustee shall be deemed to have met the requirements in clause
(a).
"Eligible Investments" means, at any time, any one or more of
the following obligations and securities:
(a) direct obligations of, and obligations fully guaranteed as
to timely payment of principal and interest by, the United States of
America;
(b) demand deposits, time deposits or certificates of deposit
of any depository institution or trust company incorporated under the
laws of the United States of America or any state thereof (or any
domestic branch of a foreign bank) and subject to supervision and
examination by Federal or State banking or depository institution
authorities; provided, however, that at the time of the investment or
contractual commitment to invest therein, the commercial paper or other
short-term unsecured debt obligations (other than such obligations the
rating of which is based on the credit of a Person other than such
depository institution or trust company) thereof shall have a credit
rating from each of the Rating Agencies in the highest investment
category granted thereby;
(c) commercial paper having, at the time of the investment or
contractual commitment to invest therein, a rating from each of the
Rating Agencies in the highest investment category granted thereby;
(d) investments in money market funds having a rating from
each of the Rating Agencies in the highest investment category granted
thereby (including funds for which the Trustee or any of its affiliates
is investment manager or advisor);
(e) bankers' acceptances issued by any depository institution
or trust company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that
is a direct obligation of, or fully guaranteed by, the United States of
America or any agency or instrumentality thereof the obligations of
which are backed by the full faith and credit of the United States of
America, in either case entered into with a depository institution or
trust company (acting as principal) described in clause (ii) above;
(g) repurchase obligations with respect to any security or
whole loan, entered into with (i) a depository institution or trust
company (acting as principal) described in clause (b) above (except
that the rating referred to in the proviso in such clause (b) shall be
"A-1" or higher in the case of Standard & Poor's) (such depository
institution or trust company being referred to in this definition as a
"financial institution"), (ii) a broker/dealer (acting as principal)
registered as a broker or dealer under Section 15 of the Securities
Exchange Act of 1934 (a "broker/dealer"), the unsecured short-term debt
obligations of which are rated "P-1" by Moody's and at least "A-1" by
Standard & Poor's at the time of entering into such repurchase
obligation (a "rated broker/dealer"), (iii) an unrated broker/dealer
(an "unrated broker/dealer"), acting as principal that is a
wholly-owned subsidiary of a non-bank holding company the unsecured
short-term debt obligations of which are rated "P-1" by Moody's and at
least "A-1" by Standard & Poor's
10
at the time of entering into such repurchase obligation (a "Rated
Holding Company") or (iv) an unrated wholly-owned subsidiary of a
direct or indirect parent Rated Holding Company, which guarantees such
subsidiary's obligations under such repurchase agreement (a "Guaranteed
Counterparty"); provided that the following conditions are satisfied:
(A) the aggregate amount of funds invested in
repurchase obligations of a financial institution, a rated
broker/dealer, an unrated broker/dealer or a Guaranteed
Counterparty in respect of which the unsecured short-term
ratings of Standard & Poor's are A-1 (in the case of an
unrated broker/dealer or Guaranteed Counterparty, such rating
being that of the related Rated Holding Company) shall not
exceed 20% of the outstanding Pool Balance (there being no
limit on the amount of funds that may be invested in
repurchase obligations in respect of which such Standard &
Poor's rating is "A-1+" (in the case of an unrated
broker/dealer or Guaranteed Counterparty, such rating being
that of the related Rated Holding Company));
(B) in the case of the Subordination Spread Account
and the Yield Supplement Account, the rating from Standard &
Poor's in respect of the unsecured short term debt obligations
of the financial institution, rated broker/dealer, unrated
broker/dealer or Guaranteed Counterparty (in the case of an
unrated broker/dealer or Guaranteed Counterparty, such rating
being that of the related Rated Holding Company) shall be
"A-1+";
(C) the repurchase obligation must mature within 30
days of the date on which the Trustee or the Custodian, as
applicable, enters into such repurchase obligation;
(D) the repurchase obligation shall not be
subordinated to any other obligation of the related financial
institution, rated broker/dealer, unrated broker/dealer or
Guaranteed Counterparty;
(E) the collateral subject to the repurchase
obligation is held, in the appropriate form, by a custodial
bank on behalf of the Trustee or the Custodian, as applicable;
(F) the repurchase obligation shall require that the
collateral subject thereto shall be marked to market daily;
(G) in the case of a repurchase obligation of a
Guaranteed Counterparty, the following conditions shall also
be satisfied:
(1) the Trustee or the Custodian, as
applicable, shall have received an Opinion
of Counsel to the effect that the guarantee
of the related Rated Holding Company is a
legal, valid and binding agreement of the
Rated Holding Company, enforceable in
accordance with its terms, subject, to the
effect of bankruptcy, insolvency,
reorganization, moratorium or other
11
similar laws affecting creditors' rights
generally and to general equitable
principles;
(2) the Trustee or the Custodian, as
applicable, shall have received (x) an
incumbency certificate for the signer of
such guarantee, certified by an officer of
such Rated Holding Company, and (y) a
resolution, certified by an officer of the
Rated Holding Company, of the board of
directors (or applicable committee thereof)
of the Rated Holding Company authorizing the
execution, delivery and performance of such
guarantee by the Rated Holding Company;
(3) the only conditions to the
obligation of such Rated Holding Company to
pay on behalf of the Guaranteed Counterparty
shall be that the Guaranteed Counterparty
shall not have paid under such repurchase
obligation when required (it being
understood that no notice to, demand on or
other action in respect of the Guaranteed
Counterparty is necessary) and that the
Trustee or the Custodian, as applicable,
shall make a demand on the Rated Holding
Company to make the payment due under such
guarantee;
(4) the guarantee of the Rated
Holding Company shall be irrevocable with
respect to such repurchase obligation and
shall not be subordinated to any other
obligation of the Rated Holding Company; and
(5) each of the Rating Agencies has
confirmed in writing to the Trustee or the
Custodian, as applicable, that it has
reviewed the form of the guarantee of the
Rated Holding Company and has determined
that the issuance of such guarantee will not
result in the downgrade or withdrawal of the
ratings assigned to the Certificates; and
(H) the repurchase obligation shall require that the
repurchase obligation be overcollateralized and shall provide
that, upon any failure to maintain such overcollateralization,
the repurchase obligation shall become due and payable, and
unless the repurchase obligation is satisfied immediately, the
collateral subject to the repurchase agreement shall be
liquidated and the proceeds applied to satisfy the unsatisfied
portion of the repurchase obligation; and
(h) any other investment with respect to which the Servicer
has received written notification from the Rating Agencies that the
acquisition of such investment as an Eligible Investment will not
result in a withdrawal or downgrading of the ratings on the
Certificates;
provided that, unless otherwise expressly stated herein, each of the foregoing
investments shall be denominated in U.S. dollars, shall not be purchased at a
premium, shall mature no later than
12
the Business Day prior to the Distribution Date immediately following the date
of purchase, and shall be required to be held to such maturity; and provided,
further, that notwithstanding clauses (a) through (h) above, "Eligible
Investments" shall not include any security having an "r" subscript attached to
its Standard & Poor's rating.
For purposes of this definition, any reference to the highest available
credit rating of an obligation shall mean the highest available credit rating
for such obligation (excluding any "+" signs associated with such rating), or
such lower credit rating (as approved in writing by each Rating Agency) as will
not result in the qualification, downgrading or withdrawal of the rating then
assigned by such Rating Agency to any of the Certificates.
"ERISA" means the Employee Retirement Income Security Act of
1974.
"Event of Default" means an event specified in Section 10.01.
"Excess Amounts" means, with respect to each Distribution
Date, all interest collections on or in respect of the Receivables on deposit in
the Certificate Account in respect of such Distribution Date, after making the
distributions to the Servicer and the Certificateholders pursuant to Section
5.06(c).
"Excess Proceeds" shall have the meaning assigned to such term
in Section 8.06(b)(ii).
"Final Scheduled Distribution Date" means [_______________].
"Financed Vehicle" means a new, near-new or used automobile or
light-duty truck, together with all accessions thereto, securing an Obligor's
indebtedness under the respective Receivable.
"Initial Yield Supplement Amount" means $[_____________] [in
cash] [and receivables with an aggregate principal balance of $[__________] or
other assets (including vehicle lease contracts)].
"Lien" means any security interest, lien, charge, pledge,
equity or encumbrance of any kind, other than, in the case of a Financed
Vehicle, tax liens, mechanics' liens and any liens that attach to such Financed
Vehicle by operation of law.
"Liquidated Receivable" means a Defaulted Receivable as to
which the related Financed Vehicle has been liquidated by the Servicer.
"Monthly Remittance Conditions" shall have the meaning
assigned to such term in Section 5.02.
"Moody's" means Moody's Investors Service, Inc.
"NARC II" means Nissan Auto Receivables Corporation II, a
Delaware corporation.
13
"Net Liquidation Proceeds" means the monies collected from
whatever source on a Liquidated Receivable, net of the sum of any amounts
expended by the Servicer for the account of the Obligor, plus any amounts
required by law to be remitted to the Obligor.
"Nissan" means Nissan Motor Co., Ltd.
"NMAC" means Nissan Motor Acceptance Corporation, in its
individual capacity and not as Servicer.
"Nonrecoverable Advance" means any Outstanding Advance with
respect to (a) any Defaulted Receivable or (b) any Receivable as to which the
Servicer determines that any recovery from payments made on or with respect to
such Receivable is unlikely.
"Obligor" on a Receivable means the purchaser or co-purchasers
of the Financed Vehicle or any other Person who owes payments under the
Receivable (but excluding any Dealer in respect of Dealer Recourse).
"Officer's Certificate" means a certificate signed by the
chairman of the board, the president, any executive vice president, any vice
president, the treasurer, any assistant treasurer or the controller of the
Seller or the Servicer, as the case may be.
"Opinion of Counsel" means one or more written opinions of
counsel who may, except as otherwise provided herein, be an employee of or
counsel to the Issuer, the Seller or the Servicer, which counsel shall be
reasonably acceptable to the Trustee or the Rating Agencies, as the case may be.
"Optional Purchase Percentage" means [10.00]%.
"Original Class A Certificate Balance" means
$[_________________].
"Original Class B Certificate Balance" means
$[_________________].
"Original Class C Certificate Balance" mans
$[__________________].
"Original Pool Balance" means $[_________________], the
aggregate Principal Balance of the Receivables on the Cutoff Date.
"Outstanding Advances" " means, with respect to a Receivable
and the last day of a Collection Period, the sum of all Advances made as of or
prior to such date, minus all payments or collections as of or prior to such
date that are specified in Sections 5.04(b) and 5.04(d) as applied to reimburse
all unpaid Advances with respect to such Receivable.
"Pass-Through Rate" means the Class A Pass-Through Rate, the
Class B Pass-Through Rate or the Class C Pass-Through Rate.
"Person" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated organization or government or any agency or
political subdivision thereof.
14
"Plan" shall have the meaning assigned to such term in Section
7.03(b).
"Pool Balance" as of the close of business on the last day of
a Collection Period means the aggregate Principal Balance of the Receivables
(reduced by the principal balance of any Administrative Receivables, Warranty
Receivables and Defaulted Receivables) as of the close of business on such day;
provided, however, that where the Pool Balance is relevant in determining
whether the requisite percentage of Class A Certificateholders or Class B
Certificateholders necessary to effect any consent, waiver, request or demand
shall have been obtained, the Pool Balance shall be deemed to be reduced by the
amount equal to the portion of the Pool Balance (before giving effect to this
provision) represented by the interests evidenced by any Class A Certificate or
Class B Certificate, as applicable, registered in the name of the Seller, the
Servicer or any Person actually known by a Trustee Officer to be an Affiliate of
the Seller or the Servicer.
"Pool Factor" for a particular Class of Certificates and any
Distribution Date means a seven-digit decimal figure indicating the principal
amount of the Certificate Balance of such Class of Certificates as of the close
of business on the last day of the related Collection Period as a fraction of
the Original Pool Balance.
"Principal Balance" of a Receivable, as of any date of
determination, means the Amount Financed minus the sum of (a) all payments on
such Receivable allocable to principal, (b) any refunded portion of extended
warranty protection plan or service contract costs, or of physical damage,
credit life or disability insurance premiums included in the Amount Financed,
(c) any payment of the Administrative Purchase Payment or the Warranty Purchase
Payment with respect to the Receivable allocable to principal and (d) any Net
Liquidation Proceeds allocable to principal.
"Purchase Agreement" means the agreement, dated as of the date
of this Agreement, among [_________________________], relating to the purchase
by the Seller from NMAC of the Receivables.
"Rating Agency" means, as of any date, any of the nationally
recognized statistical rating organizations that has been requested by the
Seller or one of its Affiliates to rate any of the Certificates and that is
rating such Certificates on such date.
"Receivable" means any retail installment sale contract that
appears on Schedule A to this Agreement (which Schedule A may be in the form of
microfiche, CD, datatape or paper) and that has not been released by the Trustee
from the Trust.
"Receivable Files" means the documents specified in Section
3.03.
"Record Date" means, with respect to any Distribution Date,
the 14th day of the calendar month in which such Distribution Date occurs or, if
Definitive Certificates have been issued, the last day of the Collection Period
preceding the related Distribution Date. Any amount stated "as of a Record Date"
or "on a Record Date" shall give effect to (i) all applications of collections,
and (ii) all distributions to any party under this Agreement and the Trust
Agreement or to the related Obligor, as the case may be, in each case as
determined as of the opening of business on the related Record Date.
15
"Required Deposit Rating" for so long as the Certificates
shall be outstanding, shall mean a rating on (i) short-term unsecured debt
obligations of P-1 by Moody's and (ii) short-term unsecured debt obligations of
A-1+ by Standard & Poor's, and for any account in which deposits in excess of 30
days are to be made, so long as the Trustee's long-term unsecured debt
obligations have a rating of at least "AA-" by Standard & Poor's (such
short-term and long-term (if applicable) ratings being, the "Required Deposit
Rating").
"Residual Certificate" shall have the meaning assigned to such
term in Section 7.01.
"Required Rate" means, with respect to each Collection Period,
the sum of the Servicing Rate and [specify rate].
"Securities Act" means the Securities Act of 1933.
"Scheduled Payment" on a Receivable means the payment required
to be made by the Obligor during each Collection Period that is sufficient to
amortize the related Principal Balance under the Simple Interest Method over the
term of the Receivable and to provide interest at the APR.
"Seller" means [NARC II], as the seller of the Receivables
under this Agreement, and each successor to [NARC II] (in the same capacity)
pursuant to Section 8.03.
"Servicer" means NMAC, as the servicer of the Receivables and
not in its individual capacity, and each successor to NMAC (in the same
capacity) pursuant to Section 9.03 or Section 10.02.
"Servicer's Certificate" means a certificate completed and
executed on behalf of the Servicer by the president, any executive vice
president, any vice president, the treasurer, any assistant treasurer, the
controller or any assistant controller of the Servicer pursuant to Section 4.08.
"Servicing Rate" means 1.00% per annum.
"Simple Interest Method" means the method of allocating a
fixed level payment to principal and interest pursuant to which the portion of
such payment that is allocated to interest is equal to the product of the fixed
rate of interest multiplied by the unpaid principal balance, multiplied by the
quotient obtained by calculating the period of time elapsed since the preceding
payment of interest was made and dividing such period of time by 365.
"Simple Interest Receivable" means any Receivable under which
the portion of a payment allocable to interest and the portion allocable to
principal is determined in accordance with the Simple Interest Method.
"Specified Subordination Spread Account Balance" with respect
to any Distribution Date shall mean $_____________; provided, however, that if
on any Distribution Date (a) the annualized average for the preceding three
Collection Periods (or such shorter number of Collection Periods as have elapsed
since the Cutoff Date) of the percentage
16
equivalents of the ratios of net losses (i.e., the net balances of all
Liquidated Receivables, less any Net Liquidation Proceeds with respect to such
Liquidated Receivables from that or prior Collection Periods) to the Pool
Balance as of the first day of each such Collection Period exceeds ___%, or (b)
the average for the preceding three Collection Periods (or such smaller number
of Collection Periods as have elapsed since the Cutoff Date) of the percentage
equivalents of the ratios of the number of Receivables that are delinquent 60
days or more to the outstanding number of Receivables exceeds ___%, then the
Specified Subordination Spread Account Balance for such Distribution Date (and
for each succeeding Distribution Date until the relevant averages have not
exceeded the specified percentages in clauses (a) and (b) above for three
successive Distribution Dates) shall be a dollar amount equal to (i) __% of the
Pool Balance as of the first day of the related Collection Period minus (ii) the
excess of the Pool Balance over the Class A Certificate Balance as of the
opening of business of the first day of such Collection Period, but in no event
shall the Specified Subordination Spread Account Balance be more than
$_____________ or less than $_____________; and provided further, that on any
Distribution Date on which the aggregate balance of the Class A Certificates and
the Class B Certificates is $______________ or less, after giving effect to the
distributions on such Distribution Date, the Specified Subordination Spread
Account Balance shall be the greater of the balance described above and
$______________.
"Standard & Poor's" means Standard & Poor's Rating Services, a
division of The McGraw-Hill Companies, Inc.
"State" means any state or commonwealth of the United States
of America or the District of Columbia.
"Subordination Initial Deposit" means $_______________.
"Subordination Spread Account Property" shall have the meaning
set forth in the Custody and Pledge Agreement.
"Subordination Spread Account" means the account established
and maintained pursuant to the Custody and Pledge Agreement for the benefit of
the Holders of the Class A Certificates and the Class B Certificates.
"Supplemental Servicing Fee" means the fee payable to the
Servicer for certain services rendered during a Collection Period, determined
pursuant to and defined in Section 4.07.
"Total Available Amount" means, for each Distribution Date,
the sum of the Available Interest and the Available Principal.
"Total Servicing Fee" means the sum of the Base Servicing Fee
and the Supplemental Servicing Fee.
"Trust" means the Nissan Auto Receivables [_______] Grantor
Trust created hereunder, the estate of which shall consist of the Receivables
(other than Warranty Receivables for which the Seller has paid the Warranty
Purchase Payment in accordance with Section 3.02 and Administrative Receivables
for which the Servicer has paid the Administrative Purchase Payment in
accordance with Section 4.06), and all monies paid thereon, and all monies
accrued
17
thereon, on or after the Cutoff Date; security interests in the Financed
Vehicles and any accessions thereto; funds deposited in the Collection Account
and the Certificate Account; all property (including the right to receive Net
Liquidation Proceeds) that shall have secured a Receivable and that shall have
been acquired by or on behalf of the Trustee; proceeds from claims on any
physical damage, credit life or disability insurance policies covering Financed
Vehicles or Obligors; all Dealer Recourse; all right, title and interest of the
Seller in and to the Purchase Agreement, the Yield Supplement Agreement and the
Custody and Pledge Agreement; certain rebates of premiums and other amounts
relating to certain insurance policies and other items financed under the
Receivables in effect as of the Cutoff Date; and the proceeds of any and all of
the foregoing.
"Trustee" means the Person acting as Trustee under this
Agreement (which initially shall be [______________________________________]),
its successor in interest, and any successor trustee appointed pursuant to
Section 11.11.
"Trustee Officer" means, with respect to the Trustee, any
officer assigned to the Corporate Trust Division (or any successor thereto),
including any Vice President, Assistant Vice President, Trustee Officer, any
Assistant Secretary, or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
having direct responsibility for the administration of the Trust.
"Trustee's Certificate" means a certificate completed and
executed on behalf of the Trustee by a Trustee Officer pursuant to Section
11.02, substantially in the form of, in the case of assignment to the Seller,
Exhibit F-1 and, in the case of an assignment to the Servicer, Exhibit F-2.
"UCC" means the Uniform Commercial Code as in effect in the
relevant jurisdiction.
"USAP" shall have the meaning assigned to such term in Section
4.10.
"Warranty Purchase Payment," for any Warranty Receivable as of
the last day of any Collection Period, means the sum of the Principal Balance
thereof as of the beginning of such Collection Period plus interest accrued
thereon through the due date for the Obligor's payment in such Collection
Period, at the APR, after giving effect to the receipt of monies collected (from
whatever source other than Advances) on such Warranty Receivable, if any, during
Collection Period.
"Warranty Receivable" means a Receivable purchased as of the
close of business on the last day of a Collection Period by the Seller pursuant
to Section 3.02.
"Yield Supplement Account" shall have the meaning assigned to
such term in Section 6.01.
"Yield Supplement Agreement" means the agreement, dated as of
the date of this Agreement, between [_________________________], substantially
in the form attached hereto as Exhibit G.
18
"Yield Supplement Amount" means, with respect to any
Distribution Date, the aggregate amount on deposit in the Yield Supplement
Account after giving effect to the withdrawal therefrom of the related Yield
Supplement Deposit and without regard to any amounts on deposit therein in
respect of interest or investment earnings earned on the investment of amounts
on deposit therein in Eligible Investments for any period.
"Yield Supplement Deposit" means, with respect to any
Distribution Date, the amount by which (i) the aggregate amount of interest that
would have been due during the related Collection Period on all Yield
Supplemented Receivables if such Yield Supplemented Receivables bore interest at
the Required Rate exceeds (ii) the amount of interest accrued on such Yield
Supplemented Receivables at their respective APRs and due during such Collection
Period.
"Yield Supplemented Receivable" means any Receivable that has
an APR less than the Required Rate.
SECTION 1.02. USAGE OF TERMS. With respect to all terms in this
Agreement, the singular includes the plural and the plural the singular; words
importing any gender include the other genders; references to "writing" include
printing, typing, lithography and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments, amendments and restatements and supplements thereto or
changes therein entered into in accordance with their respective terms and not
prohibited by this Agreement; references to Persons include their permitted
successors and assigns; references to laws include their amendments and
supplements, the rules and regulations thereunder and any successors thereto;
and the term "including" means "including without limitation."
SECTION 1.03. CUTOFF DATE AND RECORD DATE. All references to the Record
Date prior to the first Record Date in the life of the Trust shall be to the
Cutoff Date.
SECTION 1.04. SECTION REFERENCES. All section references shall be to
Sections in this Agreement.
ARTICLE II
THE TRUST
SECTION 2.01. CREATION OF TRUST. Upon the execution of this Agreement
by the parties hereto, there is hereby created the Trust.
SECTION 2.02. CONVEYANCE OF RECEIVABLES. In consideration of the
Trustee's delivery to, or upon the order of, the Seller of Certificates in an
aggregate amount equal to the Original Pool Balance, the Seller does hereby
irrevocably sell, transfer, assign and otherwise convey to the Trustee, in trust
for the benefit of the Certificateholders, without recourse (subject to the
obligations herein):
(a) all right, title, and interest of the Seller in and to the
Receivables (including all related Receivable Files) listed in Schedule A hereto
and all monies due thereon or paid
19
thereunder or in respect thereof (including proceeds of the repurchase of
Receivables by the Seller pursuant to Section 3.02 or the purchase of
Receivables by the Servicer pursuant to Section 4.06 or 12.02) on or after the
Cutoff Date;
(b) amounts on deposit in the accounts established for the Trust;
(c) the right of the Seller in the security interests in the Financed
Vehicles granted by Obligors pursuant to the Receivables and any related
property;
(d) the right of the Seller in any proceeds from claims on any physical
damage, credit life, credit disability or other insurance policies covering the
Financed Vehicles or the Obligors;
(e) the right of the Seller through NMAC to receive payments in respect
of any Dealer Recourse with respect to the Receivables;
(f) the rights of the Seller under this Agreement, the Yield Supplement
Agreement, the Purchase Agreement and the Custody and Pledge Agreement;
(g) the right of the Seller to realize upon any property (including the
right to receive future Net Liquidation Proceeds) that shall have secured a
Receivable;
(h) the right of the Seller in rebates of premiums and other amounts
relating to insurance policies and other items financed under the Receivables in
effect as of the Cutoff Date;
(i) all other assets comprising the corpus of the Trust; and
(j) all proceeds of the foregoing.
Concurrently therewith and in exchange therefor, the Trustee shall
deliver to, or to the order of, the Seller the Certificates.
SECTION 2.03. ACCEPTANCE BY TRUSTEE. The Trustee does hereby accept all
consideration conveyed by the Seller pursuant to Section 2.02, and declares that
the Trustee shall hold such consideration upon the trust herein set forth for
the benefit of all present and future Certificate Owners, subject to the terms
and provisions of this Agreement.
SECTION 2.04. CHARACTERIZATION. Although the parties hereto intend that
the transfer and assignment contemplated by this Agreement be a sale, if such
transfer and assignment is deemed to be other than a sale, the parties intend
that all filings described in this Agreement shall give the Trustee on behalf of
the Trust a first priority perfected security interest in, to and under the
Receivables and other property conveyed hereunder and all proceeds of any of the
foregoing. This Agreement shall be deemed to be the grant of a security interest
from the Seller to the Trustee on behalf of the Trust, and the Trustee on behalf
of the Trust shall have all the rights, powers and privileges of a secured party
under the UCC.
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ARTICLE III
THE RECEIVABLES
SECTION 3.01. REPRESENTATIONS AND WARRANTIES OF SELLER WITH RESPECT TO
THE RECEIVABLES. The Seller makes the following representations and warranties
as to the Receivables on which the Trustee relies in accepting the Receivables
in trust and executing and authenticating the Certificates. Such representations
and warranties speak as of the execution and delivery of this Agreement, but
shall survive the sale, transfer and assignment of the Receivables to the Trust
in accordance with the terms hereof:
(a) Characteristics of Receivables. Each Receivable (i) has been
originated in the United States of America by a Dealer for the retail sale of a
Financed Vehicle in the ordinary course of such Dealer's business, has been
fully and properly executed by the parties thereto, has been purchased by the
Seller from NMAC pursuant to the Purchase Agreement, which in turn has purchased
such Receivables from such Dealer under an existing dealer agreement with NMAC,
and has been validly assigned by such Dealer to NMAC, which in turn has been
validly assigned pursuant to the Purchase Agreement by NMAC to the Seller in
accordance with its terms, (ii) created a valid, subsisting and enforceable
security interest in favor of NMAC in such Financed Vehicle, which security
interest has been validly assigned pursuant to the Purchase Agreement by NMAC to
the Seller, which in turn has been validly assigned by the Seller to the Trustee
in accordance with the terms hereof, (iii) contains customary and enforceable
provisions such that the rights and remedies of the holder thereof are adequate
for realization against the collateral of the benefits of the security, (iv)
provides for level monthly payments (provided that the payment in the first or
last month in the life of the Receivable may be minimally different from the
level payment) that fully amortize the Amount Financed over an original term of
no greater than [____] months, and (v) provides for yield interest at the
related APR.
(b) Schedule of Receivables. The information set forth in Schedule A to
this Agreement was true and correct in all material respects as of the opening
of business on the Cutoff Date; the Receivables were selected at random from
NMAC's retail installment sale contracts (other than contracts originated in
Alabama) meeting the criteria of the Trust set forth in this Agreement; and no
selection procedures believed to be adverse to the Certificateholders were
utilized in selecting the Receivables.
(c) Compliance with Law. Each Receivable, the origination of such
Receivable, and the sale of the Financed Vehicle complied at the time it was
originated or made and at the execution of this Agreement complies in all
material respects with all requirements of applicable federal, state and local
laws, and regulations thereunder, including usury laws, the Federal
Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit
Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade
Commission Act, the Magnuson-Moss Warranty Act, the Soldiers and Sailors Civil
Relief Act of 1940, the Federal Reserve Board's Regulations B and Z, and state
adaptations of the National Consumer Credit Protection Act and of the Uniform
Consumer Credit Code, state "Lemon Laws" designed to prevent fraud in the sale
of automobiles and other consumer credit laws and equal credit opportunity and
disclosure laws.
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(d) Binding Obligation. Each Receivable represents the genuine, legal,
valid and binding payment obligation in writing of the Obligor, enforceable by
the holder thereof in accordance with its terms, subject to the effect of
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and by general equitable principles.
(e) Security Interest in Financed Vehicle. (i) Immediately prior to the
sale, assignment and transfer thereof to the Trustee, each Receivable was
secured by a validly perfected first priority security interest in the Financed
Vehicle in favor of NMAC as secured party or all necessary and appropriate
actions shall have been commenced that would result in the valid perfection of a
first priority security interest in the Financed Vehicle in favor of NMAC as
secured party, and (ii) as of the Cutoff Date, according to the records of NMAC,
no Financed Vehicle has been repossessed and the possession thereof not
reinstated.
(f) Receivables in Force. No Receivable has been satisfied,
subordinated or rescinded, nor has any Financed Vehicle been released from the
lien granted by the related Receivable in whole or in part.
(g) No Waiver. No provision of a Receivable has been waived in a manner
that is prohibited by the provisions of Section 4.01 or that would cause such
Receivable to fail to meet all of the other requirements and warranties made by
the Seller herein with respect thereto.
(h) No Defenses. No Receivable is subject to any right of rescission,
setoff, counterclaim or defense, including the defense of usury, and the
operation of any of the terms of any Receivable, or the exercise of any right
thereunder, will not render such Receivable unenforceable in whole or in part or
subject such Receivable to any right of rescission, setoff, counterclaim or
defense, including the defense of usury, and no such right of rescission,
setoff, counterclaim or defense has been asserted with respect thereto.
(i) No Liens. To the Seller's knowledge, no liens have been filed for
work, labor or materials relating to a Financed Vehicle that shall be liens
prior to, or equal or coordinate with, the security interest in the Financed
Vehicle granted by the Receivable.
(j) No Default. Except for payment defaults continuing for a period of
not more than 29 days as of the Cutoff Date, no default, breach, violation or
event permitting acceleration under the terms of any Receivable has occurred;
and no continuing condition that with notice or the lapse of time would
constitute a default, breach, violation or event permitting acceleration under
the terms of any Receivable has arisen (other than deferrals and waivers of late
payment charges or fees permitted hereunder).
(k) Insurance. NMAC, in accordance with its customary procedures, has
determined at the time of origination of each Receivable that the related
Obligor has agreed to obtain physical damage insurance covering the Financed
Vehicle and the Obligor is required under the terms of the related Receivable to
maintain such insurance.
(l) Title. It is the intention of the Seller that the transfer and
assignment herein contemplated constitute a sale of the Receivables from the
Seller to the Trust and that the beneficial interest in and title to the
Receivables not be part of the Seller's estate in the event of
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the filing of a bankruptcy petition by or against the Seller under any
bankruptcy law. Immediately prior to the transfer and assignment herein
contemplated, the Seller had good and marketable title to each Receivable free
and clear of all Liens and, immediately upon the transfer thereof, the Trustee,
for the benefit of the Certificateholders, shall have good and marketable title
to each Receivable, free and clear of all Liens and rights of others. Each
Receivable File contains the original certificate of title (or a photocopy or
image thereof) or evidence that an application for a certificate of title has
been filed. To the extent the transfer and assignment contemplated under this
Agreement is deemed to be other than a sale, this Agreement and all filings
described under this Agreement create a valid and continuing security interest
(as defined in the applicable UCC) in the Receivables in favor of the Issuer,
which security interest is prior to all other Liens, and is enforceable as such
as against creditors of and purchasers from the Seller.
(m) Lawful Assignment. No Receivable has been originated in, or shall
be subject to the laws of, any jurisdiction under which the sale, transfer and
assignment of such Receivable under this Agreement or pursuant to transfers of
the Certificates are unlawful, void or voidable.
(n) All Filings Made. All filings (including, without limitation, UCC
filings) necessary in any jurisdiction to give the Trustee a first priority
perfected ownership interest in the Receivables have been made or have been
delivered in form suitable for filing to the Trustee in a form suitable for
filing.
(o) Chattel Paper. Each Receivable constitutes "chattel paper," as such
term is defined in the UCC.
(p) Simple Interest Receivables. All of the Receivables are Simple
Interest Receivables.
(q) One Original. There is only one original executed copy of each
Receivable.
(r) No Amendments. No Receivable has been amended such that the amount
of the Obligor's Scheduled Payments has been increased.
(s) APR. The APR of each Receivable equals or exceeds ___%.
(t) Maturity. As of the Cutoff Date, each Receivable had a remaining
term to maturity of not less than _____ payments and not greater than _____
payments.
(u) Balance. Each Receivable had an original Principal Balance of not
more than $____________ and, as of the Cutoff Date, had a Principal Balance of
not less than $______ and not more than $_________.
(v) Delinquency. No Receivable was more than 29 days past due as of the
Cutoff Date and no Receivable has been extended by more than two months.
(w) Bankruptcy. No Obligor was the subject of a bankruptcy proceeding
(according to the records of NMAC) as of the Cutoff Date.
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(x) Transfer. Each Receivable prohibits the sale or transfer of the
Financed Vehicle without the consent of NMAC.
(y) New, Near-New and Used Vehicles. Each Financed Vehicle was a new,
near-new or used automobile or light-duty truck at the time the related Obligor
executed the retail installment sale contract.
(z) Origination. Each Receivable has an origination date on or after
_____________.
(aa) Location of Receivable Files. The Receivable Files shall be kept
at one or more of the locations listed in Schedule B hereto.
(bb) Forced-Placed Insurance Premiums. No contract relating to any
Receivable has had forced-placed insurance premiums added to the amount
financed.
(cc) No Fraud or Misrepresentation. To the knowledge of the Seller, no
Receivable was originated by a Dealer and sold by such Dealer to the Seller with
any conduct constituting fraud or misrepresentation on the part of such Dealer.
(dd) No Further Amounts Owed on the Receivables. No further amounts are
owed by the Seller to any Obligor under the Receivables.
(ee) No Pledge or Assignment of Receivables. Other than the security
interest granted to the Issuer pursuant to this Agreement, the Seller has not
pledged, assigned, sold, granted a security interest in, or otherwise conveyed
any of the Receivables. The Seller has not authorized the filing of and is not
aware of any financing statements against the Seller that include a description
of collateral covering the Receivables other than any financing statement
relating to the security interest granted to the Issuer hereunder or a financing
statement as to which the security interest covering the Receivables has been
released. The Seller is not aware of any judgment or tax lien filings against
the Seller.
SECTION 3.02. REPURCHASE UPON BREACH. The Seller, the Servicer or the
Trustee, as the case may be, shall inform the other parties to this Agreement
promptly, in writing, upon the discovery of any breach of the Seller's
representations and warranties pursuant to Section 3.01 that materially and
adversely affects any Receivable. Unless the breach shall have been cured by the
last day of the second Collection Period following such discovery (or, at the
Seller's election, the last day of the first Collection Period following such
discovery), the Seller shall be obligated (whether or not such breach was known
to the Seller on the Closing Date (as defined in the Purchase Agreement)), and
the Trustee shall enforce the obligation of the Seller under this Agreement,
and, if necessary, the Seller shall enforce the obligation of NMAC under the
Purchase Agreement, to repurchase any Receivable materially and adversely
affected by the breach as of such last day. A breach of the representation in
Section 3.01(a)(iv), (t) or (u) shall be deemed to affect materially and
adversely the related Receivable. In consideration of the purchase of the
Receivables, the Seller shall remit the Warranty Purchase Payment in the manner
specified in Section 5.05. For purposes of this Section 3.02, the Warranty
Purchase Payment of a Receivable that is not consistent with the Seller's
warranty pursuant to Section 3.01(a)(iv) shall include such additional amount as
shall be necessary to provide the full amount of interest as contemplated
therein to the date of repurchase. The sole remedy of the Trustee, the Trust, or
the
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Certificateholders with respect to a breach of the Seller's representations and
warranties pursuant to Section 3.01 shall be to require the Seller to repurchase
Receivables pursuant to this Section 3.02 and to enforce the obligation of NMAC
to the Seller to repurchase such Receivables pursuant to the Purchase Agreement.
SECTION 3.03. CUSTODY OF RECEIVABLE FILES. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Trustee, upon
the execution and delivery of this Agreement, hereby revocably appoints the
Servicer, and the Servicer hereby accepts such appointment, to act as the agent
of the Trustee as custodian of the following documents or instruments
(collectively, the "Receivable Files") that are hereby constructively delivered
to the Trustee with respect to each Receivable:
(a) The original of the Receivable (or a photocopy or other image
thereof that the Servicer shall keep on file in accordance with its customary
procedures) fully executed by the Obligor;
(b) The original credit application fully executed by the Obligor (or a
photocopy or other image thereof that the Servicer shall keep on file in
accordance with its customary procedures);
(c) The original certificate of title (or a photocopy or other image
thereof or such documents that the Servicer shall keep on file, in accordance
with its customary procedures), evidencing the security interest of NMAC in the
Financed Vehicle; and
(d) Any and all other documents that the Servicer shall keep on file,
in accordance with its customary procedures, relating to a Receivable, the
related Obligor or a Financed Vehicle.
SECTION 3.04. DUTIES OF SERVICER AS CUSTODIAN.
(a) Safekeeping. The Servicer shall hold the Receivable Files on behalf
of the Trustee for the use and benefit of all present and future
Certificateholders, and maintain such accurate and complete accounts, records
and computer systems pertaining to each Receivable File as shall enable the
Trustee to comply with this Agreement. In performing its duties as custodian,
the Servicer shall act with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to the receivable files
relating to all comparable automotive receivables that the Servicer services for
itself or others. In accordance with its customary practices with respect to its
retail installment sale contracts, the Servicer shall conduct, or cause to be
conducted, periodic audits of the Receivable Files held by it under this
Agreement, and of the related accounts, records and computer systems, in such a
manner as shall enable the Trustee to verify the accuracy of the Servicer's
record keeping. The Servicer shall promptly report to the Trustee any material
failure on its part to hold the Receivable Files and maintain its accounts,
records and computer systems as herein provided in all material respects and
shall promptly take appropriate action to remedy any such material failure.
Nothing herein shall be deemed to require an initial review or any periodic
review by the Trustee of the Receivable Files.
(b) Maintenance of and Access to Records. The Servicer shall maintain
each Receivable File at one of its offices specified in Schedule B to this
Agreement, or at such other
25
office as shall be specified to the Trustee by written notice from the Servicer
not later than 90 days after any change in location. The Servicer shall make
available to the Trustee or its duly authorized representatives, attorneys or
auditors the Receivable Files and the related accounts, records and computer
systems maintained by the Servicer at such times during normal business hours as
the Trustee shall instruct. The Servicer shall permit the Trustee and its agents
at any time during normal business hours upon reasonable prior notice to
inspect, audit and make copies of and abstracts from the Servicer's records
regarding any Receivable.
(c) Release of Documents. Upon the occurrence and during the
continuation of an Event of Default or to the extent necessary for the Trustee
to comply with its obligations under this Agreement, the Servicer shall, upon
instruction from the Trustee, release any Receivable File to the Trustee, the
Trustee's agent or the Trustee's designee, as the case may be, at such place or
places as the Trustee may designate, as soon as practicable.
SECTION 3.05. INSTRUCTIONS; AUTHORITY TO ACT. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable Files
upon its receipt of written instructions signed by the Trustee Officer.
SECTION 3.06. CUSTODIAN'S INDEMNIFICATION. The Servicer, as custodian,
shall indemnify the Trustee for any and all liabilities, obligations, losses,
compensatory damages, payments, costs or expenses of any kind whatsoever that
may be imposed on, incurred by or asserted against the Trustee as the result of
any improper act or omission in any way relating to the maintenance and custody
by the Servicer, as custodian of the Receivable Files; provided, however, that
the Servicer shall not be liable for any portion of any such amount resulting
from the willful misfeasance, bad faith or negligence of the Trustee.
SECTION 3.07. EFFECTIVE PERIOD AND TERMINATION. The Servicer's
appointment as custodian pursuant to Section 3.03 shall become effective as of
the Cutoff Date and shall continue in full force and effect until terminated
pursuant to this Section 3.07. If NMAC shall resign as Servicer in accordance
with the provisions of this Agreement or if all of the rights and obligations of
the Servicer shall have been terminated under Section 10.01, the appointment of
the Servicer as custodian may be terminated by the Trustee, or by the Holders
evidencing not less than 25% of the Controlling Class of Certificates, in the
same manner as the Trustee or such Holders may terminate the rights and
obligations of the Servicer under Section 10.01. As soon as practicable after
any termination of such appointment, the Servicer shall deliver the Receivable
Files and the related accounts and records maintained by the Servicer to the
Trustee or the Trustee's agent at such place or places as the Trustee may
reasonably designate.
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.01. DUTIES OF SERVICER. (a) The Servicer shall manage,
service, administer and make collections on the Receivables with reasonable
care, using that degree of skill and attention that the Servicer exercises with
respect to all comparable receivables that it services for itself or others.
Except with respect to Defaulted Receivables, Administrative Receivables or
Warranty Receivables, the Servicer shall not change the amount of or reschedule
the due date of
26
any Scheduled Payment, change the APR of, or extend any Receivable, except as
provided herein, or change any material term of a Receivable; provided, however,
that:
(i) if a default, breach, violation, delinquency or event
permitting acceleration under the terms of any Receivable shall have
occurred or, in the judgment of the Servicer, is imminent, the Servicer
may (A) extend such Receivable for credit related reasons that would be
acceptable to the Servicer with respect to comparable new, near-new or
used automobile or light-duty truck receivables that it services for
itself, but only (1) if the final scheduled payment date of such
Receivable as extended would not be later than the last day of the
Collection Period preceding the Final Scheduled Distribution Date, and
(2) the rescheduling or extension would not modify the terms of such
Receivable in such a manner which would constitute a cancellation of
such Receivable and the creation of a new receivable for federal income
tax purposes; or (B) reduce an Obligor's monthly payment amount in the
event of a prepayment resulting from refunds of credit life and
disability insurance premiums and service contracts and make similar
adjustments in an Obligor's payment terms to the extent required by
law; or
(ii) if at the end of the scheduled term of any Receivable,
the outstanding principal amount thereof is such that the final payment
to be made by the related Obligor is larger than the regularly
scheduled payment of principal and interest made by such Obligor, the
Servicer may permit such Obligor to pay such remaining principal amount
in more than one payment of principal and interest, provided that the
last such payment shall be due on or prior to the last day of the
Collection Period preceding the Final Scheduled Distribution Date; and
(iii) the Servicer may in its discretion waive any late
payment charge or any other fees that may be collected in the ordinary
course of servicing a Receivable.
(b) The Servicer's duties shall include collection and posting of all
payments, responding to inquiries of Obligors on the Receivables, investigating
delinquencies, sending remittance advices to Obligors, reporting tax information
to Obligors, accounting for collections, furnishing monthly and annual
statements to the Trustee with respect to distributions and making Advances
pursuant to Section 5.04.
(c) Without limiting the generality of the foregoing, the Servicer is
authorized and empowered by the Trustee to execute and deliver, on behalf of
itself, the Trust, the Certificateholders or the Trustee or any of them, any and
all instruments of satisfaction or cancellation, or partial or full release or
discharge, and all other comparable instruments, with respect to the Receivables
or to the Financed Vehicles securing the Receivables. If the Servicer shall
commence a legal proceeding to enforce a Receivable, the Trustee (in the case of
a Receivable other than an Administrative Receivable or a Warranty Receivable)
shall thereupon be deemed to have automatically assigned, solely for the purpose
of collection, such Receivable to the Servicer. If in any enforcement suit or
legal proceeding it shall be held that the Servicer may not enforce a Receivable
on the ground that it shall not be a real party in interest or a holder entitled
to enforce such Receivable, the Trustee shall, at the Servicer's expense and
direction, take steps to enforce the Receivable, including bringing suit in its
name or the name of the Certificateholders. The Trustee shall furnish the
Servicer with any powers of attorney and other
27
documents reasonably necessary or appropriate to enable the Servicer to carry
out its servicing and administrative duties hereunder.
(d) The Servicer, at its expense, shall obtain on behalf of the Trust
all licenses, including those required under the Pennsylvania Motor Vehicle
Sales Finance Act and the Maryland Financial Institutions Article, required by
the laws of any jurisdiction to be held by the Trust in connection with
ownership of the Receivables, and shall make all filings and pay all fees as may
be required in connection therewith during the term hereof. Nothing in the
foregoing or in any other section of this Agreement shall be construed to
prevent the Servicer from implementing new programs, whether on an intermediate,
pilot or permanent basis, or on a regional or nationwide basis, or from
modifying its standards, policies and procedures as long as, in each case, the
Servicer does or would implement such programs or modify its standards, policies
and procedures in respect of comparable assets serviced for itself in the
ordinary course of business.
SECTION 4.02. COLLECTION OF RECEIVABLE PAYMENTS. The Servicer shall
make reasonable efforts to collect all payments called for under the terms and
provisions of the Receivables as and when the same shall become due and shall
follow such collection procedures as it follows with respect to all comparable
receivables that it services for itself or others.
SECTION 4.03. REALIZATION UPON RECEIVABLES. On behalf of the Trust, the
Servicer shall use commercially reasonable efforts, consistent with its
customary servicing procedures, to repossess or otherwise convert the ownership
of the Financed Vehicle securing any Receivable as to which the Servicer shall
have determined eventual payment in full is unlikely. The Servicer shall follow
such customary and usual practices and procedures as it shall deem necessary or
advisable in its servicing of comparable receivables, which may include
reasonable efforts to realize upon any Dealer Recourse and selling the related
Financed Vehicle at public or private sale. The foregoing shall be subject to
the provision that, in any case in which the Financed Vehicle shall have
suffered damage, the Servicer shall not expend funds in connection with the
repair or the repossession of such Financed Vehicle unless it shall determine in
its discretion that such repair and/or repossession will increase the Net
Liquidation Proceeds.
SECTION 4.04. MAINTENANCE OF SECURITY INTERESTS IN FINANCED VEHICLES.
The Servicer shall, in accordance with its customary servicing procedures, take
such steps as are necessary to maintain perfection of the security interest
created by each Receivable in the related Financed Vehicle. The Trustee hereby
authorizes the Servicer to take such steps as are necessary to re-perfect such
security interest on behalf of the Trust in the event of the relocation of a
Financed Vehicle or for any other reason. If the assignment of a Receivable to
the Trust is insufficient, without a notation on the related Financed Vehicle's
certificate of title, to grant to the Trust a first priority perfected security
interest in the related Financed Vehicle, the Servicer hereby agrees to serve as
the agent of the Trust for the purpose of perfecting the security interest of
the Trust in such Financed Vehicle and agrees that the Servicer's listing as the
secured party on the certificate of title is in this capacity as agent of the
Trust.
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SECTION 4.05. COVENANTS OF SERVICER.
(a) The Servicer shall not release the Financed Vehicle securing any
Receivable from the security interest granted by such Receivable in whole or in
part except in the event of payment in full by or on behalf of the Obligor
thereunder or repossession.
(b) If the Servicer shall determine not to make an Advance related to
delinquency or non-payment of any Receivable pursuant to Section 5.04 because it
determines that such Advance would not be recoverable from subsequent
collections on such Receivable, such Receivable shall be designated by the
Servicer to be a Defaulted Receivable, provided that such Receivable otherwise
meets the definition of a Defaulted Receivable.
(c) Except with respect to Defaulted Receivables, Administrative
Receivables or Warranty Receivables, the Servicer shall not (i) alter the APR of
any Receivable or forgive payments on a Receivable. Except as provided in
Section 4.01, the Servicer shall not modify the number of payments under a
Receivable, increase the amount financed under a Receivable or extend the due
date for any payment on a Receivable.
(d) If the Servicer shall determine not to make an Advance related to
delinquency or non-payment of any Receivable pursuant to Section 5.04 because it
determines that such Advance would not be recoverable from subsequent
collections on such Receivable, such Receivable shall be designated by the
Servicer to be a Defaulted Receivable, provided that such Receivable otherwise
meets the definition of a Defaulted Receivable.
SECTION 4.06. PURCHASE OF RECEIVABLES UPON BREACH. The Servicer or the
Trustee shall inform the other party promptly, in writing, upon the discovery of
any breach by the Servicer of its obligations under the second sentence of
Section 4.01 or under Section 4.02, 4.04 or 4.05 that would materially and
adversely affect any Receivable. Unless the breach shall have been cured by the
last day of the second Collection Period following such discovery (or, at the
Servicer's election, the last day of the first Collection Period following such
discovery), the Servicer shall (whether or not such breach was known to the
Servicer on the Closing Date (as defined in the Purchase Agreement)) purchase
any Receivable materially and adversely affected by such breach as of such last
day. In consideration of the purchase of such Receivable, the Servicer shall
remit the Administrative Purchase Payment (as reduced by any Outstanding
Advances with respect to such Receivable) in the manner specified in Section
5.05. For the purposes of this Section 4.06, the Administrative Purchase Payment
shall consist in part of a release by the Servicer of all rights of
reimbursement with respect to Outstanding Advances with respect to the purchased
Receivable. The sole remedy of the Trustee, the Trust or the Certificateholders
with respect to a breach by the Servicer of its obligations under the second
sentence of Section 4.01 or under Section 4.02, 4.04 or 4.05 shall be to require
the Servicer to purchase Receivables pursuant to this Section 4.06.
SECTION 4.07. TOTAL SERVICING FEE. The Servicer shall be entitled to
the Base Servicing Fee, as provided herein. As additional servicing
compensation, the Servicer shall be entitled to an amount equal to any interest
earned on the amounts deposited in the Collection Account and the Certificate
Account and earned on funds held by the Servicer pending deposit therein during
such Collection Period, plus an amount that may be retained by the Servicer
consisting of all late
29
fees, prepayment charges and other administrative fees and expenses or similar
charges allowed by applicable law (and which comply with Prohibited Transaction
Exemption 97-34) with respect to Receivables, collected (from whatever source)
on the Receivables during such Collection Period (collectively, the
"Supplemental Servicing Fee").
SECTION 4.08. SERVICER'S CERTIFICATE.
(a) On or before the tenth day of each month (or, if such tenth day is
not a Business Day, then on the next succeeding Business Day), the Servicer
shall deliver to (i) the Trustee (with a copy to each of the Rating Agencies),
(ii) for so long as the Custody and Pledge Agreement is in existence, the
Custodian, and (iii) if any Class C Certificate is held by a Person other than
the Seller or any Affiliate of the Seller, such Class C Certificateholder, a
Servicer's Certificate containing all information necessary to make the
distributions pursuant to Section 5.06 (including the amount of the aggregate
collections on the Receivables, the aggregate Advances to be made by the
Servicer, if any, the aggregate Administrative Purchase Payments for any
Administrative Receivables to be purchased by the Servicer, and the aggregate
Warranty Purchase Payments for any Warranty Receivables to be purchased by the
Seller) for the Collection Period preceding the date of such Servicer's
Certificate, all information necessary for the Trustee to send statements to
Certificateholders pursuant to Section 5.08 and, for so long as the Custody and
Pledge Agreement or a related agreement is in existence, all information
necessary for the Custodian to determine the amounts necessary to be deposited
in the Subordination Spread Account and the amount that may be released to the
Seller. Receivables purchased or to be purchased by the Servicer or the Seller
shall be identified by the Servicer by the Seller's account number with respect
to such Receivable (as specified in Schedule A of this Agreement). The Trustee
and the Custodian may conclusively rely on the information in any Servicer's
Certificate, and shall have no duty to confirm or verify the contents thereof.
(b) Concurrently with delivery of the Servicer's Certificate in each
month, the Servicer shall deliver to the underwriters of the Class A
Certificates and the Class B Certificates and, if any Class C Certificate is
held by a Person other than the Seller or any Affiliate of the Seller, to such
Class C Certificateholder, the Class A Certificate Factor and the Class B
Certificate Factor as of the close of business on the Distribution Date
occurring in such month.
SECTION 4.09. ANNUAL STATEMENT AS TO COMPLIANCE; NOTICE OF DEFAULT.
(a) The Servicer shall deliver to the Trustee and to each of the Rating
Agencies on or before the last day of the third month after the end of each
fiscal year of the Servicer, beginning [________________, ______], with respect
to the prior fiscal year (or with respect to the initial Officer's Certificate,
the period from the date of the initial issuance of Certificates hereunder to
[__________________], ______), stating that (i) a review of the activities of
the Servicer during the preceding 12-month (or shorter) period and of its
performance under this Agreement has been made under such officer's supervision
and (ii) to the best of such officer's knowledge, based on such review, the
Servicer has fulfilled all its obligations under this Agreement throughout such
twelve-month (or shorter) 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 Officer's Certificate
may be obtained by any Certificateholder by a request in writing to the Trustee
addressed to the Corporate Trust Office.
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(b) The Servicer shall deliver to the Trustee and to each of the Rating
Agencies promptly after having obtained knowledge thereof, but in no event later
than five Business Days thereafter, written notice in an Officer's Certificate
of any Event of Default or event that with the giving of notice or lapse of
time, or both, would become an Event of Default under Section 10.01. The Seller
shall deliver to the Trustee and to each such Rating Agency, promptly after
having obtained knowledge thereof, but in no event later than five Business Days
thereafter, written notice in an Officer's Certificate of any event that with
the giving of notice or lapse of time, or both, would become an Event of Default
under Section 10.01(a)(ii) or of any lowering of the rating described in clause
(ii) of the definition of "Monthly Remittance Condition".
SECTION 4.10. ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT'S REPORT.
The Servicer shall cause a firm of independent certified public accountants, who
may also render other services to the Servicer or to the Seller, to deliver to
the Trustee and each of the Rating Agencies, on or before the last day of the
third month after the end of each fiscal year of the Servicer, beginning
[______________, _______], with respect to the prior fiscal year (or with
respect to the initial reports, the period from the date of the initial issuance
of Certificates hereunder to [________________, _______]) the following reports:
(a) a report that such firm has audited the consolidated financial statements of
the Servicer in accordance with generally accepted auditing standards, that such
firm is independent of the Servicer within the meaning of the Code of
Professional Ethics of the American Institute of Certified Public Accountants
("AICPA"), and expressing such firm's opinion thereon; and (b) a report
indicating that such firm has examined, in accordance with standards established
by AICPA, management's assertion about the Servicer's compliance with the
minimum servicing standards identified in the Mortgage Bankers Association of
America's Uniform Single Attestation Program for Mortgage Bankers ("USAP") as
such standards relate to automobile and light-duty truck loans serviced for
others, and expressing such firm's opinion on such management assertion (the
"Annual USAP Report"). Upon the request of a Certificate Owner, the Trustee
shall promptly provide such Certificate Owner with a copy of such Annual USAP
Report. For all purposes of this Agreement, the Trustee may rely on the
representation of any Person that it is a Certificate Owner.
SECTION 4.11. ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
RECEIVABLES. The Servicer shall provide to the Certificateholders access to the
Receivable Files in such cases where the Certificateholders shall be 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 the normal business hours at the respective offices of the Servicer.
Nothing in this Section shall affect the obligation of the Servicer to observe
any applicable law prohibiting disclosure of information regarding the Obligors,
and the failure of the Servicer to provide access to information as a result of
such obligation shall not constitute a breach of this Section.
SECTION 4.12. APPOINTMENT OF SUBSERVICER. So long as NMAC acts as the
Servicer, the Servicer may at any time without notice or consent subcontract
substantially all its duties under this Agreement to any corporation more than
50% of the voting stock of which is owned, directly or indirectly, by Nissan.
The Servicer may at any time perform specific duties as servicer under this
Agreement through other subcontractors; provided, however, that no such
delegation or
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subcontracting shall relieve the Servicer of its responsibilities with respect
to such duties as to which the Servicer shall remain primarily responsible with
respect thereto.
SECTION 4.13. SERVICER EXPENSES. The Servicer shall be required to pay
all expenses incurred by it in connection with its activities hereunder,
including fees and disbursements of independent accountants and the Trustee,
taxes imposed on the Servicer, expenses incurred in connection with
distributions and reports to Certificateholders and all other fees and expenses
not expressly stated under this Agreement to be for the account of the
Certificateholders.
ARTICLE V
DISTRIBUTIONS; SUBORDINATION SPREAD ACCOUNTS;
STATEMENTS TO CERTIFICATEHOLDERS
SECTION 5.01. ACCOUNTS. The Servicer shall establish the Collection
Account and the Certificate Account in the name of the Trustee for the benefit
of the Certificateholders. Each of the Collection Account and the Certificate
Account shall be a segregated trust account initially established with the
Trustee and maintained with the Trustee so long as (a) the deposits of the
Trustee have the Required Deposit Rating or (b) the Collection Account or the
Certificate Account, as the case may be, is maintained in a segregated trust
account in the trust department of the Trustee; provided, however, that all
amounts held in the Collection Account and the Certificate Account shall, to the
extent permitted by applicable laws, rules and regulations and as directed by
the Servicer, be invested by the Trustee in Eligible Investments and such
Eligible Investments shall mature not later than the Business Day preceding the
next Distribution Date, in such manner that such amounts invested shall be
available to make the required distributions on the Distribution Date; provided,
that if permitted by the Rating Agencies, monies on deposit therein may be
invested in Eligible Investments that mature later than the Business Day
preceding the next Distribution Date; provided, however, that such investment
shall be sold not later than the Business Day preceding the next Distribution
Date. Should the short-term unsecured debt obligations of the Trustee no longer
have the Required Deposit Rating then, unless the Collection Account and the
Certificate Account are maintained in segregated trust accounts in the trust
department of the Trustee, the Servicer shall, with the Trustee's assistance as
necessary and within ten Business Days of receipt of notice from the Trustee
that the Trustee no longer has the Required Deposit Rating, cause the Collection
Account and the Certificate Account (a) to be moved to segregated trust accounts
in a bank or trust company, the short-term unsecured debt obligations of which
shall have the Required Deposit Rating, or (b) to be moved to the trust
department of the Trustee. Earnings on the investment of funds in the Collection
Account and the Certificate Account shall be paid to the Servicer on each
Distribution Date as servicing compensation, and any losses and investment
expenses shall be charged against the funds on deposit in the Collection Account
or the Certificate Account, as the case may be.
SECTION 5.02. COLLECTIONS. The Servicer shall remit to the Collection
Account (a) all payments by or on behalf of the Obligors in respect of the
Receivables (excluding payments on Administrative Receivables or Warranty
Receivables and amounts constituting Supplemental Servicing Fees) and (b) all
Net Liquidation Proceeds, not later than the first Business Day after receipt
thereof. Prior to each Distribution Date, for so long as the Custody and Pledge
Agreement or any similar agreement is in existence, the Servicer shall notify
the Custodian that
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the Custodian will be required to remit to the Collection Account from the
Subordination Spread Account the lesser of (i) the amount of the Subordination
Spread Account, (ii) the amounts, if any, required to be distributed to Class A
Certificateholders from the Subordination Spread Account pursuant to Sections
5.06(c)(ii) and 5.06(c)(iii), and (iii) the amounts, if any, required to be
distributed to Class B Certificateholder, from the Subordination Spread Account
pursuant to Sections 5.06(c)(iv) and 5.06(c)(v). Notwithstanding the foregoing,
the Servicer shall be entitled to withhold or to be reimbursed from amounts
otherwise payable into or on deposit in the Collection Account, as the case may
be, amounts previously deposited in the Collection Account but later determined
to have resulted from mistaken deposits or posting. Accordingly, notwithstanding
the provisions of the first sentence of this Section 5.02, the Servicer shall
remit collections received during a Collection Period to the Collection Account
in immediately available funds on the Business Day prior to the related
Distribution Date but only for so long as (i) NMAC is the Servicer, (ii) the
rating of the Servicer's short-term unsecured debt obligations is at least "P-1"
by Moody's and the rating of the Servicer's (or, if NMAC is the Servicer and the
Servicer then has no short-term rating from Standard & Poor's, Nissan Capital of
America, Inc.'s) short-term unsecured debt obligations is at least "A-1" by
Standard & Poor's (so long as Moody's and Standard & Poor's are Rating
Agencies), and (iii) no Event of Default shall have occurred and be continuing
(each, a "Monthly Remittance Condition"); except that the requirement in clause
(i) above shall not apply if the Class A Certificates and the Class B
Certificates are not then outstanding and the Class C Certificates do not have
an investment grade rating. Notwithstanding the foregoing, if a Monthly
Remittance Condition is not satisfied, the Servicer may utilize an alternative
remittance schedule (which may include the remittance schedule utilized by the
Servicer before the Monthly Remittance Condition became unsatisfied), if the
Servicer provides to the Trustee written confirmation from each Rating Agency
that such alternative remittance schedule will not result in the downgrading or
withdrawal by such Rating Agency of the ratings then assigned to such
Certificates. The Servicer shall give the Trustee and each Rating Agency written
notice of the failure of any Monthly Remittance Condition (and any subsequent
curing of a failed Monthly Remittance Condition) as soon as practical after the
occurrence thereof but in no event later than 10 Business Days after obtaining
knowledge thereof (it being understood that if the Monthly Remittance Condition
is not satisfied as of the Closing Date no such notice shall be required in
connection therewith). The Trustee shall not be deemed to have knowledge of any
event or circumstance under clause (ii) of the definition of Monthly Remittance
Condition that would require daily remittance by the Servicer to the Collection
Account unless the Trustee has received notice of such event or circumstance
from the Seller or the Servicer in an Officer's Certificate or from the Holders
of Certificates evidencing not less than 25% of the Class A Certificate Balance
or the Class B Certificate Balance, or a Trustee Officer in the Corporate Trust
Office with knowledge hereof or familiarity herewith has actual knowledge of
such event or circumstance. For purposes of this Article V the phrase "payments
by or on behalf of Obligors" shall mean payments made by Persons other than the
Servicer.
SECTION 5.03. APPLICATION OF COLLECTIONS. As of the Business Day
immediately preceding the related Distribution Date, all collections for the
related Collection Period with respect to each Receivable shall be applied by
the Servicer as follows:
(a) first, to interest accrued to date on such Receivable;
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(b) second, to principal until the Principal Balance of such Receivable
is brought current;
(c) third, to reduce the unpaid late charges (if any) as provided in
such Receivable; and
(d) fourth, to prepay principal on such Receivable.
SECTION 5.04. ADVANCES.
(a) The Servicer shall make a payment with respect to each Receivable
(other than an Administrative Receivable, a Warranty Receivable or a Liquidated
Receivable) equal to the excess, if any, of (i) the product of the Principal
Balance of such Receivable as of the first day of the related Collection Period
and one-twelfth of its APR (calculated on the basis of a 360-day year comprised
of twelve 30-day months), over (ii) the interest actually received by the
Servicer with respect to such Receivable from the Obligor or from payments of
the Administrative Purchase Payment or the Warranty Purchase Payment, as the
case may be, during such Collection Period. The Servicer will not be obligated
to make an Advance in respect of a Receivable (other than an Advance in respect
of an interest shortfall arising from the prepayment of a Receivable) to the
extent that the Servicer, in its sole discretion, shall determine that the
Advance constitutes a Nonrecoverable Advance. With respect to each Receivable,
the Advance shall increase the Outstanding Advances. No Advances will be made
with respect to the Principal Balance of the Receivables. The Servicer shall
deposit all such Advances into the Collection Account in immediately available
funds no later than 5:00 p.m., New York City time, on the Business Day
immediately preceding the related Distribution Date. To the extent that the
amount set forth in clause (ii) above with respect to a Receivable is greater
than the amount set forth in clause (i) above with respect thereto, such amount
shall be distributed to the Servicer pursuant to Section 5.06(a)(ii); provided,
however, that, notwithstanding anything else herein, the Servicer shall not be
reimbursed for any amounts representing an Advance, or any portion thereof, made
in respect of an interest shortfall arising from the prepayment of a Receivable.
(b) The Servicer shall be entitled to reimbursement for Outstanding
Advances, without interest, with respect to a Receivable from the following
sources with respect to such Receivable pursuant to Section 5.06(a)(ii): (i)
subsequent payments made by or on behalf of the related Obligor, (ii) Net
Liquidation Proceeds, and (iii) the Warranty Purchase Payments.
(c) To the extent that the Servicer has determined that any Outstanding
Advance is a Nonrecoverable Advance, the Servicer may provide to the Trustee an
Officer's Certificate setting forth the amount of such Nonrecoverable Advance,
and on the related Distribution Date, the Trustee shall remit to the Servicer
from funds on deposit in the Collection Account an amount equal to the amount of
such Nonrecoverable Advance pursuant to Section 5.06(a)(iii).
(d) For so long as the Monthly Remittance Conditions are satisfied, in
lieu of causing the Servicer first to deposit and then the Trustee to remit to
the Servicer the amounts described in clauses (i) through (iii) of Section
5.04(b) reimbursable in respect on Outstanding Advances, or the amounts
described in Section 5.04(c) applicable in respect of Nonrecoverable Advances,
the
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Servicer may deduct such amounts from deposits otherwise to be made into the
Collection Account.
(e) Notwithstanding the provisions of Section 5.04(a), no successor
servicer, including the Trustee, shall be obligated to make Advances unless it
has expressly agreed to do so in writing.
SECTION 5.05. ADDITIONAL DEPOSITS.
(a) The Servicer shall deposit into the Collection Account the
aggregate amount of Advances pursuant to Section 5.04(a). The Servicer and the
Seller shall deposit in the Collection Account the aggregate Administrative
Purchase Payments with respect to Administrative Receivables pursuant to Section
4.06 and the aggregate Warranty Purchase Payments with respect to Warranty
Receivables pursuant to Section 3.02, and the Servicer shall deposit therein all
amounts to be paid under Section 12.02. All such deposits with respect to a
Collection Period shall be made, in immediately available funds, by 5:00 p.m.,
New York City time, on the Business Day immediately preceding the Distribution
Date related to such Collection Period.
(b) All deposits required to be made pursuant to this Section 5.05 by
the Seller or the Servicer, as the case may be, may be made in the form of a
single deposit and shall be made in immediately available funds, no later than
5:00 P.M., New York City time, on the Business Day immediately preceding the
related Distribution Date. At the direction of the Servicer, the Trustee shall
invest such amounts in Eligible Investments maturing not later than 3:00 P.M.
New York City Time, on the related Distribution Date.
SECTION 5.06. DISTRIBUTIONS.
(a) On each Distribution Date, the Trustee shall cause to be made the
following transfers and distributions in the amounts set forth in the Servicer's
Certificate for such Distribution Date:
(i) From the Collection Account to the Certificate Account, in
immediately available funds, the entire amount then on deposit in the
Collection Account; provided, however, that if the Servicer is required
to make deposits to the Collection Account on a daily basis pursuant to
Section 5.02, the amount of the funds transferred from the Collection
Account to the Certificate Account will include only those funds that
were deposited in the Collection Account for the Collection Period
related to such Distribution Date.
(ii) From the Certificate Account to the Servicer, in
immediately available funds, from amounts on deposit or amounts
received from Obligors and allocable to interest, the amount payable in
respect of Outstanding Advances pursuant to the last sentence of
Section 5.04(a) and Section 5.04(b).
(iii) From the Certificate Account to the Servicer, in
immediately available funds, any payments in respect of Nonrecoverable
Advances required and to the extent set forth in Section 5.04(c).
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(b) The Servicer shall calculate on each Determination Date the Total
Available Amount, the Available Interest, the Available Principal, the Class A
Distributable Amount, the Class B Distributable Amount and the Class C
Distributable Amount and, based on the Total Available Amount and the other
distributions to be made on such Distribution Date, determine the amount
distributable to Certificateholders of each class.
(c) The rights of the Class B Certificateholders and the Class C
Certificateholders to receive distributions in respect of the Class B
Certificates and the Class C Certificates shall be and hereby are subordinated
to the rights of the Class A Certificateholders to receive distributions in
respect of the Class A Certificates as provided below. In addition, the rights
of the Class C Certificateholders to receive distributions in respect of the
Class C Certificates shall be and hereby are subordinated to the rights of the
Class B Certificateholders to receive distributions in respect of the Class B
Certificates as provided below. On each Distribution Date, the Trustee (based on
the information contained in the Servicer's Certificate delivered on the related
Determination Date pursuant to Section 4.08) shall make the following
distributions (after payment of the Supplemental Servicing Fee, to the extent
not previously retained by the Servicer) from the Certificate Account in the
following order of priority:
(i) first, to the Servicer, from Available Interest, the Base
Servicing Fee and all unpaid Base Servicing Fees from prior Collection
Periods, if any;
(ii) second, to the Class A Certificateholders, from Available
Interest (as such Available Interest has been reduced as described in
clause (i) above), an amount equal to the sum of the Class A Interest
Distributable Amount and any outstanding Class A Interest Carryover
Shortfall as of the close of business on the preceding Distribution
Date; and if such Available Interest is insufficient, the Class A
Certificateholders will receive such shortfall first, from monies on
deposit in the Subordination Spread Account, and second, if such
amounts are insufficient, from the Class C Percentage of Available
Principal, and third, if such amounts are insufficient, from the Class
B Percentage of Available Principal;
(iii) third, to the Class A Certificateholders, from Available
Principal, an amount equal to the sum of the Class A Principal
Distributable Amount and any outstanding Class A Principal Carryover
Shortfall as of the close of business on the preceding Distribution
Date; and if such Available Principal is insufficient, the Class A
Certificateholders will receive such shortfall first, from monies on
deposit in the Subordination Spread Account, and second, if such
amounts are insufficient, from Available Interest (as such Available
Interest has been reduced as described in clauses (i) and (ii) above);
(iv) fourth, to the Class B Certificateholders, from Available
Interest (as such Available Interest has been reduced by the
distributions described above in clauses (i), (ii) and (iii) above), an
amount equal to the sum of the Class B Interest Distributable Amount
and any outstanding Class B Interest Carryover Shortfall as of the
close of business on the preceding Distribution Date; and if such
Available Interest is insufficient, the Class B Certificateholders will
receive such shortfall first, from monies on deposit in
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the Subordination Spread Account, and second, if such amounts are
insufficient, from the Class C Percentage of Available Principal;
(v) fifth, to the Class B Certificateholders, from Available
Principal (as such Available Principal has been reduced as described in
clauses (iii) and (iv) above), an amount equal to the sum of the Class
B Principal Distributable Amount and any outstanding Class B Principal
Carryover Shortfall as of the close of business on the preceding
Distribution Date; and if such Available Principal is insufficient, the
Class B Certificateholders will receive such shortfall first, from
monies on deposit in the Subordination Spread Account, and second, if
such amounts are insufficient, from Available Interest (as such
Available Interest has been reduced as described in clauses (i), (ii),
(iii) and (iv) above);
(vi) sixth, to the Class C Certificateholders, from Available
Interest (as such Available Interest has been reduced as described in
clauses (i), (ii), (iii), (iv) and (v) above), an amount equal to the
sum of the Class C Interest Distributable Amount and any outstanding
Class C Interest Carryover Shortfall as of the close of business on the
preceding Distribution Date;
(vii) seventh, to the Class C Certificateholders, from
Available Principal (as such Available Principal has been reduced as
described in clauses (iii), (iv) and (v) above), an amount equal to the
sum of the Class C Principal Distributable Amount and any outstanding
Class C Principal Carryover Shortfall as of the close of business on
the preceding Distribution Date; and if such Available Principal is
insufficient, the Class C Certificateholders will receive such
shortfall from Available Interest (as such Available Interest has been
reduced as described in clauses (i), (ii), (iii), (iv), (v) and (vi)
above); and
(viii) eighth, to the Seller, any Excess Amounts, except to
the extent required to be deposited in the Subordination Spread Account
pursuant to the Custody and Pledge Agreement;
provided, however, that amounts otherwise distributable to the holders of Class
C Certificates pursuant to clauses (vi) and (vii) above shall be deposited by
the Trustee on behalf of such holders in the Subordination Spread Account to the
extent of any deficiency in the Specified Subordination Spread Account Balance.
For purposes of all of the provisions of this Agreement, all such amounts
deposited in the Subordination Spread Account shall be deemed to have been
distributed pro rata to the holders of Class C Certificates and contributed by
such holders to the Subordination Spread Account pursuant to the Custody and
Pledge Agreement.
Notwithstanding anything herein to the contrary, no amount
shall be paid to the Certificateholders in respect of any Yield Supplement
Deposit with respect to a Receivable, except to the extent of amounts withdrawn
from the Yield Supplement Account and deposited in the Certificate Account or
paid to the Certificate Account by the Seller pursuant to the Yield Supplement
Agreement; provided, however, that, if an insufficiency of funds in the Yield
Supplement Account would result in a shortfall of interest, the amount of such
shortfall shall be withdrawn from the Subordination Spread Account and deposited
in the Certificate Account
37
prior to such Distribution Date. Other withdrawals and deposits into the
Subordination Spread Account shall be made as provided in the Custody and Pledge
Agreement.
(d) Subject to Section 12.01 respecting the final payment upon
retirement of each Certificate, the Servicer shall on each Distribution Date
instruct the Trustee to distribute to each Certificateholder of any class of
record on the preceding Record Date either by wire transfer, in immediately
available funds to the account of such holder at a bank or other entity having
appropriate facilities therefor, if such Certificateholder is the Seller or a
Clearing Agency and shall have provided to the Trustee appropriate instructions
prior to such Distribution Date, or, if not, by check mailed to such
Certificateholder (such check to be mailed as soon as reasonably practicable on
or after such Distribution Date) at the address of such holder appearing in the
Certificate Register, the amounts to be distributed to such Certificateholder
pursuant to such holder's Certificates.
SECTION 5.07. NET DEPOSITS. For so long as each Monthly Remittance
Condition is satisfied (or the rating agency confirmation described in the fifth
sentence of Section 5.02 has been obtained), the Servicer (in whatever capacity)
may make the remittances pursuant to Sections 5.02 and 5.05 above net of amounts
to be distributed to the Servicer (in whatever capacity) pursuant to Section
5.06(a)(ii), Section 5.06(a)(iii) or Section 5.06(c). In addition, the Seller
agrees that such remittances may be made net of amounts to be distributed to the
Seller hereunder and under the Custody and Pledge Agreement, if any. Accounts
between the Seller and the Servicer will be adjusted accordingly. Nonetheless,
the Servicer shall account for all of the above described remittances and
distributions (except for the Supplemental Servicing Fee to the extent that the
Servicer is entitled to retain such amounts) in the Servicer's Certificate as if
the amounts were deposited and/or transferred separately.
SECTION 5.08. STATEMENTS TO CERTIFICATEHOLDERS.
(a) On each Distribution Date, the Trustee shall include with each
distribution to each Class A Certificateholder and Class B Certificateholder,
and, if the Class C Certificateholder is not the Seller or an Affiliate of the
Seller, to the Class C Certificateholder, a statement (which statement shall
also be provided to each Rating Agency) based on information in the Servicer's
Certificate furnished pursuant to Section 4.08, setting forth for the Collection
Period relating to such Distribution Date the following information:
(i) the amount of such distribution allocable to principal;
(ii) the amount of such distribution allocable to interest;
(iii) the amount of such distribution allocable to the Yield
Supplement Deposit, if any, plus reinvestment income, if any, on the
Yield Supplement Account;
(iv) the amount on deposit in the Yield Supplement Account;
(v) the Pool Balance as of the close of business on the last
day of the related Collection Period;
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(vi) the amount of the Base Servicing Fee paid to the Servicer
with respect to the related Collection Period, the Class A
Certificateholder's, the Class B Certificateholder's, or the Class C
Certificateholder's Class A Percentage, Class B Percentage, or Class C
Percentage, as the case may be, of the Base Servicing Fees, the amount
of any unpaid Base Servicing Fees and the change in such amount from
that of the prior Distribution Date;
(vii) the amount of the Class A Interest Carryover Shortfall,
the Class A Principal Carryover Shortfall, the Class B Interest
Carryover Shortfall, the Class B Principal Carryover Shortfall, the
Class C Interest Carryover Shortfall and the Class C Principal
Carryover Shortfall, if any, on such Distribution Date and the change
in such amounts from the preceding Distribution Date;
(viii) the Class A Certificate Balance, the Class A
Certificate Factor, the Class A Pool Factor, the Class B Certificate
Balance, the Class B Certificate Factor, the Class B Pool Factor and
the Class C Certificate Balance as of such Distribution Date;
(ix) the amounts otherwise distributable to the Class B
Certificateholders and Class C Certificateholders that are distributed
to Class A Certificateholders on such Distribution Date, and the amount
otherwise distributable to the Class C Certificateholders that is
distributed to the Class B Certificateholders or deposited in the
Subordination Spread Account on such Distribution Date;
(x) for so long as the Custody and Pledge Agreement or a
related agreement is in existence, the balance of the Subordination
Spread Account, as the case may be, on such Distribution Date, after
giving effect to distributions made on such Distribution Date, and the
change in such balance from the preceding Distribution Date;
(xi) the amount of Advances made in respect of the Receivables
during the related Collection Period and the amount of the unreimbursed
Advances on such Distribution Date;
(xii) the amount of defaults and net losses on the Receivables
for the related Collection Period; and
(xiii) the number of delinquencies on the Receivables as a
percentage of the number of Receivables.
(b) Copies of such statements may be obtained by Certificate Owners
from the Trustee by a request in writing. The Trustee shall provide such copies
promptly after such requests.
(c) Within the prescribed period of time for tax reporting purposes
after the end of each calendar year during the term of this Agreement, but not
later than the latest date permitted by law, the Trustee shall make available
with the Clearing Agency holding Book-Entry Certificates or, if Definitive
Certificates have been issued, mail to each Person who at any time during such
calendar year shall have been a holder of a Definitive Certificate (other than
the Seller or any Affiliate of the Seller) a statement containing the sum of the
amounts or the amount
39
as of the end of such calendar year, as the case may be, set forth in clauses
(i), (ii), (iii), (v), (vi) and (vii) of Section 5.08(a) above and such other
information, if any, as the Servicer determines is necessary to ascertain the
Certificateholder's share of the gross income and deductions of the Trust
(exclusive of the Supplemental Servicing Fee) or is otherwise necessary under
applicable law for the preparation of the federal income tax returns by
Certificateholders for such calendar year or, if such Person shall have been a
holder of a Certificate during a portion of such calendar year, for the
applicable portion of such year, for the purposes of such Certificateholder's
preparation of federal income tax returns.
SECTION 5.09. NO PETITION. Each the Servicer and the Trustee (not in
its individual capacity but solely as Trustee) covenants and agrees that, prior
to the date which is one year and one day after the date upon which the
Certificates are paid in full, it will not at any time file, join in any filing
of, or cooperate with or encourage others to file any bankruptcy, reorganization
arrangement, insolvency or liquidation proceeding or other proceedings under any
federal or state bankruptcy or similar law against the Seller. This Section 5.09
shall survive the termination of this Agreement or the termination of the
Servicer or the Trustee, as the case may be, under this Agreement.
Each Certificateholder hereby covenants and agrees that it
will not at any time file, join in any filing of, or cooperate with or encourage
others to file bankruptcy, reorganization arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law against the Seller in connection with any obligations
relating to the Certificates.
ARTICLE VI
ADDITIONAL AGREEMENTS
SECTION 6.01. YIELD SUPPLEMENT ACCOUNT. (a) In order to assure that
sufficient amounts to make required distributions of interest to
Certificateholders will be available, the [Servicer] [Trustee], pursuant to [the
Securities Account Control Agreement and] the Yield Supplement Agreement, will
establish and maintain with the [Securities Intermediary] [Trustee] a segregated
trust account (the "Yield Supplement Account") in the name of the Trustee which
will include the money and other property deposited and held therein pursuant to
the Yield Supplement Agreement and this Section 6.01.
(a) On or prior to the Closing Date, the Seller shall [[make a capital
contribution to the Trust by depositing an amount equal to $___________]
[deposit an amount equal to $_________] [in cash] into the Yield Supplement
Account][, transfer retail installment sales contracts with an aggregate
principal balance, as of the Cut-Off Date, of $_________ to the Trust] [and
transfer receivables [or other assets] in an amount, collectively, equal to
$__________ to the Trust] ([the][collectively,] "Initial Yield Supplement
Amount"). [On each Distribution Date, the Servicer will deposit payments
received with respect to the retail installment sales contracts referred to
above into the Yield Supplement Account.] [On each Distribution Date, the
Servicer will deposit payments received with respect to those receivables or
other assets referred to above into the Yield Supplement Account.] On each
Distribution Date, to the extent amounts then on deposit in the Yield Supplement
Account are sufficient
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therefor, the Trustee will withdraw amounts then on deposit in the Yield
Supplement Account in an amount equal to the Yield Supplement Deposit[,
comprising a portion of the Available Interest to be distributed in accordance
with Section 5.06 and this Section,] with respect to such Distribution Date and
deposit such amounts into the Collection Account for application pursuant to
Section 5.06. On each Distribution Date, if the amount on deposit in the Yield
Supplement Account (after giving effect to all deposits thereto or withdrawals
therefrom on such Distribution Date) is greater than the Required Yield
Supplement Amount, the Trustee [will distribute any remaining amounts and all
rights to the Yield Supplement Account and all other collateral registered or
held therein to the Seller [or third party]]. Upon such distribution to the
Seller [or third party], the Certificateholders will have no further rights in,
or claims to, such amount.
(b) All amounts held in the Yield Supplement Account shall be invested
by the [Trustee, as directed in writing by the Servicer,] [Servicer] in Eligible
Investments [; provided that if (i) the Servicer shall have failed to give
investment directions for any funds on deposit in the Yield Supplement Account
to the Trustee by 5:00 p.m. Eastern Time (or such other time as may be agreed by
the Servicer and the Trustee) on any Business Day, or (ii) an Event of Default
shall have occurred and be continuing but the Certificates shall not have been
declared due then the Trustee shall, to the fullest extent practicable, invest
and reinvest funds in the Yield Supplement Account in one or more Eligible
Investments specified in clauses (i), (iv) or (vi) of the definition of Eligible
Investments]. All such Eligible Investments shall mature not later than the
Business Day preceding the next Distribution Date, in such manner that such
amounts invested shall be available to make the required deposits on the
Distribution Date; provided that if permitted by the Rating Agencies, monies on
deposit therein may be invested in Eligible Investments that mature later than
the Business Day preceding the next Distribution Date. [The Servicer will not
direct the Trustee to make] [The Trustee will not make] any investment of any
funds or to sell any investment held in the Yield Supplement Account unless the
security interest granted and perfected in such account will 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 Trustee to make any such investment or sale, if requested by the Trustee,
the Servicer shall deliver to the Trustee an Opinion of Counsel, reasonably
acceptable to the Trustee, to such effect]. [Earnings, if any, on investment of
funds in the Yield Supplement Account shall be deposited in the Collection
Account on each Distribution Date, and losses and any investment expenses shall
be charged against the funds on deposit therein.] [The Trustee shall incur no
liability for the selection of investments or for losses thereon absent its own
negligence or willful misfeasance. The Trustee shall have no liability in
respect of losses incurred as a result of the liquidation of any investment
prior to its stated maturity date or the failure of the Servicer to provide
timely written investment directions.]
(c) [The Trustee and the Seller will treat the Yield Supplement
Account, all funds therein and all net investment income with respect thereto as
assets of the Trust for federal income tax and all other purposes.]
(d) If for any reason the Yield Supplement Account is no longer an
Eligible Deposit Account, the Relevant Trustee shall promptly cause the Yield
Supplement Account to be moved to another institution or otherwise changed so
that the Yield Supplement Account becomes an Eligible Deposit Account.
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(e) The Trustee shall not enter into any subordination or intercreditor
agreement with respect to the Yield Supplement Account.
(f) Upon termination of the Trust pursuant to 12.01, any amounts on
deposit in the Yield Supplement Account, after payment of all amounts due to the
Certificateholders, shall be paid to the [Seller] [third party].]
SECTION 6.02. CUSTODY AND PLEDGE AGREEMENT. The Seller and the Trustee,
as initial Custodian, shall enter into the Custody and Pledge Agreement or
otherwise provide such partial credit support, if any, as may be necessary for
each Rating Agency to provide those ratings necessary to satisfy the related
condition precedent to the underwriters' obligation to purchase the Class A
Certificates and the Class B Certificates.
SECTION 6.03. LIMITATIONS ON THE TRUST. The Trust shall not (a) incur
any indebtedness or obligations or (b) engage in any business activity other
than acquiring and holding the assets of the Trust, issuing the Certificates and
making payments thereon, each in accordance with the terms of this Agreement.
ARTICLE VII
THE CERTIFICATES
SECTION 7.01. THE CERTIFICATES. The Class A Certificates and the Class
B Certificates shall be issued in denominations of $1,000 and integral multiples
thereof; the Class C Certificates shall be issued in denominations of $100,000
or in any amount in excess thereof, in each case in fully registered form and
integral multiples thereof; provided, however, that one Class A Certificate, one
Class B Certificate and one Class C Certificate may be issued in a denomination
equal to the residual amount (the "Residual Certificate"). The Certificates
shall be executed on behalf of the Trust by manual or facsimile signature of a
Trustee Officer of the Trustee. Certificates bearing the manual or facsimile
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Trust, shall be valid and
binding obligations of the Trust, notwithstanding that such individuals or any
of them shall have ceased to be so authorized prior to the authentication and
delivery of such Certificates or did not hold such offices at the date of such
Certificates.
SECTION 7.02. AUTHENTICATION OF CERTIFICATES. The Trustee shall cause
the Certificates to be executed on behalf of the Trust, authenticated and
delivered to or upon the written order of the Seller, signed by its chairman of
the board, its president or any vice president, without further corporate action
by the Seller, in authorized denominations, pursuant to this Agreement. No
Certificate shall entitle its holder to any benefit under this Agreement, or
shall be valid for any purpose, unless there shall appear on such Certificate a
certificate of authentication substantially in the form set forth in Exhibit A,
Exhibit B or Exhibit C hereto executed by the Trustee by manual or facsimile
signature; such authentication shall constitute conclusive evidence that such
Certificate shall have been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication.
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SECTION 7.03. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
(a) The Certificate Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 7.07, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. The Trustee shall be the initial
Certificate Registrar.
(b) The Class C Certificates shall initially be retained by the Seller.
No transfer of a Class C Certificate shall be made unless (i) the registration
requirements of the Securities Act, and any applicable State securities laws are
complied with, (ii) such transfer is exempt from the registration requirements
under the Securities Act and any applicable State securities laws or (iii) the
prospective transferee of the Class C Certificate certifies in writing to the
Seller and the Trustee, to the Seller's satisfaction, that such transferee is a
Qualified Institutional Buyer (as defined in Rule 144A under said Act);
provided, however, that no such transfer pursuant to clause (i), (ii) or (iii)
shall be made (A) if such transfer would result in a downgrading or withdrawal
of the rating of any Rating Agency or (B) if such transfer would cause the Trust
or any arrangements identified in the Custody and Pledge Agreement to be
characterized as an association taxable as a corporation or otherwise adversely
affect the federal, state or local income tax status of the Trust and (C) unless
the Custody and Pledge Agreement is amended, in form and substance satisfactory
to the Trustee and the Seller, in order to reflect such transfer and cause such
transferee to be bound by the obligations thereunder. If a transfer is to be
made in reliance upon an exemption from the Securities Act or any applicable
State securities laws to a Person other than a Qualified Institutional Buyer,
the Class C Certificateholder desiring to effect such transfer and such
Certificateholder's prospective transferee must each certify in writing to the
Seller and the Trustee the facts surrounding such transfer and, at the request
of the Seller, provide both the Seller and the Trustee with an Opinion of
Counsel in form and substance satisfactory to the Seller that such transfer may
be made pursuant to an exemption from the Securities Act or any applicable State
securities laws and such transfer will not result in the Trust or any
arrangements identified in the Custody and Pledge Agreement from being
characterized as an association taxable as a corporation or otherwise adversely
affect the federal, state or local income tax status of the Trust, which Opinion
of Counsel shall not be an expense of the Seller or the Trustee. Neither the
Seller nor the Trustee is under an obligation to register the Class C
Certificates under the Securities Act or any other securities law.
(c) No transfer of a Class A Certificate, or beneficial interest
therein, shall be made unless the Trustee shall have received a representation
from the transferee thereof substantially in the form of Exhibit H-1 to the
effect that:
(i) such transferee is not an employee benefit plan or an
arrangement subject to Section 406 of ERISA or a plan subject to
Section 4975 of the Code (a "Plan"), nor a person acting on behalf of a
Plan nor using the assets of a Plan to effect such transfer; or
(ii) if such transferee is a Plan, then:
(A) such Plan is an "accredited investor" as defined
in Rule 501(a)(1) of Regulation D under the Securities Act;
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(B) such Plan's investment in the Class A
Certificates does not exceed 25% of all of the Class A
Certificates outstanding at the time of such transfer; and
(C) immediately after the acquisition, no more than
25% of the assets of the Plan with respect to which a person
has discretionary authority or renders investment advice are
invested in certificates representing interests in trusts
containing assets sold or serviced by the same entity.
(d) Without limiting the generality of Section 7.03(b), no transfer of
a Class B Certificate or Class C Certificate, or beneficial interest therein,
shall be made unless the Trustee shall have received a representation from the
transferee thereof substantially in the form of Exhibit H-2 to the effect that
such transferee (A) is not a Plan nor a person acting on behalf of a Plan nor
using the assets of a Plan to effect such transfer, or (B) is an insurance
company purchasing a Class B Certificate or Class C Certificate with funds
contained in an "insurance company general account" (as defined in Section V(e)
of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) as to which
there is a Plan with respect to which the amount of such general account's
reserves and liabilities for the contracts held by or on behalf of such Plan and
all other Plans maintained by the same employer (or affiliate thereof as defined
in Section V(a)(1) of PTCE 95-60) or by the same employee organization does not
exceed 10% of the total of all reserves and liabilities of such general account
(as such amounts are determined under Section I(a) of PTCE 95-60) at the date of
acquisition.
(e) For purposes of Sections 7.04(c) and (d), with respect to any
Certificate that is a Book-Entry Certificate, the representations contained
therein shall be deemed to have been made to the Trustee by the transferee's
(including an initial acquirer's) acceptance of an interest in such Certificate.
Notwithstanding anything else to the contrary herein, any purported transfer of
a Certificate, or a beneficial interest therein, to or on behalf of a Plan or a
person acting on behalf of a Plan or using the assets of a Plan to effect such
transfer not exempt pursuant to PTCE 97-34 or to an insurance company purchasing
with funds from a general account not exempt pursuant to PTCE 95-60 shall be
void and of no effect.
(f) To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person for
any registration of transfer of any Certificate that is in fact not permitted by
this Section 7.03 or for making any payments due on such Certificate to the
Certificateholder thereof or taking any other action with respect to such
Certificateholder under the provisions of this Agreement so long as the transfer
was registered by the Trustee in accordance with the foregoing requirements.
Upon surrender for registration of transfer of any Certificate at the Corporate
Trust Office, the Trustee shall execute, authenticate and deliver, in the name
of the designated transferee or transferees, one or more new Certificates in
authorized denominations of a like aggregate amount dated the date of
authentication by the Trustee. At the option of a Holder, Certificates may be
exchanged for other Certificates of authorized denominations of a like aggregate
amount upon surrender of the Certificates to be exchanged at the Corporate Trust
Office.
(g) Every Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer in
form satisfactory to the Trustee and the Certificate Registrar duly executed by
the Holder or his attorney duly authorized in writing.
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Each Certificate surrendered for registration of transfer or exchange shall be
cancelled and subsequently disposed of by the Trustee.
(h) No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
SECTION 7.04. MUTILATED, DESTROYED, LOST, OR STOLEN CERTIFICATES. If
(a) any mutilated Certificate shall be surrendered to the Certificate Registrar,
or if the Certificate Registrar shall receive evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (b) there shall be
delivered to the Certificate Registrar and the Trustee such security or
indemnity as may be required by them to save each of them harmless, then in the
absence of notice that such Certificate shall have been acquired by a bona fide
purchaser, the Trustee on behalf of the Trust shall execute and the Trustee
shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
tenor and denomination. In connection with the issuance of any new Certificate
under this Section 7.04, the Trustee and the Certificate Registrar may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section 7.04 shall constitute conclusive evidence of ownership
in the Trust, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
SECTION 7.05. PERSONS DEEMED OWNERS. Prior to due presentation of a
Certificate for registration of transfer, the Trustee or the Certificate
Registrar shall treat the Person in whose name any Certificate shall be
registered as the owner of such Certificate for the purpose of receiving
distributions pursuant to Section 5.06 and for all other purposes whatsoever,
and neither the Trustee nor the Certificate Registrar shall be bound by any
notice to the contrary.
SECTION 7.06. ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND
ADDRESSES. The Trustee shall furnish or cause to be furnished to the Servicer,
within 15 days after receipt by the Trustee of a request therefor from the
Servicer in writing, a list, in such form as the Servicer may reasonably
require, of the names and addresses of all Certificateholders as of the most
recent Record Date. If three or more Certificateholders, or one or more Holders
of Certificates aggregating not less than 25% of the Class A Certificate Balance
or the Class B Certificate Balance, apply in writing to the Trustee, and such
application states that the applicants desire to communicate with other
Certificateholders of their class with respect to their rights under this
Agreement or under the Certificates and such application shall be accompanied by
a copy of the communication that such applicants propose to transmit, then the
Trustee shall, within five Business Days after the receipt of such application,
request from the Clearing Agency and make available to such Certificateholders
access during normal business hours to the current list of Certificateholders of
such class. Each Holder, by receiving and holding a Certificate, shall be deemed
to have agreed to hold neither the Servicer nor the Trustee accountable by
reason of the disclosure of its name and address, regardless of the source from
which such information was derived.
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SECTION 7.07. MAINTENANCE OF OFFICE OR AGENCY. The Trustee shall
maintain in the Borough of Manhattan, The City of New York, an office or offices
or agency or agencies where Certificates may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Trustee in
respect of the Certificates and this Agreement may be served. The Trustee
initially designates the Corporate Trust Office as its office for such purposes.
The Trustee shall give prompt written notice to the Servicer and to the
Certificateholders of any change in the location of the Certificate Register or
any such office or agency.
SECTION 7.08. BOOK-ENTRY CERTIFICATES. The Class A Certificates and the
Class B Certificates, upon original issuance, will be issued in the form of
typewritten Certificates representing the Book-Entry Certificates, to be
delivered to The Depository Trust Company, the initial Clearing Agency (or a
custodian therefor), by, or on behalf of, the Seller. The Class A Certificates
and the Class B Certificates delivered to The Depository Trust Company shall
initially be registered on the Certificate Register in the name of CEDE & Co.,
the nominee of the initial Clearing Agency, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's interest
in the Class A Certificates or the Class B Certificates, except as provided in
Section 7.10. Unless and until definitive, fully registered Certificates (the
"Definitive Certificates") have been issued to Certificate Owners pursuant to
Section 7.10:
(a) the provisions of this Section 7.08 shall be in full force and
effect;
(b) the Seller, the Servicer, the Certificate Registrar and the Trustee
may deal with the Clearing Agency for all purposes (including the making of
distributions on the Class A Certificates and the Class B Certificates) as the
authorized representative of the Certificate Owners;
(c) to the extent that the provisions of this Section 7.08 conflict
with any other provisions of this Agreement, the provisions of this Section 7.08
shall control;
(d) the rights of Certificate Owners shall be exercised only through
the Clearing Agency and shall be limited to those established by law and
agreements between such Certificate Owners and the Clearing Agency and/or the
Clearing Agency Participants. Pursuant to the Depository Agreement, unless and
until Definitive Certificates are issued pursuant to Section 7.10, the initial
Clearing Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit distributions of principal and interest on
the Class A Certificates and the Class B Certificates to such Clearing Agency
Participants; and
(e) whenever this Agreement requires or permits actions to be taken
based upon instructions or directions of Holders evidencing a specified
percentage of the Controlling Class of Certificates, the Clearing Agency shall
be deemed to represent such percentage only to the extent that it has received
instructions to such effect from Certificate Owners and/or Clearing Agency
Participants owning or representing, respectively, such required percentage of
the Controlling Class of Certificates and has delivered such instructions to the
Trustee. The Trustee shall have no obligation to ascertain whether the Clearing
Agency has in fact received any such instructions.
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SECTION 7.09. NOTICES TO CLEARING AGENCY. Whenever notice or other
communication to the Class A Certificateholders or the Class B
Certificateholders are required under this Agreement, unless and until
Definitive Certificates shall have been issued to Certificate Owners pursuant to
Section 7.10, the Trustee and the Servicer shall give all such notices and
communications specified herein to be given to Holders of the Class A
Certificates and the Class B Certificates to the Clearing Agency.
SECTION 7.10. DEFINITIVE CERTIFICATES. If (a)(i) the Seller advises the
Trustee in writing that the Clearing Agency is no longer willing or able
properly to discharge its responsibilities under the Depository Agreement, and
(ii) the Trustee or the Seller is unable to locate a qualified successor, (b)
the Seller, at its option, advises the Trustee in writing that it elects to
terminate the book-entry system through the Clearing Agency, or (c) after the
occurrence of an Event of Default, Certificate Owners representing beneficial
interests aggregating not less than a majority of the Class A Certificate
Balance or Class B Certificate Balance, as applicable, advise the Trustee and
the Clearing Agency through the Clearing Agency Participants in writing that the
continuation of a book-entry system through the Clearing Agency is no longer in
the best interests of the Certificate Owners of such class, then the Trustee
shall notify the Clearing Agency and request that the Clearing Agency notify all
Certificate Owners of such class of the occurrence of any such event and of the
availability of Definitive Certificates to Certificate Owners of such class
requesting the same. Upon surrender to the Trustee of the Certificates of such
class by the Clearing Agency, accompanied by registration instructions from the
Clearing Agency for registration, the Trustee shall issue the applicable
Definitive Certificates of such class and deliver such Definitive Certificates
in accordance with the instructions of the Clearing Agency. Neither the Seller,
the Certificate Registrar nor the Trustee shall be liable for any delay in
delivery of such instructions and each may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Certificates, the Trustee shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.
ARTICLE VIII
THE SELLER
SECTION 8.01. REPRESENTATIONS OF SELLER. The Seller makes the following
representations on which the Trustee relies in accepting the Receivables in
trust and executing and authenticating the Certificates. The representations
speak as of the execution and delivery of this Agreement and shall survive the
sale of the Receivables to the Trustee:
(a) 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 corporate power and authority to own its properties and
to conduct its business, as such properties are currently owned and such
business is presently conducted, and had at all relevant times, and has,
corporate power, authority and legal right to acquire and own the Receivables.
The location of the Seller's chief executive office and principal place of
business is Torrance, California.
(b) Due Qualification. The Seller is duly qualified to do business as a
foreign corporation in good standing, and has obtained all necessary licenses
and approvals in all
47
jurisdictions in which the ownership or lease of property or the conduct of its
business shall require such qualifications and where the failure to so qualify
would have a material adverse effect on the ability of the Seller to perform its
obligations under this Agreement.
(c) Power and Authority. The Seller has the corporate power and
authority to execute and deliver this Agreement and to carry out its terms. The
Seller has full power and authority to sell and assign the property to be sold
and assigned to and deposited with the Trustee as part of the Trust and has duly
authorized such sale and assignment to the Trustee by all necessary corporate
action; and the execution, delivery and performance of this Agreement has been
duly authorized by the Seller by all necessary corporate action.
(d) Valid Sale; Binding Obligations. This Agreement evidences a valid
sale, transfer and assignment of the Receivables, enforceable against creditors
of and purchasers from the Seller (other than a good faith purchaser for value
in the ordinary course of business who takes actual possession of one or more
Receivables); and this Agreement is a legal, valid and binding obligation of the
Seller enforceable in accordance with its terms, subject to the effect of
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and by general equitable principles.
(e) No Violation. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof do not conflict with,
result in any breach of any of the terms and provisions of, nor constitute (with
or without notice or lapse of time) a default under, the 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 shall be bound; nor
result in the creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such indenture, agreement or other instrument
(other than the Basic Documents); nor violate any law or, to the best of the
Seller's knowledge, any order, rule or regulation applicable to the Seller of
any court or of any federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the Seller or its
properties; which breach, default, conflict, Lien or violation in any case would
have a material adverse effect on the ability of the Seller to perform its
obligations under this Agreement.
(f) No Proceedings. There are no proceedings or investigations pending,
or, to the best of the Seller's knowledge, threatened, before any court,
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Seller or its properties: (i) asserting the
invalidity of this Agreement, the Yield Supplement Agreement, the Custody and
Pledge Agreement or the Certificates; (ii) seeking to prevent the issuance of
the Certificates or the consummation of any of the transactions contemplated by
this Agreement, , the Yield Supplement Agreement, the Custody and Pledge
Agreement; (iii) seeking any determination or ruling that would materially and
adversely affect the performance by the Seller of its obligations under, or the
validity or enforceability of, this Agreement, the Yield Supplement Agreement,
the Custody and Pledge Agreement or the Certificates; or (iv) relating to the
Seller and which would adversely affect the federal or any state income tax
attributes of the Certificates.
SECTION 8.02. LIABILITY OF SELLER; INDEMNITIES. The Seller shall be
liable in accordance herewith only to the extent of the obligations specifically
undertaken by the Seller under this Agreement.
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(a) The Seller shall indemnify, defend and hold harmless the Trustee,
the Trust and the Certificateholders and the Trust from and against any taxes
that may at any time be asserted against the Trustee or the Trust with respect
to, and as of the date of, the sale of the Receivables to the Trust or the
issuance and original sale of the Certificates, including any sales, gross
receipts, general corporation, tangible personal property, privilege or license
taxes (but, in the case of the Trust, not including any taxes asserted with
respect to ownership of the Receivables or federal or other income taxes arising
out of the transactions contemplated by this Agreement) and costs and expenses
in defending against the same.
(b) The Seller shall indemnify, defend and hold harmless the Trustee
from and against any loss, liability or expense incurred by reason of (i) the
Seller's willful misfeasance, bad faith or negligence in the performance of its
duties under this Agreement, or by reason of reckless disregard of its
obligations and duties under this Agreement and (ii) the Seller's violation of
federal or state securities laws in connection with the registration or the sale
of the Certificates.
Indemnification under this Section 8.02 shall survive the
termination of this Agreement and shall include reasonable fees and expenses of
counsel and expenses of litigation. If the Seller shall have made any indemnity
payment to the Trustee pursuant to this Section 8.02 and the Trustee thereafter
shall collect any of such amounts from others, the Trustee shall promptly repay
such amounts to the Seller, without interest (except to the extent the recipient
collects interest from others).
Promptly after receipt by a party indemnified under this
Section 8.02 (for purposes of this paragraph, an "Indemnified Party") of notice
of the commencement of any action, such Indemnified Party will, if a claim is to
be made in respect thereof against the Seller under this Section 8.02, notify
the Seller of the commencement thereof. If any such action is brought against
any Indemnified Party under this Section 8.02 and it notifies the Seller of the
commencement thereof, the Seller will assume the defense thereof, with counsel
reasonably satisfactory to such Indemnified Party (who may, unless there is, as
evidenced by an Opinion of Counsel to the Indemnified Party stating that there
is a conflict of interest, be counsel to the Seller), and the Seller will not be
liable to such Indemnified Party under this Section 8.02 for any legal or other
expenses subsequently incurred by such Indemnified Party in connection with the
defense thereof, other than reasonable costs of investigation. The obligations
set forth in this Section 8.02 shall survive the termination of this Agreement
or the resignation or removal of the Trustee and shall include reasonable fees
and expenses of counsel and expenses of litigation. If the Seller shall have
made any indemnity payments pursuant to this Section 8.02 and the Person to or
on behalf of whom such payments are made thereafter collects any of such amounts
from others, such Person shall promptly repay such amounts to the Seller,
without interest (except to the extent received by such Person).
SECTION 8.03. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, SELLER. Subject to Section 8.06, any Person (a) into which the
Seller may be merged or consolidated, (b) resulting from any merger, conversion
or consolidation to which the Seller shall be a party, (c) succeeding to the
business of the Seller or (d) that is a corporation more than 50% of the voting
stock of which is owned directly or indirectly by Nissan, which Person in any of
the
49
foregoing cases executes an agreement of assumption to perform every obligation
of the Seller under this Agreement, will 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; provided, however, that
(i) immediately after giving effect to such transaction, no representation or
warranty made pursuant to Section 3.01 shall have been breached and no Event of
Default, and no event that, after notice or lapse of time, or both, would become
an Event of Default, shall have occurred and be continuing, (ii) the Seller
shall have delivered to the Trustee an Officer's Certificate stating that such
consolidation, merger or succession and such agreement or assumption comply with
this Section 8.03 and that all conditions precedent, if any, provided for in
this Agreement relating to such transaction have been complied with and (iii)
the Seller shall have delivered to the Trustee an Opinion of Counsel either (A)
stating that, in the opinion of such counsel, based on customary qualifications
and assumptions, all financing statements and continuation statements and
amendments thereto have been executed and filed that are necessary fully to
perfect the interest of the Trustee in the Receivables, and reciting the details
of such filings, or (B) stating that, in the opinion of such counsel, no such
action shall be necessary to preserve and protect such interest. The Seller
shall provide notice of any merger, consolidation or succession pursuant to this
Section 8.03 to each Rating Agency. Notwithstanding anything herein to the
contrary, the execution of the foregoing agreement of assumption and compliance
with clauses (i), (ii) and (iii) above shall be conditions to the consummation
of the transactions referred to in clauses (a), (b), (c) or (d) above.
SECTION 8.04. LIMITATION ON LIABILITY OF SELLER AND OTHERS.
(a) Neither the Seller nor any of the directors, officers, employees or
agents of the Seller shall be under any liability to the Trust or the
Certificateholders, except as provided under this Agreement, for any action
taken or for refraining from the taking of any action pursuant to this
Agreement; provided, however, that this provision shall not protect the Seller
or any such person against any liability that would otherwise be imposed by
reason of willful misfeasance, bad faith or negligence in the performance of
duties or by reason of reckless disregard of obligations and duties under this
Agreement. The Seller and any director, officer, employee or agent of the Seller
may rely in good faith on the advice of counsel or on any document of any kind,
prima facie properly executed and submitted by any Person respecting any matters
arising under this Agreement.
(b) The Seller shall not be under any obligation to appear in,
prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement, and that in its opinion may cause it to incur
any expense or liability; provided, however, that the Seller may undertake any
reasonable action that it may deem necessary or desirable in respect of this
Agreement and its obligations under this Agreement. In such event, the legal
expenses and costs of such action and any liability resulting therefrom shall be
expenses, costs and liabilities of the Seller and the Seller will not be
entitled to be reimbursed therefor.
SECTION 8.05. SELLER MAY OWN CERTIFICATES. The Seller and any Affiliate
of the Seller may in its individual or any other capacity become the owner or
pledgee of Certificates with the same rights as it would have if it were not the
Seller or an affiliate thereof, except as otherwise provided in the definition
of "Certificateholder" specified in Section 1.01 and except as otherwise
specifically provided herein. Certificates so owned by or pledged to the Seller
or such
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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 the Certificates, except as otherwise expressly
provided in this Agreement.
SECTION 8.06. ADDITIONAL COVENANTS.
(a) The Seller agrees with the Certificate Owners and each Rating
Agency that the Seller shall not issue any additional securities that could
reasonably be expected to affect materially and adversely the rating of the
Certificates issued pursuant to this Agreement unless it shall have first
obtained the written consent of each Rating Agency to the effect that such
issuance will not materially adversely affect such rating; provided that, the
issuance of another series of certificates pursuant to an agreement with terms
substantially similar to the terms of this Agreement shall not be deemed to
materially and adversely affect the ratings on the Certificates. The Seller
shall provide a copy of any such consent to the Trustee.
(b) The Seller shall not do any of the following without the prior
written consent of each Rating Agency (other than Moody's), which consent shall
be to the effect that the acts set forth below shall not affect materially
adversely such rating) and, upon the Seller's receipt of such written consent
from each Rating Agency (other than Moody's), the Trustee shall, without any
exercise of its own discretion, also provide its written consent to the Seller
and, promptly after the occurrence of any of the following, the Seller shall
provide notice of such occurrence to Moody's, so long as Moody's is then rating
any outstanding Certificates:
(i) engage in any business or activity other than those set
forth in Article Three of the Seller's Certificate of Incorporation, as
amended;
(ii) incur any indebtedness, or assume or guaranty any
indebtedness of any other entity, other than (A) any indebtedness
incurred in connection with any certificates or notes (as defined in
the Seller's Certificate of Incorporation), provided that any such
future indebtedness incurred in connection with any certificates or
notes must be rated at least with the same ratings given the
outstanding certificates or notes secured or supported by assets
acquired by the Seller from NMAC by each nationally recognized
statistical rating organization that has rated such outstanding
certificates or notes or, prior to the issuing of such future
indebtedness incurred in connection with such certificates or notes,
the Seller shall have received confirmation from each nationally
recognized statistical rating organization that has rated such
outstanding certificates or notes that the ratings of such outstanding
certificates or notes will not be adversely affected by the issuance of
such future indebtedness and (B) any indebtedness to NMAC or any of its
Affiliates incurred in connection with the acquisition of Receivables,
provided that (1) such indebtedness shall be fully subordinated (and
which shall provide for payment only after payment in respect of all
outstanding rated debt) and shall be nonrecourse against any assets of
the Seller other than the assets pledged to secure such indebtedness;
(2) such indebtedness does not constitute a claim against the Seller in
the event the assets pledged to secure such indebtedness are
insufficient to pay such indebtedness; (3) holders of such indebtedness
agree that they have no rights in any assets of the Seller other than
the assets pledged to secure such indebtedness; and (4) to the extent
that any holder of such indebtedness is deemed to have any interest in
any assets of the Seller other than the
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assets pledged to secure such indebtedness, holders of such
indebtedness agree that their interest is subordinate to claims or
rights of holders of other indebtedness issued by the Seller, and that
such agreement constitutes a subordination agreement for purposes of
Section 510(a) of the Bankruptcy Code.
(iii) dissolve or liquidate, in whole or in part; consolidate
or merge with or into any other entity or convey or transfer its
properties and assets substantially as an entirety to any entity,
unless:
(A) the entity (if other than the Seller) formed or
surviving the consolidation or merger or which acquires the
properties and assets of the Seller is organized and existing
under the laws of the State of Delaware, expressly assumes the
due and punctual payment of, all obligations of, the Seller,
including those obligations of the Seller under this Agreement
and the Basic Documents, and has a Certificate of
Incorporation containing provisions identical to the
provisions of the "Restricted Articles," as defined in the
Seller's Certificate of Incorporation, of the Seller's
Certificate of Incorporation[, as amended]; and
(B) immediately after giving effect to the
transaction, no default or event of default has occurred and
is continuing under any indebtedness of the Seller or any
agreements relating to such indebtedness; and
(C) the entity (if other than the Seller) formed or
surviving the consolidation or merger or which acquires the
properties and assets of the Seller agrees that (1) it shall
maintain its funds or assets as identifiable and not commingle
its funds or assets with those of any direct or ultimate
parent of such entity and pay from its assets all obligations
and indebtedness of any kind incurred by it, (2) it shall
maintain bank accounts, corporate records and books of account
separate from those of any direct or ultimate parent of such
entity and (3) the business affairs of such entity will be
managed by or under the direction of its board of directors
and it will conduct its business from an office space separate
from any direct or ultimate parent of such entity; and
(D) each nationally recognized statistical rating
organization that has rated any issue of certificates or notes
secured or supported by the assets acquired by the Seller from
NMAC shall confirm in writing that the rating of such
certificates or notes shall not be adversely affected by such
consolidation or merger;
(iv) without the affirmative vote of 100% of the members of
the board of directors of the Seller, institute proceedings to be
adjudicated bankrupt or insolvent, or consent to the institution of
bankruptcy or insolvency proceedings against it, or file a petition
seeking or consent to reorganization or relief under any applicable
federal or state law relating to bankruptcy, or consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator
(or other similar official) of the corporation or all or substantially
all of its property, or make any assignment for the benefit of
creditors.
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(v) cease to have an "Independent Director," as defined in the
Seller's Certificate of Incorporation;
(vi) without the affirmative vote of at least one "Independent
Director," as defined in the Seller's Certificate of Incorporation,
enter into any transaction with the Servicer not in the ordinary course
of business; or
(vii) modify any provision of the "Restricted Articles," as
defined in the Seller's Certificate of Incorporation, of the Seller's
Certificate of Incorporation[, as amended,] in any material respect.
ARTICLE IX
THE SERVICER
SECTION 9.01. REPRESENTATIONS OF SERVICER. The Servicer makes the
following representations on which the Trustee relies in accepting the
Receivables in trust and executing and authenticating the Certificates. The
representations speak as of the execution and delivery of this Agreement and
shall survive the sale of the Receivables to the Trust:
(a) Organization and Good Standing. The Servicer is duly organized and
is validly existing as a corporation in good standing under the laws of the
state of its incorporation, with corporate power and authority to own its
properties and to conduct its business as such properties are currently owned
and such business is presently conducted, and had at all relevant times, and
has, corporate power, authority and legal right to acquire, own, sell and
service the Receivables and to hold the Receivable Files as custodian on behalf
of the Trustee. The location of the Servicer's chief executive office and
principal place of business is Torrance, California.
(b) Due Qualification. The Servicer 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 relating to the servicing of the Receivables as
required by this Agreement shall require such qualifications and where the
failure to so qualify would have a material adverse effect on the ability of the
Servicer to perform its obligations under this Agreement.
(c) Power and Authority. The Servicer has the power and authority to
execute and deliver this Agreement and to carry out its terms; and the
execution, delivery and performance of this Agreement have been duly authorized
by the Servicer by all necessary corporate action.
(d) Binding Obligation. This Agreement constitutes a legal, valid and
binding obligation of the Servicer enforceable in accordance with its terms,
subject to the effect of bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally and to general
equitable principles.
(e) No Violation. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof do not conflict with,
result in any breach of any of the terms and provisions of, nor constitute (with
or without notice or lapse of time) a default under, the articles of
incorporation or by-laws of the Servicer, or any indenture,
53
agreement or other instrument to which the Servicer is a party or by which it
shall be bound; nor result in the creation or imposition of any Lien upon any of
its properties pursuant to the terms of any such indenture, agreement or other
instrument (other than this Basic Documents); nor violate any law or any order,
rule or regulation applicable to the Servicer of any court or of any federal or
state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Servicer or its properties; which
breach, default, conflict, Lien or violation in any case would have a material
adverse effect on the ability of the Servicer to perform its obligations under
this Agreement.
(f) No Proceedings. There are no proceedings or investigations pending,
or, to the best of the Servicer's knowledge, threatened, before any court,
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Servicer or its properties: (i) asserting the
invalidity of this Agreement or the Certificates; (ii) seeking to prevent the
issuance of the Certificates or the consummation of any of the transactions
contemplated by this Agreement; (iii) seeking any determination or ruling that
would materially and adversely affect the performance by the Servicer of its
obligations under, or the validity or enforceability of, this Agreement or the
Certificates; or (iv) relating to the Servicer and that would adversely affect
the federal or any state income tax attributes of the Certificates.
SECTION 9.02. INDEMNITIES OF SERVICER. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer under this Agreement.
(a) The Servicer shall defend, indemnify and hold harmless the Trustee,
the Trust and the Certificateholders from and against any and all costs,
expenses, losses, damages, claims and liabilities (collectively, "Damages")
arising out of or resulting from the use, ownership or operation by the Servicer
or any of its Affiliates thereof (other than the Trust) of a Financed Vehicle.
(b) The Servicer shall indemnify, defend and hold harmless the Trustee,
the Trust and the Certificateholders from and against any and all Damages to the
extent that such Damage arose out of, or was imposed upon the Trustee, the Trust
or the Certificateholders through the negligence, willful misfeasance or bad
faith of the Servicer in the performance of its duties under this Agreement or
by reason of reckless disregard of its obligations and duties under this
Agreement.
(c) The Servicer shall indemnify, defend and hold harmless the Trustee
from and against all Damages arising out of or incurred in connection with the
acceptance or performance of the trusts and duties herein contained, except to
the extent that such Damage: (i) shall be due to the willful misfeasance, bad
faith, or negligence (except for errors in judgment) of the Trustee; (ii)
relates to any tax other than the taxes with respect to which the Seller shall
be required to indemnify the Trustee; (iii) shall arise from the Trustee's
breach of any of its representations or warranties set forth in the Basic
Documents; (iv) shall be one as to which the Seller is required to indemnify the
Trustee and as to which the Trustee has received payment of indemnity from the
Seller; or (v) shall arise out of or be incurred in connection with the
performance by the Trustee of the duties of successor Servicer hereunder.
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Promptly after receipt by a party indemnified under this
Section 9.02 (for purposes of this paragraph, an "Indemnified Party") of notice
of the commencement of any action, such Indemnified Party will, if a claim in
respect thereof is to be made against the Servicer under this Section 9.02,
notify the Servicer of the commencement thereof. If any such action is brought
against any Indemnified Party under this Section 9.02 and it notifies the
Servicer of the commencement thereof, the Servicer will assume the defense
thereof, with counsel reasonably satisfactory to such Indemnified Party (who
may, unless there is, as evidenced by an opinion of counsel to the Indemnified
Party stating that there is an unwaivable conflict of interest, be counsel to
the Servicer), and the Servicer will not be liable to such Indemnified Party
under this Section 9.02 for any legal or other expenses subsequently incurred by
such Indemnified Party in connection with the defense thereof, other than
reasonable costs of investigation. The obligations set forth in this Section
9.02 shall survive the termination of this Agreement or the resignation or
removal of the Servicer or the Trustee and shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Servicer shall have made
any indemnity payments pursuant to this Section 9.02 and the Person to or on
behalf of whom such payments are made thereafter collects any of such amounts
from others, such Person shall promptly repay such amounts to the Servicer,
without interest (except to the extent received by such Person).
Indemnification under this Section 9.02 by NMAC (or any
successor thereto pursuant to Section 9.03) as Servicer, with respect to the
period such Person was the Servicer, shall survive the termination of such
Person as Servicer or a resignation by such Person as Servicer as well as the
termination of this Agreement and shall include reasonable fees and expenses of
counsel and expenses of litigation. If the Servicer shall have made any
indemnity payments pursuant to this Section 9.02 and the recipient thereafter
collects any of such amounts from others, the recipient shall promptly repay
such amounts to the Servicer, without interest (except to the extent the
recipient collects interest from others).
SECTION 9.03. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF, SERVICER. Any Person (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) so long as NMAC acts as Servicer, that is a corporation more
than 50% of the voting stock of which is owned directly or indirectly by Nissan,
which Person in any of the foregoing cases executes an agreement of assumption
to perform every obligation of the Servicer under this Agreement, will be the
successor to the Servicer under this Agreement without the execution or filing
of any paper or any further act on the part of any of the parties to this
Agreement; provided, however, that (i) immediately after giving effect to such
transaction, no Event of Default, and no event which, after notice or lapse of
time, or both, would become an Event of Default, shall have occurred and be
continuing, (ii) the Servicer shall have delivered to the Trustee an Officer's
Certificate stating that such consolidation, merger or succession and such
agreement of assumption comply with this Section 9.03 and that all conditions
precedent provided for in this Agreement relating to such transaction have been
complied with and (iii) the Servicer shall have delivered to the Trustee an
Opinion of Counsel either (A) stating that, in the opinion of such counsel,
based on customary qualifications and assumptions, all financing statements and
continuation statements and amendments thereto have been executed and filed that
are necessary fully to preserve and protect
55
the interest of the Trustee in the Receivables, and reciting the details of such
filings, or (B) stating that, in the opinion of such counsel, no such action
shall be necessary to preserve and protect such interest. The Servicer shall
provide notice of any merger, consolidation or succession pursuant to this
Section 9.03 to each Rating Agency. Notwithstanding anything herein to the
contrary, the execution of the foregoing agreement of assumption and compliance
with clauses (i), (ii) and (iii) above shall be conditions to the consummation
of the transactions referred to in clauses (a), (b), (c) or (d) above.
SECTION 9.04. LIMITATION ON LIABILITY OF SERVICER AND OTHERS.
(a) Neither the Servicer nor any of the directors, officers, employees
or agents of the Servicer shall be under any liability to the Trust or the
Certificateholders, except as provided under this Agreement, for any action
taken or for refraining from the taking of any action pursuant to this Agreement
or for errors in judgment; provided, however, that this provision shall not
protect the Servicer or any such person against any liability that would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
in the performance of duties or by reason of reckless disregard of obligations
and duties under this Agreement. The Servicer and any director, officer,
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.
(b) Except as provided in this Agreement, the Servicer shall not be
under any obligation to appear in, prosecute or defend any legal action that
shall not be incidental to its duties to service the Receivables in accordance
with this Agreement, and that in its opinion may cause it to incur any expense
or liability; provided, however, that the Servicer may undertake any reasonable
action that it may deem necessary or desirable in respect of the Basic Documents
and the rights and duties of the parties to the Basic Documents and the
interests of the Certificateholders under this Agreement. In such event, the
legal expenses and costs of such action and any liability resulting therefrom
shall be expenses, costs and liabilities of the Servicer and the Servicer will
not be entitled to be reimbursed therefor.
SECTION 9.05. DELEGATION OF DUTIES. So long as NMAC acts as Servicer,
the Servicer may at any time without notice or consent subcontract substantially
all its duties under this Agreement to any corporation more than 50% of the
voting stock of which is owned, directly or indirectly, by Nissan. The Servicer
may at any time perform specific duties as servicer under this Agreement through
other subcontractors; provided, however, that no such delegation or
subcontracting shall relieve the Servicer of its responsibilities with respect
to such duties as to which the Servicer shall remain primarily responsible with
respect thereto.
SECTION 9.06. NMAC NOT TO RESIGN AS SERVICER. Subject to the provisions
of Section 9.03 hereof, NMAC shall not resign from the obligations and duties
hereby imposed on it as Servicer under this Agreement except upon determination
that the performance of its duties under this Agreement shall no longer be
permissible under applicable law. Notice of any such determination permitting
the resignation of NMAC shall be communicated to the Trustee at the earliest
practicable time (and, if such communication is not in writing, shall be
confirmed in writing at the earliest practicable time) and any such
determination shall be evidenced by an Opinion of Counsel to such effect
delivered to the Trustee concurrently with or promptly after
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such notice. No such resignation shall become effective until the Trustee or a
successor Servicer shall (a) have taken the actions required by Section 10.01(b)
of this Agreement to effect the termination of the responsibilities and rights
of the predecessor Servicer under this Agreement, including the transfer to the
successor Servicer for administration by it of all cash amounts that shall at
the time be held by the predecessor Servicer for deposit, or shall thereafter be
received with respect to a Receivable and the delivery of the Receivable Files,
and the related accounts and records maintained by the Servicer, and (b) have
assumed the responsibilities and obligations of NMAC as Servicer under this
Agreement in accordance with Section 10.02 of this Agreement (other than the
initial Servicer's obligation to make Advances).
ARTICLE X
DEFAULT
SECTION 10.01. EVENTS OF DEFAULT.
(a) If any one of the following events ("Events of Default") shall
occur and be continuing:
(i) Any failure (A) by the Servicer to deliver to the Trustee
for distribution to Certificateholders, or (B) by the Seller to
deliver, for so long as the Custody and Pledge Agreement or similar
agreement is in existence, to the Custodian for deposit in the
Subordination Spread Account any proceeds or payment required to be so
delivered under the terms of the Certificates, this Agreement or the
Custody and Pledge Agreement, as the case may be, that shall continue
unremedied for a period of three Business Days after (1) written notice
of such failure is received by the Servicer or the Seller, as the case
may be, from the Trustee or Custodian, as the case may be, (2)
discovery of such failure by an officer of the Servicer or the Seller,
as the case may be, or (3) written notice of such failure is received
by the Servicer or the Seller, as the case may be, from the Holders of
Certificates evidencing not less than [25%] of the Class A Certificate
Balance or the Class B Certificate Balance; or
(ii) Any failure by the Servicer (or the Seller, as long as
NMAC is the Servicer) to duly observe or to perform in any material
respect any other covenant or agreement of the Servicer (or the Seller,
as long as NMAC is the Servicer) set forth in the Certificates or in
this Agreement (including its agreement to purchase the Receivables
pursuant to Section 4.06), which failure shall (A) materially and
adversely affect the rights of Certificateholders and (B) continue
unremedied for a period of 90 days after the date on which written
notice of such failure, requiring the same to be remedied, shall have
been given (1) to the Servicer (or the Seller, as long as NMAC is the
Servicer) by the Trustee, or (2) to the Servicer (or the Seller, as
long as NMAC is the Servicer) and to the Trustee by the Holders of
Certificates evidencing not less than [25%] of the Class A Certificate
Balance or the Class B Certificate Balance; or
(iii) The filing of a decree or order by a court or agency or
supervisory authority having jurisdiction in the premises in respect to
the Servicer or all or substantially all of its property in an
involuntary case under any applicable federal or
57
state bankruptcy, insolvency or other similar law now or hereafter in
effect, or in appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official for the Servicer or for all
or substantially all of its property, or in ordering the winding up or
liquidation of its affairs, provided such decree or order remains
unstayed and in effect for a period of 90 consecutive days; or
(iv) The commencement by the Servicer of a voluntary case
under any applicable federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect, or the consent by the Servicer
to the entry of an order for relief in an involuntary case under any
such law, or the consent of the Servicer to the appointment of or
taking possession by any receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official for the Servicer or for all
or substantially all of its property, or the making by the Servicer of
any general assignment for the benefit of creditors;
then, and in each and every case, so long as an Event of Default shall not have
been remedied, either the Trustee, or the Holders evidencing not less than a
majority of the Controlling Class of Certificates, by notice then given in
writing to the Servicer (and to the Trustee if given by the Certificateholders)
may terminate all of the rights and obligations of the Servicer under this
Agreement. On or after the receipt by the Servicer of such written notice, all
authority and power of the Servicer under this Agreement, whether with respect
to the Certificates or the Receivables or otherwise, shall, without further
action, pass to and be vested in the Trustee or such successor Servicer as may
be appointed under Section 10.02; and, without limitation, the Trustee is hereby
authorized and empowered to execute and deliver, for the benefit of the
predecessor Servicer, as attorney-in-fact or otherwise, any and all documents
and other instruments, and to do or accomplish all other acts or things
necessary or appropriate to effect the purposes of such notice of termination,
whether to complete the transfer and endorsement of the Receivables and related
documents, or otherwise.
(b) The predecessor Servicer shall cooperate with the successor
Servicer and the Trustee in effecting the termination of the responsibilities
and rights of the predecessor Servicer under this Agreement, including, without
limitation, the transfer to the successor Servicer for administration by it of
all cash amounts that shall at the time be held by the predecessor Servicer for
deposit, or shall thereafter be received with respect to a Receivable and the
delivery of the Receivable Files, and the related accounts and records
maintained by the Servicer. All reasonable costs and expenses (including
attorneys' fees) incurred in connection with transferring the Receivable Files
to the successor Servicer and amending this Agreement to reflect such succession
as Servicer pursuant to this Section 10.01 shall be paid by the predecessor
Servicer upon presentation of reasonable documentation of such costs and
expenses. Upon receipt of notice of an Event of Default, the Trustee shall give
notice thereof to each of the Rating Agencies.
SECTION 10.02. APPOINTMENT OF SUCCESSOR.
(a) Upon the Servicer's receipt of notice of termination pursuant to
Section 10.01 or the Servicer's resignation in accordance with the terms of this
Agreement, the predecessor Servicer shall continue to perform its functions as
Servicer under this Agreement, in the case of termination, only until the date
specified in such termination notice or, if no such date is
58
specified in a notice of termination, until receipt of such notice and, in the
case of resignation, until the earlier of (i) the date 45 days from the delivery
to the Trustee of written notice of such resignation (or written confirmation of
such notice) in accordance with the terms of this Agreement and (ii) the date
upon which the predecessor Servicer shall become unable to act as Servicer, as
specified in the notice of resignation and accompanying Opinion of Counsel. In
the event of the Servicer's resignation or termination hereunder, the Trustee
shall appoint a successor Servicer, and the successor Servicer shall accept its
appointment by a written assumption in form acceptable to the Trustee. If a
successor Servicer has not been appointed at the time when the predecessor
Servicer has ceased to act as Servicer in accordance with this Section 10.02,
the Trustee without further action shall automatically be appointed the
successor Servicer. Notwithstanding the above, the Trustee shall, if it shall be
unwilling or legally unable so to act, appoint, or petition a court of competent
jurisdiction to appoint, and the predecessor Servicer, if no successor Servicer
has been appointed at the time the predecessor Servicer has ceased to act, may
petition a court of competent jurisdiction to appoint, any established
institution, having a net worth of not less than $100,000,000 and whose regular
business shall include the servicing of automobile and/or light-duty truck
receivables, as the successor to the Servicer under this Agreement.
(b) Upon appointment, the successor Servicer shall be the successor in
all respects to the predecessor Servicer and shall be subject to all the
responsibilities, duties and liabilities arising thereafter relating thereto
placed on the predecessor Servicer (except the initial Servicer's obligation to
make Advances), and shall be entitled, subject to the arrangements referred to
in paragraph (c) below, to the Total Servicing Fees and all of the rights
granted to the predecessor Servicer by the terms and provisions of this
Agreement.
(c) In connection with such appointment, the Trustee may make such
arrangements for the compensation of such successor Servicer out of payments on
Receivables as it and such successor Servicer shall agree; provided, however,
that no such compensation shall be in excess of that permitted the predecessor
Servicer under this Agreement. The Trustee and such successor Servicer shall
take such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession.
SECTION 10.03. REPAYMENT OF ADVANCES. If the Servicer shall resign or
be terminated, the Servicer shall continue to be entitled to receive, to the
extent of available funds, reimbursement for Outstanding Advances pursuant to
Sections 5.04 and 5.06 with respect to all Advances previously made by such
Servicer.
SECTION 10.04. NOTIFICATION TO CERTIFICATEHOLDERS. Upon any termination
of, or appointment of a successor to, the Servicer pursuant to this Article X,
the Trustee shall give prompt written notice thereof to Certificateholders at
their respective addresses appearing in the Certificate Register and to each of
the Rating Agencies.
SECTION 10.05. WAIVER OF PAST DEFAULTS. The Holders of Certificates
evidencing not less than a majority of the Controlling Class of Certificates
may, on behalf of all Holders of Certificates, waive any default by the Servicer
in the performance of its obligations hereunder and its consequences, except a
default in making any required deposits to or payments from the Collection
Account or the Certificate Account in accordance with this Agreement. Upon any
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such waiver of a past default, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
ARTICLE XI
THE TRUSTEE
SECTION 11.01. DUTIES OF TRUSTEE. The Trustee, both prior to the
occurrence of an Event of Default and after an Event of Default shall have been
cured or waived, shall undertake to perform such duties as are specifically set
forth in this Agreement. If an Event of Default shall have occurred and shall
not have been cured or waived and, in the case of an Event of Default described
in clause (i) of Section 10.01(a), the Trustee has received notice of such Event
of Default pursuant to Section 4.09(b), the Trustee shall exercise such of the
rights and powers vested in it by this Agreement, and shall use the same degree
of care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of its own affairs; provided, however,
that if the Trustee shall assume the duties of the Servicer pursuant to Section
10.02, the Trustee in performing such duties shall use the degree of skill and
attention customarily exercised by a servicer with respect to automobile
receivables that it services for itself or others. If the Trustee becomes the
successor servicer, the Trustee shall not be obligated to make Advances pursuant
to Section 5.04.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee that shall be specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement.
The Trustee shall take and maintain custody of the list of Receivables
included as Schedule A to this Agreement and shall retain all Servicer's
Certificates identifying Receivables that become Administrative Receivables or
Warranty Receivables.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own bad faith; provided, however, that:
(a) Prior to the occurrence of an Event of Default (or, in the case of
an Event of Default described in clause (i) of Section 10.01(a), before the
Trustee has received notice thereof pursuant to Section 4.09(b)), and after the
curing or waiving of all such Events of Default that may have occurred, (i) the
duties and obligations of the Trustee shall be determined solely by the express
provisions of this Agreement, (ii) the Trustee shall not be liable except for
the performance of such duties and obligations as shall be specifically set
forth in this Agreement, (iii) no implied covenants or obligations shall be read
into this Agreement against the Trustee and (iv) in the absence of bad faith on
the part of the Trustee, the Trustee may conclusively rely on the truth of the
statements and the correctness of the opinions expressed upon any certificates
or opinions furnished to the Trustee and conforming to the requirements of this
Agreement;
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(b) The Trustee shall not be liable for an error of judgment made in
good faith by a Trustee Officer, unless it shall be proved that the Trustee
shall have been negligent in ascertaining the pertinent facts;
(c) The Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken in good faith in accordance with this Agreement
or at the direction of the Holders of Certificates evidencing not less than a
majority of the Controlling Class of Certificates relating to the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee, under this
Agreement;
(d) The Trustee shall not be charged with knowledge of any failure by
the Servicer to comply with the obligations of the Servicer referred to in
Section 10.01, or of any failure by the Seller to comply with the obligations of
the Seller referred to in Section 10.01, unless a Trustee Officer assigned to
the Trustee's Corporate Trust Administration Department obtains actual knowledge
of such failure (it being understood that knowledge of the Servicer or the
Servicer as custodian, in its capacity as agent for the Trustee, is not
attributable to the Trustee) or the Trustee receives written notice of such
failure from the Servicer or the Seller, as the case may be, or the Holders of
Certificates evidencing not less than a majority of the Class A Certificate
Balance or the Class B Certificate Balance; and
(e) Without limiting the generality of this Section 11.01 or Section
11.04, the Trustee shall have no duty (i) to see to any recording, filing or
depositing of this Agreement, any agreement referred to herein, or any financing
statement or continuation statement evidencing a security interest in the
Receivables or the Financed Vehicles, or to see to the maintenance of any such
recording, filing or depositing or to any re-recording, refiling or redepositing
of any thereof, (ii) to see to any insurance of the Financed Vehicles or
Obligors or to effect or maintain any such insurance, (iii) to see to the
payment or discharge of any tax, assessment or other governmental charge or any
Lien or encumbrance of any kind owing with respect to, assessed or levied
against, any part of the Trust, (iv) to confirm or verify the contents of any
reports or certificates of the Servicer delivered to the Trustee pursuant to
this Agreement believed by the Trustee to be genuine and to have been signed or
presented by the proper party or parties, or (v) to inspect the Financed
Vehicles at any time or ascertain or inquire as to the performance or observance
of any of the Seller's or the Servicer's representations, warranties or
covenants or the Servicer's duties and obligations as Servicer and as custodian
of the Receivable Files under this Agreement.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there shall be
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability shall not be reasonably assured to it,
and none of the provisions contained in this Agreement shall in any event
require the Trustee to perform, or be responsible for the manner of performance
of, any of the obligations of the Servicer under this Agreement except during
such time, if any, as the Trustee shall be the successor to, and be vested with
the rights, duties, powers and privileges of, the Servicer in accordance with
the terms of this Agreement.
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SECTION 11.02. TRUSTEE'S CERTIFICATE. Upon request of the Seller or
Servicer, on or as soon as practicable after each Distribution Date on which
Receivables shall be assigned to the Seller or the Servicer, as applicable,
pursuant to Section 11.03, the Trustee shall execute a Trustee's Certificate
based on (a) the information contained in the Servicer's Certificate for the
related Collection Period, (b) amounts deposited to the Certificate Account and
(c) notices received pursuant to this Agreement, identifying the Receivables
repurchased by the Seller pursuant to Section 3.02 or purchased by the Servicer
pursuant to Sections 4.06 or 12.02 during such Collection Period, and shall
deliver such Trustee's Certificate, accompanied by a copy of the Servicer's
Certificate for such Collection Period, to the Seller or the Servicer, as the
case may be. The Trustee's Certificate submitted with respect to such
Distribution Date shall operate, as of such Distribution Date, as an assignment,
without recourse, representation or warranty, to the Seller or the Servicer, as
the case may be, of all the Trustee's right, title and interest in (other than
that the Trustee has good and marketable title to such Receivables on behalf of
the Trust) and to such repurchased Receivable, and all security and documents
relating thereto, such assignment being an assignment outright and not for
security.
SECTION 11.03. TRUSTEE'S ASSIGNMENT OF ADMINISTRATIVE RECEIVABLES AND
WARRANTY RECEIVABLES. With respect to all Receivables repurchased by the Seller
pursuant to Section 3.02 or purchased by the Servicer pursuant to Sections 4.06
or 12.02, the Trustee shall by a Trustee's Certificate assign, without recourse,
representation or warranty (other than that the Trustee has good and marketable
title to such Receivables on behalf of the Trust), to the Seller or the Servicer
(as the case may be) all the Trustee's right, title and interest in and to such
Receivables, and all security and documents relating thereto. If in any
enforcement suit or legal proceeding it shall be held that the Servicer may not
enforce a Receivable on the ground that it shall not be a real party in interest
or a holder entitled to enforce the Receivable, the Trustee shall, at the
Servicer's expense, take such steps as the Trustee deems necessary or the
Servicer may reasonably request to enforce the Receivable, including bringing
suit in its name or in the name of the Certificateholders.
SECTION 11.04. CERTAIN MATTERS AFFECTING THE TRUSTEE. Except as
otherwise provided in Section 11.01:
(a) The Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, Officer's Certificate, Servicer's Certificate,
certificate of auditors, or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) The Trustee may consult with counsel and any Opinion of Counsel
shall be full and complete authorization and protection in respect of any action
taken or suffered or omitted by it under this Agreement in good faith and in
accordance with such Opinion of Counsel;
(c) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement, or to institute, conduct or
defend any litigation under this Agreement or in relation to this Agreement, at
the request, order or direction of any of the Certificateholders pursuant to the
provisions of this Agreement, unless such Certificateholders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses and
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liabilities that may be incurred therein or thereby; provided, however, that
nothing contained in this Agreement shall relieve the Trustee of the
obligations, upon the occurrence of an Event of Default (that shall not have
been cured or waived), to exercise such of the rights and powers vested in it by
this Agreement, and to use the same degree of care and skill in its exercise as
a prudent man would exercise or use under the circumstances in the conduct of
his own affairs;
(d) The Trustee shall not be liable for any action taken, suffered or
omitted by it in good faith in accordance with its standard of care and
reasonably believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Agreement;
(e) Prior to the occurrence of an Event of Default (or in the case of
an Event of Default described in clause (i) of Section 10.01(a), before the
Trustee has received notice of such Event of Default pursuant to Section
4.09(b)) and after the curing or waiving of all Events of Default that may have
occurred, the Trustee shall not be bound to make any investigation into the
facts of matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other paper
or document, unless requested in writing to do so by Holders of Certificates
evidencing not less than a majority of the Class A Certificate Balance or the
Class B Certificate Balance; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely to
be incurred by it in the making of such investigation shall be, in the
reasonable opinion of the Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of this Agreement, the Trustee may require
reasonable indemnity against such cost, expense or liability as a condition to
so proceeding. The reasonable expense of every such examination shall be paid by
the Servicer or, if paid by the Trustee, shall be reimbursed by the Servicer
within 30 days after demand. Nothing in this clause (e) shall affect the
obligation of the Servicer to observe any applicable law prohibiting disclosure
of information regarding the Obligors;
(f) The Trustee may execute any of the trusts or powers hereunder or
perform any duties under this Agreement either directly or by or through agents
or attorneys or a custodian. The Trustee shall not be responsible for any
misconduct or negligence of any such agent or custodian appointed with due care
by it hereunder or of the Servicer in its capacity as Servicer or custodian; and
(g) Subsequent to the sale of the Receivables by the Seller to the
Trustee, the Trustee shall have no duty of independent inquiry, except as may be
required by Section 11.01, and the Trustee may rely upon the representations and
warranties and covenants of the Seller and the Servicer contained in this
Agreement with respect to the Receivables and the Receivable Files.
SECTION 11.05. TRUSTEE NOT LIABLE FOR CERTIFICATES OR RECEIVABLES. The
recitals contained herein and in the Certificates (other than the certificate of
authentication on the Certificates) shall be taken as the statements of the
Seller or the Servicer, as the case may be, and the Trustee assumes no
responsibility for the correctness thereof. The Trustee shall make no
representations as to the validity or sufficiency of this Agreement or of the
Certificates (other than the certificate of authentication on the Certificates),
or of any Receivable or related document. The Trustee shall at no time have any
responsibility or liability for or with respect to the legality, validity and
enforceability of any security interest in any Financed Vehicle or any
Receivable, or the perfection and priority of such security interest or the
maintenance of any such
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perfection and priority, or for or with respect to the efficacy of the Trust or
its ability to generate the payments to be distributed to Certificateholders
under this Agreement, including (a) the existence, condition, location and
ownership of any Financed Vehicle; (b) the review of any Receivable File
therefor; (c) the existence and enforceability of any physical damage insurance
thereon; (d) the existence and contents of any Receivable or any Receivable File
or any computer or other record thereof; (e) the validity of the assignment of
any Receivable to the Trust or of any intervening assignment; (f) the
completeness of any Receivable or any Receivable File; (g) the performance or
enforcement of any Receivable; (h) the compliance by the Seller or the Servicer
with any warranty or representation made under this Agreement or in any related
document and the accuracy of any such warranty or representation prior to the
Trustee's receipt of notice or other discovery of any noncompliance therewith or
any breach thereof; (i) any investment of monies by the Servicer or any loss
resulting therefrom (other than monies invested in obligations of the Trustee in
its individual capacity) (it being understood that the Trustee shall remain
responsible for any Trust property that it may hold); (j) the acts or omissions
of the Seller, the Servicer or any Obligor; (k) any action of the Servicer taken
in the name of the Trustee; or (l) any action by the Trustee taken at the
instruction of the Servicer; provided, however, that the foregoing shall not
relieve the Trustee of its obligation to perform its duties under this
Agreement. Except with respect to a claim based on the failure of the Trustee to
perform its duties under this Agreement or based on the Trustee's bad faith,
negligence or willful misconduct, no recourse shall be had for any claim based
on any provision of this Agreement, the Certificates or any Receivable or
assignment thereof against the Trustee in its individual capacity and the
Trustee shall not have any personal obligation, liability or duty whatsoever to
any Certificateholder or any other Person with respect to any such claim, and
any such claim shall be asserted solely against the Trust or any indemnitor who
shall furnish indemnity as provided in this Agreement. The Trustee shall not be
accountable for the use or application by the Seller of any of the Certificates
or of the proceeds of such Certificates, or for the use or application of any
funds paid to the Servicer in respect of the Receivables.
SECTION 11.06. TRUSTEE MAY OWN CERTIFICATES. The Trustee in its
individual or any other capacity may become the owner or pledgee of Certificates
and may deal with the Seller and the Servicer in banking transactions with the
same rights as it would have if it were not Trustee.
SECTION 11.07. TRUSTEE'S FEES AND EXPENSES. The Servicer shall pay to
the Trustee, and the Trustee shall be entitled to, the compensation separately
agreed upon between the Servicer and the Trustee for all services rendered by it
in the execution of the trusts created by this Agreement and in the exercise and
performance of any of the Trustee's powers and duties under this Agreement, and
the Servicer shall pay or reimburse the Trustee upon its request for all
reasonable expenses, disbursements and advances (including the reasonable
compensation and the expenses and disbursements of its counsel and of all
persons not regularly in its employ) incurred or made by the Trustee in
accordance with any provisions of this Agreement, except any such expense,
disbursement or advance as may be attributable to the Trustee's willful
misfeasance, negligence, or bad faith, and the Servicer shall indemnify the
Trustee for, and hold it harmless against, any loss, liability or expense
incurred without willful misfeasance, negligence or bad faith or breach of
representations and warranties contained in Section 11.14 on the Trustee's part,
arising out of or in connection with the acceptance or administration of the
Trust, including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its powers or
duties under this Agreement.
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Additionally, the Seller, pursuant to Section 8.02, and the Servicer, pursuant
to Section 9.02, respectively, shall indemnify the Trustee with respect to
certain matters, and the Certificateholders, pursuant to Section 11.04, shall,
upon the circumstances therein set forth, indemnify the Trustee under certain
circumstances. The provisions of this Section 11.07 shall survive the
termination of this Agreement.
SECTION 11.08. INDEMNITY OF TRUSTEE. The Trustee shall be indemnified
by the Servicer and held harmless against any loss, liability, fee, disbursement
or expense (including any compensation or expense referred to in Section 11.07)
arising out of or incurred in connection with the acceptance or performance of
the trusts and duties contained in this Agreement to the extent that (a) the
Trustee shall not be entitled to indemnity for such loss, liability, fee,
disbursement or expense by the Seller pursuant to Section 8.02, the Servicer
pursuant to Section 9.02, or the Certificateholders pursuant to Section 11.04;
(b) such loss, liability, fee, disbursement or expense shall not have been
incurred by reason of the Trustee's willful misfeasance, bad faith or
negligence; and (c) such loss, liability, fee, disbursement or expense shall not
have been incurred by reason of the Trustee's breach of its representations and
warranties contained in Section 11.14.
SECTION 11.09. ELIGIBILITY REQUIREMENTS FOR TRUSTEE. The Trustee under
this Agreement shall at all times be a corporation having an office in the same
state as the location of the Corporate Trust Office as specified in this
Agreement, organized and doing business under the laws of such state or the
United States of America, authorized under such laws to exercise corporate trust
powers and having a combined capital and surplus of at least $50,000,000 and a
long-term rating from Moody's of at least Baa3 (or having a corporate parent
with at least such rating) and subject to supervision or examination by federal
or state authorities. If such corporation shall publish reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purpose of this Section 11.09,
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 11.09, the Trustee shall resign
immediately in the manner and with the effect specified in Section 11.10.
SECTION 11.10. RESIGNATION OR REMOVAL OF TRUSTEE. The Trustee may at
any time resign and be discharged from the trusts hereby created by giving
written notice thereof to the Servicer. Upon receiving such notice of
resignation, the Servicer shall promptly appoint a successor Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
resigning Trustee and one copy to the successor Trustee. If no successor Trustee
shall have been so appointed and have accepted appointment within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 11.09 and shall fail to resign after written
request therefor by the Servicer, or if at any time the Trustee shall be legally
unable to act, or shall be adjudged bankrupt or insolvent, or a receiver of the
Trustee or of its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the purpose
of rehabilitation,
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conservation, or liquidation, then the Servicer may remove the Trustee. If it
shall remove the Trustee under the authority of the immediately preceding
sentence, the Servicer shall promptly appoint a successor Trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor Trustee and shall promptly pay
all fees owed to the outgoing Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 11.10 shall
not become effective until acceptance of appointment by the successor Trustee
pursuant to Section 11.11 and payment of all fees and expenses owed and any
other amounts due hereunder to the outgoing Trustee. The Servicer shall provide
notice of such resignation or removal of the Trustee to each of the Rating
Agencies.
SECTION 11.11. SUCCESSOR TRUSTEE. Any successor Trustee appointed
pursuant to Section 11.10 shall execute, acknowledge and deliver to the Servicer
and to its predecessor Trustee an instrument accepting such appointment under
this Agreement, and thereupon the resignation or removal of the predecessor
Trustee shall become effective and such successor Trustee, without any further
act, deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor under this Agreement, with like effect
as if originally named as Trustee. The predecessor Trustee shall upon payment of
its fees and expenses and any other amounts due it hereunder deliver to the
successor Trustee all documents and statements and monies held by it under this
Agreement; and the Servicer and the predecessor Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for fully and certainly vesting and confirming in the successor Trustee all such
rights, powers, duties and obligations.
No successor Trustee shall accept appointment as provided in this
Section 11.11 unless at the time of such acceptance such successor Trustee shall
be eligible pursuant to Section 11.09.
Upon acceptance of appointment by a successor Trustee pursuant to this
Section 11.11, the Servicer shall mail notice of such successor Trustee to all
Certificateholders at their addresses as shown in the Certificate Register and
to the Rating Agencies. If the Servicer shall fail to mail such notice within 10
days after acceptance of appointment by the successor Trustee, the successor
Trustee shall cause such notice to be mailed at the expense of the Servicer.
SECTION 11.12. MERGER OR CONSOLIDATION OF TRUSTEE. Any corporation into
which the Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be eligible pursuant to Section 11.09, without the execution
or filing of any instrument or any further act on the part of any of the parties
hereto; anything herein to the contrary notwithstanding.
SECTION 11.13. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust or any Financed Vehicle may at
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the time be located, the Servicer and the Trustee acting jointly shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Trustee to act as co-trustee, jointly with the Trustee,
or separate trustee or separate trustees, of all or any part of the Trust, and
to vest in such Person, in such capacity and for the benefit of the
Certificateholders, such title to the Trust, or any part thereof, and, subject
to the other provisions of this Section 11.13, such powers, duties, obligations,
rights and trusts as the Servicer and the Trustee may consider necessary or
desirable. If the Servicer shall not have joined in such appointment within 15
days after the receipt by it of a request to do so, or if an Event of Default
shall have occurred and be continuing, the Trustee alone shall have the power to
make such appointment. No co-trustee or separate trustee under this Agreement
shall be required to meet the terms of eligibility as a successor trustee
pursuant to Section 11.09 and no notice of a successor trustee shall be required
pursuant to Section 11.11.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(a) All rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred upon and exercised or performed by the
Trustee and such separate trustee or co-trustee jointly (it being understood
that such separate trustee or co-trustee is not authorized to act separately
without the Trustee joining in such act), except to the extent that under any
law of any jurisdiction in which any particular act or acts are to be performed
(whether as Trustee under this Agreement or as successor to the Servicer under
this Agreement), the Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee
or co-trustee, but solely at the direction of the Trustee;
(b) No trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this Agreement;
(c) The Servicer and the Trustee acting jointly may at any time accept
the resignation of or remove any separate trustee or co-trustee; and
(d) All duties owed hereunder to the Trustee by the Servicer shall be
deemed to be owed to each separate trustee and co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article XI. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Each
such instrument shall be filed with the Trustee and a copy thereof given to the
Servicer.
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Any separate trustee or co-trustee may at any time appoint the Trustee,
its agent or attorney-in-fact with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement on
its behalf and in its name. If any separate trustee or co-trustee shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee. Notwithstanding anything to the contrary contained in this
Agreement, the appointment of any separate trustee or co-trustee shall not
relieve the Trustee of its obligations and duties thereunder.
SECTION 11.14. REPRESENTATIONS AND WARRANTIES OF TRUSTEE. The Trustee
hereby makes the following representations and warranties on which the Seller,
the Servicer and the Certificateholders shall rely:
(a) The Trustee is a [_______________] duly organized, and validly
existing, under the laws of the State of [__________] and authorized to conduct
and engage in a banking and trust business under such laws;
(b) The Trustee has full corporate power, authority and legal right to
execute, deliver and perform this Agreement, and has taken all necessary action
to authorize the execution, delivery and performance by it of this Agreement;
and
(c) This Agreement has been duly executed and delivered by the Trustee.
SECTION 11.15. TAX RETURNS. The Servicer shall prepare or shall cause
to be prepared any tax or information returns required to be filed by the Trust
and shall remit or cause to be remitted such returns to the Trustee for
signature at least five days before such returns are due to be filed. The
Trustee, upon request, will furnish the Servicer with all such information known
to the Trustee as may be reasonably required in connection with the preparation
of all tax or information returns of the Trust, and shall, upon request, execute
such returns.
SECTION 11.16. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
CERTIFICATES. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee. Any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Certificateholders in respect of which such judgment has
been obtained.
SECTION 11.17. SUITS FOR ENFORCEMENT. If an Event of Default shall
occur and be continuing, the Trustee, in its discretion may, subject to the
provisions of Section 11.01, proceed to protect and enforce its rights and the
rights of the Certificateholders under this Agreement by a suit, action or
proceeding in equity or at law or otherwise, whether for the specific
performance of any covenant or agreement contained in this Agreement or in aid
of the execution of any power granted in this Agreement or for the enforcement
of any other legal, equitable or other remedy as the Trustee, being advised by
counsel, shall deem most effectual to protect and enforce any of the rights of
the Trustee or the Certificateholders.
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SECTION 11.18. RIGHTS OF CERTIFICATEHOLDERS TO DIRECT TRUSTEE. Holders
of Certificates evidencing not less than a majority of the Controlling Class of
Certificates shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee; provided, however, that, subject to
Section 11.01, the Trustee shall have the right to decline to follow any such
direction if the Trustee being advised by counsel determines that the action so
directed may not lawfully be taken, or if the Trustee in good faith shall, by a
Trustee Officer, determine that the proceedings so directed would be illegal or
subject it to personal liability or be unduly prejudicial to the rights of
Certificateholders not parties to such direction; and provided further that
nothing in this Agreement shall impair the right of the Trustee to take any
action deemed proper by the Trustee and which is not inconsistent with such
direction by the Certificateholders.
SECTION 11.19. APPOINTMENT OF CUSTODIAN. For so long as the Custody and
Pledge Agreement or any similar agreement is in existence, the Trustee shall
appoint the Custodian in accordance with the terms hereof, including that the
Custodian must satisfy the requirements for eligibility of the Trustee pursuant
to Section 11.09. The Custodian may, but is not required to, be the Trustee. If
the Trustee is not the Custodian, the Trustee shall pay any Custodian fees out
of the Trustee's fees and not out of assets of the Trust.
ARTICLE XII
TERMINATION; RELEASE OF RECEIVABLES
SECTION 12.01. TERMINATION OF THE TRUST. The respective obligations and
responsibilities of the Seller, the Servicer and the Trustee (except for the
obligations contained in Sections 5.08(c) and 11.15) created hereby and the
Trust created by this Agreement shall terminate upon (a) the purchase as of the
last day of any Collection Period by the Servicer at its option, pursuant to
Section 12.02, of the corpus of the Trust and the subsequent distribution to
Certificateholders pursuant to Section 5.06 of the amount required to be
deposited pursuant to Section 12.02, (b) the payment to Certificateholders of
all amounts required to be paid to them pursuant to this Agreement and the
disposition of all property held as part of the Trust or (c) the maturity or
other liquidation of the last Receivable and the disposition of any amounts
received upon liquidation of any remaining Receivables; provided, however, that
in no event shall the trust created by this Agreement continue beyond the
expiration of 21 years from the death of the last survivor of the descendants of
Rose Kennedy, formerly of Massachusetts, living on the date of this Agreement.
The Servicer shall promptly notify the Trustee of any prospective termination
pursuant to this Section 12.01.
Notice of any termination, specifying the Distribution Date upon which
the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee by letter to Certificateholders mailed not earlier than the 15th day
and not later than the 25th day of the month next preceding the specified
Distribution Date stating (a) the Distribution Date upon which final payment of
the Certificates shall be made upon presentation and surrender of the
Certificates at the office of the Trustee therein designated, (b) the amount of
any such final payment and (c) if applicable, that the Record Date otherwise
applicable to such Distribution Date is not applicable, payments being made only
upon presentation and surrender of the
69
Certificates at the office of the Trustee therein specified. The Trustee shall
give such notice to the Certificate Registrar (if other than the Trustee) at the
time such notice is given to Certificateholders. Upon presentation and surrender
of the Certificates, the Trustee shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date pursuant to
Section 5.06.
If fewer than all of the Certificateholders shall surrender
their Certificates for cancellation within six months after the date specified
in the above-mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice fewer than all the Certificates have been
surrendered for cancellation, the Trustee may take appropriate steps, or may
appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds and other assets that shall remain
subject to this Agreement. Subject to any applicable law, any funds remaining in
the Trust after exhaustion of such remedies shall be distributed by the Trustee
to the Children's Hospital Los Angeles.
SECTION 12.02. OPTIONAL PURCHASE OF ALL RECEIVABLES.
On each Distribution Date following the last day of a
Collection Period as of which the Pool Balance shall be less than or equal to
the Optional Purchase Percentage multiplied by the Original Pool Balance, the
Servicer or any successor to the Servicer shall have the option to purchase the
corpus of the Trust (whether or not such assets then comprise all or a portion
of the Trust). To exercise such option, the Servicer, or any successor to the
Servicer, as the case may be, shall notify the Trustee of its intention to do so
in writing, no later than the tenth day of the month preceding the month in
which the Distribution Date as of which such purchase is to be effected and
shall, on or before the Distribution Date on which such purchase is to occur,
deposit pursuant to Section 5.05 in the Collection Account an amount equal to
the aggregate Administrative Purchase Payments for the Receivables, plus the
appraised value of any other property held by the Trust, such value to be
determined by an appraiser mutually agreed upon by the Servicer and the Trustee,
and shall succeed to all interests in and to the Trust; provided, however, that
(a) the purchase price shall be equal to or greater than the sum of the Class A
Certificate Balance, the Class B Certificate Balance, the Class C Certificate
Balance, the Class A Interest Distributable Amount, the Class B Interest
Distributable Amount, and the Class C Interest Distributable Amount for such
Distribution Date, and (b) the Servicer shall not effect any such purchase so
long as the rating of NMAC by Moody's, or if NMAC shall then be unrated by
Moody's, then the rating of Nissan Capital of America, Inc., is less than "Bal"
by Moody's, and the Seller shall not effect any such purchase so long as the
rating of NARC II by Moody's, or if NARC II shall then be unrated by Moody's,
then the rating of Nissan Capital of America, Inc., is less than "Ba1" by
Moody's, in each case unless the Trustee shall have received an Opinion of
Counsel to the effect that such purchase shall not constitute a fraudulent
conveyance, subject to such assumptions as to factual matters as may be
contained therein. Amounts so deposited will be paid and distributed as set
forth in Section 5.06 of this Agreement. Upon such deposit of the amount
necessary to purchase the corpus of the Trust, the Servicer shall for all
purposes of this Agreement be deemed to have released all claims for
reimbursement of Outstanding Advances made in respect of the Receivables.
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Notice of any such purchase of the corpus of the Trust shall
be given by the Trustee to each Certificateholder as soon as practicable after
their receipt of notice thereof from the Servicer.
SECTION 12.03. RELEASE OF RECEIVABLES.
(a) Upon repurchase of any Receivable by the Seller pursuant to Section
3.02 or the Servicer pursuant to Section 4.06 or 12.02, the Trustee on behalf of
the Certificateholders shall, without further action, be deemed to transfer,
assign, set-over and otherwise convey to the Seller or the Servicer, as the case
may be, all right, title and interest of the Trustee in, to and under such
repurchased Receivable, all monies due or to become due with respect thereto and
all proceeds thereof and the other property conveyed to the Trustee hereunder
pursuant to Section 2.02 with respect to such Receivable, and all security and
any documents relating thereto, such assignment being an assignment outright and
not for security; and the Seller or the Servicer, as applicable, shall thereupon
own each such Receivable, and all such related security and documents, free of
any further obligation to the Trustee or the Certificateholders with respect
thereto.
(b) The Trustee shall execute such documents and instruments of
transfer and assignment and take such other actions as shall be reasonably
requested by the Seller or the Servicer, as the case may be, to effect the
conveyance of such Receivable pursuant to Sections 3.02, 4.06 and 12.02.
(c) If in any enforcement suit or legal proceeding it is held that the
Seller or Servicer may not enforce a repurchased Receivable on the ground that
it is not a real party in interest or a holder entitled to enforce the
Receivable, the Trustee on behalf of the Certificateholders shall, at the
written direction and expense of the Seller or Servicer, as the case may be,
take such reasonable steps as the Seller or the Servicer deems necessary to
enforce the Receivable, including bringing suit in the name or names of the
Certificateholders.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. AMENDMENT. This Agreement may be amended from time to
time by the Seller, the Servicer, NMAC (so long as NMAC has any rights or
obligations thereunder) and the Trustee, without the consent of
Certificateholders, (a) to cure any ambiguity, to correct or supplement any
provision in this Agreement that may be inconsistent with any other provision
herein, or to make any other provisions with respect to matters or questions
arising hereunder that are not inconsistent with the provisions herein;
provided, however, that (i) such amendment shall not materially and adversely
affect the interests of any Certificateholder and (ii) the Servicer shall have
delivered an Officer's Certificate to the Trustee stating that such amendment
will not materially and adversely affect the interests of any Certificateholder;
and (b) to change the formula for determining the Specified Subordination Spread
Account Balance, provided that (i) each Rating Agency delivers a letter to the
Trustee to the effect that the use of such new formulation will not result in a
qualification, reduction or withdrawal of its then-current rating of the
Certificates and (ii) the Servicer delivers to the Trustee an Officer's
Certificate stating that such amendment will not materially and adversely affect
the interests of any Certificateholder.
71
An amendment shall be deemed to not materially and adversely affect the
interests of the Class A Certificateholders or the Class B Certificateholders if
(A) such amendment does not adversely affect the Trust's status as a grantor
trust for federal income tax purposes and (B) each Rating Agency confirms in
writing that such amendment will not result in a reduction or withdrawal of its
then current rating of the Certificates of those Classes, and (C) the Servicer
has delivered the Officer's Certificate described in this Section 13.01.
This Agreement may also be amended from time to time by the
Seller, the Servicer, NMAC (so long as NMAC has any rights or obligations
hereunder) and the Trustee with the consent of the Holders of Class A
Certificates, the Class B Certificates and the Class C Certificates, each voting
as a separate class (which consent of any Holder of a Certificate given pursuant
to this Section or pursuant to any other provision of this Agreement shall be
conclusive and binding on such Holder and on all future Holders of such
Certificate and of any 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 Certificate), evidencing not less than a majority of the Class A
Certificate Balance, the Class B Certificate Balance and the Class C
Certificates, respectively, 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 Holders of Certificates;
provided, however, that no such amendment shall (a) increase or reduce in any
manner the amount of, or accelerate or delay the timing of, collections of
payments on Receivables or distributions that shall be required to be made on
any Certificate or change the Class A Pass-Through Rate, the Class B
Pass-Through Rate or the Class C Pass-Through Rate or the Specified Subordinated
Spread Account Balance (except as described in clause (b) above) without the
consent of each adversely affected Certificateholder or (b) reduce the aforesaid
percentage of the Class A Certificate Balance, the Class B Certificate Balance
or the Class C Certificate Balance which is required to consent to any such
amendment, without the consent of the Holders of all Certificates of such class
then outstanding. Notwithstanding the foregoing, no amendment referred to in
clause (a) of the preceding proviso will be made unless each Rating Agency
confirms that such amendment will not result in a reduction or withdrawal of its
rating of the Certificates of such class. In connection with any amendment
referred to in clause (a) above, the Servicer shall deliver an Officer's
Certificate to the Trustee stating that those Certificateholders whose consents
were not obtained were not adversely affected by such amendment.
Prior to the execution of any such amendment or consent
pursuant to this Section 13.01, the Servicer will provide and the Trustee shall
distribute written notification of the substance of such amendment or consent to
each of the Rating Agencies at least ten Business Days prior to the execution
thereof.
Promptly after the execution of any such amendment or consent,
the Trustee shall furnish written notification of the substance of such
amendment or consent to each Certificateholder.
It shall not be necessary for the consent of
Certificateholders pursuant to this Section 13.01 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 Certificateholders provided for in this Agreement) and of
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evidencing the authorization of the execution thereof by Certificateholders
shall be subject to such reasonable requirements as the Trustee may prescribe,
including the establishment of record dates pursuant to paragraph number 2 of
the Depository Agreement.
Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating
that the execution of such amendment is authorized or permitted by this
Agreement and the Opinion of Counsel referred to in Section 13.02(h)(i). The
Trustee may, but shall not be obligated to, enter into any such amendment that
affects the Trustee's own rights, duties or immunities under this Agreement or
otherwise.
SECTION 13.02. PROTECTION OF TITLE TO TRUST.
(a) The Seller shall execute and file such financing statements and
cause to be executed and filed such continuation statements, all in such manner
and in such places as may be required by law fully to preserve, maintain and
protect the interest of the Certificateholders and the Trustee in the
Receivables and in the proceeds thereof. The Seller shall deliver (or cause to
be delivered) to the Trustee file-stamped copies of, or filing receipts for, any
document filed as provided above, as soon as available following such filing.
(b) The Seller and the Servicer shall notify the Trustee within 30 days
after any change of its name, identity or corporate structure in any manner that
would, could or might make any financing statement or continuation statement
filed by the Seller in accordance with paragraph (a) above seriously misleading
within the meaning of Section 9-402(7) of the UCC, and shall promptly file
appropriate amendments to all previously filed financing statements or
continuation statements.
(c) The Seller and the Servicer shall notify the Trustee of any
relocation of its principal executive office within 30 days after such
relocation, if, as a result of such relocation, the applicable provisions of the
UCC would require the filing of any amendment of any previously filed financing
or continuation statement or of any new financing statement and shall promptly
file any such amendment. The Servicer shall at all times maintain each office
from which it shall service Receivables, and its principal executive office,
within the United States of America.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit (i) the reader thereof
to know at any time the status of such Receivable, including payments and
recoveries made and payments owing (and the nature of each), and (ii)
reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Certificate
Account in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that, from and
after the time of sale under this Agreement of the Receivables to the Trust, the
Servicer's master computer records that refer to a Receivable shall indicate
clearly the interest of the Trust in such Receivable and that such Receivable is
owned by the Trust. Indication of the Trust's ownership of a Receivable shall be
deleted from or modified on the Servicer's computer systems when, and
73
only when, the related Receivable shall have become a Liquidated Receivable or
been repurchased.
(f) If at any time the Seller or the Servicer shall propose to sell,
grant a security interest in, or otherwise transfer any interest in automotive
receivables to any prospective purchaser, lender or other transferee, the
Servicer shall give to such prospective purchaser, lender or other transferee
computer tapes, records or print-outs that, if they shall refer in any manner
whatsoever to any Receivable, shall indicate clearly that such Receivable has
been sold to and is owned by the Trust.
(g) Upon receipt of a written request from the Trustee, which request
shall be made no more frequently than annually, the Servicer shall furnish to
the Trustee, within 20 Business Days after receipt of such request, a list of
all Receivables (by contract number and name of Obligor) then held as part of
the Trust, together with a reconciliation of the list of Receivables attached
hereto as Schedule A and to each of the Servicer's Certificates furnished before
such request indicating removal of Receivables from the Trust. The Servicer
shall permit the Trustee and its agents at any time during normal business hours
upon reasonable prior notice to inspect, audit and make copies and abstracts
from the Servicer's records regarding any Receivable.
(h) The Servicer shall deliver to the Trustee:
(i) upon the execution and delivery of this Agreement and of
each amendment hereto, an Opinion of Counsel based on the customary
assumptions and qualifications, stating that, in the opinion of such
counsel, either (A) all financing statements and continuation
statements have been executed and filed that are necessary to perfect
the interest of the Trustee in the Receivables, and reciting the
details of such filings or referring to prior Opinions of Counsel in
which such details are given, or (B) no such action shall be necessary
to preserve and protect such interest; and
(ii) if requested by the Trustee, not more frequently than
annually, an Opinion of Counsel, dated as of a date during such 90-day
period, stating that, in the opinion of such counsel, based on
customary assumptions and qualifications, either (A) all financing
statements and continuation statements have been executed and filed
that are necessary to perfect the interest of the Trustee in the
Receivables, and reciting the details of such filings or referring to
prior Opinions of Counsel in which such details are given, or (B) no
such action shall be necessary to preserve and protect such interest.
Each Opinion of Counsel referred to in clause (h)(i) or
(h)(ii) above shall specify any action necessary (as of the date of such Opinion
of Counsel) to be taken in the following year to preserve and protect such
interest.
SECTION 13.03. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust,
nor otherwise affect the rights, obligations and liabilities of the parties to
this Agreement or any of them.
74
No Certificateholder shall have any right to vote (except as
specifically provided herein) or in any manner otherwise control the operation
and management of the Trust, or the obligations of the parties to this
Agreement, nor shall anything in this Agreement set forth, or contained in the
terms of the Certificates, be construed so as to constitute the
Certificateholders from time to time as partners or members of an association;
nor shall any Certificateholder be under any liability to any third person by
reason of any action taken pursuant to any provision of this Agreement.
No Certificateholder shall have any right by virtue or by
availing itself of any provisions of this Agreement to institute any suit,
action or proceeding in equity or at law upon or under or with respect to this
Agreement, unless such Holder previously shall have given to the Trustee a
written notice of default and of the continuance thereof, and unless also (a)
the default arises from the Seller's or the Servicer's failure to remit payments
when due hereunder, or (b) the Holders of Certificates evidencing not less than
a majority of the Controlling Class of Certificates shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee under this Agreement and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for 30 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding and during
such 30-day period no request or waiver inconsistent with such written request
has been given to the Trustee pursuant to this Section 13.03 or Section 10.05;
no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing itself or themselves of any provisions of this
Agreement to affect, disturb or prejudice the rights of the Holders of any of
the other Certificates, or to obtain or seek to obtain priority over or
preference to any other such Holder, or to enforce any right under this
Agreement except in the manner provided in this Agreement and for the equal,
ratable and common benefit of all Certificateholders of that class. For the
protection and enforcement of the provisions of this Section 13.03, each
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
SECTION 13.04. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES UNDER THIS AGREEMENT SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 13.05. NOTICES. All demands, notices, communications, and
instructions upon or to the Seller, the Servicer, the Trustee or any Rating
Agencies under this Agreement shall be (a) in writing, personally delivered or
mailed by certified mail, return receipt requested, or (b) by facsimile, at its
facsimile number, and shall be deemed to have been duly given upon receipt (i)
in the case of the Seller or the Servicer, to Nissan Auto Receivables
Corporation II, 990 West 190th Street, Torrance, CA 90502, Attention: Secretary,
(310) 719-8013, (ii) in the case of the Trustee, at the Corporate Trust Office,
(iii) in the case of Moody's, to Moody's Investors Service, Inc., ABS Monitoring
Department, 99 Church Street, New York, New York 10007, and (iv) in the case of
Standard & Poor's, to Standard & Poor's Rating Services, a division of The
McGraw-Hill Companies, Inc., 55 Water Street, New York, New York 10041-0003,
Attention: Asset Backed Surveillance Department; or, as to each of the
foregoing, at such other address as
75
shall be designated by written notice to the other parties. Any notice required
or permitted to be mailed to a Certificateholder shall be given by first class
mail, postage prepaid, at the address of such Holder as shown in the Certificate
Register. Any notice so mailed within the time prescribed in this Agreement
shall be conclusively presumed to have been duly given, whether or not the
Certificateholder shall receive such notice.
SECTION 13.06. 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 13.07. ASSIGNMENT. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 8.03 and 9.03 and as provided
in the provisions of this Agreement concerning the resignation of the Servicer,
this Agreement may not be assigned by the Seller or the Servicer without the
prior written consent of the Trustee and the Holders of Certificates evidencing
not less than 66-2/3% of the Controlling Class of Certificates.
SECTION 13.08. CERTIFICATES NONASSESSABLE AND FULLY PAID.
Certificateholders shall not be personally liable for obligations of the Trust.
The interests represented by the Certificates shall be nonassessable for any
losses or expenses of the Trust or for any reason whatsoever, and, upon
authentication thereof by the Trustee pursuant to Section 7.02 or Section 7.03,
Certificates shall be deemed fully paid.
SECTION 13.09. FURTHER ASSURANCES. The Seller and the Servicer agree to
do and perform, from time to time, any and all acts and to execute any and all
further instruments required or reasonably requested by the Trustee more fully
to effect the purposes of this Agreement, including the execution of any
financing statements or continuation statements relating to the Receivables for
filing under the provisions of the UCC of any applicable jurisdiction.
SECTION 13.10. NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise
and no delay in exercising, on the part of the Trustee or the
Certificateholders, any right, remedy, power or privilege hereunder, shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges provided herein are cumulative and
not exhaustive of any rights, remedies, powers and privileges provided by law.
Notwithstanding anything to the contrary, the Issuer shall not waive any breach
of representations and warranties as set forth in Sections 3.01(e), (l), (n),
(o), (aa) or (ee) without the written consent of at least a majority of the
Holders of Class A Certificates, the Class B Certificates and the Class C
Certificates, each voting as a separate class (which consent of any Holder of a
Certificate given pursuant to this Section or pursuant to any other provision of
this Agreement shall be conclusive and binding on such Holder and on all future
Holders of such Certificate and of any 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 Certificate), evidencing not
76
less than a majority of the Class A Certificate Balance, the Class B Certificate
Balance and the Class C Certificates, respectively.
SECTION 13.11. THIRD-PARTY BENEFICIARIES. This Agreement will inure to
the benefit of and be binding upon the parties hereto, the Certificateholders
and their respective successors and permitted assigns. Except as otherwise
provided in this Article XIII, no other Person will have any right or obligation
hereunder.
SECTION 13.12. ACTIONS BY CERTIFICATEHOLDERS.
(a) Wherever in this Agreement a provision is made that an action may
be taken or a notice, demand or instruction given by Certificateholders, such
action, notice or instruction may be taken or given by any Certificateholder,
unless such provision requires a specific percentage of Certificateholders.
(b) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Certificateholder shall bind such Certificateholder and
every subsequent Holder of such Certificate issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done or omitted to be done by the Trustee or the Servicer in reliance
thereon, whether or not notation of such action is made upon such Certificate.
SECTION 13.13. QUALIFICATION AS GRANTOR TRUST; SEPARATE ASSETS. The
Trust created hereunder is intended to be a separate grantor trust within the
meaning of Subpart E of Part I of Subchapter J of the Internal Revenue Code of
1986, as amended. Those assets held pursuant to the Custody and Pledge Agreement
and pursuant to the Yield Supplement Agreement shall not be considered to be
owned by the Trust but instead, (i) with respect to the Custody and Pledge
Agreement, shall be considered to be owned by the Seller [and/or by the holders
of the Class C Certificates,] as the case may be, as set forth in the Custody
and Pledge Agreement, and to be pledged to the Trust and (ii) with respect to
the Yield Supplement Agreement, shall be considered owned by the Seller, as set
forth in the Yield Supplement Agreement, and to be pledged to the Trust. Each
agreement should be interpreted accordingly. No party to this Agreement shall
take any action to cause the Trust to be treated as other than a grantor trust
for federal income tax and state tax purposes.
SECTION 13.14. COUNTERPARTS. For the purpose of facilitating the
execution of this Agreement and for other purposes, this Agreement may be
executed in any number of counterparts, each of which counterparts shall be
deemed to be an original, and all of which counterparts shall constitute but one
and the same instrument.
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IN WITNESS WHEREOF, the Seller, Servicer, NMAC and the Trustee
have caused this Pooling and Servicing Agreement to be duly executed by their
respective officers as of the ___ day of___________________________.
NISSAN AUTO RECEIVABLES CORPORATION II,
as Seller
By:
--------------------------------------
Name:
Title:
NISSAN MOTOR ACCEPTANCE
CORPORATION, as Servicer
By:
--------------------------------------
Name:
Title:
NISSAN MOTOR ACCEPTANCE
CORPORATION, in its individual capacity
By:
--------------------------------------
Name:
Title:
------------------------------
------------------------------,
as Trustee
By:
--------------------------------------
Name:
Title:
S-1
SCHEDULE A
SCHEDULE B
LOCATION OF THE RECEIVABLES FILES
1. Nissan Motor Acceptance Corporation,
including its Infiniti Financial Services Division
2901 Kinwest Parkway
Irving, Texas 75063
2. Iron Mountain, Inc.
1235 N. Union Bower
Irving, Texas 75061
3. Nissan North America, Inc.
Denver Data Center
106 Inverness Circle
East Englewood, Colorado 80112-5312
4. Arcus
15505 East Hinsdale Circle
Englewood, Colorado 80112
EXHIBIT A: FORM OF CLASS A CERTIFICATE SEE REVERSE FOR
CERTAIN DEFINITIONS
[the following legend to be inserted if this Certificate is issued to CEDE
& Co.:]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
NISSAN AUTO RECEIVABLES _______ GRANTOR TRUST
[_]% ASSET BACKED CERTIFICATE
CLASS A
evidencing a fractional undivided interest in the Trust, as defined below, the
property of which includes a pool of retail installment sale contracts secured
by new, near-new and used automobiles and light-duty trucks and sold to the
Trust by Nissan Auto Receivables Corporation II.
(This Certificate does not represent an interest in or obligation of Nissan Auto
Receivables Corporation II or Nissan Motor Acceptance Corporation or any of
their respective affiliates thereof, except to the extent described below.)
NUMBER CUSIP ___________
R
US$_____________
THIS CERTIFIES THAT is the registered owner of a
dollars nonassessable, fully-paid, fractional undivided interest in
the Nissan Auto Receivables _______ Grantor Trust (the "Trust") formed by Nissan
Auto Receivables Corporation II, a Delaware corporation (the "Seller"). The
Trust was created pursuant to a Pooling and Servicing Agreement dated as of
[_____________], __________ (the "Agreement"), among the Seller, Nissan Motor
Acceptance Corporation ("NMAC"), as Servicer (the "Servicer") and in its
individual capacity, and ______________________________________, as Trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth below. To the extent not otherwise defined herein, the capitalized terms
used herein have the meanings assigned to them in this Agreement. This
Certificate is one of the duly authorized Certificates designated as "[__]%
Asset Backed Certificates, Class A" (herein called the "Class A Certificates").
Also issued under this Agreement are Certificates designated as
A-1
"[_]% Asset Backed Certificates, Class B" (the "Class B
Certificates") and "[_]% Asset Backed Certificates, Class C" (the "Class C
Certificates"). The Class C Certificates, the Class B Certificates and the Class
A Certificates are hereinafter collectively called the "Certificates." The
aggregate undivided interest in the Trust evidenced by all Class A Certificates
is [_]%. This Class A Certificate is issued under and is subject to the terms,
provisions and conditions of this Agreement, to which Agreement the holder of
this Class A Certificate, by virtue of the acceptance hereof, assents and by
which such holder is bound. The property of the Trust includes (as more fully
described in this Agreement) a pool of retail installment sale contracts of new,
near-new and used automobiles and light-duty trucks (the "Receivables"), certain
monies paid thereon on or after ____________, security interests in the vehicles
financed thereby, certain bank accounts and the proceeds thereof, property
(including the right to receive Net Liquidation Proceeds) securing the
Receivables and held by the Trustee, proceeds from claims on physical damage,
credit life and disability insurance policies covering vehicles financed thereby
and the obligors thereunder, certain interests of the Seller in Dealer Recourse,
all right, title and interest of the Seller in and to the Purchase Agreement,
the Yield Supplement Agreement and the Custody and Pledge Agreement and any and
all proceeds of the foregoing.
Under this Agreement, there will be distributed on the 15th
day of each month or, if such 15th day is not a Business Day, the next Business
Day (the "Distribution Date"), commencing on _____________________, to the
person in whose name this Class A Certificate is registered at the close of
business on the Record Date (as determined pursuant to this Agreement), such
Class A Certificateholder's fractional undivided interest of the amounts to be
distributed to the Class A Certificateholders as determined pursuant to this
Agreement.
Distributions on this Class A Certificate will be made by the
Trustee by check or money order mailed to the Class A Certificateholder of
record in the Certificate Register without the presentation or surrender of this
Class A Certificate or the making of any notation hereon except that with
respect to Class A Certificates registered in the name of Cede & Co., the
nominee for the Clearing Agency, distributions will be made in the form of
immediately available funds. Except as otherwise provided in this Agreement and
notwithstanding the above, the final distribution on this Class A Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Class A
Certificate at the office or agency maintained for that purpose by the Trustee
in the Borough of Manhattan, The City of New York. The Record Date otherwise
applicable to such distribution shall not be applicable.
Reference is hereby made to the further provisions of this
Class A Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have
been executed by an authorized officer of the Trustee, by manual signature, this
Class A Certificate shall not entitle the holder hereof to any benefit under
this Agreement or be valid for any purpose.
A-2
IN WITNESS WHEREOF, the Trustee on behalf of the Trust and not
in its individual capacity has caused this Class A Certificate to be duly
executed.
NISSAN AUTO RECEIVABLES _______
GRANTOR TRUST
BY ,
--------------------------------------
as Trustee
By:
--------------------------------------
DATED:
[SEAL]
ATTEST:
- ----------------------
Authorized Officer
This is one of the Class A Certificates referred to in the
within-mentioned Agreement.
------------------------------
------------------------------,
as Trustee
By:
--------------------------------------
Authorized Officer
A-3
[Reverse of Certificate]
The Certificates do not represent an obligation of, or an
interest in, the Seller, Nissan Motor Acceptance Corporation, the Trustee or any
affiliate of any of them. The Certificates are limited in right of payment to
certain collections and recoveries respecting the Receivables, all as more
specifically set forth in this Agreement. A copy of this Agreement may be
examined during normal business hours at the principal office of the Seller, and
at such other places, if any, designated by the Seller, by any Certificate Owner
upon request.
This Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Seller and the rights of the Certificateholders under this
Agreement at any time by the Seller, the Servicer, NMAC and the Trustee with the
consent of the Holders of Class A Certificates, Class B Certificates and Class C
Certificates, each voting as a Class, evidencing not less than a majority of the
Class A Certificate Balance, the Class B Certificate Balance and the Class C
Certificate Balance, respectively. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and on all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. This Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in this Agreement and subject to certain
limitations set forth therein, the transfer of this Certificate is registrable
in the Certificate Register upon surrender of this Certificate for registration
of transfer at the offices or agencies maintained by the Trustee in its capacity
as Certificate Registrar, or by any successor Certificate Registrar, in the
Borough of Manhattan, The City of New York, accompanied by a written instrument
of transfer in form satisfactory to the Trustee and the Certificate Registrar
duly executed by the holder hereof or such holder's attorney duly authorized in
writing, and thereupon one or more new Certificates of authorized denominations
evidencing the same aggregate interest in the Trust will be issued to the
designated transferee.
The Class A Certificates are issuable only as registered
Certificates without coupons in denominations of $1,000 and integral multiples
thereof; however, one Certificate may be issued in a denomination equal to the
residual amount. As provided in this Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of authorized denomination evidencing the same aggregate
denomination, as requested by the holder surrendering the same. No service
charge will be made for any such registration of transfer or exchange, but the
Trustee may require payment of a sum sufficient to cover any tax or governmental
charges payable in connection therewith.
The Trustee, the Certificate Registrar and any agent of the
Trustee or the Certificate Registrar shall treat the person in whose name this
Class A Certificate is registered as the owner hereof for all purposes, and
neither the Trustee, the Certificate Registrar, nor any such agent shall be
affected by any notice to the contrary.
The obligations and responsibilities created by this Agreement
and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to
A-4
be paid to them pursuant to this Agreement and the disposition of all property
held as part of the Trust. The Servicer of the Receivables may at its option
purchase the corpus of the Trust at a price specified in this Agreement, and
such purchase of the Receivables and other property of the Trust will effect
early retirement of the Certificates; however, such right of purchase is
exercisable only as of a Record Date as of which the Pool Balance is less than
or equal to 10% of the original aggregate principal balance of the Receivables.
The recitals contained herein (other than the certificate of
authentication herein) shall be taken as the statements of the Seller or the
Servicer, as the case may be, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representations as to the validity or
sufficiency of this Certificate (other than the certificate of authentication
herein), or of any Receivable or related document.
A-5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
(Please print or typewrite name and address, including postal zip code,
of assignee)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
____________________________________________________________ Attorney to
transfer said Certificate on the books of the Certificate Registrar, with full
power of substitution in the premises.
Dated:
*
-----------------------------------------
Signature Guaranteed:
*
-----------------------------------------
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
A-6
EXHIBIT B: FORM OF CLASS B CERTIFICATE SEE REVERSE FOR
CERTAIN DEFINITIONS
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED PURSUANT
TO THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE TRANSFERRED OR SOLD TO
A PERSON OTHER THAN A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE ACT) THAT CERTIFIES AS SUCH TO THE SATISFACTION OF THE SELLER, UNLESS
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN OPINION OF COUNSEL THAT
SUCH REGISTRATION IS NOT REQUIRED AND THE SATISFACTION OF CERTAIN OTHER
SIGNIFICANT REQUIREMENTS SPECIFIED IN THIS AGREEMENT (AS DEFINED BELOW).
NISSAN AUTO RECEIVABLES _______ GRANTOR TRUST
[_]% ASSET BACKED CERTIFICATE
CLASS B
evidencing a fractional undivided interest in the Trust, as defined below, the
property of which includes a pool of retail installment sale contracts secured
by new, near-new and used automobiles and light-duty trucks and sold to the
Trust by Nissan Auto Receivables Corporation II.
(This Certificate does not represent an interest in or obligation of Nissan Auto
Receivables Corporation II or Nissan Motor Acceptance Corporation or any of
their respective affiliates thereof, except to the extent described below.)
NUMBER CUSIP_________________
R US$___________________
THIS CERTIFIES THAT _______________________ is the registered
owner of a _____________ dollars nonassessable, fully-paid, fractional undivided
interest in the Nissan Auto Receivables _______ Grantor Trust (the "Trust")
formed by Nissan Auto Receivables Corporation II, a Delaware corporation (the
"Seller"). The Trust was created pursuant to a Pooling and Servicing Agreement
dated as of [__________], ____ (the "Agreement"), among the Seller, Nissan Motor
Acceptance Corporation ("NMAC"), as Servicer (the "Servicer") and in its
individual capacity, and ______________________________________, as Trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth below. To the extent not otherwise defined herein, the capitalized terms
used herein have the meanings assigned to them in this Agreement. This
Certificate is one of the duly authorized Certificates designated as "[_]% Asset
Backed Certificates, Class B" (herein called the "Class B Certificates"). Also
issued under this Agreement are Certificates designated as "[__]% Asset Backed
Certificates, Class A" (the "Class A Certificates"). The Class B Certificates
and the Class A Certificates are hereinafter collectively called the
"Certificates." The aggregate
B-1
undivided interest in the Trust evidenced by all Class B Certificates is [__]%.
This Class B Certificate is issued under and is subject to the terms,
provisions, and conditions of this Agreement, to which Agreement the holder of
this Class B Certificate, by virtue of the acceptance hereof, assents and by
which such holder is bound. The property of the Trust includes (as more fully
described in this Agreement) a pool of retail installment sale contracts for
new, near-new and used automobiles and light-duty trucks (the "Receivables"),
certain monies paid thereon on or after ________________, security interests in
the vehicles financed thereby, certain bank accounts and the proceeds thereof,
property (including the right to receive Net Liquidation Proceeds) securing the
Receivables, proceeds from claims on physical damage, credit life and disability
insurance policies covering vehicles financed thereby and the obligors
thereunder, certain interests of the Seller in Dealer Recourse, all right, title
and interest of the Seller in and to the Purchase Agreement, the Yield
Supplement Agreement and the Custody and Pledge Agreement and any and all
proceeds of the foregoing. The rights of the holders of the Class B Certificates
are subordinated to the rights of the holders of the Class A Certificates, as
set forth in this Agreement.
Under this Agreement, there will be distributed on the 15th
day of each or, if such 15th day is not a Business Day, the next Business Day
(the "Distribution Date"), commencing on _________________, to the person in
whose name this Class B Certificate is registered at the close of business on
the Record Date (as determined pursuant to this Agreement), such Class B
Certificateholder's fractional undivided interest in the amounts to be
distributed to the Class B Certificateholders as determined pursuant to this
Agreement.
Distributions on this Class B Certificate will be made by the
Trustee by wire transfer, check or money order mailed to the Class B
Certificateholder of record in the Certificate Register without the presentation
or surrender of this Class B Certificate or the making of any notation hereon.
Except as otherwise provided in this Agreement and notwithstanding the above,
the final distribution on this Class B Certificate will be made after due notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Class B Certificate at the office or agency maintained for
that purpose by the Trustee in the Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this
Class B Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have
been executed by an authorized officer of the Trustee, by manual signature, this
Class B Certificate shall not entitle the holder hereof to any benefit under
this Agreement or be valid for any purpose.
B-2
IN WITNESS WHEREOF, the Trustee on behalf of the Trust and not
in its individual capacity has caused this Class B Certificate to be duly
executed.
NISSAN AUTO RECEIVABLES _______
GRANTOR TRUST
BY ,
---------------------------------------
as Trustee
DATED: BY
---------- --------------------------------------------------
[SEAL]
ATTEST:
- ----------------------
Authorized Officer
This is one of the Class B Certificates referred to in the
within-mentioned Agreement.
-----------------------------------------
-----------------------------------------
as Trustee
By
--------------------------------------
Authorized Officer
B-3
[Reverse of Certificate]
The Certificates do not represent an obligation of, or an
interest in, the Seller, Nissan Motor Acceptance Corporation, the Trustee or any
affiliate of any of them. The Certificates are limited in right of payment to
certain collections and recoveries respecting the Receivables, all as more
specifically set forth in this Agreement. A copy of this Agreement may be
examined during normal business hours at the principal office of the Seller, and
at such other places, if any, designated by the Seller, by any Certificate Owner
upon request.
This Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Seller and the rights of the Certificateholders under this
Agreement at any time by the Seller, the Servicer, NMAC and the Trustee with the
consent of the Holders of Class A Certificates, Class B Certificates and Class C
Certificates, each voting as a Class, evidencing not less than a majority of the
Class A Certificate Balance, the Class B Certificate Balance and the Class C
Certificate Balance, respectively. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and on all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. This Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in this Agreement and subject to certain
significant limitations on transfer therein set forth, the transfer of this
Certificate is registrable in the Certificate Register upon surrender of this
Certificate for registration of transfer at the offices or agencies maintained
by the Trustee in its capacity as Certificate Registrar, or by any successor
Certificate Registrar, in the Borough of Manhattan, The City of New York,
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by the holder hereof or such
holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of authorized denominations evidencing the same aggregate interest
in the Trust will be issued to the designated transferee.
The Class B Certificates are issuable only as registered
Certificates without coupons in denominations of $1,000 or in any amount in
excess thereof; however, one Certificate may be issued in a denomination
representing or including any residual amount. As provided in this Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of authorized denominations evidencing the same aggregate
denomination, as requested by the holder surrendering the same. No service
charge will be made for any such registration of transfer or exchange, but the
Trustee may require payment of a sum sufficient to cover any tax or governmental
charges payable in connection therewith.
The Trustee, the Certificate Registrar and any agent of the
Trustee or the Certificate Registrar shall treat the person in whose name this
Class B Certificate is registered as the owner hereof for all purposes, and
neither the Trustee, the Certificate Registrar, nor any such agent shall be
affected by any notice to the contrary.
B-4
The obligations and responsibilities created by this Agreement
and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to this
Agreement and the disposition of all property held as part of the Trust. The
Servicer of the Receivables may at its option purchase the corpus of the Trust
at a price specified in this Agreement, and such purchase of the Receivables and
other property of the Trust will effect early retirement of the Certificates;
however, such right of purchase is exercisable only as of a Record Date as of
which the Pool Balance is less than or equal to 10% of the original aggregate
principal balance of the Receivables.
The recitals contained herein (other than the certificate of
authentication herein) shall be taken as the statements of the Seller or the
Servicer, as the case may be, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representations as to the validity or
sufficiency of this Certificate (other than the certificate of authentication
herein), or of any Receivable or related document.
B-5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
- --------------------------------------------------------------------------------
(Please print or typewrite name and address, including postal zip code,
of assignee)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
___________________________________________________ Attorney
to transfer said Certificate on the books of the Certificate Registrar, with
full power of substitution in the premises.
Dated:
*
-----------------------------------------
Signature Guaranteed:
*
-----------------------------------------
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
B-6
EXHIBIT C: FORM OF CLASS C CERTIFICATE SEE REVERSE FOR
CERTAIN DEFINITIONS
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED PURSUANT
TO THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE TRANSFERRED OR SOLD TO
A PERSON OTHER THAN A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE ACT) THAT CERTIFIES AS SUCH TO THE SATISFACTION OF THE SELLER, UNLESS
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR AN OPINION OF COUNSEL THAT
SUCH REGISTRATION IS NOT REQUIRED AND THE SATISFACTION OF CERTAIN OTHER
SIGNIFICANT REQUIREMENTS SPECIFIED IN THIS AGREEMENT (AS DEFINED BELOW).
NISSAN AUTO RECEIVABLES _______ GRANTOR TRUST
[_]% ASSET BACKED CERTIFICATE
CLASS C
evidencing a fractional undivided interest in the Trust, as defined below, the
property of which includes a pool of retail installment sale contracts secured
by new, near-new and used automobiles and light-duty trucks and sold to the
Trust by Nissan Auto Receivables Corporation II.
(This Certificate does not represent an interest in or obligation of Nissan Auto
Receivables Corporation II or Nissan Motor Acceptance Corporation or any of
their respective affiliates thereof, except to the extent described below.)
NUMBER CUSIP_____________
R US$_______________
THIS CERTIFIES THAT _______________________ is the registered
owner of a _____________ dollars nonassessable, fully-paid, fractional undivided
interest in the Nissan Auto Receivables _______ Grantor Trust (the "Trust")
formed by Nissan Auto Receivables Corporation II, a Delaware corporation (the
"Seller"). The Trust was created pursuant to a Pooling and Servicing Agreement
dated as of [__________], _____ (the "Agreement"), among the Seller, Nissan
Motor Acceptance Corporation("NMAC"), as Servicer (the "Servicer") and in its
individual capacity, and ______________________________________, as Trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth below. To the extent not otherwise defined herein, the capitalized terms
used herein have the meanings assigned to them in this Agreement. This
Certificate is one of the duly authorized Certificates designated as "[_]% Asset
Backed Certificates, Class C" (herein called the "Class C Certificates"). Also
issued under this Agreement are Certificates designated as "[__]% Asset Backed
Certificates, Class A" (the "Class A Certificates") and [_]% Asset Backed
Certificates, Class B. The Class C Certificates, the Class B Certificates and
the Class A Certificates are
C-1
hereinafter collectively called the "Certificates." The aggregate undivided
interest in the Trust evidenced by all Class C Certificates is [__]%. This Class
C Certificate is issued under and is subject to the terms, provisions, and
conditions of this Agreement, to which Agreement the holder of this Class C
Certificate, by virtue of the acceptance hereof, assents and by which such
holder is bound. The property of the Trust includes (as more fully described in
this Agreement) a pool of retail installment sale contracts for new, near-new
and used automobiles and light-duty trucks (the "Receivables"), certain monies
paid thereon on or after ______________, security interests in the vehicles
financed thereby, certain bank accounts and the proceeds thereof, property
(including the right to receive Net Liquidation Proceeds) securing the
Receivables, proceeds from claims on physical damage, credit life and disability
insurance policies covering vehicles financed thereby and the obligors
thereunder, certain interests of the Seller in Dealer Recourse, all right, title
and interest of the Seller in and to the Purchase Agreement, the Yield
Supplement Agreement and the Custody and Pledge Agreement and any and all
proceeds of the foregoing. The rights of the holders of the Class C Certificates
are subordinated to the rights of the holders of the Class A Certificates and
the Class B Certificates, as set forth in this Agreement.
Under this Agreement, there will be distributed on the 15th
day of each or, if such 15th day is not a Business Day, the next Business Day
(the "Distribution Date"), commencing on _______________, to the person in whose
name this Class C Certificate is registered at the close of business on the
Record Date (as determined pursuant to this Agreement), such Class C
Certificateholder's fractional undivided interest in the amounts to be
distributed to the Class C Certificateholders as determined pursuant to this
Agreement; provided, however, that under certain circumstances specified in this
Agreement, amounts otherwise distributable to the Class C Certificateholders
will be deposited in the Subordination Spread Account.
Distributions on this Class C Certificate will be made by the
Trustee by wire transfer, check or money order mailed to the Class C
Certificateholder of record in the Certificate Register without the presentation
or surrender of this Class C Certificate or the making of any notation hereon.
Except as otherwise provided in this Agreement and notwithstanding the above,
the final distribution on this Class C Certificate will be made after due notice
by the Trustee of the pendency of such distribution and only upon presentation
and surrender of this Class C Certificate at the office or agency maintained for
that purpose by the Trustee in the Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this
Class C Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have
been executed by an authorized officer of the Trustee, by manual signature, this
Class C Certificate shall not entitle the holder hereof to any benefit under
this Agreement or be valid for any purpose.
C-2
IN WITNESS WHEREOF, the Trustee on behalf of the Trust and not
in its individual capacity has caused this Class C Certificate to be duly
executed.
NISSAN AUTO RECEIVABLES _______
GRANTOR TRUST
BY ,
--------------------------------------
as Trustee
DATED: BY
---------- ------------------------------------------
[SEAL]
ATTEST:
- ----------------------
Authorized Officer
This is one of the Class B Certificates referred to in the
within-mentioned Agreement.
-----------------------------------------
-----------------------------------------
as Trustee
By
---------------------------------------
Authorized Officer
C-3
[Reverse of Certificate]
The Certificates do not represent an obligation of, or an
interest in, the Seller, Nissan Motor Acceptance Corporation, the Trustee or any
affiliate of any of them. The Certificates are limited in right of payment to
certain collections and recoveries respecting the Receivables, all as more
specifically set forth in this Agreement. A copy of this Agreement may be
examined during normal business hours at the principal office of the Seller, and
at such other places, if any, designated by the Seller, by any Certificate Owner
upon request.
This Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Seller and the rights of the Certificateholders under this
Agreement at any time by the Seller, the Servicer, NMAC and the Trustee with the
consent of the Holders of Class A Certificates, Class B Certificates and Class C
Certificates, each voting as a Class, evidencing not less than a majority of the
Class A Certificate Balance, the Class B Certificate Balance and the Class C
Certificate Balance, respectively. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and on all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. This Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in this Agreement and subject to certain
significant limitations on transfer therein set forth, the transfer of this
Certificate is registrable in the Certificate Register upon surrender of this
Certificate for registration of transfer at the offices or agencies maintained
by the Trustee in its capacity as Certificate Registrar, or by any successor
Certificate Registrar, in the Borough of Manhattan, The City of New York,
accompanied by a written instrument of transfer in form satisfactory to the
Trustee and the Certificate Registrar duly executed by the holder hereof or such
holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of authorized denominations evidencing the same aggregate interest
in the Trust will be issued to the designated transferee.
The Class C Certificates are issuable only as registered
Certificates without coupons in denominations of $100,000 or in any amount in
excess thereof; however, one Certificate may be issued in a denomination
representing or including any residual amount. As provided in this Agreement and
subject to certain limitations therein set forth, Certificates are exchangeable
for new Certificates of authorized denominations evidencing the same aggregate
denomination, as requested by the holder surrendering the same. No service
charge will be made for any such registration of transfer or exchange, but the
Trustee may require payment of a sum sufficient to cover any tax or governmental
charges payable in connection therewith.
The Trustee, the Certificate Registrar and any agent of the
Trustee or the Certificate Registrar shall treat the person in whose name this
Class C Certificate is registered as the owner hereof for all purposes, and
neither the Trustee, the Certificate Registrar, nor any such agent shall be
affected by any notice to the contrary.
C-4
The obligations and responsibilities created by this Agreement
and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to this
Agreement and the disposition of all property held as part of the Trust. The
Servicer of the Receivables may at its option purchase the corpus of the Trust
at a price specified in this Agreement, and such purchase of the Receivables and
other property of the Trust will effect early retirement of the Certificates;
however, such right of purchase is exercisable only as of a Record Date as of
which the Pool Balance is less than or equal to 10% of the original aggregate
principal balance of the Receivables.
The recitals contained herein (other than the certificate of
authentication herein) shall be taken as the statements of the Seller or the
Servicer, as the case may be, and the Trustee assumes no responsibility for the
correctness thereof. The Trustee makes no representations as to the validity or
sufficiency of this Certificate (other than the certificate of authentication
herein), or of any Receivable or related document.
C-5
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
- --------------------------------------------------------------------------------
(Please print or typewrite name and address, including postal zip code,
of assignee)
the within Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
___________________________________________________ Attorney
to transfer said Certificate on the books of the Certificate Registrar, with
full power of substitution in the premises.
Dated:
*
-----------------------------------------
Signature Guaranteed:
*
-----------------------------------------
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Certificate in every particular, without
alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
C-6
Exhibit F-1
Trustee's Certificate
pursuant to Section 11.03
of the Pooling and Servicing
Agreement
______________________________________, as trustee (the
"Trustee") of the Nissan Auto Receivables _______ Grantor Trust created pursuant
to the Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
dated as of
[ ], ____, among Nissan Auto Receivables Corporation II, as Seller (the
"Seller"), Nissan Motor Acceptance Corporation, as Servicer and in its
individual capacity, and the Trustee, does hereby sell, transfer, assign and
otherwise convey to the Seller, without recourse, representation or warranty,
all of the Trustee's right, title and interest in and to all of the Receivables
(as defined in the Pooling and Servicing Agreement) identified in the attached
Servicer's Certificate as "Warranty Receivables," which are to be repurchased by
the Seller pursuant to Section 3.02, and all security and documents relating
thereto.
IN WITNESS WHEREOF I have hereunto set my hand this ____ day
of __________ , ____.
F-1
Exhibit F-2
Trustee's Certificate
pursuant to Section 11.03
of the Pooling and Servicing
Agreement
______________________________________, as trustee (the
"Trustee") of the Nissan Auto Receivables _______ Grantor Trust created pursuant
to the Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
dated as of [__________], ____, among Nissan Auto Receivables Corporation II, as
Seller, Nissan Motor Acceptance Corporation, as Servicer (the "Servicer") and in
its individual capacity and the Trustee, does hereby sell, transfer, assign and
otherwise convey to the Servicer, without recourse, representation or warranty,
all of the Trustee's right, title and interest in and to all of the Receivables
(as defined in the Pooling and Servicing Agreement) identified in the attached
Servicer's Certificate as "Administrative Receivables," which are to be
purchased by the Servicer pursuant to Section 4.06 or 12.02, and all security
and documents relating thereto.
IN WITNESS WHEREOF I have hereunto set my hand this ___ day of
_________ , ____.
EXHIBIT H-1
FORM OF
REPRESENTATION LETTER
Nissan Auto Receivables [____-___] Grantor Trust
___% Asset Backed Certificates, Class A
I [Name], hereby represent and warrant to [____________], as trustee
(the "Trustee") of the above-named trust, as follows:
1. I am [an officer of [Name of the Transferee],] the proposed
transferee (the "Transferee") of an ownership interest in the
Class A Certificates (the "Certificates") issued pursuant to the
Pooling and Servicing Agreement (the "Agreement"), dated as of
[_________], relating to the above-referenced securities, among
Nissan Auto Receivables Corporation II, as seller, Nissan Motor
Acceptance Corporation, as servicer, and the Trustee. Capitalized
terms used but not defined herein shall have the meanings ascribed
thereto in the Agreement. [The Transferee has authorized me to
make the following representations and warranties on behalf of the
Transferee.]
2. The Transferee agrees to require a Representation Letter
substantially in the form of this Representation Letter from any
Person to whom the Transferee attempts to transfer its interest in
the Certificates and in connection with any transfer by a Person
for whom the Transferee is acting as nominee, trustee or agent.
The Transferee will not transfer its interest or cause any
interest to be transferred to any Person that the Transferee knows
cannot truthfully complete such a Representation Letter.
3. CHECK APPROPRIATE BOX:
[ ] The Transferee is not an employee benefit plan or
arrangement subject to Section 406 of the Employee Retirement
Income Security Act of 1974, as amended, or a plan subject to
Section 4975 of the Internal Revenue Code of 1986, as amended
(a "Plan"), nor a person acting on behalf of a Plan nor using
the assets of a Plan to effect such transfer; or
[ ] if such Transferee is a Plan, then
(A) such Plan is an "accredited investor" as defined
in Rule 501(a)(1) of Regulation D under the Securities Act;
(B) such Plan's investment in the Certificates does
not exceed 25% of all of the Certificates outstanding at the
time of such transfer; and
(C) immediately after the acquisition, no more than
25% of the assets of the Plan with respect to which a person
has discretionary authority or renders
H-1-1
investment advice are invested in certificates representing
interests in trusts containing assets sold or serviced by the
same entity.
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed
this [___] day of [________, __].
-----------------------------------------
Print Name of the Transferee
[By:
-------------------------------------
Name:
Title:]
H-1-2
EXHIBIT H-2
FORM OF
REPRESENTATION LETTER
Nissan Auto Receivables [_____-__] Grantor Trust
___% Asset Backed Certificates, Class [B][C]
I [Name], hereby represent and warrant to [_____________], as trustee
(the "Trustee") of the above-named trust, as follows:
1. I am [an officer of [Name of Transferee],] the proposed transferee
(the "Transferee") of an ownership interest in the Class [B][C]
Certificates (the "Certificates") issued pursuant to the Pooling
and Servicing Agreement (the "Agreement"), dated as of
[_________], relating to the above-referenced securities, among
Nissan Auto Receivables Corporation II, as seller, Nissan Motor
Acceptance Corporation, as servicer, and the Trustee. Capitalized
terms used but not defined herein shall have the meanings ascribed
thereto in the Agreement. [The Transferee has authorized me to
make the following representations and warranties on behalf of the
Transferee.]
2. The Transferee agrees to require a Representation Letter
substantially in the form of this Representation Letter from any
Person to whom the Transferee attempts to transfer its interest in
the Certificates and in connection with any transfer by a Person
for whom the Transferee is acting as nominee, trustee or agent.
The Transferee will not transfer its interest or cause any
interest to be transferred to any Person that the Transferee knows
cannot truthfully complete such a Representation Letter.
3. CHECK APPROPRIATE BOX:
[ ] The Transferee is not an employee benefit plan or
arrangement subject to Section 406 of the Employee Retirement
Income Security Act of 1974, as amended, or a plan subject to
Section 4975 of the Internal Revenue Code of 1986, as amended
(a "Plan"), nor a person acting on behalf of a Plan nor using
the assets of a Plan to effect such transfer; or
[ ] The Transferee is an insurance company purchasing the
Certificates or beneficial interest therein with funds
contained in an "insurance company general account" (as
defined in Section V(e) of Prohibited Transaction Class
Exemption 95-60 ("PTCE 95-60")) as to which there is the Plan
with respect to which the amount of such general account's
reserves and liabilities for the contracts held by or on
behalf of such Plan and all other Plans maintained by the same
employer (or affiliate thereof as defined in Section V(a)(1)
of PTCE 95-60) or by the same employee organization does not
exceed 10% of the total of all reserves and liabilities of
such general account (as such amounts are determined under
Section I(a) of PTCE 95-60) at the date of acquisition.
H-2-1
IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed
this [___] day of [________, __].
-----------------------------------------
Print Name of the Transferee
[By:
-------------------------------------
Name:
Title:]
H-2-2